Corporate Welfare Scandals Analyzed and Exposed
Sports Stadiums Becoming Major Corporate Welfare
Sports Stadiums Becoming Major Corporate Welfare
Read the author's major article on this subject.
And here is an excerpt of a review of his book:
American
taxpayers as well as sports fans will continue to pay through the
nose for pro sports until they decide to outlaw the monopoly status
of professional sports leagues, says Stanford economist Roger Noll in
a new book.
Noll and fellow sports fan and economist Andrew Zimbalist of
Smith College argue against sports monopolies in a new book they
edited, "Sports, Jobs and Taxes," for the Brookings Institution.
The National Football League, for example, is a cartel of team owners
that is able to extract monopoly prices in the form of public
subsidies because they have no competition. "The NFL will always see
to it that there are a few cities who are hungry for a team but don't
have one," Noll says. "Their business plan is to keep the wolves at
the door, so a team can make a case for more subsidy every time a
lease expires."
In New York, where the Yankees want at least $800 million from
the city for a new stadium in Manhattan, it would be cheaper if the
city fathers simply gave the Yankees a cash bribe of $10 million a
year, Noll says.
In nearly all cases, Noll says, federal taxpayers are also being
hit hard. They provide about 30 percent of the local subsidy in the
form of tax-free bonds that the cities sell to build the facilities.
The 1986 Tax Reform Act encourages cities to subsidize stadiums,
because they can only sell tax-exempt bonds if the revenues from the
stadium account for less than 10 percent of their debt service.
The book is required reading for any citizens group hoping to
fight plans for a new taxpayer-subsidized football or baseball
stadium or hockey or basketball arena in their area. It provides the
nitty-gritty details of the many flaws in economic analyses that are
prepared by consultants for stadium proponents. Such studies usually
conclude that a team and a new stadium will improve the local
economy, reduce poverty and increase jobs.
"We are just pointing out two important facts," Noll says.
"Stadiums are not a net local economic benefit, and the reasons
cities are paying for them is because the (federal) government made
the professional leagues monopolies" -- exempt from anti-trust laws
that apply to most other industries.