Jan 31st, 2013 by 'holic
As the remaining hours of this transfer window come to a frantic close it is time for the follow-up piece from Bergkamp the Man. More Orwellian than I have heard him before, and a more interesting read because of that. If his Part 1 on Monday evening is anything to go by, I know we can expect a lively response in the drinks. Thanks BtM.
As Adam Smith’s wooly bugger landed softly on the silken surface of the Calsay Burn in pursuit of trout, he felt an immediate flash of silver and a simultaneous tug of gray.
The gray matter comprising his small-planet-sized brain, just couldn’t let Deloitte’s Football League data rest. “How could it be that two teams (Citeh and Chel$ki), that had earned less silver than their peers, were more successful in winning trophies?” he pondered. Something was most definitely amiss. This phenomenon was completely out of kilter with ALL of the economic fundamentals he’d laid out clearly and simply in “The Wealth of Nations”. Something or somebody was corrupting the sensitive balance of the economic universe. Who or what could that wooly bugger be?
Smith laid down his rod and sauntered back to the Boar’s Head saloon. His neurons began to spark as he commenced a deep delve. The Deloitte’s top line revenue numbers were condemning in themselves. Citeh only realized 163M, (over 200M less than their Mancunian neighbours). But much worse, when Smith delved all the way down to their bottom line, (Deloitte’s revenue number less all of Citeh’s costs), he found a dirty great big negative turd of a number! A stinkin’, bealin’, steamin’, coo turd. A 480M euro loss on one single year of trading. “That is definitely not sustainable. That enterprise is going to go the way of auld Angus Macdougall’s porridge oats factory – right doon the gurgler and straight into the River Swanny.”
His delve into Chel$ki’s numbers revealed very similar peculiarities. He laughed out loud over one of the comments he read when, after Chel$ki had stated that their 600M euro debt had been restructured to zero overnight, his fellow economist Arsene Wenger, had retorted “Ah, now we live in times of economic miracles, of-course.” Thought Smith “Something damned fishy is going on here that makes nae sense whitsoever and has nothing tae dae wi’ guid economics”
And he was absolutely right. It is stated quite clearly in The Wealth of Nations (honest, it is), that football success is driven purely and simply by economic strength. That strength transcends, by the length of a Poldi pile-driver, the quality of the product on the playing field in terms of importance to trophy success. Economic strength enables the fittest financially to:
1. Attract the best players in the world. And then,
2. Retain these self same best players in the world. The game is, quite frankly, as simple as that. Just ask The Famous Red Grouse, Auld Purple Nose of Dunfermline Toon fame. HE read The Wealth of Nations as a laddie and has sworn by it since. All you need is the money and that comes from i) Matchday ii) Broadcasting iii) Commercial (Sponsorships).
“But it still doesn’t add up!” Cursed Smith. “Neither Citeh nor Chel$ki are fittest financially. In fact, having lost 480M, Citeh are the weakest in the entire league, but still they won it. Whit is the root cause of this economic hokey-pokey, be damned? Neither of these two teams is playing according to the same economic standards as a’ the rest. Wha’s the financial fiddler and wha’s callin’ his tunes”
The root of Citeh’s hokey-pokey lies deep in the earth of a massive lake of hydrocarbons formed over millennia by the death of more dinosaurs than you can count; Chel$ki’s – in grand larceny, Russian style. Quite simply, these two clubs compete on a completely different basis than nearly every other in the Premier League. Both are a million miles away from the sound financial foundations under-pinning Arsenal’s long-term sustainability. They are subject to the whims of a Russian Oligarch and an Abu Dhabi oil sheik whose money would be better served addressing some of the woes of the people in his home state.
That’s fine fuss and bother, but it’s a temporary thing, right? It’ll pass? These sugar daddies will lose interest and sail off into the sunset on their yachts to Indonesia? Normal service will be resumed and all Arsenal has to do in the meantime is “Spend some flipping money” and all will be good again. Like us fans have been saying all along.
Let’s get real. This is no temporary event. This is no glimpse of a gray ghost of Adam Smith flashing transiently over the quicksilver in a mirror. This, most certainly, in Citeh’s case anyway, is for the very long term. That’s what Arab culture does. That’s what it’s about – long term relationships and commitments. If they wish to do so, Manchester City, with the unlimited resources at their disposal, can become over time, the leading global brand, the predominant force in world football. Noel Gallagher – sing your heart out, morning glory.
And you know what the funny thing is? Eventually, that machine will become less reliant on the Milk Shake of Abu Dhabi’s oil dollars. The game is becoming the globe’s leading sport. The population of the planet continues to explode to provide more young brains to be manipulated and painted light blue. Citeh, in the very long term, may even become a self-sustaining business that can qualify for the CL finals, with one magnificent manager for 15 seasons in a row, emulating the feats of the single team on the planet EVER to achieve this feat.
Realistically, can Arsenal compete with Citeh? Not really. Not on this basis. Over the long term, if this economic imbalance continues (and FFP will NOT cause the playing field to level, I promise you that), Citeh will prevail, prosper and become kings of the football universe. They will attract a more able manager (imagine the consequences of Arsene Wenger being there now!) and, eventually, the global superstars will be attracted there and will be retained there (as it is written in “The Wealth”).
Is Arsenal “Doooooomed” then, as so many proclaim? Most definitely Arsenal is not. The future is there for the grasping – but the club is certainly more challenged now than previously. The BPL has fragmented into three bands:
1. Those prepared to buy trophies as baubles for their trees – Citeh, Chel$ki.
2. Those who can compete on a self-sustaining basis, Arsenal and Manure.
3. The rest (with cameos of the characteristics of the two groups above from the likes of Liverpool, Villa, Spuds)
Manure are showing Arsenal’s business bods how to build the yellow brick road toward success in Oz. But sadly, ours are no wizards. This is absolutely about being better in the commercial game to provide REAL wherewithal to “spend some flipping money.” Astute business brains, a growing global market, and the developing world, hold a key that is even more golden than Jack Wilshere’s left foot. Quite simply, unless that key is forged and turned to open the door to future wealth, Super Jack will NOT be playing at Arsenal in five years time – he’ll be earning Van Persie money at Middle Eastlands.
Commercial, Broadcasting and Matchday are the three revenue avenues. Arsenal is now competitive on Matchday income, but the likelihood of improving there is slim (reference the call for lower ticket prices). A doubling, at least, of Arsenal’s sponsorship income is a must.
GAME ON, Ivan Gazidis. Give me a call if you need some help, Oh yes, and take a quick flip through the days of Fife Enlightenment via Adam Smith and The Wealth of Nations. It’s a magnificent read and I’m nearly at the end of chapter one………….zzzzzzzzzzzzz.
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