When Money Stops Talking
In the sporting world, when you pony up particularly large amounts of money, it comes with certain expectations. Sports are, after all, known to not be the most productive thing in the world; in fact, some call it a complete waste of time. Over the past few decades, an increasing share of proposed stadium construction projects asking for public funding have run into questions from local residents about whether the money could be put to better use somewhere else, or what exactly is wrong with the stadium they’re using at the time. That, of course, intensifies exponentially if the World Cup, Olympics, or other major international competition is involved.
This also applies to the roster itself: as any fan knows, some teams have a payroll a whole lot bigger than others, because- hold on to your seats, we’re about to blow some minds here- better players tend to cost more money. And in order to facilitate those larger payrolls, ad space is sold on every surface that good taste will permit, and some that it won’t. Sponsors are sought for everything under the sun. Top teams come under the control of ever-richer owners, some of which pool their money and equity with other moneyed interests, as they see in sports the same thing they see in tall buildings and large yachts: bragging rights.
It all comes with one only sometimes-unspoken agreement from the fans who look on: if you’re going to be spending that kind of money, it damn well better work. The stadium had actually better turn the neighborhood around, or turn the team around. The event the city is hosting at great expense better actually put the city on the metaphorical map and not result in a ton of structures that will be left to rot the instant the circus pulls up the stakes. The most expensive team in the league is generally presumed to contain either the best collection of players, or close to it, and so while fans living under lower payrolls will accuse such teams of ‘buying the championship’, fans of the high-payrolled team fully expect the team to make that bought championship happen, and will raise hell if it ends up in the hands of someone else.
In North American-based leagues, fans are quite familiar with this concept. For instance, in MLB, which has no hard salary cap (but does impose a luxury tax for teams that spend beyond a certain amount), last season, two of the top five payrolls (the Phillies and Red Sox) resulted in losing records, while two of the bottom five payrolls (the Athletics and Pirates) resulted in winning records and playoff appearances. The World Series saw the 7th-ranked payroll defeat the 19th. Every team has its share of stories about handing large contracts to players who wound up being complete busts, and every fan reading this is now muttering one of those stories under their breath.
The soccer world, though, while not without its own list of busts, has fretted that this is more or less not worth even dreaming about in the modern age. These concerns are far from meritless. According to a 2010 study by SportingIntelligence, from the 04-05 to 08-09 seasons, the English Premier League showed a .85 correlation (on a scale from 0 to 1) between payroll per player and win percentage. (Over the same timeframe, the NFL, which features a hard salary cap, showed a .14 correlation.) Other uncapped leagues, which means just about everyone save for MLS and the A-League, were not measured, but anecdotal evidence suggests not to expect much different. To a fairly extreme degree, you get what you pay for in a soccer payroll.
This puts immense pressure on the owners to pump as much money as humanly possible into their rosters, and at great financial risk. Owners, again, stake bragging rights on sports teams. They can’t all have a championship at the same time. When an owner lifts a trophy, he’s lifting something that he beat out a lot of other very rich people to get his hands on. He’s on TV, standing in front of the world as a winner. Meanwhile, in the Premier League, three teams out of 20 are relegated every season. No amount of investment will change the fact that come May, three unimaginably wealthy people will not only not be rewarded for their extravagances, but actively punished and watch their assets be sharply devalued for not being extravagant enough. None of them want to look like a loser in front of the world. Not after getting to where they are. The process repeats in every nation where league structure and money allows, not only in the major European leagues but at the periphery of the soccer world. Russia’s Anzhi Makhachkala, China’s Shanghai Shenhua, and Uzbekistan’s Bonyodkor have all made temporary names for themselves through particularly outrageous bouts of spending far in excess of what their leagues and lots would suggest, only to fade back away immediately when that spending proved unsustainable.
In an effort to promote sanity and keep clubs from spending themselves into ruin, UEFA introduced Financial Fair Play (FFP), taking effect in 2011-12, levying punishments up to and including disqualification from continental competition upon clubs whose expenditures too grossly outpace their revenues. But instead of making things more fair, evidence suggests that it has only made things worse. A few of the absolute richest clubs have honed themselves into such proficient moneymaking machines that they regularly turn substantial profits, permitting them to spend as they wish without running afoul of FFP. Instead, clubs who surge to prominence via a sudden influx of cash find themselves punished and warned not to overspend further, which some can step around by injecting cash from outside assets into the club, thereby creating the illusion of profit, Smaller clubs who only rarely find continental competition who find themselves kicked out entirely when they lack the outside assets to give the club “profits”. In effect, a continentwide salary cap has been imposed, but every club has been handed its own separate cap, some smaller than others, and some harder than others.
As you might expect, the clubs naturally unburdened by it have no problem with it, with Chelsea manager Jose Mourinho stating that clubs who violate FFP- oh, say, last season’s champion, Manchester City- should not be allowed to be league champions, and should be docked points besides. Meanwhile, supporters of Paris Saint-Germain- who will be playing Chelsea in the Champions League round of 16 later this month- are challenging FFP in French court, seeking to void it altogether.
Chelsea finished third last season, four points behind Manchester City. Second-place Liverpool, two points ahead of Chelsea, was also investigated, but were cleared for the time being.
So things, from the perspective of those not in the landed gentry, appear bleak, and bleaker by the year. But a .85 correlation is still not perfect. As many volumes as money can speak in soccer, outright silencing is another matter. Wild swings are still possible.
Borussia Dortmund is the winner of the Bundesliga in 2011 and 2012, and made it to the 2013 UEFA Champions League final before falling to Bayern Munich. In a SportingIntelligence survey of the team payrolls in principal world sports leagues, taken last April, Bayern Munich ranked 7th overall in terms of payroll per player, sitting at $6,689,311. Borussia Dortmund was 47th, at $4,158,080. The two sat 1-2 among the 18 Bundesliga teams represented in the survey, which represented the 2012-13 season, and the 3rd and 4th highest payrolls came in 4th and 3rd respectively. The two lowest-ranked clubs on the list, Fortuna Dusseldorf and SpVgg Gruether Furth, were also the two clubs relegated. Most of the table followed relatively to suit.
But then there was SC Freiburg, who finished 15th on the money list but 5th in the league and collected a Europa League group stage appearance for their trouble (that they then failed to advance from). And this season, Borussia Dortmund, whose wage bill now doesn’t look all that different from when the survey was taken, and who Forbes currently values as the 11th most valuable soccer club in the world, is not only not fighting Bayern Munich for the league title, they’re struggling just to stay in the league at all. On Saturday, a visiting Dortmund beat Freiburg 3-0, which in previous years would just be regarded as taking care of business, but this season was a sorely needed relegation six-pointer.
At the start of the matchday, Dortmund sat stone dead last in the table, coming off a 1-0 home loss to a shorthanded FC Augsburg side that itself is currently entertaining notions of Europe, a match that ended in Dortmund fans chewing out their own team, which included seven of the same players from the Champions League final’s starting eleven two years prior: Marcel Schmelzer, Mats Hummels, Roman Weidenfeller, Marco Reus, Ilkay Gundogan, Neven Subotic and Kevin Großkreutz, as well as late substitute Nuri Sahin and manager Jurgen Klopp. The win over Freiburg puts Dortmund in 16th, which would mean a promotion/relegation playoff, but the fact that Dortmund is down in that area at all has left the German soccer world grasping for answers as to why.
The answers suggested do not make for a short list. Champions League striker Robert Lewandoski transferring to Bayern Munich. A visit by the injury bug. A change in tactics. A change in attitude. Klopp losing the locker room. But none of it makes enough sense to explain why Dortmund also won their Champions League group against Arsenal, RSC Anderlecht and Galatasaray, earning a date with Juventus in the round of 16, and most are still confident that Dortmund will at least come back enough to where they’ll remain in the Bundesliga.
Most. Not all. The wondering has begun in earnest. 20 of the 34 games on the schedule are in the books. It’s not a young season anymore. Money isn’t working. It’s still actual people that have to kick the ball into the net more often than the other guys, and for Dortmund, that simply isn’t happening.
In a smaller league, this might be cause for true concern. Take the case of South China, by a wide margin the most successful club in Hong Kong. South China owns 32 of the 69 league titles awarded; second-place Seiko, who dissolved in 1986, has 9. Following a few disappointing seasons, in the 2005-06 campaign, South China finished seventh out of eight teams. The last-place club, Hong Kong 08, was intended for 2008 Olympic preparation and thus exempted from relegation; they were founded in 2002, after Beijing was awarded the Olympics, and would dissolve in 2007 after Hong Kong’s elimination from the qualifiers. The relegation burden thus fell on South China. The last game of the season was on April 29. On June 15, though, the national federation announced that the league would expand from eight to ten teams, sparing everybody. Why did this happen? Because South China had begged their way out of it, promising to… wait for it… spend more money on the team next season. It’s also figured that, because they were so much more prominent than everybody else, seeing South China relegated would tank attendance figures across the league, which with an Olympic preparation team also in the league was not an attractive prospect. The league buckled, South China stayed, and proceeded to win the next four titles.
Of course, this is not Hong Kong. This is Germany. If Dortmund goes down, there are other clubs itching to take their place, and while their presence will be missed, the Bundesliga will roll merrily on without them if it comes to that.
Fans from outside the megaclubs kind of wish it would happen a little more often.