Can member-owned football clubs succeed?

The pandemic has humbled football fans everywhere. Empty stadiums have removed the power fans used to wield, not least their freedom of expression in the stands, including the freedom not to show up at all.

It’s now clearer than ever how flimsy that power was. The verdicts of the match-day crowd were always a theatrical mask for the economic and legal power wielded by club owners, sponsors, superagents and broadcasters.

All that remains for fans is the freedom to complain about their clubs on social media, which feels more than ever like pissing into the wind. Meanwhile, the football tycoons chart their courses through the maze of the Covid-19 pandemic, entering some deeply cynical territory as they go. Witness the resurrection of the unworkable European Super League proposal, which amounts to an act of brinkmanship as rich clubs attempt to blackmail everyone else into giving them an even bigger slice of the pie: give us more, or we’ll destroy the whole pie.

The pandemic and its lockdowns have also provided cover for smaller but equally mercenary stunts. In South Africa, Bidvest sold Wits and their 99-year legacy into thin air. In England, Arsenal retrenched many of their lowest-paid workers, including mascot Gunnersaurus, despite the bulletproof wealth of the club’s owners, the Kroenke family.

Even so, the dream of democratic football is not dead. It just has a nasty virus.

 

Souled out in Brazil

Brazil, the football scout’s heaven, can be hell for fans. The country’s football industry remains as corrupt and dysfunctional as the Jair Bolsonaro government.

Leo Soldado, Marquinhos and Luigui are hardcore Flamengo fans and co-hosts of the Flanalíticos YouTube channel, on which they dissect the fortunes of the Rio de Janeiro superclub in forensic detail every week. Flamengo are one of the better-run clubs in the top flight.

All of Brazil’s big sides are technically fully owned by members, as required by law. But Soldado says true fan power is reserved for a small subset of the fan base, the official members. “As members of the Flamengo club ‘nation’,” he says, “we don’t vote for the president of the club. So we don’t have a say in the big decisions. Today there is a more retail model of participation in the club, which is called being a ‘fan-partner’. You’re essentially a subscriber to the club website, like a Spotify account, you pay a fee and you get discounts on tickets and kit. But you still don’t have a say in the running of the club.”

Even this “fan-partner” subscription is too expensive for Flamengo’s underclass ultras, the Geraldinos, who populated the legendary Geral stand in decades past, before the Maracana became an all-seater arena in 2005.

“To become a partner of the club, you have to buy a title, like a noble title,” says Luigui. “It’s very expensive and it’s for the few, not the many. It’s like being a member of a yacht club marina. Because all the most popular clubs in Rio were originally clubs for the elites. After three to five years of religiously paying your membership dues, you become part of the advisory board, and then you have a say about what happens on the pitch.”

There is a plan to enfranchise ordinary Flamengo fans, though, which is an exciting development for the Flanalíticos crew. “The subscribers will soon also be allowed to vote for the president, which is something that would increase their influence,” says Luigui.

“But we don’t have democratic clubs in Brazil,” says Soldado. “It’s actually forbidden by law for clubs to be publicly held companies.” He says private ownership is the rule in small-town clubs, which are often owned by a local business baron who owns the supermarket and the football club, and his family dominates local politics. “He’s basically the owner of the town. So in a way it gets less democratic, the smaller it gets.”

The lack of democratic oversight, combined with a lack of private investment at elite level, means the vast job-creating potential of Brazilian football is endlessly squandered. Despite the country’s unrivalled wealth of talent, its football economy contributes a far smaller share of gross domestic product than in Spain, the United Kingdom or Germany. Major clubs are chronically indebted, to the taxman and to former players that they failed to pay. About 1 000 young players are sold abroad annually, often prematurely, draining the quality of the top division.

“We are happy with the management of Flamengo at the moment,” says Luigui. “It’s not a company, but it’s managed like a company, with people appointed on merit. But irresponsible management is everywhere else, it’s exactly like Brazilian political governance. The departing administration leaves a financial mess for the incoming administration, and that just carries on and snowballs. Most clubs try finance their senior teams by selling all their academy players too young and too cheaply. So they don’t invest enough in the player. It’s like trafficking in human beings.”

Where the ball is roundish

Germany is often hailed as the laboratory for football progress, with fans required by law to hold a majority stake in every Bundesliga club. But has the country quietly realised the dream of democratic, sustainable football?

Yes and no. Take European champions Bayern Munich, who are 75% owned by 293 000 official club members through the registered sports club that owns three-quarters of the commercial entity. The remaining stock is held by giant sponsor-partners Adidas, Audi and Allianz.

As a result of their ample sponsorships, slick management and millions of big-spending fans, Bayern has made a fat annual profit for decades, despite their massive transfer and salary budgets. Bayern – like Barcelona and Real Madrid, which are also majority-owned by their members, or socios – is a shining example of how fan ownership can deliver a consistently exceptional football team.

And in keeping with the Bundesliga norm, Bayern’s ticket prices are markedly lower than those paid by Real Madrid and Barcelona’s fan-owners, despite the high disposable incomes of most stadium-going Bayern fans.

But as internally democratic as they might be, these three fan-owned superclubs certainly don’t represent a democratic ethos beyond their membership. Bayern’s relentless dominance of German football has led other German football fans to see the club as a glaring symptom of a lopsided ecosystem. The fact that RB Leipzig, the strongest new challengers to Bayern, are a Red Bull marketing project masquerading as a club doesn’t improve the mood.

One of the clubs fighting for a better system is FC St Pauli, the left-wing Hamburg club beloved of socialists, punks and hipster tourists.

Michael Pahl, the director of the FC St Pauli Museum, says the problem is not Bayern, which at least play by the rules and can’t be blamed for their excellence. “The Bayern model is so much better than that of RB Leipzig. They have an open membership system, anyone can become one and vote at the members’ convention every year. Despite the outsourcing of the first team to an operating company, the club remains the most important stakeholder in the holding company.

“The criticism is more about a system that allows one club to get so far ahead, just because so much money is thrown at them. The Bundesliga is boring now. And St Pauli are one of the clubs that want us to talk about how the money generated by the entire system can be distributed more fairly to provide for a more interesting competition.”

FC Barcelona, owned by 144 000 members, have perfected the Spanish socio-system. They look good on paper and great in the trophy cabinet. But while Barcelona profess to be a club of the people and of the left, they happily accepted a politically dubious shirt sponsorship deal from the Qatari government. And for many years Barcelona have colluded with Real to hog half of La Liga’s broadcast revenue between them, leaving the other 18 clubs to survive on the remaining half.

This plainly unfair system is defended on the basis that the two el clásico giants represent half of the “market value” of the “product”. And how does one sustain such a dominance of the product? By pocketing half of the money every year. The other clubs accept the deal simply because they have to. That’s capitalism.

The problem, then, is that internally democratic, fan-owned football clubs can behave badly as social and economic actors. They are implicated in the economic and political climate that surrounds and sustains them. So Germany’s fan-ownership model reflects the relatively cooperative and equitable German model of capitalism, in which workers have reserved seats on company boards and a bigger chunk of profits are socialised, through wages and taxes, than they are in the UK or the United States.

There is a simple German idiom about the deep fairness of football at its best: Der ball ist rund (the ball is round). And we can safely say that for German football fans, if not for Bayern’s opponents, the ball isn’t square.

Guts, no glory

But genuine fan power often means taking the high road, which always means the hard road. At FC St Pauli, members zealously protect the progressive values of their club, keeping a careful eye out for any exposure to politically or environmentally toxic partners or sponsors.

“Making democratic decisions is in the genes of this club right now. And decisions have been made that involve sacrifice. I don’t know of any other club in the top three German divisions which hasn’t sold the naming rights for its stadium. That’s usually a million-dollar deal. St Pauli members voted not to sell the name, to set themselves apart and preserve their tradition,” says Pahl.

Decisions like these are part of the reason St Pauli spends most of its time in the second division, despite its bankable image. “The one thing that sets St Pauli apart is that symbiotic relationship between the fans and the team. This club has never won anything. But they are still one of the top five teams in Germany when it comes to merchandise sales, for example. The popularity-to-success relationship is interesting.”

But even such principled clubs are still participants in the inequities of the football industry in Germany and elsewhere. The best players, for example, are grossly overpaid. There is an argument to be made that pay structures in football are unusually labour-friendly in the sense that the industry’s most productive and indispensable workers – the players – get the bulk of the money. For example, if football’s broad pay structure were to be transposed to the music-streaming industry, musicians would be deservedly much better paid than they are currently.

The excessive pay gaps in elite football remain difficult to stomach from a socialist standpoint. The gaps exist within leagues, but more importantly within the community (or market) that sustains football. The professional game is a case study in the dangers of untrammelled meritocracy, not in the sense that an average La Liga player earning a fraction of Messi’s pay deserves to be paid much more, but in the sense that the public-sector nurse whose attention helps pay Messi’s salary deserves to be paid much more because she does more important work than Messi. The sponsors and tycoons who lavish their surpluses on football should instead be paying more tax.

This is part of a broader syndrome. Far too much of the economic surplus of late-capitalist societies is funnelled toward socially unproductive “workers” – star footballers, financial executives, big tech “disruptors” – at the expense of socially productive, or essential, workers.

The scramble for England

In England, that imbalance has been deepened by the billions poured into the Premier League by a long parade of the world’s oligarchs, sheikhs and barons. All that stinky offshore money makes for some snazzy football. But sometimes the money starts to travel out of the club rather than into it, which does not amuse the faithful.

#Glazersout is not the most electrifying of revolutionary slogans. It suggests a Belgian savoury waffle rather than a popular uprising. But it keeps coming back, year after year, as Manchester United fans are increasingly enraged by the gulf between the budget of the club and their win ratio.

Unlike its more achievable comrade, #OleOut, #Glazersout at least has the virtue of identifying an underlying problem. Manchester United’s US owners, the Glazer family, have sucked £89 million (about R1.8 billion today) out of the club over the past five years.

Even more troubling than the regular siphoning of profit across the Atlantic has been United’s apparent loss of a coherent football vision, both on and off the pitch, since the retirement of Alex Ferguson and the rise of former investment banker (and Glazer ally) Ed Woodward as the club’s leading official. The extractive ethic of the owners is grinding down the team’s identity into a red splatter of commerce.

Elsewhere in England, other anti-owner revolts simmer, with the common enemy being those owners who collect profits from their club instead of subsidising it, as Roman Abramovich does Chelsea or Sheik Mansour bin Zayed Al Nahyan does Manchester City.

So Arsenal fans have recurring spasms of #KroenkeOut and Newcastle United fans have wanted #AshleyOut for years. But if the problem of billionaire ownership is framed morally and not strategically, then bean-counting types like the Glazers, Stan Kroenke or Mike Ashley are in truth no worse than their profligate peers such as Abramovich or Al Nahyan. Because the wealth of such oligarchs is, of course, ill-gotten. It is paid for by ordinary people whose mineral resources have been privatised or royalised. Their football investments are the exercise of soft power, not gifts to the world.

So the English Premiership might be described – after a few drinks – as a proxy war between two species of billionaire: those who plunder the planet, who are loved by the fans, and those who plunder the club, who are not loved by the fans.

What the two types of billionaire have in common is that they were stinking rich before they bought into football. Buying control of an elite club is too expensive even for large and organised collectives of angry supporters. So the rebels have to resort instead to small, performative acts of defiance by forming amateur or semi-professional protest clubs such as FC United of Manchester, which have clawed their way up three amateur divisions since their establishment in 2007 as a rejection of the Glazer takeover. But FC United of Manchester remain a struggling non-league side. They attract between 2 000 and 3 000 of their 5 000 fan-owners to any given match.

Crucially, the players of FC United cannot and never will do what Bruno Fernandes or Marcus Rashford do. They give you a completely different fan experience, one in which effort and loyalty outweigh spectacle and triumph, a gristly garage pie to Man United’s Wagyu steak. You get what you pay for, in other words.

That’s why, for the typical Premiership fan, it makes more sense just to give up. To tolerate the murderous ticket prices, profit-gouging and strategic myopia, and focus instead on the excellence between the touchlines.

And even in those rare situations in which the fans have all the power, it can be extremely tempting to sell out. Non-league Welsh side Wrexham AFC were one of the few supporter-owned clubs in Britain. But the club was snapped up by American actors Ryan Reynolds and Rob McElhenney in mid-November, with an initial tranche of £2 million. A stadium upgrade is on the way, along with talk of a return to the Football League.

The catch came soon after the deal was announced, when the two Hollywood stars revealed that they’ve already started making a documentary television series about the club and its fans, a lucrative project for A-list stars in the Netflix era and one that could easily recoup their modest investment.

So there you go. Even in Hollywood, the ball isn’t round.

This article was first published on New Frame