The NFL and Statism

I started to write this while watching Monday Night Football, which went into rain delay.

My argument this go around is that the NFL is more than happy to exercise statist tactics. While it may be true that the NFL is a private, non-profit sports league, that hardly makes it innocent and virtuous. It basically brings out the ugliest aspects of all its substituent franchises, some of which are owned by unscrupulous folks connected to the federal government (see Redskins). It's the same old story: big businesses are not evil because they exploit folks through the free market, it's because they're connected to the powers that be.

How does the NFL use statist tactics? You may have heard someone refer to it as the "No Fun League." This is no joke. Just like the state, the NFL has rules that control absolutely everything, usually for no reason other than to generate revenue through fines, the NFL's version of taxation. The fines are truly insane too. Terrell Owens recently got in trouble for tweeting within 90 minutes of a game (he made an announcement about a giveaway promo to a lucky fan who wore his jersey to the game). Other players have been fined for text messages, endzone celebrations, and numerous other on/off-field rules (some are concurrent with the equally corrupt NCAA).

The league might be voluntary, but it's also a de facto monopoly due to numerous sports regulations that make it impossible for competitors to offer a better, consumer/employee-friendly alternative. This is true across sports where wealthy owners do not have to buy their stadiums since cities will force the taxpayers to pay it for them. Good luck competing with franchises that are able to get some of the loftiest subsidies in town. As a consequence, like every other business that does this kind of thing, the NFL becomes a creature of the state.

What are some other special rules that help the NFL? Well, first of all, the NFL is not a business in its own right, it's a sports league, a non-profit organization that fosters the competitive endeavors of its substituent franchises. The government classifies it as a 501(c)6 non-profit group, a nice designation to have that allows it to escape tax burdens. As you may have noticed, the state rarely hesitates to provide unfair tax advantages to its buddies at the expense of everyone else. The 501(c)6 status is the same privilege granted to real estate boards (who are very dominant in local politics) and the so-called Chambers of Commerce. It's nice to be part of the state's list of priveleged operations that gain the non-profit designation. And you wonder why churches are so corrupt nowadays?

Again, the Marxists have things totally backwards. It's not private companies that use, abuse, and alienate employees, it's the fascist ones. NFL teams, under the banner of the omnipotent NFL, treat their players like dog meat, allowing them to generate concussions at break-neck speed. The NFL only puts superficial protective measures in place. If a player gets a concussion, they're only really required to have an independent doctor take a look at him. It comes as no shock that this step gets fudged over in order to make sure the player gets back on the field as soon as possible. The WWE has a similiar problem when it comes to concussions, something that may have had an impact on Chris Benoit's murder/suicide episode. If any other non-politically-connected business tried to get away with this disregard for employees, OSHA would put them away in no time. The rules do not apply to everybody though.

By the way, here's a recent LRC article that illustrates some of the same problems but focuses more on the college level.

~Sports and Over-Leveraging~

During the pre-game of the Vikings/Jets game I heard commentators talk about how the Vikings organization has all the chips in with the expensive veteran, Brett Favre, along with newly acquired WR Randy Moss. Truth be told, the concept of "all-in" gambling amongst sports teams hoping for "a championship now" is reflective of the short-term thinking that plagues not only pro sports teams, but many American companies these days. Many sports franchises, like the Stanley Cup champion, Chicago Blackhawks, mortgage their entire futures all for a chance of winning here and now. It is a sign of over-leveraging brought on by money printing, which leads to credit expansion, along with favors from municipal governments that routinely dole out money for new stadiums.

Ironically, now would be the time for teams to focus on long-term contracts, much the way the New Jersey Devils did with Illya Kovalchuk. The crazed money printing of the Fed means that teams stand to gain a lot by locking players into long-term deals that pay in dollar amounts bound to be devalued severely by the time the latter years of the contract are paid. In other words, $100,000,000 (as long as its not paid competely up front) will be worth less and less as its paid out annually to the player. Teams can take advantage of rapid inflation with multi-year obligations just like other debtors can get away with allowing inflation to wittle away their debt.

Nevertheless, the tendency for sports teams to go nuts with huger, yet shorter contracts in every league is a sign of the times. Large businesses are still drinking the punch from the Fed and all of its money-creating, credit expansion. Once the plug is pulled on the dollar, the jig is up for pro sports teams. I expect this bubble to burst just like all others related to borrowing and government handouts. When it does, good bye mid-market teams.

Good bye statist sports!