Indulge us, readers from places other than the US. If, at first, it appears we are focusing on a rather narrow topic, let us assure you that it addresses global economic theory and political ideology, as well as sports. And, this could happen to you.
American football is the country's favorite sport. It is fast, violent and made for TV. It generates approximately $9 billion a year and during its six month long season consistently delivers higher TV ratings than any other type of programming. It is also an omnipresent attention-getter on radio and through various fan-centric initiatives, is a growing force on the internet.
This season has been marred, a majority of fans and commentators believe, by the presence of replacement referees drawn from the ranks of various amateur or school leagues. The reason is that the 32 NFL owners are insisting, as a matter more of principle than economics, that the refs take a cut in pay and pension benefits consistent with the income reductions being administered to workers all across the US. The referees, who are unionized, balked (and, in truth, could probably have been a bit more reasonable in their counter-demands) and so were, in classic labor parlance, locked out.
The problem is that fans, who have endured wildly expensive ticket price increases, pay-for-tv viewing demands, seat license payments to even have access to buying tickets in new stadiums and a host of other indignities could always depend on what they have been led to believe is the integrity of the game. The replacement refs have been slow and mistake-prone, but not disastrous. Until a few nights ago, when a blown call changed the outcome of a game.
Of the NFL owners, 18 are billionaires. A few owners inherited their team ownership from their families, but the majority of the owners made their money in oil and gas, autos, real estate and pharmaceuticals. They also include a founder of Microsoft, a founder of Home Depot and Malcolm Glazer, also the owner of Manchester United (be afraid, you English fans, be very afraid).
Fan and media attitudes initially blamed both sides for being intransigent. But as the lock-out has worn on, it has become apparent that a core of owners are driven by an ideological opposition to collective bargaining with anyone. Their moralistic pronouncements about 'the principle' of this dispute, particularly as some have cited conservative Ayn Rand, has begun to turn public support towards the refs. The internet is filled with calls for a fan boycott of game attendance and TV watching. The sense is that the owners will not be swayed by calls for compromise and reasonableness since they are defending what they believe to be a Rand-ian principle. But, it is believed, they will pay attention to a decline in revenues.
The following article is more of a rant than a dispassionate analysis of the issues at stake, but it does illustrate how commitment to philosophical or ideological principles can distract even rational business people from attaining pragmatic solutions to relatively straightforward problems.
Paul Campos comments in Salon:
If you want to know whom to blame for the surreal officiating fiasco that robbed Paul Ryan’s favorite football team of a win, the answer is Paul Ryan’s favorite political thinker.
As improbable as it sounds, Ayn Rand’s lunatic brand of Marxism turned on its head is to a significant extent responsible for Lingerie Football League castoffs refereeing America’s most popular and profitable sport (with predictably catastrophic consequences). To understand why, it’s first necessary to understand what sort of numbers we’re talking about here. NFL owners chose to lock out the sport’s referees because they’re trying to squeeze an extra $4,000 in revenues per game out of their cozy little $9 billion per year cartel arrangement. Now, to a normal human being $4,000 is real money, but NFL owners are not normal human beings.
They are people like William Clay Ford, who has made two masterful investments in his life, the second of which was to buy the Detroit Lions in 1963 for $4.5 million. The Lions — one of the NFL’s least valuable franchises — are estimated to be worth $855 million today. (Ford’s first key investment decision was to be born the grandson of Henry Ford.)
Ford is one of 18 billionaire NFL owners. It’s hard to grasp what that means, but put it this way: If a billionaire lost $4,000 in his couch cushions, it wouldn’t be worth it to him to dig around for the money. To a billionaire, $4,000 is, in economic terms, literally nothing. It’s a rounding error on the balance sheet of one of the many people he pays to keep track of such details. It adds no “marginal utility,” as economists say, to his already grotesque plentitude.
But $4,000 per game adds up, you say. A penny saved is a penny earned. Waste not, want not. Wrong. To a billionaire, $62,000 per year (which is what Ford and his ilk stand to lose if they get no concessions at all from the employees they’re locking out) is again literally nothing. It’s like a quarter to an ordinary person. Would you stop to pick up a quarter lying on the sidewalk? Probably not if you were in a hurry. That’s how William Clay Ford feels about a $62,000 bill.
The thing is, this fight isn’t really about $62,000 per year. Lots of people are denouncing the owners for being “greedy,” but we football fans would be far better off if the owners’ current behavior were being motivated primarily by greed.
First of all, if this fight were actually about the money, it would have ended long ago. Continuing the lockout is sheer idiocy from a dollars-and-cents perspective, as the owners are doing serious damage to the quality of their immensely valuable investments because of a fight over what is, for them, not even pocket change.
Second, greed has limits. “Principle,” however, does not – which brings us back to the true villain of this debacle, crazy old Ayn Rand. The guiding principle of Rand’s thought has been summed up well by Jonathan Chait:
She believed that the principle of trade governed all human relationships — that in a free market one earned money only by creating value for others. Hence, one’s value to society could be measured by his income. History largely consisted of “looters and moochers” stealing from society’s productive elements. In essence, Rand advocated an inverted Marxism. In the Marxist analysis, workers produce all value, and capitalists merely leech off their labor. Rand posited the opposite.
This, of course, is the wacky idea that has spread like an ideological infection through American political life, and that is embraced most fervently by the super-rich Lords of Capital who own baubles like NFL franchises and the contemporary Republican Party.
Ungrateful “moochers” like NFL referees – mere laborers who, unlike the captains of industry who deign to pay their wages, have failed to climb to the top of our ruthlessly meritocratic social pyramid — need to be shown their place. Although locking the refs out and replacing them with utterly incompetent substitutes is a nonsensical decision from an economic perspective, there’s a higher principle to be vindicated here, which is that the Heroic Businessman is responsible for everything good about America, and the lesser orders had better not forget it.
That, at the deepest ideological and psychological level, is why the NFL owners are insisting on doing their best to wreck the sport, in much the same way that their political lapdogs, like the Rand-worshiping Ryan, are dedicated to wrecking the nation.
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