One of the defining myths of modern America is that greed is good. That greed isn’t just good for the guys at the top, no, their greed trickles down to the regular folk. So that the more wealth one can amass, the better it is for society as a whole.
This myth goes on to state that billionaires deserve their wealth. That they earned this money through “hard work” or being smarter than everyone else, and that anyone attempting to limit the growth of that money, or worse, tax them, is just jealous and evil.
Taxes are often even referred to as theft. Libertarians in particular follow this line of logic but the reality is that most wealthy people hire people to make sure that they pay as little tax as possible. In the words of former President Donald Trump, paying no tax “makes me smart”.
And of course, this wealth shouldn’t be taxed while they are alive and it’s even more unfair to tax their estates when they die. Wealth, power, privilege should be allowed to accumulate in perpetuity. For the good of the people.
Whenever I think about “trickle-down” economics I remember that during the reign of Henry VIII, he and the court would eat vast meals at the Great Watching Table and because these were polite gluttons they wouldn’t eat everything on their plate. It was considered good manners to leave some food. That food was collected and eaten by the servants. And the lord of the house was generous as well with his people! The servants were ordered to also not waste food and anything that wasn’t eaten by them or reused in the main meals was distributed to the poor. The first trickle down economics, literally in the case of left over beer.
And what we saw in the last 48 hours, with the formation of the Super League, was exactly this type of “greed for the greater good” mythology. The clubs that signed on to become part of a Super League did so out of greed, openly and brazenly, and what I think they thought would happen is that fans would embrace it because after all they included some table scraps: solidarity payments to the leagues. “This is just trickle-down economics, folks!”
But it’s not for the good of the people, is it. They aren’t the smartest guys in the room. They aren’t the hardest working people we know. The implementation of this Super League, its rollout, its botched public relations, the absurd financial planning, and indeed the entire legal underpinnings of their idea were more poorly planned out than the Fyre Festival. The more I dug into the details, or the lack of details, the more shambolic this whole thing looked. They didn’t even have broadcasters lined up. How were they supposed to get broadcasters to pay them billions of dollars? This was the kind of presentation I would expect from Jerry Smith (Rick and Morty). If this was a football match, it was the equivalent of the head coach throwing darts to pick his first team and making his tactics be “just facking run around a bit”.
And look at the way that Arsenal have been mismanaged for the last 8 years. You can’t look me in the eye and tell me you think this club have been run well. The Swiss Ramble (in his usual excellent analysis) has outlined the problem Arsenal have faced over the last two years:
These aren’t the smartest guys. Enos and Josh Kroenke aren’t the hardest working guys at Arsenal. These are people who bumped into wealth through marriage and birth. They are terrible custodians of Arsenal football club – not just on the pitch but off the pitch as well. And Arsenal’s losses would have been catastrophic last year if not for player sales. And let’s not forget that this is a club which was incredibly profitable when Wenger was in charge. They have frittered away all of that money and more, through incredible mismanagement, ineptitude, and indifference.
And in another tweet in that same thread Swiss Ramble almost perfectly picks out the entire cast of the Super League when he warns of massive losses across Europe:
Boom. Why the Super League? What are great old clubs like Arsenal, Barcelona, Real Madrid, and all of those Italian clubs doing pissing all over their legacy? They are in trouble, folks.
Juventus’ wage bill is unbelievable. Barcelona’s debt is a billion, A BILLION, Euros. Arsenal needed a big loan to stay stable, one which I’m concerned gives the stadium to Kroenke. Inter and Milan are on the verge of insolvency. Even Tottenham, which at one time was a paragon of self-sustaining business practices, has found themselves at the wrong end of the balance sheet.
That’s why in his unsigned open letter to the fans, Enos included the bit about “The system needs to be fixed. We must work together to find solutions which protect the future of the game”. The system does need to be fixed because the system is broken. But the Super League never would have fixed the system, it would have broken it even more – hoarding wealth and power in the hands of those 12-15 clubs (they didn’t even know how many clubs were in this thing, ffs).
Salaries are out of control. Fees to agents are absurd. Transfer fees are unsustainable. And teams who make it into the Champions League but then drop out basically face a relegation type of problem: they will often have built an expensive team to get into the Champions League, one which they can only afford by staying in the Champions League.
In Andrew’s column this morning he voiced a concern that in their open letter, Kroenke was issuing a threat and worried that the situation between the owners and the fans could boil for years. I agree with Andrew, this could potentially drag on for years, and could get extremely ugly.
They mention protecting Arsenal several times in their apology to the fans. Their intent was to “protect Arsenal” and “ensure financial stability”: “the decision to be part of the Super League was driven by our desire to protect Arsenal, the club you love, and to support the game you love through greater solidarity and financial stability.”
This is trickle-down economics, folks. The logic here is that, yes, they were greedy – yes, they were willing to harm the other members of world football – but see it was for the greater good of Arsenal fans. And hey, the proposal also had solidarity payments, they were going to be helping all of football!
But the big lie of the billionaire class is that they deserve the money because they built their wealth on their own. It ignores the entire system in which wealth accumulates and the contributions of millions of people to that wealth. Jeff Bezos can only accumulate wealth with the national infrastructure in place which allows for deliveries and with the networks in place that allow for orders. And of course he needs a work force to do the actual work, one which he can add on a margin of profit on top of their work, that he then gets to skim off for himself.
Now apply this to football. Did Stan Kroenke build Arsenal? Not even remotely. He has almost as little as possible to do with football and Arsenal. He doesn’t even pretend to like football much less build the game. What has he given to the game of football? Anything? So, what right does he have to profit off Arsenal? His only right to profit off this game, one which has been built by billions of fans all over the world, is because he was the lesser of two evils at a time when Arsenal were going through turmoil. And he got himself a nice loan, and “bought” the team.
And since then what has he done? He’s run the team and the club into the ground. He has sullied the name of this club with his greed and stupidity. We are a laughingstock. The butt of jokes all over the world. And he has somehow managed to hire in the most inept people possible. If you’re going to be a guy who doesn’t give a shit about the club, at least hire some people who do. Those years after Wenger left weren’t just terrible on the pitch, they were disastrous in the board room. No wonder they ran into the arms of the Super League, it offered them immediate debt relief and a permanent seat at the king’s table. They were happy to destroy football in order to protect their investment, even if they were only invited because the rest of the clubs there wanted a team they could beat up every week.
Stan Kroenke isn’t a football fan and he’s not here at Arsenal because he wants to give the fans some joy, because he cares about Islington, or because he wants to build football. Arsenal are an investment vehicle and what he wants from Arsenal are stable returns.
Given the current financial situation at the club, however, I’m deeply concerned. Don’t be surprised if the next thing we see is him asking for a bailout. I wouldn’t even put it past them to use “too big to fail”. Or at the very least, I think we are in for some big big cuts and player sales, a period of austerity.
This isn’t over. Arsenal are in big trouble financially. And we have the dumbest and greediest guys in charge. This could get very ugly.
A long time ago I read “Arsenal: The Making of a Modern Superclub” – published in 2008. In retrospect it’s hilarious (or tragic…) how naïve the authors were. When you consider the advantages we had compared to Villa, Leicester, Spurs or even Liverpool over the last 10 years the position the Koenke’s have put us in is unforgivable. Total incompetence.
The very definition of your headline, rears in ugly head in a very lovely little part of my country, which Stan is more than happy to toy with:
https://www.cbc.ca/news/canada/british-columbia/bc-crown-lands-access-court-battle-1.5987099
Does Canada not have eminent domain or a similar doctrine?
https://www.ownerscounsel.com/eminent-domain-canada/
Interpretation and enforcement has been historically difficult.
Superb analysis, Tim. Bang on the money!
All three of your pieces on the topic have been quite good Tim. Thanks.
5 gets you ten that if Kroenke could move the club to a more profitable location, he’d do it. He’s a Missourian FFS and he couldn’t care less that he can’t show his face in St. Louis, so he surely would be bothered if all the residents in Islington Council rose up in protest.
Except there is nowhere else to go. There is currently nowhere in UK or Europe, with the right venue that would be more more profitable with a team that used to be based in England. So he’s stuck with us, and unfortunately, we with him.
It’s a given that the status quo is done, as it is unsustainable given our current financial state. KSE is going to do SOMETHING, much sooner than later. Cue up “Gimmie Shelter” and let me hear those foreboding Keith Richard licks.
Is this now getting to the point where he considers selling? From what you say there doesn’t seem to be a way out and why would he want to hang on to a loss making business, specially one he cares nothing for?
This is my hope.
“Salaries are out of control. Fees to agents are absurd. Transfer fees are unsustainable”
While all the above points are valid, but the biggest problem in football I think is wage inflation. Average premiere league salaries have increased about 7.5 times since 2000, from around half a million a year to 3.8mn. It’s actually increased to around 28 times since 1992 while general prices have only doubled. And all of the costs will be paid by fans, one way or the other.
So while it’s commendable that Henderson made a stance and was organising a call amongst captains, is he now going to voluntarily offer a 25% reduction by all his team mates and offer a salary cap for the next ten years?
The greed of the billionaires is despicable, but wasn’t Premier league borne out of greed? I understand the lack of relegation and promotion goes against sports ethos but it’s just a reaction to the perils of a CL team paying CL wages falling out of the competition. So fix the root cause! Also, how many times has a non breakaway team in UK has finished in top4 in the past 20’years barring the freak Leicester season and possible this freak COVID constrained season. So the sporting equality is a myth. Besides there was a provision of a floating membership for 5 clubs in ESL.
I found the Everton statement vomit inducing. The only reason they were upset was because Farhad Moshiri wasn’t invited to the party. Now that the “disaster” is curtailed, I await the Everton board to announce a 50% rebate on season tickets during this difficult times to show they really care for the fans after all.
The media and pundits were up in arms because BT and Sky were tied in expensive contracts with UEFA and wouldn’t want to invest even more in ESL.
Ultimately it was a case millionaires and lesser billionaires fighting against even richer billionaires for wanting a share of the pie. The wall to wall coverage of the fans winning the battle makes me chuckle. It is the fans who would be shown to be the muppets in the long run.
https://www.frontier-economics.com/uk/en/news-and-articles/articles/article-i7652-dont-expect-a-dent-in-premier-league-pay/#
https://www.inflationtool.com/british-pound/1992-to-present-value
This echoes my feelings 100%. Very nicely put. The irony from Neville and Carragher who take Murdoch’s shilling.
The first argument of economic demagogues and robber barons is that “wage inflation” (or wage costs) is the “REAL” problem. [eye-roll emoji]
Oh so you don’t think wage inflation is problem in football? Tell me which of the breakaway clubs have consistently made profits over the past decade despite being the highest earning clubs in the world? Next tell me which is their biggest item of expense?
A superb read. Thank you.
Not to mention the Petro-dollars that grease this whole system whether through sponsorship (Gazprom) or ownership (oil rich nation states or oligarchs). Oil is probably the “greediest” commodity known to man and there it is completely inflating all aspects of the game from club ownership, to player fees and wages (and agents), to ticket prices and subscription fees. And it is influencing the game of football from the very top, against the backdrop of global warming, to the point that the governing bodies of the game are prepared to turn a blind eye to a World Cup in the desert built by slave labour. Football is sick with greed…
With just a skeletal framework in place? Had this group of owners and executives instead presented the Super League as a concept– sans the specifics? It may have become a viable vehicle for ‘next steps’. Perhaps one that positioned the group with some clout in dealing with UEFA and FIFA.
There seemed to be some heavy hitters in the lineup. But no real foundation underneath them. Not sure from whose perspective this scheme seemed solid enough to rollout.
https://m.youtube.com/watch?v=DFO3vzH3yug
Excellent, Tim – Thanks for laying it out – Loving living in the capitalist end-times!
Evening. Great post as usual Tim.There was a documentary back in the day from Michael Moore who interviewed the Head of your Federal Reserve bank who’s name escapes me. MM put it to him that under the constitution of The United States For America not of it states an honest days pay for an honest days work American citizens do not legally have to pay tax. The guy replied its true but whom is going to believe it? 2) if you already have, my apologies but if any of you havemt i urge you to watch the Netflix series titled The Men who built America. Rockafella, JP Morgan to name but two. Utterly fascinating
We’ve been adjudicating the tax laws in this country from day 1. There is no such escape clause in the constitution.
https://en.wikipedia.org/wiki/Tax_protester_constitutional_arguments
In a normal year, I spend maybe 2 or 3 months of the year in California and have made very good friends there. I’m always amused when the subject gets round to taxation, which a lot of Californians complain about as the state is deemed to be left wing, high tax.
Sales tax about 10% max? Really? On this side of the pond we pay 20% VAT, as do most European countries. Likewise income tax. Americans pay a fraction of what Brits do. What do you get in return for this? Immaculately kept streets with no litter, which are swept by a machine once a week. High schools that have a sports stadium, which would embarrass most lower league English teams. Cops that actually turn up when you call them. Parks and public facilities, which are well kept.
Despite all of this, I have a friend who lives in Newport Beach, which if you don’t know is luxury personified, who recently moved to Nevada to “escape the taxes”. My jaw dropped and hit the floor.
At the same time billionaires get away with paying relatively little, which is deemed OK.
I really don’t understand any of this.
The other thing I never understand is the American use of the word “communist”. Speak to any Republican about any form of National Health and you must therefore be a “communist”. Offer the view that the wealthy should pay proportionally more of their income in tax than poor people, then they look at you as if you are Mao Tse Tung reincarnate.
Communism is an economic system where the state owns the means of production. That was always the definition I learnt. Somewhere like California is without a doubt one of the most capitalist places on Earth. People are out trying to earn a buck. That’s how it gets along. Listening to them bang on about Newsome being “practically a commie”, just makes me laugh.
If you picked up the Democrat party and plonked it in almost any other country in the World, it would be regarded as slightly right of centre, if anything.
Newsome? Boris? Difficult to spot the difference, apart from hair styling.
There is a fan forum tonight, and someone needs to ask Vinai this:
“Have Arsenal FC really left the table of ESL or have they left the chair out? Have they said they’ve left, but haven’t paid the “Leaving Fine” and how much is/was that?”
This is one of your best pieces, mate.
I can’t praise it enough.