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Game theory in the popular press.

NBA team as status symbol becoming more like an idol
David Waters
August 18, 2001
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Driving around the other day, I heard a guy on the radio complaining.

He said some rich man wants local taxpayers to build a $250 million arena for his pro basketball team.

Suddenly, the clouds parted and I heard a voice that wasn't coming from the radio.

"If you don't build it, they won't come," the voice said.

I was in a rental car in Orlando, Fla., not a cornfield in Iowa. I might as well have been in Memphis or Charlotte or any city that is a victim of the professional sports shakedown.

The voice is everywhere. Not only are we listening to it. For some ungodly reason, we're obeying it.

In city after city, we're cutting down cornfields and putting in ball fields, basketball courts and ice rinks, surrounded by plush seats, lush suites and flush subsidies.

We're tearing down good palaces to build better palaces for entertainment emperors who make more in a year than most of us make in a lifetime.

We're not doing it because we want to, but because they tell us we have no choice.

If we don't built it, the voices of the sports gods tell us, they won't come to our city. Or they won't stay.

If we don't play by their rules, they'll take their balls and go somewhere else.

If we don't pay, they won't play, and for some reason that matters to a lot of people.

But this isn't about owners and athletes and the money and demands they make.

This is about the idols we create, the altars we build, and the sacrifices we make to the sports gods.

Bowing to idols

Orlando and Memphis have a lot in common.

OK, so maybe Orlando has a few billion more tourists, but both cities are sunny and muggy.

Both sit in counties with populations of about 850,000. Both have a Peabody hotel, a Belz mall, an international airport and a decade-old downtown arena.

And there was a time when both called Anfernee 'Penny' Hardaway a hometown hero.

Hardaway, the former University of Memphis star, signed a $65 million deal with the NBA's Orlando Magic in 1993.

Those were giddy days for the Magic. With superstars like Hardaway and Shaquille O'Neal, the Orlando "O'rena" sold out every game for five years. The team won most of its games and made it to the NBA Finals in 1995.

The Magic was one of America's most successful, popular and profitable sports franchises.

As a proud Memphian, I switched my basketball allegiance from Larry Bird and the Boston Celtics to Penny and the Magic. I bought Magic souvenirs and took my children to see Penny and Shaq play an exhibition game at The Pyramid. I bowed to their greatness.

Boomers like me who grew up loving pro sports have ruined pro sports.

It wasn't enough for us to root for players and teams. We idolized them. Then, we grew up and became taxpayers and decision-makers. Now we build altars to them and make great sacrifices for them.

We Boomers took something of relative worth and gave it absolute value. That's the definition of idolatry.

That's also a pretty good definition of insanity.

Supply and demand

Pro sports leagues are monopolies. They artificially restrict the supply of franchises.

There are 53 metro areas in the United States and Canada with populations of more than 1 million. There are 29 NBA teams. If your city wants one, it has to compete. Highest bidders win.

So, greed explains the supply side of the insanity.

What explains the insane demand for these small, heavily subsidized businesses owned and operated by millionaires?

Pro sports franchises are not big businesses. The average NBA team generates about $50 million in annual gross revenues and employs fewer than 100 people.

That wouldn't even crack the Top 50 private businesses in Memphis.

"Economists have never found any statistical relationship between economic development and the presence of a team," professor Mark S. Rosentraub wrote in Major League Losers: The Real Cost of Sports and Who's Paying for It.

Why would there be? Think about it. More than half an average team's revenues go to 13 people - 12 players and a coach. They tend to live and spend elsewhere.

Nearly all of a team's remaining revenues goes to the owner and other executives and coaches.

Payrolls are the main reason teams demand newer and more lucrative arenas. Player salaries keep going through the roof, so owners want new roofs.

So that's how it is in the professional sports racket. Most of the money spent by millions of fans and taxpayers goes to millionaires.

Call it trickle-up economics.

"A welfare system exists in this country that transfers hundreds of millions of dollars from taxpayers (and fans) to wealthy investors and their extraordinarily well paid employees," Rosentraub wrote.

"Who are these individuals profiting from life on the dole? They are the owners of America's professional sports teams and the athletes who play in each of the four major sports leagues."

Pay for play

Somehow, the vital measure of a great American city isn't its schools, neighborhoods or people, but its big-league team.

Living in a city with a big-league team is a point of pride in this culture, a status symbol. Cities that don't have a big-league team envy cities that do. We covet their teams.

Pride, envy, coveting. Didn't they used to be sins?

I confess. I used to envy people who lived in Orlando. Not because they had Mickey and the Magic Kingdom, but because they had Penny and the Magic.

Orlando isn't quite as enviable as it once was.

After Penny and Shaq became cultural icons, they were coveted by other franchises in bigger cities with newer arenas and more money. In 1996, Shaq went to Los Angeles for $120 million. In 1999, Penny went to Phoenix for $86 million.

Now, Orlando ranks near the bottom of the league in attendance. Magic executives say the franchise has lost $40 million in four years.

The team's billionaire owner says the team can't survive in Orlando's 16,000-seat arena, built in 1989 just for the NBA.

The owner wants a new $250 million arena with more luxury suites, club seats and amenities. And he wants taxpayers to pay for nearly all of it.

I told you Memphis and Orlando have a lot in common.

"The mayors of American cities are confronted with a prisoner's dilemma of sorts," former Washington Mayor Sharon Pratt Kelley explained once.

"If no mayor succumbs to the demands of a franchise shopping for a new home then teams will stay where they are.

"This, however, is unlikely to happen because if Mayor A is not willing to pay the price, Mayor B may think it is advantageous to open up the city's wallet. Then, to protect his or her interest, Mayor A often ends up paying the demanded price."

Just say no

So here we are in Memphis, facing a prisoner's dilemma.

The wealthy owner of the NBA's Vancouver Grizzlies says his team can't survive in that city's 19,000-seat arena, built in 1995 just for the NBA.

He wants to move his team to Memphis, but he says we must have a $250 million NBA-quality arena with more luxury suites, club seats and amenities.

Hurry, the team's Memphis pursuers say. If we don't build it, he won't come. NBA Now - or never. This is a "defining moment" for the city, a once in a lifetime opportunity for our community.

Yes, it is.

This is an opportunity for one city to stand up to the professional sports welfare system and just say no.

No to a system that says 10-year-old, 20,000-seat, multimillion-dollar arenas may be fine for fans, but aren't good enough for millionaires.

No to a system that in 10 or 15 years could say the very same thing about a $250 million arena.

No to a system that says sports franchises are economic gold mines, but only if taxpayers do all the digging and give all the gold to the millionaires.

No to a system that pits American cities against each other by exploiting fan loyalty, civic pride and philanthropy.

No to a system that pays people millions of dollars a year to play a game when half the people on the planet are living on $2 a day.

We've created too many idols and built too many altars to the sports gods. We've sacrificed too much.

It's time a city stood up and said: NBA NO.