Somehow while living in New York I failed to notice that the city government had decided to give the Yankees $220 million dollars towards the building of their $1.3 billion new stadium. I am a Yankees fan of long duration. But if the Yankees want a $1.3 billion stadium, they should pay for it themselves.
Apparently, the best seats will now cost $2,500 a pop. I'm feeling more affection for the Nationals by the minute.
My libertarian instincts tell me that you are correct.
However, I would be remiss if I did not offer a personal anecdote to the contrary: this is the last year the Yankees will play at the House That Ruth Built--and I've never been there. So I'm going this summer. That's a trip I wouldn't have made without the new stadium.
I'll stay in a hotel, and NYC will take their usual 13.5% cut. I'll drink plenty of beer and I'll see a show or two and listen to some jazz and eat pizza by the slice in the middle of the night, and NYC will get a sliver of all of that.
No, it won't add up to $220B, but if you believe that the right way to decide on issues like this is via cost-benefit analysis, don't forget to add in these benefits.
As a libertarian, of course, I don't believe that cost-benefit analysis is the right way to decide on these issues. But most people disagree with me.
Ummm... $220M, not $220B.
Check out the subsidies for the new Nationals stadium. You will be unhappy.
It's impossible to make a general rule with this sort of thing, Rich, but there's lots of evidence that new sports stadia don't translate into the large economic benefits that team owners and league administrations tend to claim. Also, this isn't the sort of situation where ownership can threaten to move, or claim desperation. The Yankees aren't going anywhere, and they certainly wouldn't go bankrupt without a new stadium.
Houston recently built a bunch of new stadiums, including a new football stadium literally in the parking lot of the old stadium. The city helped pay for all of them in various ways, from tax relief to helping arrange land deals, etc... generally claiming that "no taxpayer money was being spent". I guess they assume that taxpayers don't understand opportunity costs.
I hate the fact that I am forced to pay for various sports arenas. I was quite content to see the Oilers move when they didn't get their new stadium. I was quite pissed when we then bent over backwards to get a new franchise to replace them. We should have just given the Oilers their damn stadium.
Now the basketball arena that I grew up going to is a megachurch and we have a basketball arena and baseball arena in the downtown area (it obviously wasn't crowded enough) along with an expensive light rail system that serves the various stadiums and convention center (but not really a lot of commuters, except those who already only had a 15 minute drive to downtown).
And we're trying to get the Superbowl again (and probably the Olympics). Each time, they spend a bunch of money just on the attempt. Then we get a bunch of visitors who block up the roads.
I suspect that it would not tack much effort to find wiser ways to invest city money than sporting arenas and sporting events.
Well, the Nationals have a new publicly financed stadium opening this year. I believe the amount of public funds granted is even larger than that Yankees and it is taking money from a community much less able to pay.
The new Nationals Park, opening this Sunday, is entirely publicly funded. D.C. agreed to build it and pay for it to entice the Montreal Expos to move their team. It will eventually cost the city a total of $611 million.
What's really ridiculous is that public money is going to the Yankees. Although I'm still against it, I'm certainly more amenable to the idea of public funds being used to entice a new team to come to a city or to prevent a team from leaving than to pay anything to the frickin' Yankees.
$220 million? That's their payroll for a single year. There's zero need to use public money. That's hardly even an enticement to the Yankees.
Earnest Iconoclast:
Makes you yearn for the days of Earl Campbell, doesn't it? ;-)
P.S. Luv Ya Blue!!!!
The new Nationals Park, opening this Sunday, is entirely publicly funded. D.C. agreed to build it and pay for it to entice the Montreal Expos to move their team. It will eventually cost the city a total of $611 million.
Actually more. As of early 2006, it had increased to 667 million.
Now, the Post shows it at 770 million, including the final costs of eminent domain grabs.
Seriously, the money given to the Yankees seems pretty paltry by comparison.
decided to give the Yankees $220 million dollars towards the building of their $1.3 billion new stadium.
This is incorrect. The $220 million is NOT being given to the Yankees or going for the new stadium - it is going for infrastructure improvements. Roads, new parks, waterfront, etc. All public, not private.
Now, I'm sure Megan will counter that the infrastructure improvements aren't necessary without the stadium. Perhaps true (and perhaps not). But I don't find that argument very compelling - the fact is that the benefits of the public money go directly to the public.
As a long time Yankees-hater (and Mets fan) I would love to begrudge the Yankees a new stadium, but to be fair it's not just money to subsidize a stadium, but an attempt to revitalize a community that sorely needs it.
Much like Camden has done for the Baltimore waterfront, there is good reason to believe that a new Yankees stadiums, with better transportation, more restaurants and amenities could totally wake up an area of the Bronx that is not so hot these days. This, in turn, could definitely drive up property value in the area, as well as the tax base. Sure, in the short term it might not be profitable, but in the long term it was beneficial (particularly since there was a time that the Steinbrenners were clamoring about moving the new stadium to Jersey, which would have been just fine by me).
Anyway, much like any support for public infrastructure or support of a private enterprise I would think long-term cost-benefit analysis is order. I mean how is this any different than corporate tax breaks to bring in businesses? I mean it really only turns on a false positive-negative distinction, but in the end even tax cuts are a form of investment.
So many broken window fallacy arguments here. Ugh.
Gotta love the hard work and research that goes into preparing this blog. What next, a piece commending Kristol on his fact checking?
Jonathan, allow me to reply to you and everyone else who ever has or will use the stimulus argument when it comes to publically financed stadia.
READ
ZIMBALIST
Actually, Megan, if you ever plan on discussing this again please stick it in the post. He's more or less the be all and end all of this branch of sports economics
The Yankees are one of the rare sports teams that paid to build their own stadium. One of the drawbacks of having the most reliable local base is that you can't credibly threaten to move the team if you don't get a free stadium. I think Steinbrenner will live with that.
Wait a minute...
You read Spanish? (TFA esta en Español.)
If you followed the second link in that blog post, you would see that the 220M in public financing is for "parking facilities ($75 million), parkland along the waterfront ($135 million) and other work related to the stadium." Not the stadium itself. And the Yankees are apparently kicking in 1.1B of their own money, almost 4/5ths of the total planned cost. Unstated is exactly where that money is coming from (a loan from the city or state, maybe?), but at least on the surface it appears the Yankees are paying for most of the work themselves. That would be quite a change from the usual practice, where the sports team demands that the community pay for everything and give the team owners part (or all) of the revenue directly generated by the new stadium.
Rich: The House that Ruth Built disappeared in the 70s when the stadium was renovated. Renovated so radically that it barely resembles the previous stadium.
That renovation was supposed to bring a revival to that section of the Bronx. That section of the Bronx is still waiting last I heard. The new stadium is supposed to revive that section of the Bronx. Lets hope this time around it actually happens.
Why if this is such a fabulous idea does the government have to subsidize it?