I often complain about how America, which we claim is the most capitalist country on Earth, runs most sports based on state socialism. This in contrast to Europe, where soccer is strictly a capitalist enterprise.
But when I look at the results, as a fan, I wish for something different.
Unfettered capitalism leads to a few eternal winners and lots of eternal losers. Real Madrid. Bayern Munich. Liverpool. Another half-dozen or so. They win all the trophies and have most of the fans. When some other club manages to break through, that breakthrough is wildly celebrated and brief. Leicester. Bayer Leverkusen. When a club joins the “elite” semi-permanently, it’s as a secondary character. Athletico Madrid. Borussia Dortmund. Newcastle.
The same applies to the one American sport where capitalism rules, which is college football. Alabama and Georgia, Ohio State and Michigan. Another half-dozen or so. Their fans believe they DESERVE to always win, because they spend the money. Winning franchises (college sports teams are franchises) will fire winning coaches because they don’t win enough. When a “losing” team like Vanderbilt has a great season, bigger schools lure their best people away with enormous salaries, egged on by a media that loves nothing so much as crushing the underdog.
State Socialism in America
Contrast this with the state socialism of American sports leagues like the NFL, MLS, and Major League Baseball.
The number of franchises is limited. No one is being relegated because of a losing season. Because the number of franchises is kept low, teams can blackmail governments into giving them stadiums. This has evolved into getting enormous development rights around the stadiums. Exhibit A is the Atlanta Braves, who moved to the suburbs in exchange for $2 billion in land and highway improvements. Exhibit B is the Atlanta Hawks, which got a huge tax benefit to develop the land around their Stadium.
If a city resists, the team can threaten to move. Sometimes they do move. Las Vegas will be the A’s fourth city. Oakland no longer has any sports teams. Only New York has been able to resist, although its football teams in New Jersey.
On the other hand.
American sports leagues are competitive. The Dodgers were the first baseball team in a quarter century to win two straight World Series. NFL dynasties are incredibly hard to maintain, usually lasting (at most) a half-decade. In MLS, one of the lowest-spenders had the most points last year, and one of the highest-spenders had one of the worst records. (As a test, name the teams.) Teams can go from “worst to first,” and they can go from “first to worst.” It’s easy to “Wait ‘til Next Year” when you’ll be in the same league.
State socialism is also great for the socialists. MLS teams are among the most valuable in the world, not because they’re great teams, and not because they have enormous fan bases, but because their expenses are capped and they can blackmail governments.
The Good and the Bad
In Europe a semi-pro team can rise to compete with the best, as Wrexham AFC is doing in Wales. Teams from small countries can shine on the biggest stage, as Qarabag is doing in Azerbaijan. If you spend the money, you can do great things. That’s capitalism. But you must invest to win. Operating margins in soccer are notoriously thin.
But there’s enormous risk if you don’t invest wisely. The soccer club I have supported for 30 years, Sheffield Wednesday, is now in Administration for the second time, headed for the third division of English football. Bury, once part of the Premier League, was “wound up” a few years ago after going bankrupt. It no longer exists.
Capitalist sports are great for the fans, but you can wind up with hollow leagues, a class system where make do with crumbs. Socialist sports are great for the owners, who can create rules guaranteeing competitiveness, but they also remove the risk that’s at the heart of both sport and capitalism.
The best system would take the best of both worlds. It would allow for relegation, but it would limit spending to create closer competition. It would be completely private while allowing new money to go toward players and coaches rather than “expansion fees” that go to existing owners.
A mixed economy is best.
