After the superbowl: NFL owners going after the players.

Saints show solidarity against the boss before they beat each other up

The United States of Goldman Sachs has its employees or former employees planted in every nook and cranny where money can be made. Former governors of states, crucial positions in the federal government, and even in the top ranks of the NFL where former Goldman investment banker Eric Grubman sits as executive vice president of business operations.

This Sunday, Pittsburgh will play Green Bay (the NFL’s only publicly owned team) (1). But beyond that there is even talk of it being the last Super bowl as the contract between the NFL owners and the players’ association expires on March 3rd. It’s hard to defend folks that supposedly earn millions of dollars a year. All sports figures are vulnerable and I can’t say that I feel sorry for Manchester United’s Rooney and the couple of hundred thousand dollars a week he reputedly earns.

But the point is that in a side between the employer and the person(s) they hire, we take the side of the worker, high paid or not. These issues, including sport and how it and its participants are simply commodities in capitalist society are part of a larger discussion for another time. But if players receive too much money, imagine what the owners, TV execs, investors and others who don’t get their body smashed to bits earn.

American football is a particularly brutal sport. Those who compare it to rugby make the wrong comparison. In rugby, the object is not to stop, at all costs, the forward motion of the individual; it is more to obtain possession of the ball. In American football, yardage is everything and the helmet is a weapon. But there are many facts about the game that we should know.

The average NFL salary is $1.9 million and the median salary $770,000. The average career length is 3.5 years. The damage to the body, particularly brain function, is significant and last year as results of injury, out of the 1900 players in the NFL, 352 were on the injured reserve list.

The Goldman Sachs banker is the chief negotiator for the owners. He claims the problem is the players “are too concerned with how you divide the pie; while we’re trying to grow the pie so there’s more money for everybody”(2) But Grubman reveals that the employers opted out of the agreement because “They made a bad deal” in 2006 when they agreed to an extension to raise the salary cap and allot 60% of the league’s total revenues to player salaries. The deal also had a “revenue sharing plan” which meant that the top 15 teams in earnings subsidize the 17 less profitable ones; that’s communism isn’t it?

The owners want to decrease the player’s share of total revenue and add two games to the regular season. We wrote more about this and the dangers of playing this game in a previous blog. Union reps on the fields such as Saints QB Drew Brees, and Vikings lineman Steve Hutchinson organized on field protests like the one when the Saints and the Viking players marched to midfield and stuck their index fingers in the air in a symbol of solidarity. Egypt its not, but the locker rooms are turning in to Union halls say the players as what they term a lockout, and the owners call a work stoppage looms.Houston and Indianapolis players followed suit.

Finding out about team revenue in the NFL is not easy, as private franchises are not required to release financial statements publicly, the exception being Green Bay which is a publicly owned company. This is what was going on with the Facebook/Goldman Sachs deal that caused such controversy recently. Facebook was trying to attract more capital through investors but wanted to avoid going beyond the shareholder limit that would force it to go public making its financial dealings more accessible.

Grubman says that the players’ wanting to see the books is simply to “uncover stuff like private jet fees or other expenses that they can use to embarrass the owners with the public.” “But that’s not relevant he adds.”

But the taxpayer heavily subsidizes the industry. Since 1990, construction or renovation of NFL stadiums has occurred at a staggering rate the player’s association says as “ 87.5% (28) of all NFL teams have either opened a new stadium, done major renovations to an existing stadium, or are currently in the planning and negotiation stages for a new stadium.”

* In the past 20 years, NFL clubs have received over $7 billion in taxpayer subsidies to build or renovate stadiums, with the average team receiving 65% of its stadium financing through taxpayer subsidies.
* Since 2000, 15 stadiums, costing on average $555 million, have been or will be built or renovated with 58% coming from public financing.
* 100% of NFL owners have relied on taxpayer subsidies to publicly finance stadium construction, infrastructure improvements near the stadium, or land development.
* 10 NFL stadiums are 100% publicly financed, while 19 are at least 75% publicly financed.

The player’s association also points out that, “NFL team revenue and franchise values have increased dramatically as a result of public financing. By year seven, the average revenue increase from year one for teams with new stadiums was almost $90 million, compared to $68 million for teams without new stadiums.” (3)

The investors and speculators that own and control national sport as an entertainment, something we watch rather than participate in, have the upper hand in terms of money than the players. They have $900 million on hand to wait out the players if the contract isn’t settled. They’ll lay off up to 1000 of their own employees, office staff etc, if it lasts. One weakness in the players camp is solidarity with regular workers like the low waged at the stadiums or those employed by the NFL owners who would undoubtedly be non Union. $700,000 a year doesn't look too bad when you're earning $12 dollars an hour.

What’s more, the league gets $4 billion from agreed TV deals for next season whether games are played or not. In 2010 the league brought in $8 billion in what Grubman refers to as a “magical resilient business.” Grubman, like Roger Goodell NFL commissioner should feel good about the “Business”, they earned $4.44 and $.9.76 million respectively in 2009. With twice Grubman’s salary, Goodell had better watch his back.

Like music and art, sport is a healthy part of human society, of human culture. As a business instead of participating in it as players and spectators, we are merely spectators whose pockets are the source of revenue, either through attendance at games or even more so through the billions spent on alcohol, gambling, and other connected issues. Our chidlren are supposed to worship sports figures as heroes that they should emulate.  They are used to sell everything form Viagra to clothing.

In a democratic socialist society a brutal game like American football would not be played, much like boxing. The sons of the ruling class don’t look for careers in boxing or American football; just like they don’t enlist for their stints in Afghanistan; they have better options.

Stepehen Ross, the real estate magnate and speculator who has paid more than $1.5 billion to own the Miami Dolphins  has a net worth of $2.5 billion and is number 117 on Forbes' list of richest Americans.  He's just one example.

It is important that we build a society in which sport, like art and music, is not a business and prisoner of the market but a healthy part of human development and social interaction.  But in the upcoming struggle between the speculators and coupon clippers like Ross that own and control this aspect of sport I’m firmly with the guys that beat each other up on Sundays. (4)

(1) As a public entity, Green Bay’s finances are more open. Another reason they want to privatize the world
(2) Business Week 1-31-11 P60
(3) http://www.nflplayers.com/Articles/CBA-News/Taxpayer-Subsidies-for-NFL-Stadiums/
(4) For a great film on this subject see, North Dallas Forty, or read the book.