Sports franchise welfare

I have never seen why cities pay to build stadiums for sports teams. Or, rather, I've long been dubious that a new stadium -- particularly if it's for a team already playing in the city -- brings any additional income to a city. Bronx residents can certainly tell you that having the wealthiest professional sports franchise in the world in their midst has done absolutely nada for them except for making it the safest neighborhood in New York on game nights. Baseball teams play only 81 games a year on their home turf; football teams just eight I think. And after construction ends the only jobs are low wage stadium jobs. The teams make money, as does the companies with the vending and parking contracts, but not the city.

Turns out my suspicion is right.

ACCORDING TO Siegfried, there's a remarkable agreement on these points. In economics, he says, ''with most empirical issues there's lots of debate. Does the minimum wage cause unemployment? There's lots of debate about that issue. Here there's no debate." Even the consulting firm ERA put out an issue paper, back in 1995, cautioning against ''overblown claims of the economic value of major league sports teams" and concluding that, ''Compared with more traditional public investments of scarce economic development dollars. . .sports facilities are a rather poor investment." [sic]

But if public subsidies for sports teams are such an incontrovertibly bad idea, why is a city like Washington, D.C., still willing to pay $611 million for a sports stadium? Sports economists point, with varying degrees of frustration, to a combination of politics and unfortunate economic realities.

Major league sports, they argue, are essentially monopolies: They can ensure that the number of teams always stays below the number of cities that can support one. In economic terms, this creates a scarcity of supply and thereby drives up the ''price"-in subsidies, favorable land terms, or stadium lease deals-that a team can demand. Chicago built the White Sox a new stadium to keep them from moving to St. Petersburg, Fla., in the late '80s, for example. More recently, Nashville had to agree to build a new stadium to lure the former Houston Oilers to town.

Politicians, who like the publicity that comes from being associated with a major league sports team, see sports subsidies as a particularly glamorous use of public money-and are particularly vulnerable to the allure of gaining a team or the pain of losing one. As a business sector, major league sports is fairly small, and yet, points out Clemson economics professor Raymond Sauer, ''It's the only sector with its own section in every major newspaper in the country. It's an attention getter, so it's very natural for political people to align themselves with sports projects."

Washington DC, with all of its problems, got well snookered when it agreed to pay $611 million. And they should sue Major League Baseball for having failed to find a buyer for the team, one, you know, that has an incentive for the team to be a winner. An incentive that the current owners -- the owners of the other teams -- certainly do not have.

Furthermore, it looks like Nationals' games may not be the place to be seen these days.