While the debate rages on over Rafael Benitez’ future at Liverpool one argument that seems to favour those who want him out of the club is that money isn’t everything and he should still be able to do a job without it. Well, with clubs trying their hardest to bring in foreign money men and getting themselves into crippling debt it’s hard to see exactly how money isn’t important.
Those who argue money isn’t needed to generate success usually use the example of Arsenal manager Arsene Wenger. The Frenchman has managed to spend very little in his time as the Gooners boss, instead relying on bringing in relative unknowns and developing the youth team. Indeed, this did prove very successful for the London club, with them collecting a number of league titles, domestic cups and even reaching a European Cup final.
However it’s been fuor years since Arsenal have won a major trophy and the main reason for that is their spending policy. Whilst the way Wenger spends was perfectly suited to football up until the middle of the decade a big change in the league made the Penny-pinching Arsenal financial tactic out of date. That change is the arrival of the foreign billionaires to the worlds most popular football league.
Roman Abramovich was the first true money man to arrive in the England when he took over Chelsea in June of 2003. Although foreign investors had took over English clubs before him, most notably Malcolm Glazer’s gradual aquisition of Manchester United, Abramovich was the foreigner who came in with the sole intention of running Chelsea as a hobby rather than a business, which meant he pumped in hundreds of millions without any real expectation of a return on his investment.
Chelsea, who when the Russian took over were struggling to qualify for the Champions League, are now one of the most formidable sides in Europe, winning two league titles, two F.A Cups and two League Cups, as well as getting to the Champions League final in 2008. There’s no doubt the high spending by the oligarch has lead to Chelsea’s success and it’s a prime example of how important money has become in football.
The only club in England that have truly been able to keep up with Chelsea in recent years is Sir Alex’s Ferguson’s Manchester United, but their financial stability is under-threat with debts that have the potential to cripple the 18 times league champions. The current league champions are currently estimated to be paying £48,00o an hour on interest on their debts. That, of course, is just the interest on its own without even considering the actual debt, which stands at around £750 million. United’s 2009 accounts reported just over £40 million was paid back in interest payments during the year, with the club making an operating profit of £32 million, which means the club would have been in the financial red if it hadn’t have been for the £80 million sale of star player Cristiano Ronaldo.
A large chunk of United’s debt is scheduled to be paid between 2013 and 2015, and that’s got the clubs money men in a panic. Despite how it may have been covered up United had to sell Ronaldo to keep themselves out of the red in 2009 and they’re likely going to have to sell more and more star players into the future, especially with some of the debt repayments due in just three years time. This may be the decade that see’s the fall on Manchester United and it’s all to do with money.
While red side of Manchester may be facing financial collapse the blue side will be significantly more optimistic about their future since the arrival of the leagues second big money man Sheikh Mansour of Abu Dhabi. The oil-rich Arab has personal wealth of around £6 billion, though being a part of the U.A.E royal family will most likely mean he has much more than that at his disposal.
The similarities between Chelsea and City are quite considerable, Chelsea turned from a team challenging for a European place into a team challenging for the league and City have turned from a team struggling to get in the top half in to a team seriously challenging for a place in next years Champions League competition. The similarities don’t end there, Chelsea got rid of manager Ranieri after he proved he couldn’t effectively spend the hundreds of millions at his disposal, the same can arguably be said for Hughes at City. Chelsea replaced the Italian with curent Inter Milan manager Jose Mourinho and City have brought in the former manager Roberto Mancini.
Both have made massive progress in a short period of time, and it’s only going to continue into the future unless another billionaire is attracted to a Premier League club.
To a lesser extent Aston Villa have also benefited from a considerable cash injection from American Tycoon Randy Lerner, who has overseen the resurgence of the Birmingham club into a serious outfit challenging for European football. While his investment isn’t to the same level as that of City and Chelsea’s owners it still is worth a mention. Under his ownership Martin O’ Neil has spent millions on the likes of Downing, Friedel and Milner and has had to sell very little, with the one of a few major players to leave the club being Gareth Barry who of course headed for City in the summer.
So, back to Arsenal’s current spending system. To put it simply it’s outdated and their success in recent years shows it. While Arsenal will be able to compete for Europe in years to come thanks to having a 60,000 seater stadium in the center of London I can’t see them getting close to the league title again, not with the established money of Chelsea and the emergence of Manchester City as contenders for the best of the rich clubs crown. It has to be noted Arsenal have a particularly good youth team but can you really expect to compete when you’re integrating youth players into the squad and only bringing in one high-price signing every few years? Especially when City and Chelsea will be buying the best in the world window after window.
Saying that things are only likely to get worse on the home front as well. Liverpool’s sell-to-buy policy is less than sustainable when the two rich clubs are spending big. Couple this with £250 million of debt and high interest payments and things are looking gloomy financially for the Reds. Liverpool’s historic stadium gives them a disadvantage as well, especially against Arsenal and debt-ridden United, who both have over 60,000 seats with a host of executive boxes while Liverpool can only boast 45,000 seats and a basic ability to cater for corporate customers.
So, what could happen to the Premier League in the coming years? If City and Chelsea keep their current owners I have no doubt they will end up being the two biggest clubs in the country. If United can’t re-finance they’re going to have serious problems in years to come and even if they can it’s only delaying the inevitable. The only thing that can seemingly save the red side of Manchester from financial meltdown now is new owners willing to invest just as much as Abramovich has at Chelsea. Arsenal and Liverpool’s inability to spend will no doubt see them fall further and further behind the pack, although our lack of a world class stadium may see us falling further behind than Arsenal.
If things continue as they are Chelsea and City may end up being the Celtic and Rangers of the Premier League. Both clubs will likely have the ability to grab first and second place every season and they make look down at the rest of the table for new signings, luring players from all their rivals with promises of big wages and silverware. I may be going a bit over the top, but it’s hard to see this league be anything but a two horse race in years to come, not unless other clubs attract serious investment from a billionaire.
Of course it could go a different way, with the huge taxes now imposed on football players they may be attracted to Spain or Italy, making on of them the most popular league in the world, stealing the Premier Leagues long worn crown. If that’s the case the billionaires may get bored with their toy team and go off in search of something more interesting, leaving clubs like City and Chelsea with huge wages and nobody to pay the bill, allowing clubs who had been in their shadow to take their crown at the top of the table. Ultimately though, the only clubs that will prosper if the billionaires get bored are the next richest clubs in line. This is a game that is reliant on money, even if the bubble does burst on the Premier League.
So, that’s the story of the Premier League and money so far and it’s one which isn’t likely to have a happy ending.
M. Owen
michael@empireofthekop.clm