Does it ever make sense to subsidize sports?
We asked economist Andrew Zimbalist, author of Circus Maximus and No Boston Olympics. He says the numbers often don’t add up.
...Zimbalist says emotional arguments to subsidize the team can be made, but don’t substitute for a business case. “If you’re concerned at a social or cultural level, then I would say you have to think about subsidies. But don’t think about subsidies because of an economic impact.”And here's the key paragraph:
Zimbalist doesn’t oppose all sports subsidies. He says stadiums as redevelopment catalysts can make sense, pointing to San Diego, Calif., and Brooklyn, N.Y. But those are the minority, and “the devil is in the details.” He warns against subsidies by another name, like waiving property taxes, interest-free loans or introducing a special tax or fee to support the team.Thing is, Zimbalist is not just an academic expert but a (former) paid consultant on the Atlantic Yards project, whose analysis was decidedly flawed (and now quite dated).
Oh, so the Barclays Center was the catalyst for a project that's been delayed? (And you can't call it the catalyst for new construction in nearby Downtown Brooklyn and around the Brooklyn Academy of Music.)
Here are a couple of lines from Zimbalist's 2005 report that didn't age well:
- Hence, it does not seem that the AtlanticYards development will necessitate the construction of any new school buildings.
- My estimates below assume that, despite the very substantial infrastructural costs connected to relocating and covering the railyards, inter alia , this acreage would be fully developed on the proposed arena’s timetable. This is the most conservative assumption I could possibly make.
- Although the MOU refers to the possibility of additional optional contributions from the city and state, it seems unlikely that such payments would be made and, in any case, it would be entirely speculative to assign a dollar figure to them.