JLF’s John Hood writes today about the folly of subsidizing professional sports with tax dollars.
Subsidized sports is a racket, pure a simple. Team owners, broadcasters, and assorted lackeys bamboozle their marks with promises of broad economic benefits for the community at large. Big-time sports will “put our community on the map,” they say, thus attracting new employers and creating new jobs. They hire flimflam artists posing as scholars to claim that the team will have a “huge economic impact” without bothering to compare it to the lost economic impact of the tax dollars diverted from their original uses, such as shopping or eating out.
Careful policy analysts have been onto this scam for decades now. While economists continue to debate many challenging issues, not much controversy remains about government subsidies for sports teams. Most studies find that they aren’t worth the cost to taxpayers.
For example, economist Ian Hudson wrote a study for the Journal of Urban Affairsin 1999 that used a regional-growth model to evaluate the employment effects of communities gaining or losing professional sports teams. He didn’t find any. In an earlier issue of the same journal, economist Robert Baade concluded that subsidizing sports was not a wise public investment. “The primary beneficiaries of subsidies are the owners and players, not the taxpaying public,” he wrote.
And yet, the folly continues.