mykeystrokes.com

"Do or Do not. There is no try."

“Getting The Sports Moguls Off Our Backs”: The Subsidy-Bloated Profits Generally End Up In The Pockets Of The Owners

It was not out of a sense of decency that the National Football League recently let go of its tax-exempt status. You see, as a tax-exempt organization, the NFL had to disclose Commissioner Roger Goodell’s compensation — $44.2 million in 2012. That seemed an excessive sum for the head of a “nonprofit” freed from having to pay any federal income tax. Now the NFL can keep it secret.

Tax exemption is a subsidy. The taxes the NFL money machine didn’t have to pay, everyone else had to pay. Thanks go to former Sen. Tom Coburn (R-OK), Rep. Jason Chaffetz (R-UT), and Rep. Elijah Cummings (D-MD), for railing against such unsightly deals.

But that’s not the only good news for citizens tired of being milked by billionaire sports moguls. Consider Verizon’s decision to let customers buy TV packages that do not include ESPN or other sports channels.

An explanation: Animal Planet and Food Network are not why TV bills are so ludicrously high. What drive them up are the enormous fees the sports channels extract for their programming.

ESPN alone tacks an estimated $7 on monthly bills. By comparison, USA Network adds less than $1.

An interesting calculation: If every month you put $7 into an investment with an annual return of 4 percent, you’d have $1,027 after 10 years. These things add up.

It was not charity that prompted Verizon to let its customers buy a smaller base package of channels, plus extra bundles containing the channels they actually watch, at lower cost. Every month, thousands of Americans — incensed by their monthly TV bills and now able to get most of what they watch from the Internet — have been “cutting the cord,” that is, dropping their cable, satellite, or fiber-optic TV service altogether.

Anyhow, ESPN has dragged Verizon Communications into court. The sports network, the Disney empire’s most lucrative business, claims that Verizon broke a contract requiring that ESPN channels be part of its basic offerings. Verizon says that any of its customers can obtain ESPN through a bonus bundle at no additional cost and that therefore it is included.

Never did I think I’d say this, but I am rooting for my pay-TV provider.

On to another reason to cheer. President Obama’s proposed budget would ban the financing of professional sports stadiums with tax-exempt bonds. Such bonds lower borrowing costs for the zillionaire team owners. Currently, 22 NFL teams play in stadiums financed by tax-exempt bonds, as do 64 professional baseball, basketball and hockey teams.

Why would tax-exempt bonds — created to help cities, towns, and states pay for needed infrastructure — go to benefit mega-businesses? Because the team owners have succeeded in conning locals to see sports arenas as economic magnets pumping money into their weary tax bases.

Lots of studies contradict this self-serving propaganda. First off, the economic activity generated by the teams often pales next to the concessions wrenched from the taxpayers. Secondly, many of the dollars spent at the games are dollars that would have otherwise been left at local businesses, such as restaurants.

Furthermore, the subsidy-bloated profits generally end up in the pockets of the owners and their magnificently paid players — who promptly take them out of town. With all due respect to Cleveland, one doubts that LeBron James spends many of his millions there.

Ending tax-exempt bonds for sports arenas might reduce our elected officials’ temptation to sacrifice their taxpayers in return for good tickets to the game. That would be the best outcome.

They who love professional sports should pay for them.

 

By: Froma Harrop, The National Memo, May 7, 2015

May 16, 2015 - Posted by | Corporate Welfare, National Football League, Nonprofit Organizations | , , , , ,

1 Comment »

  1. Removing the tax exempt status is so past due. I, and millions like me, don’t give a tinkers damn about sports or major sports teams. It’s not only the bloated owners, but the prima-donna, spoiled brat players who somehow believe they are owed special treatment, and they are above the rules. Maybe ending taxpayer supported arenas, owners and players will bring a bit more reality into the games.

    And for the record, I cut my cable connection years ago because of the outrageous sports fees for things I never watched. I cut the cable, and have never looked back.

    Like

    Comment by Barneysday | May 16, 2015 | Reply


Share your comment

Please log in using one of these methods to post your comment:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: