Major League Boondoggle | Culture Club | Chicago Reader

Major League Boondoggle 

Why does the public turn over millions to subsidize profitable professional sports teams? Writer Mark Rosentraub offers some answers.

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"Where are our priorities?" asked Senn high school history teacher Jesse Sharkey in a Reader article last fall about the $360 million the city paid to rebuild Soldier Field so the Bears can play eight games a year there. "It's just outrageous that our city would spend all those hundreds of millions of dollars on a new stadium but can only come up with $1 million for reduction of class size," Sharkey said. His comments inspired writer Ben Joravsky to note that, curiously, in all the furor over the stadium's location and design, "the one aspect of the project that engendered little early public criticism was that price tag."

Last month a man who's made a career of explaining curiosities like these came to town for a meeting of the Chicago Seminar on Sport and Culture, sponsored by Northeastern Illinois University and the Newberry Library. Mark Rosentraub, dean of Cleveland State University's college of urban affairs and author of Major League Losers: The Real Cost of Sports and Who's Paying for It, laid out the rules of a game many of us aren't aware we're playing.

Rosentraub argues that professional sport is on the receiving end of an enormous welfare system paid for by the average citizen to benefit an elite group of successful, privately owned businesses and their employees. The key to understanding the system, he says, is to recognize that there is no free market in pro sports--the leagues are cartels. The NFL, NBA, MLB, and NHL exist to make team owners and players rich, and they do that by limiting the number of their teams. By keeping supply smaller than demand, they create the only real competition in the business--that between cities striving against each other, offering ever fatter subsidies and more lavish facilities to land or hang on to a precious team. To level the playing field, Rosentraub says, we'd need a twofold act of Congress: legislators would have to repeal the Sports Broadcast Act, which gave the NFL the right to sell its games to more than one network, and take away the leagues' ability to limit the number of franchises.

Sports and cities have teamed up since ancient Rome, but their relationship hasn't always been like this. Up until the 1970s teams generally built their own facilities or paid fair rent to government landlords. But in the last few decades, Rosentraub says, a couple of things changed that. In the 70s and 80s sports facilities came to be seen as a cornerstone of downtown redevelopment, and cities started looking for ways to lure back teams that had migrated to the suburbs. Players, first granted free agency in 1975, began moving among teams, negotiating for the best salary. By the 90s players were signing multimillion-dollar contracts, and owners needed to bring in more money to pay them or dig into their own profits. Television revenues, which had grown in the previous two decades, were leveling off, especially in smaller markets, so owners began looking to premium seating and concession sales as major sources of new income. For that, they needed fancy new stadiums with skyboxes and restaurants, preferably paid for by the cities hot to be their home. And if, as is the case with Soldier Field and White Sox Park (which got $167 million in subsidies), there are no restaurants or bars in the immediate area--indeed, no real neighborhoods--all the better. Then the team owner has a lock on hot dogs, beer, and parking for a captive audience. The cities are never done paying, because stadiums are now obsolete after a decade. "Don't believe anyone who tells you you're building a facility for 30 years," Rosentraub warns.

Campaigns for new stadiums follow two patterns: if a city has a team, the owner threatens to take it elsewhere if he doesn't get the new facility or improvements he says he needs. A city without a team may be convinced that if it builds a stadium, a team will come. In both cases, arguments get put forth about how good the new facility will be for the city--how it will spur development and boost the economy. But Rosentraub says these claims are seldom examined carefully--in part because sports play a nostalgic, emotional role in our lives--and that if they were examined, they wouldn't hold up. "If you ask the question, 'What do sports do for a regional economy?', the answer is 'zero,'" he says. "The presence or absence of a sports team has no correlation to economic activity."

Professional sports teams, says Rosentraub, account for less than 1 percent of the jobs in any community. Bringing a team to a city will not stop the long-term trend toward decentralization of the economy and downtown job losses, and will not generate high-paying jobs. Indianapolis, despite rebuilding a four-block area of its downtown around a sports facility, now has a lower average income level relative to other cities than it did before the construction. Meanwhile, storefronts one block away from the central core are standing vacant.

What sports can do, Rosentraub says, is shift economic activity within a region. He gives the example of Cleveland, where Cuyahoga County paid to build two sports facilities--at a cost of $50 per year for every county household "forever"--and the city got about five million additional downtown visitors annually, racial mixing, job retention, an improved residential rental market in the immediate area, a better image, and a reduced crime rate. In terms of bringing new money into the larger region, he says, the project was an absolute failure. "But did it keep a tax base in downtown Cleveland? Yep. Does Cleveland have any other options? Nope." In a city like that, "you've got to play by the leagues' rules."

Chicago is a different story. Soldier Field and Sox Park are not boosting businesses in their neighborhoods, and it's doubtful that a significant number of tourists are coming here to see the Bears or Sox. (In the Bears' case, Northeastern Illinois professor Steven Riess pointed out, no tickets are available.) And the teams aren't going anywhere. "There are four markets the leagues must be in," Rosentraub says: New York, Los Angeles, Chicago, and Boston. "Knowing that, you can play with the cartel." Would the Bears ever leave Chicago? No, Rosentraub says--the other team owners would never permit it. Was there a better deal? "Probably."

So how did we get stuck with this one?

Art accompanying story in printed newspaper (not available in this archive): illustration/Robert Ullman.

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