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Bread & Circuses: The Shady, Slimy & Corrupt World Of Taxpayer Funded Sports Stadiums

Tyler Durden's picture




 

Submitted by Mike Krieger via Liberty Blitzkrieg blog,

Screen Shot 2015-09-03 at 12.09.24 PM

Like pretty much everything in the modern U.S. economy, wealthy and connected people fleecing taxpayers in order to earn even greater piles of money is also the business model when it comes to sports stadiums. Many cities have tried to make voter approval mandatory before these building boondoggles get started, but in almost all cases these efforts are thwarted by a powerful coalition of businessmen and corrupt politicians. Sound familiar? Yep, it a microcosm for pretty much everything else in America these days.

To get you up to speed, here are a few excerpts from an excellent Pacific Standard magazine article:

Over the past 15 years, more than $12 billion in public money has been spent on privately owned stadiums. Between 1991 and 2010, 101 new stadiums were opened across the country; nearly all those projects were funded by taxpayers. The loans most often used to pay for stadium construction—a variety of tax-exempt municipal bonds—will cost the federal government at least $4 billion in taxpayer subsidies to bondholders. Stadiums are built with money borrowed today, against public money spent tomorrow, at the expense of taxes that will never be collected. Economists almost universally agree that publicly financed stadiums are bad investments, yet cities and states still race to the chance to unload the cash. What gives?  

 

To understand this stadium trend, and why it’s so hard for opponents to thwart public funding, look to Wisconsin. Last month, Governor Scott Walker signed a bill to spend $250 million on a new basketball arena for the Milwaukee Bucks. (The true cost of the project, including interest payments, will be more than $400 million.)

Isn’t Scott Walker supposed to be “Mr. Fiscal Conservative?”

The story of what’s happening in Milwaukee is remarkable, if not already familiar. Step one: A down-on-its-luck team is purchased by a group of billionaire investors. Step two: The owners nod to their “moral responsibility” to keep the team in its hometown,while simultaneously lobbying for a new stadium. Step three: The team threatens to abandon its hometown for greener pastures—and newer facilities—in another city. Step four: The threat scares up hundreds of millions of public dollars in stadium financing. Step five: The new stadium opens, boosting the owners’ investment, while sloughing much of the financial risk onto taxpayers. As New York Times columnist Michael Powell wrote, “From start to desultory end, Milwaukee offered a case study in all that is wrong with our arena-shakedown age.”

 

That’s not to say the Bucks plan was entirely unopposed. Last year, a coalition of religious and community groups known as Southeastern Wisconsin Common Ground tried to fight the arena proposal. It called for a voter referendum on the bond issue, and lobbied for money to improve Milwaukee’s public parks and playing fields. Powell explains the rest:

 

The local business community—which includes several members who have ownership shares in the team—dismissed such ideas as impractical. “The Bucks took control of the strategy from the start,” said Bob Connolly, a member of Common Ground. “They pushed the referendum idea right to the side.” Months later, when Common Ground leaders turned to usually friendly local foundations for more funding, they found themselves turned away. You are, they were told several times, too political.

 

The lesson is clear: It is incredibly difficult to fight these projects. And Milwaukee is not alone. In St. Louis, for example, a judge recently struck down a city ordinance requiring voters to approve public spending on a new stadium for the Rams. Back in June, when Glendale, Arizona, tried to back out of its atrocious dealwith the National Hockey League’s Coyotes, the team quickly slapped the city with a lawsuit. Meanwhile, in building a new billion-dollar home in Minneapolis, the Minnesota Vikings found a loophole around a state law mandating that all public spending on sports teams be put to a vote.

 

Not surprisingly, publicly funded stadiums face the least opposition in cities with strong growth coalitions, which Eckstein and Delaney define as the “institutionalized relationship between headquartered local corporations and the local government.” A coalition can claim to represent the interests of a community—not an outrageous claim on its face, since it comprises the powerful and prominent local leaders—while shielding team owners from both direct criticism and grassroots opposition. This is precisely what’s happening in Milwaukee. Here’s the Times’ Powell again:

 

The hedge fund owners proved deft with ownership shares, handing these out to prominent Wisconsin businessmen and Republicans, including the developer Jon Hammes. Hammes has become national finance co-chairman for Walker, a Republican presidential candidate. The Capital Times recently reported that a political action committee connected to Hammes contributed $150,000 to the governor in late spring. 

 

Economists have proposed antitrust lawsuits against leagues and stricter naming rights for teams, as Slate suggested in March, but neither idea has gained much traction. Florida proposal would have shared team revenues with the public—a somewhat radical idea that Deadspin boldly declared “The Best Idea for Stadium Financing We’ve Ever Heard“—but it was quickly deemed illegal.

Sharing revenues with the taxpayers funding the stadium: Illegal.

Blatantly corrupt private-public partnership cartels: Perfectly legal.

Two words: Banana Republic.

In case you forgot the ultimate casino-gulag partnership of them all…

America in 2013: Florida Football Stadium Named After a Private Prison Company

Now here’s the always brilliant John Oliver on the issue. Enjoy:

 

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Sat, 09/05/2015 - 00:29 | 6512366 roddy6667
roddy6667's picture

Spectator sports are an important part of getting the Sheeple trained to hate and make war on command. High school students "love" their team and "hate" the other team just because they were born in a differrent Zipcode. These are real emotions, even though the game is an artificial activity invented by people.

When a team loses or wins, thousands of hate fueled fans will pour into the street and burn business and overturn cars. Thes zombies can be easily made to hate anybody on command.

Sports are just a rehearsal for war.

Sat, 09/05/2015 - 01:52 | 6512469 22winmag
22winmag's picture

Dumbfucks like Bostonians torch their own town when their team wins (2004)

Sat, 09/05/2015 - 00:43 | 6512383 J Mahoney
J Mahoney's picture

Yep, we all have whorer stories of politicians getting these stadiums built even though taxpayers dont want the debt. All the professional team examples can be beat by the 60 million dollar high school footbal stadium in Allen Texas (city of 75000 at the time it was built). Beat the ignorance if you can.

Sat, 09/05/2015 - 01:35 | 6512455 Buster Cherry
Buster Cherry's picture

Katy Texas ISD:

Can you say billion dollars? Yes, billion. With a capital B. Of course.its not all for a stadium, but come on!

What is wrong with the current Rhodes Stadium?

If Ive been misinformed, please let me know. I'll be so relieved....

Sat, 09/05/2015 - 00:47 | 6512393 Handful of Dust
Handful of Dust's picture
California governor's highway plan includes $65 driver fee

 

http://news.yahoo.com/california-governor-offers-3-6-billion-annual-high...

Sat, 09/05/2015 - 00:50 | 6512398 colddirt
colddirt's picture

When I was a kid, the city of Rockford, Illinois asked the citizens if it would pay to build the metro center, a building that would "revitalize" downtown. The people rejected it, so the city built it anyway (at taxpayers expense). It of course never made any money (who would want to come to Rockford to play?). I left that city 30 years ago - I'm not sure if the metro center is still there.

Sat, 09/05/2015 - 01:53 | 6512470 22winmag
22winmag's picture

Does anyone remember Super Bowl wnining QB John Elway and his creepy post-9/11 DHS bootlicking videos?

 

I didn't think so, but I thought I'd ask anyway.

Sat, 09/05/2015 - 03:08 | 6512529 q99x2
q99x2's picture

The Federal Government seems to be in a state of anarchy where any corporation can make their own rules. That doesn't seem like something that will last very long eh?

Sat, 09/05/2015 - 03:57 | 6512555 roddy6667
roddy6667's picture

A dollar spent on spectator sports is a dollar not available for education, medical care or research, infrastructure building and repair, or to keep our retirement secure. 

Of course, most people would prefer their money go to some aborigine playing bounceyball for $10 million. Or maybe to some steroid-sucking meatslab playing Foooooooooootball!

 

Watch the Movie "Idiocracy". It's here now.

 

Sat, 09/05/2015 - 07:41 | 6512748 quietdude
quietdude's picture

Roddy6667 - I wish I could upvote you a thousand times :-) I understand that killing " games" in the arena were popular in the last days of the Roman Empire. The games took peoples minds off the fact they were hungry. Nothing new here.

Enjoy the decline

Sat, 09/05/2015 - 08:55 | 6512843 Teh Finn
Teh Finn's picture

And then there are the cowards who hide while declaring their moral superiority about how everyone else's money should be spent.  *spit*  You are MUCH worse than those you decry.

Sat, 09/05/2015 - 09:01 | 6512854 Refuse-Resist
Refuse-Resist's picture

GO AWAY!  Baitin'!

Sat, 09/05/2015 - 10:43 | 6513103 roddy6667
roddy6667's picture

I saw you in the movie "Idiocracy".

Sat, 09/05/2015 - 08:10 | 6512773 Teh Finn
Teh Finn's picture

John Oliver...ugh.  Throw some salt on the slug.

Sat, 09/05/2015 - 09:11 | 6512878 Phillyguy
Phillyguy's picture

Milking the public to pay for these stadiums is only the beginning. Once built, the public pays astronomical prices for tickets, parking and concessions. In Philadelphia, tickets for Eagles games cost $ hundreds (stubhub price for Dallas game is $250), parking is $30 and beer is $ 8 (other stadiums are more). To put this in perspective, to take a family of 4 to an Eagles game can cost in excess of $500 for 3-4hr of “entertainment”.

Sat, 09/05/2015 - 14:39 | 6513698 Faeriedust
Faeriedust's picture

In other words, the boondoggle is another game of taxing the poor to pay for the social lives of the rich, since at $500 for a game, no one but the rich can afford to enjoy it.

Why should we be surprised?

 

Sat, 09/05/2015 - 09:42 | 6512940 risk.averse
risk.averse's picture

this mania for wasting hard-earned tax-payer money on temples to the sporting gods is not confined to the USA. In the Australian state of New South Wales, its Premier, Mike Baird, announced yesterday that he would spend A1.6 billion on 3 stadia for Sydney over the next 10 years. One of them, a 55,000 people capacity stadium is planned to replace the Roosters (a Rugby League team in Sydney) home football stadium -- which itself was only built in the 1980s !!! The Roosters average 14,000 people to their home games -- so how is a 55,000 seat stadium justified??

Unlike their Melbourne counterparts, Sydney people are notoriously lazy when it comes to attending sporting events. Who can blame 'em? With exorbitant ticket prices which many --particularly families -- can't afford, and now with big screen TVs cheap and just about in everyone's home why bother trudging along to games where you not going to get as close to the game as you would via TV?

Why such blatant wastage of scarce government income? The big construction companies in Australia are very big contrbutors to political parties.

Meanwhile, Sydney's hospitals, roads and schools are crying out for more money. Very depressing...but until such time that taxes paid are ttreated with the same reverance as campaign and party contributions then this won't change.

Sat, 09/05/2015 - 10:42 | 6513101 dogismycopilot
dogismycopilot's picture

Municipal bond financing is the most un-regulated financial industry in the US. None at the SEC really gives a shit about muni bonds. Up until a few years ago muni bond investment bankers were thought of as retarded, second-rate wannabe investment bankers. But now, the industry is seen as a place to be more "creative" with less risk. Fuck up a deal, no worries, the taxpayers will pay. Need to add some fees into the deal for the mayor's friends? no worries, the tax payers will pay. Hell, you can even buy insurance on your deal incase yu fuck it up and the taxpayers are skinned. 

This shit is only getting started. If you guys really want to stick it to Wall Street you need to stop going to the NHL/BA/MLA games...go to your local college team instead (the chicks are way hotter and younger there also).

Sat, 09/05/2015 - 10:51 | 6513127 Downtoolong
Downtoolong's picture

 

When you see stuff like this you realize what bullshit the competitive, capitalist, free market model of our economy really is. None of that applies to big business. It only applies to the small mom and pop operations which are often dependent on servicing the larger rigged scams too.  

 

Sat, 09/05/2015 - 11:03 | 6513169 corporatewhore
corporatewhore's picture

saint louis is currently going thru this.  There won't be a vote on new taxes to support this new boondoggle.  The Rams will leave (good riddance to bad rubbish).  It won't revitalize the city which is lagging looking like Detroit and behaving as such.  Going downtown is like taking your life in your hands.

If they build it, they will come.  I seriously doubt it.

Sat, 09/05/2015 - 11:29 | 6513237 IndianaJohn
IndianaJohn's picture

Stadiums are a place where people gather in the tens of thousands to worship niggers.

Sat, 09/05/2015 - 14:38 | 6513575 Prober
Prober's picture

"wealthy and connected people fleecing taxpayers in order to earn even greater piles of money"

MORE PROLETARIAT ANTI-SUCCESS ENVY PROPAGANDA

MORE THAN 60% of government spending is on ENTITLEMENT PROGRAMS to buy the votes of the 94+ MILLION entitlement parasites

Working people have more than 50% of their earnings confiscated and redistributed by the political overlords to feed the black-hole entitlement vote-buying monster.

THE PROBLEM in USA is

the entitlement-tit-sucking proletariat parasite hordes and the corrupt political parasites who buy their votes with freebies paid for by strangling the middle class,

NOT

wealthy people.

Sat, 09/05/2015 - 14:30 | 6513678 johnberesfordti...
johnberesfordtiptonjr's picture

Heh, ZH plutocrat-supporting clowns, you need only to listen to this- 

https://www.youtube.com/watch?v=WBnSv3a6Nh4

Gee. I wonder if Scott would take YOUR call. 

And, of course, there’s this… 

http://www.slate.com/blogs/moneybox/2015/08/12/scott_walker_s_basketball...

We don’t need no education we just needs basketball. 

Sat, 09/05/2015 - 15:06 | 6513734 Faeriedust
Faeriedust's picture

So much for Democracy, right?  Democracy exists on paper and on TV for three hours once every four years.  The average citizen has NO control over where and how "his/her" government, from the local town council to the Washington bureaucracy, spends "his/her" taxes.

But we have Democracy, and we are "free", even though we can't claim a park bench to sleep on without paying rent.

 

Sat, 09/05/2015 - 17:54 | 6514052 BarkingCat
BarkingCat's picture

In Washington state the voters voted against a new stadium. 2 years later the politicians decided they knew better. They ignored the voters and passed the bill all by themselves.
I am pretty sure that the stupid voters put them back in office anyway.

Sun, 09/06/2015 - 00:36 | 6514617 roddy6667
roddy6667's picture

How many of these "sports fans" know everything about the players, but nothing about what courses their child has in school?

I thought so.

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