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Sat May 26, 2012
Even Soccer Teams Are Feeling The Pinch In Spain
Originally published on Sat May 26, 2012 2:32 pm
One of the ways Spaniards console themselves amid their failing economy is with their beloved sport of soccer. If you can't afford tickets to a game, it's always on TV in your local bar.
"For an escape from work, economic problems — just enjoy it and support your team," says soccer fan Ivan Rassuli, who's having a beer as he watches a match at a bar. "Everybody likes football. Maybe like the NBA or baseball in the United States."
But futbol, as Spaniards call soccer, has followed the same sorry trajectory as Spain's economy.
Failure To Pay Taxes
Twenty years ago, when property developers started building furiously during the housing bubble, most Spanish soccer teams reclassified themselves as corporations.
Teams were sold off to rich patrons who made flashy improvements. But they neglected some important details, like paying taxes, according to Angel Cabeza, soccer editor for the Spanish sports daily Marca.
"They spent a lot of money on players, on stadiums," he said. "They didn't pay the treasury, they didn't pay the Social Security. So the debts become bigger and bigger and bigger and bigger."
Clubs now owe nearly $1 billion in back taxes and Social Security payments. That's money the Spanish government really needs right now. So it's letting teams pay off their debts in installments, through the year 2020.
The teams that win the most are also the richest — Real Madrid and Barcelona — and they stand the best chance of surviving the financial crisis.
But poor teams, just like poor countries, have to cut their deficits quickly, Cabeza says.
"They have to do it very, very soon," he says, "sooner [rather] than later."
Otherwise, he adds, "they will crash."
Superstars Join Protest
Last year, superstars like Lionel Messi and Cristiano Ronaldo joined a strike in support of less famous players, who'd gone without pay for months.
Many fans supported them — like Carlo Maresca, who was taking a break from playing soccer in his local park.
"It's a solidarity issue. I don't think any of the millionaire football players are actually not being paid," he says. "It's just the fact that they're trying to give some support to the guys in lower divisions who don't have such high paychecks. It's the principle they're defending."
That idea of solidarity resounds with people suffering in this economy. Students recently walked out of classrooms to stand alongside their teachers, on strike over pay freezes and longer work days.
Something you hear frequently in Spain — from teachers on strike, or people upset about rising taxes — is that the rich are getting richer, and the poor are getting poorer.
Rassuli says the same is true for his beloved sport.
"Football in Spain, if you are richest, more money for you next year. If you are poor? Sorry!" he says.
But come next spring, teams with unpaid bills won't get away with just an apology.
Soccer's regulatory body in Europe says it plans to relegate teams to lower divisions — the equivalent of the minor leagues — if they can't demonstrate how they plan to pay off their debts.