UEFA – “Who are you?”

The recent announcements from UEFA placing restrictions on the amount that clubs can spend (with books to be balanced over a rolling three year period) are the latest in a worrying trend of interference – the introduction of red tape has come to be the hallmark of the Platini presidency. 

The question is not whether cutting the debt of football clubs in general is a good idea, it clearly is. With an ever increasing number of clubs in ‘financial peril’ (20 percent by UEFA’s calculations) some kind of mandate stipulating the security of clubs finances may sound like an obvious response.

But look more deeply and the situation is not so simple. There is no reason why an individual of great wealth should not take over a club and spend his or her money in the way he sees fit. Indeed, such a takeover will often rescue a club from debt. Football is a competitive business – that is its attraction. As such, risks need to be taken and, since the beginning of professional football, rich people or local businessmen have kept clubs going, risking their own money for a variety of motives. If a club were to invest a lot of money in good, young players that would not produce a return for several years, they would fall foul of the new rules, in spite of their sensible (if risky) business plan. Who had heard of Cristiano Ronaldo when he went to Manchester United in 2003 for 12.24M? To say that this long-sighted outlook put Manchester United in ‘financial peril’ is evidently false.

I have never encountered a chairman whose intention is to run a club into the ground. It shatters reputations, breaks the fans hearts, and most importantly loses money. It is frankly ridiculous to suggest that now that Gianni Infantino has said that it’s probably not a good idea to be in debt, that the chairmen of the league will change their behaviour in the slightest.

Clubs go bankrupt because they invest in bad players, because their manager isn’t good enough, or because fans are unwilling to support the team. This is part and parcel of the game and leads to turnover of clubs at every level of the sport. What is being suggested will lead to those clubs that are currently of large non-performance related means (those with the largest commercial rights deals and so on) sitting at the top permanently with no thrusting, risk taking clubs being able to push them off the perch. It sounds very much like comfortable European corporatism applied to one business that should be fiercely competitive.

There doesn’t appear to be any governmental involvement. Surely the clubs are completely free to leave UEFA, and then financially run themselves into the ground. On the other hand, UEFA as a private institution is completely free to stipulate rules of membership. Liberty is not at stake here. Good article though. UEFA is essentially a trade union.

IEA BlogIEA home page:- about- news- in the press- events- IEA publications- IEA journal- donate / join- merchandise- press releases- bookshop- receive our newsletter- linksDecember 2010November 2010October 2010September 2010August 2010July 2010June 2010May 2010April 2010March 2010February 2010January 2010December 2009November 2009October 2009September 2009August 2009July 2009June 2009May 2009April 2009March 2009February 2009January 2009December 2008November 2008October 2008September 2008CultureDefenceDevelopmentEconomic historyEconomic theoryeducationEnvironment and transportEuropean UnionFinancial regulationFiscal policyHealthIEALabour marketsLaw and economicsLinksMonetary policyMorality and marketsPolicingPolitical economyregulationUncategorizedUnemploymentWelfarePortugal to be first to defaultVince Cable – not bad, but no Nick Ridley!UEFAFootballfootballJ. J. BellUEFAUncategorizedRSS 2.0June 2nd, 2010 at 12:30 pmJune 2nd, 2010 at 3:43 pmThanks for the comment, Adam.If I remember correctly, the IEA is not just anti-government, but also pro free-market. While often these allegiances align, in this case they do not, but that does not make this post unworthy.I would argue that the pervasiveness of UEFA in football makes it a de facto governing body, and as an ideological libertarian, I find this new rule unsettling.PhilipJune 2nd, 2010 at 4:10 pmJune 2nd, 2010 at 4:35 pmJune 2nd, 2010 at 5:15 pmhttp://www.timesonline.co.uk/tol/comment/letters/article7139307.eceJune 2nd, 2010 at 10:15 pmRSSiea@iea.org.uksite by politicos design: campaigning online with political & mp websites

IEA BlogIEA home page:- about- news- in the press- events- IEA publications- IEA journal- donate / join- merchandise- press releases- bookshop- receive our newsletter- linksDecember 2010November 2010October 2010September 2010August 2010July 2010June 2010May 2010April 2010March 2010February 2010January 2010December 2009November 2009October 2009September 2009August 2009July 2009June 2009May 2009April 2009March 2009February 2009January 2009December 2008November 2008October 2008September 2008CultureDefenceDevelopmentEconomic historyEconomic theoryeducationEnvironment and transportEuropean UnionFinancial regulationFiscal policyHealthIEALabour marketsLaw and economicsLinksMonetary policyMorality and marketsPolicingPolitical economyregulationUncategorizedUnemploymentWelfarePortugal to be first to defaultVince Cable – not bad, but no Nick Ridley!UEFAFootballfootballJ. J. BellUEFAUncategorizedRSS 2.0June 2nd, 2010 at 12:30 pmJune 2nd, 2010 at 3:43 pmPhilipJune 2nd, 2010 at 4:10 pmGood points. We believe in private regulation so Adam is right in one sense – we do not oppose UEFA on principle. But it is still reasonable to ask, as free market economists, whether a particular set of private regulations might have unintended effects. Libertarians do have differing views on cartels too, it is worth adding (I take a fairly relaxed view as long as they are not covert).June 2nd, 2010 at 4:35 pmJune 2nd, 2010 at 5:15 pmhttp://www.timesonline.co.uk/tol/comment/letters/article7139307.eceJune 2nd, 2010 at 10:15 pmRSSiea@iea.org.uksite by politicos design: campaigning online with political & mp websites

IEA BlogIEA home page:- about- news- in the press- events- IEA publications- IEA journal- donate / join- merchandise- press releases- bookshop- receive our newsletter- linksDecember 2010November 2010October 2010September 2010August 2010July 2010June 2010May 2010April 2010March 2010February 2010January 2010December 2009November 2009October 2009September 2009August 2009July 2009June 2009May 2009April 2009March 2009February 2009January 2009December 2008November 2008October 2008September 2008CultureDefenceDevelopmentEconomic historyEconomic theoryeducationEnvironment and transportEuropean UnionFinancial regulationFiscal policyHealthIEALabour marketsLaw and economicsLinksMonetary policyMorality and marketsPolicingPolitical economyregulationUncategorizedUnemploymentWelfarePortugal to be first to defaultVince Cable – not bad, but no Nick Ridley!UEFAFootballfootballJ. J. BellUEFAUncategorizedRSS 2.0June 2nd, 2010 at 12:30 pmJune 2nd, 2010 at 3:43 pmPhilipJune 2nd, 2010 at 4:10 pmJune 2nd, 2010 at 4:35 pmInteresting angle John. You are essentially saying that the pervasiveness of European governments regulatory and managerialist thinking is permeating into the free-market and, thereby, ruining our football. This is a unsettling thesis as it implies that the free-market is unable to overcome the pervasive influence of government; therefore this almost seems to be a critique of how free humans naturally organise themselves.Liberty should be a primary principle of political organisation. UEFA IS free, therefore you seem to be calling for something more. This is the very pitfall that statist thinking falls into, and gives unpleasant echos of the socialist principles this article eschews.June 2nd, 2010 at 5:15 pmhttp://www.timesonline.co.uk/tol/comment/letters/article7139307.eceJune 2nd, 2010 at 10:15 pmRSSiea@iea.org.uksite by politicos design: campaigning online with political & mp websites

IEA BlogIEA home page:- about- news- in the press- events- IEA publications- IEA journal- donate / join- merchandise- press releases- bookshop- receive our newsletter- linksDecember 2010November 2010October 2010September 2010August 2010July 2010June 2010May 2010April 2010March 2010February 2010January 2010December 2009November 2009October 2009September 2009August 2009July 2009June 2009May 2009April 2009March 2009February 2009January 2009December 2008November 2008October 2008September 2008CultureDefenceDevelopmentEconomic historyEconomic theoryeducationEnvironment and transportEuropean UnionFinancial regulationFiscal policyHealthIEALabour marketsLaw and economicsLinksMonetary policyMorality and marketsPolicingPolitical economyregulationUncategorizedUnemploymentWelfarePortugal to be first to defaultVince Cable – not bad, but no Nick Ridley!UEFAFootballfootballJ. J. BellUEFAUncategorizedRSS 2.0June 2nd, 2010 at 12:30 pmJune 2nd, 2010 at 3:43 pmPhilipJune 2nd, 2010 at 4:10 pmJune 2nd, 2010 at 4:35 pmJune 2nd, 2010 at 5:15 pmI said something similar in a letter to the Times on Saturdayhttp://www.timesonline.co.uk/tol/comment/letters/article7139307.ecehttp://www.timesonline.co.uk/tol/comment/letters/article7139307.eceJune 2nd, 2010 at 10:15 pmRSSiea@iea.org.uksite by politicos design: campaigning online with political & mp websites

IEA BlogIEA home page:- about- news- in the press- events- IEA publications- IEA journal- donate / join- merchandise- press releases- bookshop- receive our newsletter- linksDecember 2010November 2010October 2010September 2010August 2010July 2010June 2010May 2010April 2010March 2010February 2010January 2010December 2009November 2009October 2009September 2009August 2009July 2009June 2009May 2009April 2009March 2009February 2009January 2009December 2008November 2008October 2008September 2008CultureDefenceDevelopmentEconomic historyEconomic theoryeducationEnvironment and transportEuropean UnionFinancial regulationFiscal policyHealthIEALabour marketsLaw and economicsLinksMonetary policyMorality and marketsPolicingPolitical economyregulationUncategorizedUnemploymentWelfarePortugal to be first to defaultVince Cable – not bad, but no Nick Ridley!UEFAFootballfootballJ. J. BellUEFAUncategorizedRSS 2.0June 2nd, 2010 at 12:30 pmJune 2nd, 2010 at 3:43 pmPhilipJune 2nd, 2010 at 4:10 pmJune 2nd, 2010 at 4:35 pmJune 2nd, 2010 at 5:15 pmhttp://www.timesonline.co.uk/tol/comment/letters/article7139307.eceJune 2nd, 2010 at 10:15 pmI understand the French government hasn’t managed to balance its budget for thirty years. (Of course, it may not even have been trying.) If M. Platini has any advice to spare, maybe he could try to persuade his own country’s government to adopt a ‘three year balancing the budget’ approach. The current French policy appears to be leading the eurozone to disaster.RSSiea@iea.org.uksite by politicos design: campaigning online with political & mp websites

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