NFL Opposes GOP Tax Bill For Cutting Stadium Subsidies

NFL stadiums don't cause economic growth, tax subsidies are a waste of money

NFL Opposes Republican Tax Plan Because it Cuts their Stadium Construction Subsidies

The National Football League must relish alienating its fans.

Its mishandling of Colin Kaepernick’s “take a knee” protests is costing the League millions.  In fact, the NFL’s TV viewership is down 20 percent, and this could translate into up to $920 million in lost profits.

And as if that weren’t enough, the NFL has now come out against the Republican tax bill, Reuters reports. Why?

Because the GOP’s Tax Cuts and Jobs Act cuts the NFL’s access to tax-free bonds, which it uses to finance the construction of new NFL stadiums.  Basically, the League is upset that their tax breaks are disappearing.

Fair enough.

But the NFL should realize at this point, if it hasn’t already, that the American people are fed-up with their entitlement complex and moral sermonizing—people just want to watch football.  No one cares about the League itself.

This move can only serve to disenfranchise more fans.  After all, why should NFL teams have access to tax-free financing to build stadiums when this same opportunity is not available to small business owners?

NFL spokesman Joe Lockhart responded to this argument, saying:

You can look around the country and see the economic development that’s generated from some of these stadiums…

These sorts of infrastructure projects have a long history and the benefits of them are obvious in many of our communities around the country, so we will continue to make our opposition known on that.

However, Lockhart is wrong.

There have been many studies, including one from Stanford University, that show stadium construction projects do little to promote long-term economic growth.  That’s not to say that this is true of all stadium projects, but those few that do drive the economy are the exceptions that prove the rule.

The reasons for this are actually fairly straightforward.  First, it’s a classic example of the broken window’s fallacy, ie. money spent on stadiums came from somewhere else in the economy (whether in terms of taxes, or financing that could have gone elsewhere), and so the economic benefit is primarily re-distributive rather than generative.

Second, long run economic growth depends upon productivity improvements (whether caused by better technology, better infrastructure, better organization etc.).  Stadiums don’t directly improve productivity, and therefore rarely cause lasting economic growth—what growth happens is usually incidental.

Either way, the NFL’s actions are clearly self-destructive.

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