Soccer is a game of change and transformation. Just ask Sir Alex Ferguson.
After his Manchester United squad became the inaugural champions of the Barclay’s Premier League 1992-1993 season, he told reporters “my greatest challenge is not what is happening right at this moment, my greatest challenge was knocking Liverpool right off their f—— perch. And you can print that.”
Prior to the formation of the FA Premier League in 1992, Liverpool was the proud owner of eighteen First Division Championships, the most of any club in top flight English Football. Since the 1989 -1990 season, Liverpool has experienced a 25-year English championship drought, only collecting the consolation prize of the FA Cup twice (although they did win the 2005 Champions League Final).
In comparison, Manchester United has experienced unparalleled success in the last twenty-five years, winning the league thirteen times and the Champions League twice. United are now the most decorated club in English Football with 20 league championships and one of the most well-recognized clubs across the world. As we all now know, soccer is a game of change and transformation.
Change and transformation, however, are expensive and risky. In the modern game, clubs feel compelled to splash cash and accumulate inordinate amounts of debt to challenge for titles year-in and year-out. For example, Manchester City’s decision last week to spend £49 million on Liverpool youngster, Raheem Sterling, fueled controversy over the rising trend of buying championships in the last few years.
Infamous Arsenal supporter and outspoken television personality Piers Morgan tweeted that “If Raheem Sterling’s worth £49 million then I’m an Aardvark.”
Although The First Eleven understands the absurdity of the enormous sum payed for a 20 year-old potential talent who gracelessly abandoned his former team for the second most famous club (Manchester City) in Northwest England’s second most famous city (Manchester), we cannot confirm whether or not Piers is an Aardvark. National Geographic, however, was kind enough to provide our website with a picture from their most recent Aardvark photo shoot in London, and the similarities are stunning.
On a more serious note, buying players at such extreme financial costs is risky. Just look at Chelsea’s decision to spend £50 million on Fernando Torres in 2011. After moving to Stamford Bridge, he was unable to regain his previous form because of extensive knee ligament damage in 2010, and was more well-known for his Zorro impersonation than his soccer playing abilities at the club.
From the same exact transaction, Liverpool’s decision to spend £35 million of the transfer fee on Andy Carroll, a largely unproven goal scorer for Newcastle United, was a disaster. Expecting Carroll, who was most well-known for “helping” his club secure promotion from the Championship in the previous season (2009 -2010), to become the next Peter Crouch was unfair and unrealistic. Although these two teams each have enough money to make a mistake once or twice in the transfer market, some clubs are not afforded this luxury, and force themselves into financial ruin.
For example, Serie A club Parma FC recently announced bankruptcy after their then-owner, Giampietro Manenti, was arrested on suspicion of fraud and money-laundering. An ESPN FC article explains that the club started to experience trouble in 2014 when they were unable to obtain a UEFA license to play within the Europa League because of financial mismanagement.
According to UEFA, Parma’s €208 million debt and the club’s inability to pay the salaries and wages of its current players resulted in the exclusion. As a result, the club was denied potential revenue from Europa League appearances, and the president Tommaso Ghirardi was forced to sell the club for €1 to a Russian-Cypriot Consortium, which eventually sold two months later to Giampietro Manenti. The most recent owner, however, was unable to pay his players’ salaries, and his side was relegated from Serie A. Unfortunately, the relegation and combined bankruptcy will see the 102 year-old club drop to Italian Football’s 5th division, the Eccellenza.
No football fan wants to see a competitive team relegated because a club couldn’t keep up with the extreme cost of competing in modern football. Teams across the European continent, however, understand that each off-season is an extensive rebuilding process which goes beyond player transfers. The financial costs of developing club academies and stadium infrastructure alone is a significant sum, not to mention the salaries of players, managers, and team personnel.
A 2009 UEFA Review revealed that over half of the 655 registered European clubs experienced a loss in the previous year, and more than 20% of the clubs were in risk of bankruptcy. As a result, UEFA developed a set of financial guidelines in 2011 known as Financial Fair Play (FFP) to combat the growing number of debt-laden clubs throughout Europe. The administrative body believes that FFP will improve the overall financial health of European football by encouraging “clubs to build for success rather than continually seeking a quick fix.”
Whether UEFA achieves this goal of creating financial stability and long-term investment, only time will tell. One thing is certain – that is, nothing is certain. Football will continue to change and transform as it always has and always will. Join me on The First Eleven next week as I discuss the pros and cons of FFP.