Sunday, August 11th, 2013
I don’t really follow sports much these days, but even I have seen stuff flying around over the latest performance enhancing drug scandal in baseball. Googling “A-Rod Scandal” returned me 54 million hits.
But while commentators try to outdo each other in heaping condemnation on the players, let’s not forget that the real scandal is the staggering sums of taxpayer money spent to subsidize new stadiums for billionaire team owners at a time when other infrastructure has been crumbling and cities have been cutting back on basic services. (Hey, a bunch of mostly brown-skinned people get the book thrown at them for using drugs while a bunch of rich white dudes get away scot-free with pillaging the public purse…where have I heard that one before???)
Virtually every baseball team has gotten a new stadium in recent years, with subsidies averaging over $250 million each. This plus $4 billion in forgone taxes on bonds issued to pay for them. As has been repeatedly shown by economists, there is no way to justify these investments on an ROI basis.
Consider this partial list of headline public subsidies:
- Miller Park (home to the Milwaukee Brewers, which Commissioner Bud Selig once owned): $290 million
- Great American Ball Park (Cincinnati Reds): $290 million (built at part of a two-fer that has caused massive problems for taxpayers)
- Yankee Stadium: $550 million (at least – the public is coughing up $1.2 billion for both NYC baseball stadiums, factoring in tax exempt bonds and other favors)
- PNC Park (Pittsburgh Pirates): $228 million
- Marlins Park: $347 million (a particularly sad case)
Now I’m not going to say that every single case of a city spending on a sports team is bad. I’ve argued myself that these should be analyzed at some level as a naming-rights deal, in which the city is paying for the privilege of putting its name on the team. So some outsized spending may be worth it for branding purposes for small cities, but this can’t be the case everywhere.
In any event, the sums spent subsidizing billionaire team owners to grace our cities with the presence of their personally lucrative businesses is pretty staggering. Remember this the next time your local government cries poverty when it comes to investments that actually benefit the public. Though not baseball, the state of Michigan is pumping $450 million into a new downtown arena in bankrupt Detroit for the Red Wings – that’ll help. Chicago is laying off teachers, closing 50 schools, and has pension funds that are less than half of where they should be, but still managed to find $100 million for a new DePaul basketball arena? When will the madness end?