Right Thinking From The Left Coast
No legacy is so rich as honesty - William Shakespeare

Thursday, August 26, 2010

Take Me Out To The Cleaners

I am a huge baseball fan.  I have been since my dad took me to my first Braves game back in 1977 or 1978.  There’s little better than watching a game in one of the new beautiful stadiums. I can’t wait until SAL 11000 Beta is old enough to go.

That doesn’t mean I’m down with this bullshit:

The swindlers who run the Florida Marlins got exposed Monday. They are as bad as anyone on Wall Street, scheming, misleading and ultimately sticking taxpayers with a multibillion-dollar tab. Corporate fraud is alive and well in Major League Baseball.

A look at the leak of the Marlins’ financial information to Deadspin confirmed the long-held belief that the team takes a healthy chunk of MLB-distributed money for profit. Owner Jeffrey Loria and president David Samson for years have contended the Marlins break even financially, the centerpiece fiscal argument that resulted in local governments gifting them a new stadium that will cost generations of taxpayers an estimated $2.4 billion. They said they had no money to do it alone and intimated they would have to move the team without public assistance.

In fact, documents show, the Marlins could have paid for a significant amount of the new stadium’s construction themselves and still turned an annual operating profit. Instead, they cried poor to con feckless politicians that sold out their constituents.

I didn’t post this just because of my outrage against the duplicitous vile league division rivals of my Braves (whose stadium was mostly paid for by private contributions from Olympic interests*).  I link to this because it is an example of how our money-starved decrepit cities are victims of their own stupidity.  Check this out:

It is enough to stink. In the annals of bad stadium deals, it’s among the most odious, right alongside the Washington Nationals’ extraction of $611 million from the D.C. city council to get Nationals Park built. The team spent $20 million on a parking garage and pays $5.5 million a year in rent. So desperate was Washington to become the landing spot for the Montreal Expos, it ignored reality – there were no other legitimate options for MLB – and vastly overpaid.

Such sentiments are echoed when looking at the Marlins’ deal. One of the county’s loans is particularly egregious. According to the Miami Herald, J.P. Morgan gave a $91 million note – $80 million of which will go toward construction – that from 2041-47 will cost $118 million per year. In all, the county will spend $1.2 billion to pay off $91 million.

You know, I’m no financial whiz.  But it seems to me that spending $1.2 billion to borrow $91 million is a bit much.

There’s pork within pork here, including multi-million dollar “art” displays within the stadium.  Meanwhile, the arguments that stadiums stimulate the economy—Hey! We’re back on stimulus again!—have turned out to be bogus.  Right now, the Devil Rays are trying out this scam, claiming poverty to justify a public stadium.  In their case, it’s not quite as egregious since they have been spending some money since they became competitive.

This isn’t confined to sports stadiums, of course.  While their cities crumble around them, most city councils are interested in landing big projects with rich developers—be they stadiums, office parks, malls or rich condos.  The hum-drum business of keeping a city going just isn’t terribly exciting to politicians.  Bankrupting your people to finance rich guys’ playthings while abusing eminent domain is.  The problem really isn’t the sports team owners, who are just human.  It’s hard to pass up a $2 billion gift.  It’s the city councils and, by extension, the voters, who allow themselves to get bamboozled this way.

And frankly, I have a hard time believing that the authorities in Miami were completely ignorant of the financial state of the Marlins.  I mean, when we took out a home loan, my wife and I had to provide the bank with every piece of information about us except her bra size.  How on Earth does a $1 billion deal go down without the city knowing about the Marlins’ lack of cash problems?

My guess—it doesn’t.  The city just didn’t care.  It wanted its big project and was fine if the Marlins lied their asses of to the media and, more importantly, the voters, to make it happen.

One of the few exceptions to the starry-eyed “big project” mentality was my former hometown of San Antonio.  Thanks to strict term limits, the San Antonio city government was mostly interested in maintaining the city infrastructure, not engaging in big stupid expensive “projects”.  The special interests campaigned relentlessly against term limits—sometimes with the fairly naked rhetoric that SA needed to invest in big projects.  In 2008, the succeeded and I expect SA to promptly go downhill, probably after the drop a few hundred million on a new stadium for the Jacksonville Jaguars or something.

Posted by Hal_10000 on 08/26/10 at 03:51 PM in Politics   Law, & Economics  • (0) TrackbacksPermalink
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