The Sweeper: The Greater Fool Theory

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Christian Seifert

I’ve been alluding to it in past Sweepers, and now Bundesliga chief executive Christian Seifert has given it a name:

“During the Super Bowl [in February] I was in the United States talking to some owners and one guy told me: ‘It’s the greater fool theory. Some day a greater fool will come and buy the club.’ But hoping for that, and waiting for that in football, which is so important to the city, to a region, to people, is a natural conflict.”

Witness the hope of Manchester United supporters placed in the hands of the of a small group of potential investors to wrench their club from the leverage-happy Glazers, or the anxiety of a failed bid by American management company Rhône Group to take Liverpool from Gillett and Hicks, or the fans and owners of indebted clubs hoping a new investor will come along and save their team from administration or worse.  A change of investorship still yields the same uncertainties, the same wage inflation, the same diminishing cost/turnover ratio.

The problem is not separating the good investors from the bad. It’s the business model of football itself which, as Seifert notes, requires an enormous amount of capital investment in a sport with profit margins of less than two percent (see Simon Kuper).  It’s a system that encourages, if not dictates, profligate debt, and which entices investors less interested in the good of the club than in the prospect of “selling up.”

Seifert made these remarks in an interview with the Observer, in which he also underlined the need to limit players’ wages to an acceptable percentage of turnover for football to a remain viable sport.  He seems to be one of a few football executives to look at the wider implications of the current system, whereby English fans are reduced to hoping one set of benevolent owners will trump another set of malevolent owners in the hope their club will remain healthy and competitive in the years to come.

Seifert goes on to point out some things so blindingly simple (if naively hopeful) that one is reminded of George Orwell’s dictum, that “to see what is in front of one’s nose needs a constant struggle.” To wit:

“The Bundesliga pays less then 50% of turnover in players’ wages. I’m absolutely sure a league can reduce wages. If all the clubs said: ‘OK, we reduce wages by 10%,’ maybe you will have some players who would leave for Spain or Italy, but 99% will say: ‘OK, still I make a hell of a lot of money.’”


“Of course it’s not necessarily a problem when you have a debt. Personally when you buy a car or house you have debts. But you have to prove that you have, let’s say, a business model even as a single worker that you can pay back the money.”

Limiting wages to a percentage of turnover.  Responsible debt spending.  It’s not as if these ideas have no basis in reality; Seifert’s Bundesliga is now cited daily as a model for English football moving forward.  Some of the Labour proposals for football reform tabled last week include measures already in place in Germany.  Whether or not change comes likely depends on a commitment from administrators, supporters trusts and politicians to endeavour to state the obvious at every turn.

Quick Hits

  • A couple of articles today highlight the hypocrisy behind West Ham‘s call for Fulham to be punished for fielding a “weakened side” against their relegation rivals, Hull.
  • And if you want to argue about maintaining the “integrity of the competition” in the Premier League, Said and Done has a nice dollop of PL hathos for you.  A taste: “Premier League spending on grassroots football last year via the Football Foundation – 1.5% of their £1.005bn turnover, the same proportion spent on their operating and admin costs. Other Premier League money distribution last year: £790m to clubs – who spent £70.7m of it on agents; £74.4m on parachute payments; £790k on Richard Scudamore’s salary – plus a £745k bonus.”
  • From a Left Wing on FIFA’s decision to ban the hijab in football: “This seems like a fine moment to recall Sepp Blatter’s most famous statement about the women’s game:”Let the women play in more feminine clothes like they do in volleyball. They could, for example, have tighter shorts.” Fuck that. I’ll take headscarves and lime green tracksuits over that bullshit anyday.”
  • Are USA chants at Premier League matches offensive?
  • North Korea hasn’t been able to play a football match in ages.