Cronyism Finds New Home in Professional Sports

CronyismThe professional sports world looks more like an overgrown cronyism-based union, and less like a free market enterprise these days. Professional sports organizations have received 501(c)(6) charitable organization status under the guise that they promote the general value of their sports, rather than act as businesses pursuing individual profit. Meanwhile, President Barack Obama verbalized empathy for the top brass of the National Football League (NFL) when discussing a recent class action lawsuit involving its players and owners. When exactly did professional sports like football and hockey stop being businesses, and all of a sudden become “non-profit organizations?” The American people were put off enough when politicians bailed out their corporate cronies in the automotive industry a few years ago. The same American people will likely not be pleased to find that political-corporate partnering has a new home in professional sports.

The NFL and a group of former professional football players reached a $765 million settlement last August. The case stems from players’ claims that they have suffered long-term health problems caused by concussions while playing. On March 14, 2014 ABC News released a report on sports and concussions, stating that officials from National Hockey League (NHL) and the NFL testified before Congress on how to prevent head injuries from playing sports. NFL Senior Vice President Jeff Miller stated that the league’s current equipment still does not adequately prevent concussions.

Against this backdrop, President Barack Obama took the opportunity to throw his hat into the ring. He says that if he had a son, he would discourage him from playing in the NFL in light of the recent spike of players’ concussions. However, the President exonerated the NFL and team managers. The President told New Yorker Editor David Remnick “[Professional Football Players] know what they’re doing. They know what they’re buying into. It is no longer a secret. It’s sort of the feeling I have about smokers, you know?”

Smoking is a good analogy when discussing the impact of cronyism; as second hand smoke affects non-smokers, second hand professional sports contracts hurt those not directly involved. These days taxpayers and sports fans are getting their version of cancer or sports injury, and without the initial pleasure of a nicotine kick or multimillion dollar contract. Corporate elites among the NFL will no doubt find a way to pass the new expense on to their own loyal customers, while getting a wink from their political cronies. Hometown fans are not just customers; they’re an insurance policy in the minds of team owners.

Professional football is not the only sport to deal with cronyism. This January, the Florida Panthers NHL team asked Broward County for a $70 million donation to help pay for the BB&T Center, its hockey arena. While the team’s management complains of an inability to pay for its facility, it plans to expand the property. Team president Michael Yormark commented that taxes paying for the facility expansion would benefit the community itself.

What, if anything, does all this mean? It means that the professional sports industry is being treated more like a part of a larger-than-life machine than like the truly free market enterprise it is meant to be. From politicians advocating on behalf of an organization to which they have no direct connection, to private citizens paying for at least a substantial part of a home team or league’s bill. This newest “corporate cronyism” is a lot like the automotive industry bailout that so many people found unacceptable. The sports industry better hope people have more patience than they did with car company managers and their government buddies.

Opinion By Ian Erickson

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ABC News
Broward Sun-Sentinel
New Yorker
Reason.com

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