For buggery’s sake, this is a professor? Of economics?

Second, high pay of this level does not represent a reward for effort. It does instead represent the ability to capture a rent. In economic terms this is the equivalent of monopoly profit arising from a market imperfection. So, footballers benefit from the rent arising from there being only a very few TV channels.

Facepalm.

Have you noted how, as the number of TV channels has gone up, footballers’ pay has risen?

Yep, that’s right, Spud has it the wrong way around. There aren’t that many people capable of playing football at Premiership level. There are many TV stations who would like to be able to show advertising to the many people who like watching Premiership football.

The more TV stations there are competing for that potential profit stream then the more they will be willing to pay to the footballers (or the teams, but they have the same problem, the revenues will flow to the players) to secure the rights.

He is absolutely, 100%, the wrong way around here.

Third, there is a need to reprice this pay to beat inequality which is now widely considered to be the cause of massive social harm as well as economic stagnation. The social harm aspect is, I hope, obvious. The stagnation comes from those very well off spending on asset price inflation (or saving, in other words) rather than recirculating income into the economy as those in lower pay do.

Sheesh. Someone’s just sold the asset, they’ve now got the cash. Which can be spent or saved/invested and nothing else. And if they invest it in an asset them some other mug now has the cash and can make only the same one of two decision.

And this would, of course, justify higher personal tax rates on investment income which, even after recent dividend and rental income changes, do in most cases have tax rates lower than those on going out to work for a living, which is absurd.

And Snippa shows that not only can he get things wrong from first principles he’s entirely ignorant of basic theory on taxation too. Capital income, on efficiency grounds, *should* be taxed at lower rates than labour income.

27 comments on “For buggery’s sake, this is a professor? Of economics?

  1. Mourinho is looking for a new centre forward (oops, central striker).

    If it’s so bloody easy to be a first division (oops, Premier League) player, he could always take Morata’s place so he can stay at Real Madrid and sit on the bench.

    In my dreams I could too. I’m certainly worth Rooney’s wage.

  2. I get the feeling the prof’s article was just filler around, “And this would, of course, justify higher personal tax rates”

    Blah.
    Blah blah.
    Blah blah blah blah blah.
    MOAR TAX.
    Blah.
    Blah blah.

  3. “Third, there is a need to reprice this pay to beat inequality which is now widely considered to be the cause of massive social harm as well as economic stagnation”

    I know his site is a citation free zone so I won’t look there but has anyone provided data to substantiate this claim? I know Piketty just asserts it as well.

    Or this just about the green eyed monster?

  4. Leaving aside the fucming idiocy of his economics jist for a moment, his views on footballers (he’s returned Tot his theme more than once) are as deeply immoral an patronising as we would expect. The analogy he drew between his dog obeying it’s master and the free citizen is apt here.

    Footballers are young, often from poor third world backgrounds, often with little formal qualification or education to speak of. Temp of millions of people freely (there’s that word again) choose to pay the TV channels to watch those young men. Indeed they pay those TV channels precisely because it’s those young men exhibiting their very rare skills. So who should get the money? Only the very very conservative twats of the modern Left can decide that those unedusted but relented young men are “rentiers”.

    Fuck you Murphy, you evil cunt.

  5. If we had a world wide maximum footballers wage cap and it was enforced (which I doubt would be possible) – then the money would go to the club owners or TV stations.
    Why would that be better?

  6. How this works is like this. (© Elynomics for Dummies)

    There is theoretically a near-infinite number of premiership football teams because of the large number of men in the UK even if some of them are rather fat and waddle.

    The only constraint on the number of actual premiership teams is that TV channels operate as an oligopoly (don’t worry about this word for now – we’ll come to it next year unless my funding comes through for something better).

    For now, it is only necessary to understand that an oligopoly is an evil neo-liberal construct designed to avoid tax and extract rentier monies. This exclusive club of TV moguls force up the price of …

    Actually no, I give up, but it’s bound to be something like that.

  7. Ritchie is an expert on everything, including football.

    Predictions from 2016:
    – Mourinho to be fired from ManU before Xmas 2016
    – Leicester City would be relegated the season after winning the Premiership

    As always, never knowingly right about anything.

  8. “The more TV stations there are competing for that potential profit stream then the more they will be willing to pay to the footballers…”

    There are at least a couple of limiting factors though. Pay too much and at a certain point the casual football fans start to not want to pay the extra for the sports channels. I suspect that this point has already been reached by Sky and for some time they have had to boost subscription rates for non-sports subscribers to cover the costs of carrying football.
    This is certainly a common perception and more than a few people ditching Sky have complained at having to subsidize a service they don’t want.
    Whether or not Sky finds the present situation financially acceptable for them I doubt they will want to go too much further down this road.

  9. JS, at some point Sky will start charging separately for each sport so morons like the ECB will find out exactly how much the TV rights are worth. It’s all hidden away behind the Premier League at the moment

  10. People are always in favour of taking money from footballers and giving it to the state; but they never argue that money should be taken from Saint J.K. Rowling. Why? Because JK espouses the right political views. Footballers need to stop talking about football and start talking about disabled LGBT Muslim refugees.

  11. Ironman

    ‘Fuck you Murphy, you evil cunt’

    Well that’s a sentiment I’d hope most sentient people share – evil is just the word I’d use.

    The original source article (top entry on TRUK) is worthy of a university lecture. It’s been a while since I have seen so many fallacies in a single blog entry.

    I do think the period of ‘Peak Murphy’ is upon us now. Increasingly he is seen as batshit insane by everyone except a few diehards on his blog. Still does not preclude the need for Tim’s ‘Ragging on Ritchie’ series though – evil, particularly in a very pure form as with Murphy, must always be opposed.

  12. JS,

    It’s not just soccer fans. I cancelled my Sky Sports package because I don’t watch soccer and I got fed up with the high cost so I could watch cricket, rugby and the occasional golf like the Ryder Cup.

  13. Third, there is a need to reprice this pay to beat inequality which is now widely considered to be the cause of massive social harm as well as economic stagnation.

    If it’s “widely considered to be”, then it must be true.

    Glad that’s cleared up.

  14. In all sports every year tens of thousands of kids start playing. They will each spend thousands of hours and thousands of pounds on kit. a few dozens will make the premier league. The rest will drop along the way.

    With those odds, why would they even start? Because the stars of the premier league are famous and get lots of money. So it’s like a lottery, because no matter how talented you seem at 7, you can’t tell if you’ll be good enough when you’re 18. And a whole bunch will find out that their knees cannot handle the stress.

    Put a cap on wages in the premier league, and you take away the prize. Not just the money, but also some of the fame. Part of the fame of being a premier league footballer is that you score goals. Another part is that you travel to exotic places with your supermodel girlfriend. Less money – no supermodel girlfriend.

  15. @Van Patten

    Speaking of batshit crazy, I note that Mark Crown, once brown-noser extraodinaire over on TRUK but, for reasons best known to Murphy, found himself exiled…has now resurfaced over on the Progessive Pulsating Penis website. God fucking help us.

  16. I suppose Murphy would be happier if these working class chappies who play football would know their place and resign themselves to lives once they retire as cab drivers or if they are really lucky, running the “Broken Goalpost” pub where they slowly slide into alcoholism and dispair before hanging themselves in the beer cellar.

  17. high pay of this level does not represent a reward for effort.

    Well, duh. It’s a reward for results. What you produce, not how much effort you put into creating it.

    Is he lurching towards the Labour theory of Value (or whatever it is)? It would make sense; there is barely an economic fallacy he hasn’t arrogantly waded into and drowned in.

  18. Stretching the metaphor somewhat, Labour have missed an open goal here. They could have a manifesto commitment that all football must be shown on free-to-view TV; or even on the BBC. Not only will they win some votes amongst football fans; but more importantly it means Labour get to stick it to Murdoch and his Sky Sports empire.

  19. MBE

    +1

    Wonder what Spud would make of this?

    The theory makes sense. So Murphy would dismiss it by suggesting that its authors clearly want to allow babies to die and rivers dry up.

  20. LizardKing

    I recall him – came close to making ‘the gang of four’ (Howard Reed, Carol Wilcox, Andrew Dickie and Ivan Horrocks) a gang of five but he disappeared without a trace – I presumed he was a troll, possibly of this parish. How disturbing he has resurfaced….

    Regards

    Bruce

  21. VP/LK

    I was convinced he was a troll; I thought he was simply too “good” to be real?

    How disturbing he has resurfaced…

    Oh, I don’t know….

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