X Close

Thomas Piketty and the decline of football Inequality is corroding the once-democratic game

Fans are losing in the superclub era. Christof Koepsel/Getty Images

Fans are losing in the superclub era. Christof Koepsel/Getty Images


April 18, 2024   6 mins

On Sunday, Bayer Leverkusen beat Werder Bremen 5-0 and, by so doing, wrapped up their first ever Bundesliga title. Five times before they had been runners-up — four times in the six seasons from 1996-97 when they drew the nickname Neverkusen — but under Xabi Alonso they have been by far the best team in Germany this season.

This is, however, more than a story about a triumphant underdog. It raises the question: why is such a victory not more common? How has football, the great universal phenomenon, become a sport in which only a tiny handful of clubs can win? It’s not just in Germany, where Bayern Munich had won the previous 11 league titles. Juventus won their ninth in a row in Italy in 2019-20. Paris Saint-German have won nine of the last 11 French titles and will surely make it 10 in 12 this season. In Spain, Real Madrid are likely this season to make it 19 of the last 21 league titles for them and Barcelona. Even in England, defeats for Liverpool and Arsenal on Sunday make Manchester City favourites to claim a sixth league title in seven years.

In any competition there is the obvious problem that the more successful a team is, the more prize money it will accrue, and the more interest it will generate, drawing increased revenues from gate receipts, broadcasting deals, sponsorship and merchandise. The more money a club has, the better players it can sign and so the more likely it is to win, which in turn generates more revenue, creating an unhelpful cycle in which the rich increasingly dominate.

When the first professional football league was established in England in 1888, that danger was understood and measures taken to combat it. It was a very different world, in which gate receipts represented almost all a club’s income. Initially, to offset the advantage of popular clubs with large stadiums, home sides paid away sides £10. From 1919, this became 20% of gate receipts. Meanwhile, to reduce the bargaining power of labour and with it the advantage of the richer clubs who could afford higher wages, the system of hire-and-retain was established by which clubs held the players’ licences: it meant that even when a player’s contract had expired, he could not move to a new club until a deal was agreed to transfer his licence. Having reduced the mobility of players, the League in 1901 instituted a maximum wage of £10 a week.

As crowds declined through the Seventies, the financial struggles of league football led, in the Thatcherite economic climate, to the abolition of the levy paid by home clubs to their opponents in 1981. But its influence can still be felt today. Unlike in Europe, which never adopted the levy, English football for a long time didn’t develop a superclub model, and even now, the most successful club in English history, Manchester United, have won only 16% of all English league titles, while Juventus have won 30% in Italy, Madrid 38% in Spain and Bayern 53% in Germany. But there have also been changes from 1981 onwards: Liverpool, the most successful side up until that point, had won 14% of all league titles; since then, Manchester United have won 32%. In fact, five sides — United, Liverpool, Manchester City, Chelsea and Arsenal — have between them claimed all but five titles since.

Meanwhile, the advent of the Champions League in 1992 has radically increased the income available from European football — not just in terms of matchday revenue, but commercial deals and broadcast revenues too. The European Cup was launched in 1955 as a knockout competition but, after Real Madrid had beaten Napoli in the first round in 1987-88, Silvio Berlusconi, at the time the owner of AC Milan, pointed out the absurdity, as he saw it, of having the champions of Spain and Italy, two huge markets, meeting in a direct eliminator so early in the competition. The outcome of his lobbying was a group stage and, gradually, an expansion so that, rather than just the champions, the competition now includes up to four sides from each country. After another rejig, two countries next season will have five. The result has been that the competition has become an increasingly closed shop: it’s 20 years since a side from outside Spain, England, Italy or Germany won; in the 20 years before that, nine different countries provided European champions.

In that, football follows the model outlined by Thomas Piketty in Capital in the Twenty-First Century: the rich getting richer from 1980 or so onwards as income is drawn increasingly to capital — that is, the results of past success. For Piketty, what is unusual is less that trend of increasing inequality than the fact it was reversed in the mid-part of the century, something he puts down to large capital shocks between the beginning of the First World War and the end of the Second, including the devastation of infrastructure during the wars, nationalisation, inflation and the high growth during the period of reconstruction and demographic transition, leading to higher bargaining power for organised labour.

Counter-intuitively, English football put in place its measures against inequality during the Belle Epoque, when capitalism seemed to lead inevitably to JP Morgan-style monopolies. Although football had effectively become a business from the moment professionalism was legalised in 1885, it was underpinned by a spirit of mutual support. But even if it wasn’t publicly acknowledged at the time, competition is good for the business of sport. Football is a curious enterprise from a financial point of view, in that while each club strives to be the most successful it can be, what is actually being sold is not their excellence, but a series of contests between clubs.

Some spectators perhaps enjoy watching an expensively assembled team of stars turning tricks to destroy an opponent that is little more than a patsy, in the manner of the Harlem Globetrotters, or the ancient clashes between lions and Christians. It is true that viewing figures went up for golf and athletics when Tiger Woods and Usain Bolt were in their prime, but there is a difference between witnessing a supreme athlete pushing the boundaries of human possibility when it seems the opponent is less other golfers or sprinters than nature itself; ball sports feel futile if the opponent is just other less expensively assembled humans who are obviously less good at the sport.

Certainly that is the conclusion drawn by the major American sports, all four of which — basketball, baseball, ice hockey and American football — operate effectively as a cartel in which measures such as the draft (in which the weakest side gets first pick of the next year’s talent) and salary caps help ensure the franchises are as evenly matched as possible. What sells, they have concluded, is competition. That was always the view of Richard Scudamore, CEO of the Premier League from 1999-2018, who pursued a policy by which the team finishing first in the Premier League would receive a maximum of 1.8 times more in broadcasting revenue than the team finishing 20th. In Spain that ratio at one point reached 17:1, although a recognition of the problems it caused has brought it back to around 4.5:1. Scudamore has no doubt that relative equality has been a major factor in the Premier League’s global success.

But inequality is growing, even in the Premier League. Scudamore’s principle of the division of broadcast rights has been skewed by the increasing importance of overseas deals. Multi-club networks are becoming increasingly common, as the giants buy up smaller subsidiaries in other countries. Premier League clubs, with foreign owners, managers and players and, increasingly, foreign fans, are now essentially global brands that happen to be based in England, altering the relationship between the club and its immediate community in ways traditional fans find unnerving.

“This is football’s Belle Epoque moment.”

Attempts to impose spending caps have proved extremely difficult to implement (witness the 115 charges City still face for alleged offences, some of which date back over a decade) and, in their present form, arguably petrify pre-existing financial stratification. It’s no coincidence that Premier League clubs, looking at how to revise the existing Profit and Sustainability Regulations have happened on a similar solution to that proposed by Piketty: a luxury tax. But it faces the same problems as Piketty’s: how can it be enforced globally? And what restraint is it really when two of the major players are as extraordinarily wealthy as the investment arms of the states of Abu Dhabi and Saudi Arabia?

In his exploration of the Rawlsian nature of much of Piketty’s analysis, Martin O’Neill observes that his argument against financial inequality is not only that it “undermines equality of opportunity in the next generation and
 undercuts the political equality needed for a well-functioning democracy” but that “inequality is often counterproductive in terms of growth and economic efficiency”, which perhaps helps explain why, complacent on their own success, the likes of Juventus and Bayern can lose their grip.

It’s a more straightforward tactical point to note that when teams are much better than their domestic rivals, winning most games easily, they lose the capacity to defend, which perhaps explains the tendency for high-scoring games and dramatic comebacks in the latter stages of the Champions League in recent seasons (although that may be beginning to change).

Leverkusen are the exception, just as Leicester were in England in 2015-16. But one freak winner does not change the fundamental picture. This is football’s Belle Epoque moment. It is fashionable and popular, glamorous and at times thrilling. Crowds, at least in England, are bigger than they’ve been for 60 years, and yet player wage inflation means that debt is a permanent state for most of the league. The sense is of growing inequality creating a mounting tension; the big becoming so big that the pyramid that has sustained football for almost a century and a half is crumbling under the strain. Leverkusen’s success and the joy it provoked in an unremarkable mid-sized town on the Rhine is a reminder of what football can bring, and what it is in danger of losing in the superclub era. It’s a sport in desperate need of the modern equivalent of that £10 Victorian levy.


Jonathan Wilson is a columnist for the Guardian, the editor of the Blizzard, the co-host of the podcast It Was What It Was and author of 12 books on football history and one novel.

jonawils

Join the discussion


Join like minded readers that support our journalism by becoming a paid subscriber


To join the discussion in the comments, become a paid subscriber.

Join like minded readers that support our journalism, read unlimited articles and enjoy other subscriber-only benefits.

Subscribe
Subscribe
Notify of
guest

16 Comments
Most Voted
Newest Oldest
Inline Feedbacks
View all comments
Peter B
Peter B
3 months ago

Rubbish.
Football – sadly – is just another huge entertainment business. All tinkering around the edges does is create complexity, uncertainty and the opportunity for griifters to slice off their cut.
Take the current “financial fair play” fiasco in the Premier League. No one really knows what the rules are. Indeed, they seem to be making them up as they go along. One month Everton have a 6 point deduction. Another month it’s been reduced to 2 points. Nottingham Forest have a 4 point deduction, but the appeal won’t be decided until after the season finishes … . Meanwhile, the “big six” can do whatever they like and never get any deductions. It’s a farce.
Better to keep things simple and accept it for what it is. Better than feeding the lawyers and hangers on.
If you don’t like it, don’t go, don’t watch and don’t pay.
If you want a “fair” football league, start one yourself.
Football’s got nothing to do with democracy. It’s a sport/business. Or Thomas Piketty. Keep politics out of it.
Congratulations to Bayer Leverkusen.

Tony Price
Tony Price
3 months ago
Reply to  Peter B

All professional sport is an entertainment business. As such it has the same problems as capitalism in general, that it only properly works if it is regulated properly to maximise that entertainment value. As in business, without regulation you get monopolies, and that then reduces the entertainment value of the contest if the result is effectively decided before the kick-off.

David Giles
David Giles
3 months ago

How boringly predictable that this article should end with a nostalgic reference to player wage caps. Of yes, those young but talented lads from Africa and South America are destroying football, no doubt about it.

I wonder. If Picketty’s analysis has much to say about the financial success currently enjoyed by the l”losers”, those clubs in Leagues 1 & 2. Because at the moment, they have never had it so good.

Alex Lekas
Alex Lekas
3 months ago

Some years back, various American sports – except baseball – took a headlong plunge into parity through the salary cap. Football, in particular, was almost maniacally driven by a desire for parity to sustain fan enthusiasm for the entire season. Attendance drops off when one’s team has been eliminated from contention and people disguised as empty seats is a bad look for television.
Like everything else, this came with tradeoffs – exorbitant salaries for often marginal players and annual roster changes through which clubs are more like mercenary units, tossing aside any vestige of loyalty. Even so, the NFL is a money-making machine. So is the NBA. Fans are far less wedded to continuity and watching players develop than they once were; like many other examples, sports is an instant gratification society in which winning is expected now.

Wyatt W
Wyatt W
3 months ago
Reply to  Alex Lekas

Actually I’d argue the salary cap often does the opposite of what you’re saying. It helps teams keep homegrown/drafted players. There is a 0% chance Patrick Mahomes would be in Kansas City if Dallas/NY/LA could spend hundreds of millions more than them. As a Brewers fan, this has turned me off baseball. Anytime we manage to get a young star, you just know you’ll only have a few years before they’re traded for some 18 year old I’ll see in the majors in 5 years.

T Bone
T Bone
3 months ago
Reply to  Wyatt W

I don’t think either one of you said anything incorrect. But the MLB is just so different structurally than the NFL with the most obvious being that they play 145 more baseball games!

Baseball has always been a grind whereas each NFL game matters. Each game is a major event. The NBA somewhere in between. Unless they cut the baseball season in half (fat chance), I don’t see them adopting a salary cap anytime soon. What fun would it be if the Yankees and Dodgers couldn’t outbid every team every time!

Faith Ham
Faith Ham
3 months ago

Over here we’re in knots because Caitlin Clark is getting a$76k contract to play in the
WNB-What? Even our dear president is weighing in on the injustice of it all, as if a broken border, ascendant Iran, and a very wobbly economy weren’t enough to worry about. We saw Galway play Athlone while on vacation in October. It was fun, I guess, but with a final scor of 7-1, not very good football. As with basketball so with football: I’ll pay good money to see a great game.

Alex Lekas
Alex Lekas
3 months ago
Reply to  Faith Ham

The irony of the Clark melodrama is that the one person NOT complaining about her salary is…..Clark. There is something of a cottage industry in which people claim to be offended on behalf of those who never asked for that.

Peter West
Peter West
3 months ago

I agree with the article. As an American and relative newcomer to football (the global kind), I am a little frustrated that the same few Premier teams seem to win all the marbles year after year. I love Liverpool and Arsenal, but what about West Ham and a host of others? It would be as if the NY Yankees or Dallas Cowboys won their sport’s championships year after year. Great if you’re a diehard Yankees or Cowboys fan, but boring for the rest of us.

Dennis Roberts
Dennis Roberts
3 months ago
Reply to  Peter West

I’ve been watching football (soccer) since I was a kid in the 80s and it is more boring now with so few teams in with a chance, even if the quality is higher. And it is, of course, money and globalisation that is responsible.

But football is extremely successful, for now. It’ll be interesting to see what happens if the local fanbase that go the stadiums each week starts to decline – I can’t imagine it’ll sell so well overseas if the stadiums aren’t full.

In the women’s game some of the old established teams, like Donny Belles or Sunderland, were squeezed out so that the big brands could be utilised. Man U abandoned their womens team not long ago, but as the female game was taking off in England a way was found to resurrect it and make sure the Man U brand was involved at the top (it was Sunderland that lost out in that case).

Leonel SIlva Rocha
Leonel SIlva Rocha
3 months ago
Reply to  Peter West

A big thanks for NOT calling our beautiful sport Soccer! I never understood what the heck that means!

Dennis Roberts
Dennis Roberts
3 months ago

asSOCiation football. Analogous to Rugger for Rugby. It was a British term originally.

SIMON WOLF
SIMON WOLF
3 months ago

Despite the NFL Draft system who the coach & QB are seems to have had a big effect with for years the New England Patriots and now Kansas being so successful and the same may be true of the Premier League with Pep at Man City.In terms of spending Chelsea and Man Utd have outspent everybody else and yet not delivering.

UnHerd Reader
UnHerd Reader
3 months ago

I was present at Wembley in 1966 when England won the World Cup
What is not realised ( and still less remembered ) Football though very popular amongst ” the working class ” had until then be largely confined within those parameters. In fact the attendance figures were declining ( as a % of possible cohort )
BBC TV had, until then, largely confined it`s coverage to “Highlights “( Rare full coverage to International / Cup Final etc ). There was , of course, interest but Footballers still had a maximum wage limit ( though certain 1st Div clubs illegally paid more and were discreetly ignored ) Support was essential local to Team & location .
It was the interest by TV ( eventually world wide ) that really became the ” game changer ” and continues to dictate the development ( or otherwise) of the ” beautiful game “

David Kingsworthy
David Kingsworthy
3 months ago

I’ll be interested to see who writes, and how it will be done, the story that compares the corporatization of football (England would be the most interesting case study) to the decline of smaller clubs along with their towns (Thatcherism perhaps) and then in the very modern age, the post-Bosman impact on smaller teams corresponding to the un-Englishing of English towns.

Kirk Susong
Kirk Susong
3 months ago

I’ve got no objection to salary caps, and there should definitely be more transparency around Financial Fair Play. But to think Piketty is needed for this analysis is ridiculous, and invoking him here gives his dubious form of collectivism a legitimacy it does not warrant. If you own a steel mill, if a competitor goes out of business, you can keep on selling your product. If you own a football club, if your competitor goes out of business, you no longer have a product to sell. Rich capitalists have understood the merits of collectivism in these circumstances for a very long time.