Government Picks Winners and Losers in Entertainment

No, the above title isn’t a scenario from a dystopian science fiction work, but somethig that is now happening in cities all across America. What U.S. city dweller hasn’t heard recently the argument that expensive, taxpayer-funded facilities for professional sports teams will provide an economic boost to the city that ponies up?

Thankfully, not everyone is buying that bill of goods. In today’s Washington Examiner, concerned Washingtonian Jeffrey Lubbers, in reaction to the D.C.’s proposed $50 million proposal to upgrade the Verizon Center to the benefit of Washington Wizards owner Abe Pollin, asks that, “Before the District of Columbia Council signs off on another corporate giveaway for a professional sports facility, its members should demand clear answers regarding the promised economic benefits for the city.” He’s right to ask for such a time-out.

If the Council strives for an honest answer, its members are likely to find that the benefits just aren’t there. That’s because professional sports teams aren’t competing with comparable franchises in other cities, but with movie theaters, restaurants, outdoor activities — in short, with other forms of entertainment. As Doug Bandow, now a CEI adjunct scholar, has noted, “[S]ports spending is primarily substitutional. Stanford University economist Roger Noll figured that only 5 percent to 10 percent of those attending games live elsewhere. Local fans divert their outlays from other leisure activities and other areas within the region.”

Cartoonist Pete Bagge recently proposed a fitting name for this game: