Reject corporate welfare for Vikings

Using public money for a stadium is inefficient and worsens inequality.

Christopher Meyer

On March 1, Gov. Mark Dayton, Minneapolis Mayor R.T. Rybak and Vikings owner Zygi Wilf publicly announced a deal to build a new Vikings stadium next to the existing Metrodome site in downtown Minneapolis. Under the deal, the Vikings would pay $754.1 million, just over half of the stadium’s total cost. The state of Minnesota would subsidize the stadium with $398 million upfront, and the city of Minneapolis would subsidize it with $150 million upfront and $188.7 million in ongoing operational expenses.

The deal exemplifies corporate welfare at its worst. Politicians are preparing to extract $736 million from the public and hand it over to a private corporation owned by a billionaire real estate mogul. Minnesotans should reject this corporate welfare and insist that their tax dollars be put to better use.

Proponents of these stadium subsidies insist that their plan is a good deal for Minneapolis. In fact, they are portraying the Vikings’ contribution as downright generous. Pause for a moment to reflect on how bizarre that claim is. What is it about sports teams that make it count as a good deal when they only have to pony up half the bill for a stadium?

The main argument that stadium backers are offering in favor of these enormous subsidies is that the stadium will create jobs. Voters need to scrutinize these job-creation arguments extremely closely.

Every politician or corporation can make the argument that their pet project creates jobs because every large expenditure, no matter how wasteful, is guaranteed to employ people. The government could create lots of jobs if it spent $1 billion to hire people to dig holes and fill them back up again.

If any other for-profit corporation was building a new structure and only paying for half of it, would we consider that a good deal? Would it make sense to pay half the costs of a new Walmart store, or a new factory, just for the jobs that would bring?

The fundamental problem is that large corporations, like the Vikings, are able to leverage their influence to extract funds from governments, whereas small businesses have much more difficulty doing so. According to the Star Tribune, the Vikings have spent more than $3 million between 2005 and 2010 to lobby on behalf of their project.

The jobs argument can be valid when it’s made in a temporal context. If we accept the premise that a new Vikings stadium will be built with public funds no matter what, it makes more sense to build it now while unemployment is high and construction costs are low, instead of waiting until after the recession is over.

But before that temporal argument can be relevant, proponents need to answer the more fundamental question: Why does the Vikings stadium merit public funds in the first place? Their answer is essentially that having the Vikings in Minnesota provides “intangible” psychological benefits. It’s true that psychological benefits like pleasure and pride in one’s home team are intangible in the sense that we can’t accurately measure them in terms of dollars and cents. Thankfully we have another metric with which we can measure them: votes. The Minneapolis Charter requires that whenever the City Council wants to spend more than $10 million on a sports facility, they need to put the issue on a referendum. A referendum is the best way to determine whether the psychological benefits are worth the financial costs of the project. If Minneapolis voters feel that the benefits are worth it, they can show it at the polls.

Unfortunately, stadium backers are determined to bypass a referendum. “We are not going to do a referendum in the city,” said Rybak. “The referendum is when I stand for reelection.” The reason is obvious. City Council President Barb Johnson, the strongest stadium advocate on the council, acknowledged that “it [the referendum] won’t pass.” Her fears are backed up by a May 2011 Minnesota Poll, which found that 74 percent of Minnesotans are opposed to public subsidies for a stadium, with just 22 percent in favor.

Originally, I felt that if the stadium was going to be built, it would be better to have it in Minneapolis than in the suburbs because the transportation infrastructure is already in place. However, Jeff Rosenberg, a writer for the local politics blog MN Publius, made a compelling argument that persuaded me that the stadium is not a good fit for Minneapolis.

The Twins stadium brings 30 to 40 thousand visitors per game, with around 80 games per year. In contrast, the Vikings would bring 60 to 70 thousand visitors per game, with only 8 to 10 games per year. The Twins bring in a steady, manageable flow of visitors. The Vikings will bring in bursts of overwhelming traffic while leaving the vast, empty parking lots to sit idle for the rest of the year.

A better way to help employment is to prevent workers from getting laid off in the first place. We’ve been laying off teachers, bus drivers, firefighters and other public workers. It makes much more sense to retain those workers than to spend on this new project.

The City Council vote will likely be extremely close. By my count, there are six councilmembers who lean in opposition, four who lean in favor and three who have not indicated their position. Call your councilmember, Rybak, your state legislators and Dayton, and ask them to prioritize issues that matter rather than subsidies for entertainment.