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The Art of the Steal

An unprecedented boom in sports arena construction has been sweeping the country. A key to all of this has been the ability of team owners to "come up to speed" on "corporate welfare" — and their ability to have the public pay to increase the value of their franchise.

Here's an overview of how this has happened ... and the price we pay as working people ...


In the spring of 1989, a bewildered Kevin Costner stood in an Iowa cornfield attempting to decipher a strange promise whispered to him in barely audible tones: "If you build it, they will come." Since the release of Field of Dreams, the call for new stadiums has mounted to a deafening roar, as our cities witnessed an unprecedented boom in professional sports arena construction.

Just last week, our brand-new President threw out the first pitch at Milwaukee’s brand new Miller Park; he is well-acquainted with the wonders that a new ballpark can deliver. While owner of the Rangers, Bush opened a new ballpark in Texas, enabling him to turn his $600,000 investment into a cool $14.5 million when he sold the team in 1998. The details of this swindle and a great many more are detailed in a lively new book by Johanna Cagan and Neil DeMause, appropriately entitled Field of Schemes.

Given that sports is largely organized on a for-profit basis, it’s not surprising that the new enthusiasm for better arenas should have little to do with athletics and lots to do with money. Like owners in other branches of industry, the captains of sport (who often are also owners in other branches of industry) entered the 1990s on the offensive. As team owners came up to speed on corporate welfare and community blackmail, new stadiums — or more exactly, new publicly financed stadiums — emerged as their preferred instrument for raising return on investment.


Viewed as business plans, stadium blueprints show that they capture earnings not by selling more product but by selling more expensive product. Square footage devoted to clubhouses and luxury booths — seating that appeals to season-ticket holders and corporate renters who both pay a lot and pay up front — is greatly increased in every new arena. And despite all we hear about the "intimacy" of new stadiums like Baltimore’s Camden Yards, the actual footprint of these "cozy" "rightsized" structures is often larger than those of the "impersonal" and "oversized" arenas that they replaced. Why? In addition to the space gobbled up by the exclusive luxury decks, acres are needed for expanded concessions and elaborate kitchens catering to the refined tastes of more upscale spectators. In "upgrading" facilities in this way, owners are clearly reckoning with rising income inequality and attempting to turn it to good account. As it becomes harder for many families to afford any ballgame at all, it becomes easier for a few — an intimate and cozy and rightsized few — to manage a $400.00 outing.


But the price of a new stadium runs to hundreds of millions. How much better it would be to sell luxury booths, seat licenses, naming and broadcast rights, concession leases and proprietary logos without either the construction bill or the sunk costs of stadium ownership! The vast majority of premier league sports stadiums built in the past decade are financed partly, and often largely, by taxpayers — by local and state taxpayers in cities where arenas are built, and by all federal taxpayers, who subsidize the tax-free municipal bonds that are invariably floated to raise construction cash.

Why do taxpayers build arenas? Often it is done against their will. Detroit, Houston, San Francisco, Pittsburgh, and Seattle are cities in which residents formally voted against public financing for new stadiums — and got them anyway. And in virtually every city where residents are polled prior to stadium construction, initial sentiment runs against them. Faced with public opinions they don’t like, owners campaign hard. (Here it helps that team owners and media owners are often the same corporation.) Their themes are all too familiar. With one hand, they dangle the carrot of jobs and development; with the other, they brandish the stick of team relocation. To residents and officials of urban centers flattened by de-industrialization, such promises and threats have meaning.

Thus, despite the fact that most of the jobs that stadiums create are part-time, seasonal and low-wage, despite the fact that each such new job costs an average $300,000, despite the fact that economic "development" around stadiums is mainly a matter of transferring entertainment dollars from one part of a city to another, despite the fact that in their overall economic impact new stadiums act mainly as money pumps, drawing money out of communities and putting it into the pockets of owners, and despite the fact that most city residents and politicians know all of these facts before ground is even broken on their new stadium, city upon city has capitulated.

Describing the concessionary logic that led to two new stadiums in Seattle, one councilman remarked, "We cave in not because we believe in their positive impact, but because we’re afraid to take the chance that there isn’t any." Until we stop building stadiums and build real power for working people, the great sports con will remain the only game in town.

(Gaff is an intern working in the UE International and Research departments; Frank is UE Research director.)


UE News - 04/01

Home -> UE News -> 2001 Archives -> Article

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