I Demand An Explanation

In light of what appears to be yet another successful extortion of taxpayers to get a new ballpark in Florida, Rob Neyer ponders the question of why these irrational deals continue to be made:

There has been a great deal written about the lousy economics related to stadium-building; it’s almost always a losing proposition for the local citizenry according a simple cost-benefit analysis. Again and again and again, this is true. What I’ve never seen, though, is a study of why this happens, again and again and again. Is it because the ballpark proponents contribute money to — i.e., bribe — the local politicians? Is it because the politicians are driven to make their mark on things, and building a huge concrete playground for millionaires is one of the biggest marks one can make? Is it because the voters really do want to spend their tax dollars on those huge playgrounds?

I just don’t know. We’ve got the numbers. We’ve had them for a long time. Yet despite the numbers, the playgrounds just keep getting built, one after another after another. So, now I’d like to see some of the psychology.

I think these are the major potential explanations. Evidently, legislatures are theys-not-its, so different public officials have different motives; presumably some sincerely support inefficient public subsidies for billionaires, some have been bought off, some a combination, etc. On a more general level, stadium gifts represent the classic condition of special interest capture: concentrated benefits with diffuse costs (and evidently this is especially true of cases like this where much of the direct costs falls on non-residents.)

In addition to all this, it doesn’t help that the local media tends to be incredibly servile about self-serving claims that sports team owners are running some kind of public trust. There’s no owner argument so dumb — “artificially limiting player salaries protects the fans!” “The Dodgers are losing money hand over fist!” “Stadium construction will have the incredible urban renewal effects in your city that it brought to the South Bronx, Willet’s Point, and downtown Detroit!” — that many sportswriters won’t give it a respectful hearing. (Similarly, moralists who write about college athletics tend to reserve their moralistic outrage not for a grossly exploitative system where athletes are not permitted fair compensation for profits they produce for the university but for cases where an athlete gets a pair of shoes or something in exchange for his labor.)