Wednesday, September 26, 2007

The rich are different from you and me

Let me tell you about the very rich. They are different from you and me. They possess and enjoy early, and it does something to them, makes them soft where we are hard, and cynical where we are trustful, in a way that, unless you were born rich, it is very difficult to understand. They think, deep in their hearts, that they are better than we are because we had to discover the compensations and refuges of life for ourselves. Even when they enter deep into our world or sink below us, they still think that they are better than we are. They are different.

F. Scott Fitzgerald, “The Rich Boy,” All the Sad Young Men (1926).
To which I might add, "The rich are greedier than you and me." Consider this:
When Forbes first analyzed ... the value of NFL teams in 1998, the magazine valued the 49ers at $254 million... A rising economic tide of network television contracts and new stadiums has been raising the NFL's boats ever since... Forbes pegs the 49ers' value at $799 million in 2007.

"New stadiums lift NFL teams' value," Mike Swift, SJ Mercury News, 09/20/2007.
That's more than 3X increase in 9 years, or about 13% per year. Try to find that in your neighborhood bank's CD offerings.

Even the stock market didn't do nearly that well in the same time period: not the Dow, not the S&P500, not even the NASDAQ came close to doubling between January 1998 and 2007.

So what would you call this?
greed, n. An excessive desire to acquire or possess more than what one needs or deserves, especially with respect to material wealth.

Tuesday, September 18, 2007

Commonwealth Club discussion on "The Future of the 49ers"

Two weeks ago, I was invited to be a guest at a Commonwealth Club panel discussion entitled “After Further Review: The Future of the San Francisco 49ers.” The panelists were: Michael Cohen, Director of Base Reuse and Development, City and County of San Francisco; Ann Killion, Sportswriter, San Jose Mercury News; Patricia Mahan, Mayor, Santa Clara; and Carmen Policy, Former President and CEO, San Francisco 49ers and Cleveland Browns. The moderator was Dan Ashley of ABC7 News.

It was a fascinating discussion.

I was most surprised by two issues. First, the San Francisco stadium plan is quite serious and moving ahead quickly. Michael Cohen, who is in charge of the redevelopment efforts at Hunters Point, made it clear that while they were shocked at the Yorks' sudden withdrawal from negotiations last November, they quickly regrouped and developed an aggressive stadium development schedule. They met with the 49ers organization last December to present their new timetable, and to date they have met every one of the benchmarks on that new schedule.

The second surprise was the very strong sentiment expressed by three of the four panelists that the 49ers should stay in San Francisco. While I expected Michael Cohen to be in favor of the site, it was probably Carmen Policy who painted the most vivid picture of the possibilities of the Hunters Point location. Policy was clear in his belief that the 49ers’ first priority is a new stadium, but he was also clear that even if the San Francisco deal is not quite as good, the team should stay in San Francisco. In fact, Policy indicated that “if the NFL had its druthers, the 49ers would stay in San Francisco,” as Mercury News reporter Mike Swift noted in his article about the discussion – “49ers Decision a Year Away.”

Cohen answered many of the objections that I have heard about the site and outlined the plans for transportation improvements in the area.

Ann Killion also expressed strong support for the team staying in San Francisco, and she knocked down many of the myths promoted by stadium supporters in Santa Clara.

While Patricia Mahan talked about an “entertainment district” in Santa Clara, Killion replied that football stadiums are not like other types of professional sports facilities. She said that with a football stadium, 70,000 people come in 10 times a year to see the game, and then they turn around and leave. They don’t stick around and spend money.

She also noted that public subsidies for stadiums are a very hard sell in this area because we have the examples both of what can happen when public subsidy goes wrong (see Raiders, Oakland) and of how stadiums can be built without public subsidies (see Giants, San Francisco.)

Mayor Mahan started reading a list of cities smaller than Santa Clara that host NFL football teams, but the moderator interrupted to say that it wasn’t about the size of the city, it was about the money. [As we’ve discussed here before – "A tale of two cities."]

I would highly recommend tuning in for the broadcast of the discussion. It will be aired this Thursday, September 20, on 1590AM. Here are the full details:

Thursday, Sept. 20, 2007
KLIV-AM 1590 kHz
7:00 PM and 10:00 PM

If you miss the broadcast, you may be able to listen to it or purchase a recording of it at the Commonwealth Club website. It’s not yet available there, but I will update this post with a link as soon as it’s available.

If you want to learn more about the stadium issue, this discussion provides an excellent analysis of the situation and the state of the current proposals.

Sunday, September 9, 2007

Three million Benjamins

Photographer Chris Jordan has a new series of works entitled "Running the Numbers: An American Self-Portrait."

He created this portrait of Benjamin Franklin using images of 125,000 $100 bills — $12,500,000 representing "the amount our government spends every hour on the war in Iraq."

To depict the $222,000,000 subsidy that the San Francisco 49ers have requested from the City of Santa Clara to build a football stadium, we'd need about 18 of these expensive portraits. [And if you include the value of the land the City has been asked to donate — for a grand total of about $287,000,000 in subsidy— we'd need 23.]

Either way, that's a lot of Benjamins.

Thursday, September 6, 2007

The 700 Pound Gorilla

Funny you should mention Great America, and their parent company Cedar Fair.

Back in January, the Santa Clara Mayor and City Council formally adopted a set of principles for evaluating the 49ers stadium proposal. These included a requirement that Cedar Fair agree in writing to not interfere with the stadium feasibility study, and that this agreement was required prior to pursuing discussions with the 49ers.

Here it is September, with no agreement in sight. The Mayor is saying that Cedar Fair's opposition is "the most substantive" problem delaying the feasibility study. However, "We haven't come up against one obstacle, or one factor, that violates our principles for going forward," Mahan said. (SJMN, Sept 4 2007)

Hmm... I think we have a touch of selective amnesia going on here.