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Rafa Benitez’s £20m Buying Cap – Fact, Fiction, Irrelevant?

The Independent reported today that  documents have been revealed “which suggest Liverpool’s net summer spending will be locked at £20m until 2014”. This is slated to include player pay raises and not just transfer fees. This story has also appeared on and in the Daily Mirror. While this might explain why Liverpool weren’t particularly aggressive in the transfer market apart from getting a hold of Glen Johnson and bringing in Alberto Aquilani, for me, the story has two major problems.

Firstly, the report cited in the article was a prospectus by investment banks Rothschild and Merrill Lynch. The prospectus was made in March. So it cannot take into account Liverpool’s new, lucrative sponsorship deal with Standard Chartered Bank.

Secondly, the article acts as though Liverpool will be crippled by being forced to sell players to generate funds.

Now, part of me would love to see Liverpool bring in big name talent without having to say goodbye to players I love. But this is simply unrealistic. As much as the boundless transfer budgets of Chelsea, Manchester City and Real Madrid tickle the imagination of supporters of other clubs – “If we only had their spending power…” – ultimately that’s not a road I want to see Liverpool go down.

Selling players to bring in new ones is inevitable. While I don’t think the club should be viewed purely as a business, a certain level of fiscal pragmatism needs to be maintained for the sake of the club’s long-term health. An over-inflated transfer budget, while helpful in the short-term, does not make sense for a club that wants to reestablish itself as a title-contender for years to come.

Since, he’s been managing, Rafa Benitez has, through transfers, improved the club every year until this one. This season we took a step backwards with the loss of Xabi Alonso, but it is not as if Xabi was sold simply to raise cash. Xabi wanted to leave and so Liverpool let him go and took the money. Apart from that, the building process has been a positive one, culminating in a great season last year which saw the Reds end just four points shy of the title. If Rafa can prove that Xabi’s absence can be covered, there’s no reason not to think this club will keep striving toward that ultimate goal.

Now, there is – and will continue to be – a lot of debate over the intentions of the current owners. But this talk of a £20m buying cap can’t really enter into the fray until the conversation is updated.

Most importantly: how will the new deal with Standard Chartered Bank affect upcoming transfer windows?

Tom Hicks has hinted at putting some of the new funds toward players:

“Knowing Rafa Benitez I suspect he’s got his eye on part of it,” Hicks said, according to the Liverpool Echo. “As we build our revenues it gives ability to be more competitive on the pitch and, this is a very important one, but we think we have other opportunities in the future.”

Hmmm. Vaguely promising.

Hicks and Gillette need to show a firm commitment toward this end. Most of the talk since the new deal seems to revolve around a new stadium and that’s an important discussion as well. But the owners need to give us a healthy sign next summer that the new sponsorship will directly affect the side via the transfer window.

I’m not talking about the kind of spending coup that makes Roman Abramovich salivate. But I am talking like The Summer of Torres (cue the timpani). We brought in El Nino, Ryan Babel and Yossi Benayoun. While Babel hasn’t come as good as we’d hoped, it was the right kind of transfer window thinking. We brought in attack and creativity and we weren’t afraid to chase the quality we needed.

This summer will be an important time to do the same. I’m looking for a positive sign that after taking one step backward with the sale of Xabi Alonso, we are willing to take two steps forward (at least) in the transfer market. Then all this talk of buying caps and being forced to sell can prove itself irrelevant.

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  1. randomsausage

    September 24, 2009 at 10:00 pm

    Rafa, dry white wine please

  2. Zola612

    September 24, 2009 at 2:24 pm

    The first few times I read the title I thought it was…

    “Rafa Benitez’s £20m Buying CRAP”

    I find it amusing that it took me awhile to realize it was “cap”
    But I swear I am not having a go at Rafa’s transfer policy.

  3. brn442

    September 24, 2009 at 1:03 pm

    Is this the same Ethan Armstrong that wanted Man City’s business model to fail?. You know – when a non American foreigner – THAT ACTUALLY HAS MONEY, buys a Football Club and then spends accordingly. As opposed to proven business methods of Messrs: The Glazers, Hicks, and Gillette that calls for buying a club, then levereging its own assets up to its eyeballs to finance the purchase, leaving them with practically no liquidity (for purchases,) and a Champions League spot away from possible disaster. After all, it should work cause they are American and it’s a top four club club. Wonderful, cheers to failure.

    • Ethan Armstrong

      September 24, 2009 at 2:01 pm

      Yes, it’s the same Ethan Armstrong. If another Ethan Armstrong starts writing for EPL Talk I’m sure we’ll come up with some way of telling us apart like parenthesized nick-names. (i.e. Ethan “Sexy Pants” Armstrong. Or Ethan “Mad Dog” Armstrong.)

      And yes: I still want Man City’s business model to fail. Thus my call for long-term pragmatism over owners sinking untold amounts of their own cash into a club for quick results.

      And I’m not exactly championing Hicks and Gillette. I’ve stated what I think they should do in regard to the sponsorship deal and next summer’s transfer window. I’ve never celebrated their overall approach to running a football club, I just hope to see some of the income from Standard Chartered Bank go into the transfer market.

      Obviously, many Chelsea and City and Real supporters relish the fact that their club can bring on top talent because of the vast resources at their disposal. But I hope at least part of them sees that this is bad for football. If Liverpool get bought up by some rich tycoon with the “spend like there’s no tomorrow” approach, I will likely have mixed feelings on the matter. I’ll accept the wins and the glory, but part of me will begrudge the situation nonetheless. I’d rather see Liverpool build toward that end sensibly.

      • brn442

        September 25, 2009 at 4:09 am

        I should have known, as a column written by Ethan “Sexy Pants” Armstrong or Ethan “Mad Dog” Armstrong would’ve probably made some sense. Long term pragmatism? = “Smaller” clubs should know their place and must accept the entrenched, predictable mediocrity that is the “big four.” After all, Manchester United, Liverpool, and Arsenal have a birth right to splash the cash when they see fit but when clubs whose recent history has been less than stellar, start spending money that their owners actually have just to be competitive, that means poor Rafa and Fergie will have to pay a little more than they wanted to for that back-up striker to stick in the reserves.
        Then there are all the Premiership era football fans who will discover the dark days of football when it was possible for a club from Yorkshire to become champions in 91 and those “commoners”- Blackburn Rovers, who had the “nerve” to do so 3 years later.
        Unlike you, my feelings about a rich tycoon buying Liverpool and spending wads of HIS OWN cash as opposed the two jokers that took a club with little or no debt and turned it into a leveraged charity case, are slightly more absolute.

  4. Raatzie

    September 24, 2009 at 12:23 pm

    Hicks and Gillett need to go. ASAFP.

    I don’t give a damn if they sell to Mideast money. I just care that they get LFC out from under the debt.

    Wipe the slate clean, promise Rafa a pre-negotiated percentage of annual profit as a transfer budget, and tell him additional transfer funds have to come from sales.

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