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An American-Style Salary Cap Would Be a Fairer System For European Soccer Clubs Than FFP

5856649637 230d651952 z An American Style Salary Cap Would Be a Fairer System For European Soccer Clubs Than FFP

Last week, UEFA levied severe Financial Fair Play (FFP) sanctions against Manchester City FC and Paris Saint-Germain, among several clubs. In the wake of the settlement that averted a potential court case for the governing body of European football, much has been written about FFP. I have for a long while felt that FFP is a system designed specifically to protect the biggest clubs in European football. The current hierarchy in the European game sees an established elite club of 10-12 teams all from big western European leagues dominate the continental game. I have argued that FFP locks in the monopoly for these clubs and prevents future rivals from emerging.

Aston Villa, one of the largest and best supported clubs in England, is now for sale. However, Villa, coming from an economically deprived area compared to the top London clubs, is under the FFP regime a less attractive business proposition than it would have been six years ago when Sheik Mansour of Abu Dhabi bought Manchester City. The reason is that Villa can never charge the same for tickets or merchandise that Arsenal or Chelsea do, giving those London clubs a built-in institutionally sanctioned advantage over Villa under this system.

Last week, Soccerly columnist Simon Evans proposed another solution: An American-styled salary cap. Evans’ solution is the fairest and most equitable one proposed yet and certainly “fairer” than UEFA’s hybrid FFP that essentially picks winners and losers and locks those winners and losers in permanently. With a level playing field under a salary cap imposed at varying levels over all UEFA member top-flight leagues, clubs would equal opportunities and equal access to success.

UEFA has already determined based on its implementation of FFP that investment in football is not something they interested in. Growing the sport by attracting new investors that can increase revenues and profits for all clubs throughout Europe is obviously not something UEFA wants to encourage. By implementing FFP, UEFA has discouraged investment in football clubs outside the established order and particularly clubs in economically disadvantaged areas such as the Midlands or northeast of England.

The fairest solution that prevents clubs from slipping into oblivion would be a salary cap similar to Major League Soccer in the United States or the A-League in Australia. An outright cap on salaries would prevent both the “financial doping” that so many FFP advocates claim is ruining the sport as well as giving smaller clubs the opportunity to succeed something UEFA once claimed it wanted to see happen but has recently backed off from.

While the idea of a salary cap may seem draconian, FFP is not fair. And while I preferred the previous free market approach to any other, a cap on salaries is in my view far preferable to current FFP con.

This entry was posted in Financial Fair Play, Leagues: EPL, Manchester City, UEFA. Bookmark the permalink.

About Kartik Krishnaiyer

A lifelong lover of soccer, the beautiful game, he served from January 2010 until May 2013 as the Director of Communications and Public Relations for the North American Soccer League (NASL). Raised on the Fort Lauderdale Strikers of the old NASL, Krishnaiyer previously hosted the American Soccer Show on the Champions Soccer Radio Network, the Major League Soccer Talk podcast and the EPL Talk Podcast. His soccer writing has been featured by several media outlets including The Guardian and The Telegraph. He is the author of the book Blue With Envy about Manchester City FC.
View all posts by Kartik Krishnaiyer →

27 Responses to An American-Style Salary Cap Would Be a Fairer System For European Soccer Clubs Than FFP

  1. Tony Butterworth says:

    Salary cap just doesn’t work unless it is worldwide + how is it “fair” that a club that generates 10 times the revenue has to pay the same as one that generates very little ?

    • Jake says:

      Exactly. Real Madrid ale the most money in the world why should they be forced to spend the same amount as Sunderland or West Ham.
      If anything this favors clubs in the most attractive places i.e. London, Madrid, Barcelona, Munich are all more attractive places than Manchester or Liverpool.

      • Toby says:

        This is my point FFP is not fair and salary cap is unworkable.

        How can you have FFP across Europe when Barcelona and Real Madrid have different rules to clubs around the europe.

  2. Alan Gault says:

    FFP is very unfair and against European business rules. as clubs who have had fines and player caps also transfer capped amount gives other teams an unfair advantage. football clubs are businesses and there fore city psg could take this to the euro court. which will quash ffp. i agree with tony salary cap will have to be world wide as players will go to other parts of the world to get more money.

  3. Malcolm Green says:

    That might work in one country (eg the USA) but where you have differing tax rates and regimes it means that some countries players retain more of their income thnt others (eg Monaco).

    Also lets get this right FFP has absolutely nothing to do with fair play and everything to do with protecting the positions of a cartel of ope European clubs. If it was about protecting the futures of clubs it would be taking debt seriously.

    ManU have debts of 400 million GBP (or $600 million). They have spent over One billion dollars in bank and interest charges alone but do UEFA consider that to be a problem. No they dont.

    What caused the collapse of Rangers, Portsmouth and Leeds? Massive debt.

    • Jake says:

      The debt had nothing to do with with the club itself rather than the owners.
      United is by far the best run English club financially. All the debt the club has was levied onto it by the Glazers.

    • CTBlues says:

      You do know that we have different income tax rates in the US. You have Federal income tax then you state income tax and some states don’t have income tax. Florida and Texas both do not have a state income tax and you don’t see everyone trying to play for teams in those states.

  4. Alan Pfahl says:

    Disagree…salary caps may help a bit, but don’t address the issue when revenues vary so greatly. The clubs with the huge revenues still have tremendous advantages as they can pour money a portion of their profits into acquiring the best coaches, scouts, facilities, etc. In some North American leagues all the salary cap does is make the “poor” clubs spend more on payroll than they otherwise would to meet the salary cap “floor”!

  5. Guy says:

    I’m no expert on EU law, but I’d be willing to be a salary cap would be illegal as a restraint of trade.

  6. christian says:

    Salary cap will never happen. It’s a ridiculous policy even in our American sports. Labor shouldn’t be capped in any workplace.

  7. Alan Gault says:

    having read about salary cap comments i must agree now that it would not be right. and ffp also is wrong as small clubs with new wealthy owners can not do nothing to build the business to be another top club. so what is the way forward FFP NO Salary cap NO.

    @MALCOLM We can not punish clubs in debt we can not add to their misery.

  8. Fulhamish says:

    And here comes the flood of people reactionary disagreeing to any aspect of American sports.

    • AB says:

      Yep. As soon as something nice got said about MLS, I knew people would lose their minds.

      • goatslookshifty says:

        Ok. Make an argument and/or point instead of reverting back to the typical eurosnob comment.
        At least the previous commenters have an opinion, even if it is considered anti-american in your eyes.

        • Fulhamish says:

          Duly noted. The current system fosters Super Clubs. Are Super Clubs good for the game? That’s subjective I suppose however many feel things have spiraled out of control. I’d prefer to see the team with the best tactics and coaching win, not the one with the largest coffers. Until the day Uefa/and or Fifa impose an effective regulation leveling the playing field, I suppose I’ll just pray for a sheikh or Russian oligarch to purchase my team.

  9. Dean Stell says:

    Honestly….the uncapped spending is what attracted me to European soccer when I started drifting away from the traditional American sports about 10 years ago.

    It’s just personal preference. I know that there are a lot of people who prefer a system where talent is more evenly distributed and the outcomes of competitions is in-doubt.

    But….to me, the epitome of sport is seeing two incredible teams play each other. I’d rather have 3-4 of those HUGE games/year than have moderately competitive games on TV every weekend. I prefer quality over quantity.

    Those HUGE games are the ones that stay with you for years.

  10. Flyvanescence says:

    In the infamous words of Darth Vader:
    NOOOOOOOOOOOOOOOOO!!!

  11. A few points:

    1) Guy is right – salary caps fall on the wrong side of EU restraint of trade laws.

    2) Technically, FFP *is* a US style cap – it’s essentially a luxury tax. remember, lots of leagues in North America claim to have a cap; none of them have the same financial rules.

    3) Birmingham could never charge the same as London for a ticket since the days of maximum wage expired. Similarly, Tampa Bay can’t charge the same as Toronto for an NHL ticket, or KC can’t charge as much as the Yankees. That’s the reality of living in markets where supply and demand don’t match up.

    3a) Manchester can’t charge the same as London either, yet in a time when United charged middle of the road ticket prices (pre-Glazers, slowly creeping up during Glazer years), they still invested more in the team and remained financially healthy regardless.

    4) On the contrary, this does not consolidate the top teams. Who’s getting knocked on by FFP rules? What it does is ensure any team that rises up (and it’s still very possible through creating a better team, winning things, getting on TV more often, and getting invited to bigger tournaments) doesn’t do so at the expense of financial responsibility. Ask a Leeds fan about blowing your brains out to keep up with the Joneses, or a Blackburn supporter about a financial plan the depends on an old man not dying.

    Set a strong financial plan, organize and follow it through, and you’ll have investors, potential buyers and a sustainable situation that doesn’t collapse the one year you don’t get a long Cup run or into Europe.

    Now if you want to argue that billing a club millions because they spent billions is absurd, I’d agree. Instead of charging City or PSG (or whomever) £60 million – couch change for the Sheiks – what you should really do is refuse to let them spend money. Ban them from the transfer market for a year – 2 windows for starters, slide to 3+ if there’s more or massive irregularities – and see how quickly they learn that overspending today has both long and short term consequences when they can’t fix holes tomorrow. If a club’s worth its salt, they’ll invest in the youth scheme and be forced to make their own quality instead of buying it.

    Lo and behold, you (A) no only restrict overspending, you (b) give them a chance to become more responsible at the same time, and (c) by cutting the number of big fish eating in the pond, give an outside chance to a little fish like Southampton to actually grow instead of getting picked off the second their players prove themselves useful.

    SB

    • Jake says:

      Nice idea.

    • Why? says:

      How would any of that stop Southampton players being ‘picked off’? I got a better idea do what was always done in football and worked well for over 100 years until greed took over with the lopsided payments for finishing higher 10 times what the were, share TV rights for all leagues equally and some normality might resume, well to those who remember before the premier league etc.

      I think you’ll find that old man who died at Blackburn was worth his weight in gold to there fans and that club would have been a 1000 times worse off without him now! Leeds did what football team have done all their history and took a gamble it didn’t pay off that time FFP makes sure there won’t be a next for them, shame it wasn’t around each time Utd nearly bankrupted themselves with huge spending as they wouldn’t be where they are today, hmmm food for thought.

  12. Smokey Bacon says:

    What a load of rubbish! Keep socialism out of football. America can keep its parity and silly draft system. Europe’s capitalist winner takes all system works just fine.

  13. Brad says:

    This won’t cap the transfer spending the teams do. The USA style keeps some salaries low through the draft process where the player is limited n how much he can make.

  14. Why? says:

    Wasn’t the whole FFP idea to prevent clubs going out of business? Something that never happened to these clubs i.e Portsmouth, Rangers and Leeds? Hmmm. What actually was the point of FFP? Oh that must be it to prevent the top clubs now from being challenged by others. What a great idea! Make sure the elite stay elite and that now includes City and PSG, well done Platini!

  15. john marzan says:

    FIFA FOOTBALL = UNCONTROLLED CAPITALISM

    NBA, NFL = Socialism, Supertax/LuxuryTax, Income Redistribution aka Profit Sharing

    • Martin J. says:

      It never amazes me that in the USA, which professes to be the world’s biggest capitalist country, sports is run on socialism. What irony.

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