Abstract
The decade of the 1980s witnessed massive changes in the internal structure and functioning of English football.1 Several rules, instituted during the infancy of the professional game to limit profit-making, were overturned with remarkable rapidity within the space of a few years, culminating in the formation of the English Premier League (EPL) in 1992. In this paper, I engage with two questions. One, why and how was the century-old structure of English football so rapidly transformed and what were the consequences? Two, what sort of Marxian theoretical framework can we use to understand the historical trajectory of English football? With respect to the former, I follow David Harvey’s analysis of neoliberal strategies used to restore upper-class dominance to argue that the formation of the EPL can be interpreted as another instance of accumulation by dispossession, one among myriad attempts to solve the profitability crisis of the 1970s by creating an avenue for financial speculation in football clubs. Together with the deregulation of television, it converted football from a domain formerly regarded as “off-limits to the calculus of profitability” into a “business proper.” In terms of a theoretical framework, I propose that it is useful to think of football as serving global capitalism in a dual manner: as an avenue for accumulation (the accumulation function) and as a tool for legitimizing capitalist rule by producing alienated consciousness in society (the legitimation function).
1. Introduction
There can be no doubt that the English Premier League (EPL) is today a global phenomenon. According to its official website, the league is broadcast in 212 countries around the world, with 80 different broadcasters being involved. The television audience is approximately 4.7 billion, almost 70 percent of the world’s population. The revenue figures are even more staggering. The latest TV deal between the EPL and the broadcasters Sky and British Television amounts to £5.14 billion for the three seasons 2016-19, a 71 percent increase over the 2013-16 deal. 2 Despite not being involved in European competitions during the 2014-15 season, Manchester United’s revenue from retail, merchandising, apparel, and product licensing alone was £31.6 million. 3 It also concluded the largest kit manufacturer sponsorship deal in sports history with Adidas on August 1, 2015: £750 million over the next 10 years. 4 When we consider that by World Bank estimates, 5 the per capita gross national income of Bangladesh was $1,080 (approx. £700) in 2014, the money flowing through the EPL stands out in stark contrast.
The impact of the EPL, however, is not only economic but also cultural. It is now common to find fan clubs of the big teams all over the world, in East Asia, in Africa, and in the United States in equal measure. Recently, David Goldblatt has reported on a remarkable high-security prison in Uganda where inmates form teams called Liverpool, Arsenal, and Manchester United to organize what is surely one of the world’s most elaborate prison leagues. While this may be an example of “the transformative power of the beautiful game” (Goldblatt 2015), the problem of hooliganism, which plagued English football during the 1970s and ’80s, has not entirely disappeared and often rears its ugly head on “derby” days. All of these different aspects of the modern game deserve careful separate analysis. The money flowing through the EPL and its precise link with global financial flows needs to be analyzed. From a cultural perspective, the questions of fan loyalty and the “globalization of football brands” (Bridgewater 2010) become important. In fact, innovative research in different directions is already ongoing. For example, Kennedy and Kennedy (2010) have tried to analyze how the tension between football as “business” and clubs as symbols of community and tradition plays out in the emotive responses of supporters to commercialization.
My focus in this paper is on a prior problematic: why and how was the century-old structure of English football so rapidly transformed and what were the consequences? The profound nature of the changes of the 1980s and their consequences have been described powerfully by David Conn (2005) and David Goldblatt (2014). Goldblatt in particular also emphasizes how the larger social changes in Thatcherite Britain shaped and influenced the complete overhaul of professional football. I aim to extend their analysis by trying to understand the historical trajectory of English football within a Marxian framework. The article is organized as follows. I begin section 2 by briefly engaging with two important non-Marxian approaches to modern sport. I then outline my preferred Marxian framework and point out some of the tensions within it. In sections 3, 4, and 5, I argue that despite these tensions, the framework can help us understand the historical trajectory of English football, in particular the kind of changes leading up to the formation of the EPL. To this end, I emphasize the capitalist roots of modern football and its symbiotic relationship with mass media. I show how Baran and Sweezy’s (1964, 2013) analysis of mass media and advertising can be used to understand the changes in British television from the 1980s onward. These changes were an essential complement of those in football, and it was the combination of the two that enabled the accumulation by dispossession that is my focus. Finally, in the conclusion, I point to two possible avenues of fruitful further research.
2. Theorizing Modern Sport: Non-Marxian and Marxian Approaches
It should be mentioned at the outset that theories of modern sport have focused primarily on the Western (in some cases even European) experience.
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Of course, some Marxists have interpreted sport as a purveyor of imperial culture (Naison 1972; Stoddart 1988) and South Asianists have documented the interconnections between football, nationalism, and communalism (Dimeo and Mills 2001; Dimeo 2001; Chatterjee 2012). However, the theoretical apparatus brought to bear on sport is most appropriate for Western societies since they were the first to witness the professionalization of sport and remain at the forefront of its increased commercialization. Nonetheless, any attempt to emphasize the specificity of modern competitive sport raises important questions of an anthropological kind. Is competitive sport epochally specific to capitalism? How might we demonstrate this? The evidence is not clear-cut. For example, Cashmore (2000) reminds us that the idea of “rivalry” in sporting events can be traced as far back as 776 B.C., when the Greeks first organized the Olympic Games. Moreover, even the use of sport to divert attention of the populace from urgent political matters is not specific to capitalism as such. As Cashmore argues:
History shows that activities which at least resemble sports are rarely purely autotelic and can be augmented with other purposes. From ancient to medieval ages…the public provision of entertainment by the powerful had a latent political function in diverting attention away from realpolitik and animating sentiments and emotions that were not challenging to the established order of things. (Cashmore 2000: 71)
Thus, the question of how much of a dividing line we can draw between modern, capitalist, competitive forms of sport and pre-capitalist forms is not easily settled. Nonetheless, most commentators, Marxist and non-Marxist alike, agree that the rapid changes in the sporting arena from the mid-19th century onward, i.e. its rapid professionalization and subsequent commercialization, need to be treated as a historically unique experience. To varying degrees, they also emphasize the inextricable link of these changes to the spread of industrialization.
2.1. Non-Marxian approaches: Figurational and Weberian
Perhaps the most influential non-Marxian theory of modern sport is Norbert Elias’s “figurational” approach. He defines sportization as the process of the formal encoding and application of “fair” rules of play and the rise of impersonal organizations for maintaining them. He describes the relationship between sportization and industrialization as follows: “Both industrialization and sportization were symptomatic of a deeper-lying transformation of European societies which demanded of their individual members greater regularity and differentiation of conduct” (Elias 1986: 151). The deeper transformation referred to is the historical evolution of the civilizing process, which according to Elias leads to the increased control of violence in societies over time. The closing up of outlets for violence causes humans to search for substitute activities that can amuse and excite within the boundaries of socially acceptable norms. The explanation of sport, therefore, is just one facet of a broader understanding of social change in Elias’s theory. Thus, while emphasizing the specificity of modern sport, Elias seems to be suggesting an underlying continuity and does not draw too sharp a distinction between pre-capitalist and capitalist forms of sport.
In a slightly different vein, theorists inspired by the work of Max Weber argue that the rise of capitalism and its Protestant ethic that glorified work vis-à-vis idleness made a considerable impact on the rationalization and professionalization of sport (Cashmore 2000: 104). As Steven J. Overman (2000) puts it, “The Protestant sport ethos succeeded in transforming sport into a regimen of goal-directed behaviors which are the antithesis of pure play.”
These approaches have important insights to offer on the specificity of modern sport. In fact, the Weberian view that the professionalization of sport actually makes it antithetical to enjoyment is somewhat parallel to the Marxist understanding of the alienating character of modern sport. However, these approaches do not provide the conceptual tools needed to analyze the increased commercialization of sport in recent years. Indeed, the history of the 20th century is one of the increased absorption of sporting activities into the logic of capitalist monetary circulation. To analyze the commodification of sport, therefore, we have to turn to Marxian approaches.
2.2. Capitalism and the commodification of leisure: A Marxian understanding of modern sport
A rich Marxist literature on sport has developed since the late 1960s. While analyzing specific sports and the politics of domination or exclusion within them, Marxists have always attempted to develop general theoretical frameworks. The theoretical questions raised by this literature remain open to debate and discussion. 7 My present aim is not to attempt a resolution. Neither do I want to suggest that a single framework can be used to understand all instances of domination and exploitation in sport. Rather, I build on the ideas of previous authors to propose an approach that might be fruitful for understanding the historical trajectory of English football.
All Marxist understandings of sport in capitalist society emphasize the historically specific class character of such societies. Under capitalism, a small group of people, the bourgeoisie, owns the means of production. A huge mass of “free” laborers, the proletariat, has no access to means of production and hence is forced to work for others. Although this is a very broad schematic understanding, it is undeniable that capitalist socio-property relations change the character of work and every other sphere of human activity in palpable ways. In pre-capitalist societies, work was organized around the agricultural seasons while artisans retained a degree of control over the labor process and the means of production. However, as primitive accumulation and new capitalist social relations spread across Europe, the result was that:
Social life became increasingly regimented; social time and social space became increasingly constrained, parcellised and organised; the lives of the poor and of the working class in particular became more disciplined, watched and timed. (Budd 2014)
With the rise of capitalism, therefore, the historically specific, strict distinction between “work” and “leisure” began to get instituted. In fact, the rise of “abstract time,” that is time as an independent variable that is divisible into equal, constant, and nonqualitative units and which constitutes an independent framework within which events occur, can be shown to be historically specific to capitalism (Postone 1993: 202). Such an abstract quantification of time was required to institute “work-discipline,” as Thompson (1967) convincingly argues. Thus, it is only against the reality of “work” in capitalism that the role of “leisure” can be analyzed. Because labor is commodified and people are forced to work for others to earn a living, an extraordinary emphasis is placed on “free-time” and work is seen as a burden, as time that is “wasted.” Harry Braverman puts it succinctly:
In a society where labor power is purchased and sold, working time becomes sharply and antagonistically divided from nonworking time, and the worker places an extraordinary value upon this ‘free’ time, while on-the-job time is regarded as lost and wasted. (Braverman 1974: 278)
It has been argued that the proliferation of professional competitive sport was meant precisely to fill up this leisure time; to provide “relief from work while at the same time preparing people for more work” (Cashmore 2000: 92). Sport, as a spectacle that millions of people around the world watch during their “free-time,” typifies capitalist ideology and helps to preserve the status quo of capitalist class-relations. In other words, it helps to legitimize class rule by producing alienated consciousness among the working class in two different ways. First, sport helps to train a “docile labor force” by encouraging the working class to accept the kind of work-discipline demanded in modern production. John Hargreaves puts it nicely while comparing the features of sport and industry:
A high degree of specialisation and standardisation, bureaucratised and hierarchical administration, long-term planning, increased reliance on science and technology, a drive for maximum productivity, a quantification of performance and, above all, the alienation of both producer and consumer. (Hargreaves 1982)
Second, sport further exemplifies the core of capitalist ideology by glorifying attributes that have counterparts in society at large: egoistic aggressive individualism, competitiveness, racism, sexism, and nationalism are all qualities that are often glorified by sport, as Hargreaves argues. This process of creating alienated consciousness among the working-class by keeping them in the grip of ideology is what I will call the legitimation function of football in subsequent sections. As mentioned before, however, the legitimation function is not unique to capitalism. Moreover, history shows that sport can also yield the kind of solidarity that contributes to anti-systemic movements (Cashmore 2000: 96). Hence, what is truly unique to capitalism is its ability to commodify every sphere of social existence. In a capitalist society, a commodity has a material form but it is a social form (Postone 1993: 155). Labor under capitalism is a commodity as well as being the source of commodities. It is thus no surprise that the tendency of commodification extends into the sporting arena as well, which is increasingly drawn into the orbit of capitalist circulation of money and commodities. This trend is aptly captured by the transfer and trading of players. To quote Braverman once more:
So enterprising is capital that even where the effort is made by one or another section to find a way to nature, sport or art through personal activity and amateur or “underground” innovation, these activities are rapidly incorporated into the market so far as is possible. (Braverman 1974: 279)
Thus, through the commodification of leisure, capitalism ensures that even so-called free time becomes an avenue for profit-generation, thereby taking the alienation of workers from the labor process to its logical conclusion. This is the accumulation function of sport that mutually reinforces the legitimation function. Of course, positing such a theory of dual functions immediately raises problematic questions of a structural 8 kind. What is the mechanism through which the rigors of capitalist competition get expressed in a particular sport? What allows for football to mirror the rigors of capitalist competition in a way that constitutes pleasure rather than suffering? Why does leisure not function as the compensatory antithesis of economic life? These are theoretical questions that the Marxist literature on sport has not adequately resolved. If I retain the duality, therefore, it is not because I want to assume away the problems associated with it. Rather, it is because it helps us to illuminate different moments of the historical trajectory of football in England. In particular, I shall argue that at the moment of its birth and during its early years of existence, professional football primarily performed the legitimation function. As capitalism has progressed, the accumulation function has steadily increased in importance. In particular, it has acquired immense significance in the aftermath of the profitability crisis of the 1970s.
3. Football: The New “Opium of the Masses”
In this section, I briefly point out how the theory of a dual function of football might be used to understand the historical trajectory of this truly global sport.
3.1. The creation of an urban working class and the rise of football as mass entertainment
Section 2.2. emphasized that the historical changes associated with the rise of capitalism are what led to the transformation of sport into organized activity with codified rules and specified time-limits. The rise of football in the second half of the 19th century in England is also related to the changing conditions of industrial production at the time. Its origins lie in the “muscular Christianity” of England’s mid-19th century public schools that wanted to turn out “great men” who could survive in a ruthless world. The first codified rules for football were drawn up at Cambridge University in 1848, and public school educated men controlled the Football Association (FA) when it was formed in 1863. The original FA Cup winners included the Royal Engineers, Oxford University, the Old Etonians, and the Old Carthusians. This domination by public schools was only breached in 1883 when a professional team, Blackburn Olympic, won the FA Cup.
The transformation of football into a professional sport gathered pace in the second half of the 19th century after industrial production had stabilized as compared to the previous few decades when men, women, and even children were expected to work long hours in often appalling conditions. Capitalists realized that industrial production required a skilled as well as a healthy and relatively content workforce. The institutionalization of “leisure-time,” specifically Saturday afternoon holidays, opened the way for football games to “…[fill] a void in the lives of working men in the late Victorian industrial societies” (Conn 2005: 21). After professionalism was legalized in 1885, the Football League was formed in 1888, and a quarter of its clubs were founded by the churches keen to grow in the new urban working class areas: Aston Villa grew from a men’s Bible class, Birmingham City from Holy Trinity Church, Bolton from Christ Church, and Everton from St. Domingo’s Congregational Church Sunday School.
As industrialists began to recognize the advantages of sport, several working-class-based clubs also sprang up: Arsenal was formed from workers at the Royal Arsenal in Woolwich, West Ham United from Thames Iron Works, Manchester United from Lancashire and Yorkshire Railway, and Southampton from Woolston Shipyard. This spread of football into the working class from above was central to the creation of a “respectable” working class following “the upheavals of the post-Napoleonic and Chartist years” (Bambery 1996).
Thus, the important thing to realize is that capital by the mid-19th century was changing its methods of exploitation. It increasingly required a skilled workforce provided with a minimum amount of education, healthcare, and “rest.” This led to the use of football games as a diversion from the mundane realities of daily life. Nonetheless, the methods of enforcing “discipline” at the workplace had their counterparts in the development of football as a professional sport. As a result of the firm establishment of abstract time as a norm and its accurate measurement by the newly developed mechanical clock, time periods for contests were enforced strictly. Divisions of labor yielded role-specific positions such as goalkeepers and defenders with particular, as opposed to general, skills. The competitive drive in capitalist production was introduced into football: “winners and losers were unambiguously clear, outright and absolute” (ibid.).
At this stage, therefore, football was more a reflection of the ethics of capitalist production, which ensured that even during their “leisure-time,” workers were in thrall of capitalist ideology while simultaneously having a “good time.” Thus, football primarily performed the legitimation function rather than the accumulation function.
3.2. Football, imperialism, and nationalism
Immanuel Wallerstein defines hegemony in the capitalist world system as a situation wherein “…ongoing rivalry between the great powers is so unbalanced that one power can impose its rules in the economic, political, military and even cultural areas” (Wallerstein 2000: 255). The spread of football to vast areas of the world, including Latin America, Asia, and Africa during the late 19th and early 20th centuries, can be seen as an expression of British cultural hegemony. The historian Bill Murray has called football Britain’s “most enduring export” (Murray 1994: xi). Indeed, Britain’s huge trading empire was the transmission mechanism that turned football into a global sport.
Such expansionism was also tied to imperial interests. Organized sport was largely a product of imperial powers; most of the rules were drawn up and governing bodies were established between the 1860s and 1890s, the heyday of imperialism. C. L. R. James, in his Beyond a Boundary (1993), shows how cricket was used in the British West Indies to disseminate ideas such as racial superiority that were central to maintaining colonial rule across British colonies. Like cricket, football was spread across Britain’s empire just as U.S. imperialism ensured that baseball became the national sport of Cuba, Puerto Rico, Mexico, and much of Central America (Bambery 1996). During the early 20th century, football gradually came to be integrated into a framework of inter-state rivalry as well. For example, at the very first World Cup final played in Montevideo in 1930, the Uruguayan home side came from 2-0 down against Argentina to win the tournament 4-2. That night, while home supporters rejoiced, across the border, “…in Buenos Aires, the defeated Argentinians raged; mobs took to the streets, even stoning the Uruguayan consulate, and diplomatic relations between the countries were broken off” (G. Hodgson quoted in Bambery 1996). Even as British hegemony declined and the World Wars resulted in football taking a back seat, it nonetheless cemented its place as one of the world’s most popular games. Thus, it continued to serve its legitimation function admirably, but its role as an avenue for accumulation was still limited.
3.3. The golden age and the growth of mass media
The so-called “golden age of capitalism” was a time of reconstruction in most of the war-ravaged economies of the West. The institutionalization of welfare state policies led to a period of relative stability for capitalism in the “core” countries of the world-system, characterized by high growth and high profit rates.
During this period, the FIFA World Cup established itself as a regular fixture every four calendar years along with regional tournaments such as the African Cup of Nations and the Copa America. This was also the time when commercial interest in football, as well as in other cultural spheres such as music and cinema, began to grow. The music “industry” experienced its biggest boom in history during the 1950s and ’60s when musical genres such as “rock n roll” first burst onto the scene. As television became more popular during the 1960s, and radio transmissions became global in their reach, football matches could reach an ever-greater number of people. As the increased possibilities of revenue-generation took hold, so did the commercialization of football. In 1966 the World Cup in England became a truly global event, transmitting pictures and sound around the world, and in 1982 the TV rights for the World Cup generated $40 million. 9
Along with this increasing importance of the accumulation function, the legitimation function of football revealed its ugly side during the 1960s and ’70s. For example, in Brazil after the military coup in 1964, even as the government rounded up political dissidents, it also produced a giant poster of Pelé straining to head the ball through the goal, accompanied by the slogan Ninguém mais segura este país: Nobody can stop this country now (Dave Shirin quoted in Mathew 2014). This aptly demonstrates how football stokes nationalist sentiments, creating the possibility for an unscrupulous government to use a star player as a mouthpiece to legitimize itself. Again, in Chile after the coup in 1973, General Pinochet’s government filled the national stadium in Santiago with political dissidents who were subsequently executed. Although the Soviet Union refused to play in that stadium two months later in a World Cup qualifying game, thereby handing Chile a walkover, the Chilean team went on to play in the tournament next year and all was forgotten.
Thus, the immediate postwar period was the time when the foundation was laid for the use of football as an avenue for “investment” and the creation of the massive “industry” that it is today. Crucially important for the increased extraction of profit from the “football business” was the loyalty of millions of football fans across the world who could be charged high prices for tickets and satellite boxes. Thus, the accumulation function and the legitimation function would prove to be mutually reinforcing in subsequent years.
3.4. Crises, financialization, and deregulation from the 1980s onward
The 1960s and ’70s witnessed a serious profitability crisis in the advanced capitalist world. While there are competing views as to the causes of the crisis—a secular falling rate of profit due to rising organic composition of capital (Laibman 1987), a change in the balance of class power (Gordon, Weisskopf, and Bowles 1987) and underconsumption (Bellamy Foster 1987)—there is no doubt that profits fell substantially during that time. In response, two different kinds of methods were employed by the capitalist class to try and restore profitability (Vakulabharanam 2009). First, in the realm of expanded reproduction, the working-class was disciplined through wage-cuts, unions were dismantled, and real wages were delinked from productivity growth. The second method adopted by capitalists to restore profitability is what David Harvey (2007) refers to as “accumulation by dispossession.” This is akin to what Marx called “primitive” or “original” accumulation and refers to the “fabrication” of new avenues for accumulation from scratch through the privatization of public assets, financial speculation, and devaluation of assets, as well as through war, dispossession of the peasantry, etc. 10
Despite the explanatory potential of the concept of accumulation by dispossession, however, there has been no attempt to use it to explain major recent developments in the sports “industry.” In the next two sections, I will argue that Harvey’s theory can be used to interpret the formation of the EPL as an instance of dispossession in the search for ever-new avenues for the deployment of surplus capital.
4. Capitalism, Technological Change, and Football
The symbiotic relationship between technological advances and the increased commercialization and globalization of sport has been nicely summarized by Tony Collins in his recent book Sport in Capitalist Society: A Short History (2013). Collins emphasizes that the development of print media and newspapers in the 18th and 19th centuries contributed immensely to the increased popularity of competitive sport among the masses.
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The spread of radio in the inter-war years served to increase the reach of broadcasts of sporting events. However, the emergence of television in the 1950s started to “transform the traditional sports business model” (Collins 2013: 114). The first football match to be televised live was between Arsenal’s first and reserve teams, broadcast by the BBC in 1937. Although the growth of television viewership was slow in the UK as compared to the United States, there were 10 million households owning TV sets by 1960 and 90 percent coverage was reached by 1968 (ibid.: 115). As mentioned before, the 1966 World Cup held in England was the first globally broadcast footballing event. The rectangular pitches of football grounds lent themselves perfectly to the viewing area of the television screen, and the love affair well and truly began in the late 1950s. However, state control of broadcasts meant that the amount of money that could be made from football was still limited. Collins states:
As was the case in most of western Europe, the dominance of a state-controlled broadcasting service such as the BBC undermined any bargaining power that sports’ organisations had with television companies…[such] state control held back the financial potential for sport on the continent. (ibid.: 116)
It was the deregulation of the European television market that began in the late 1970s, and the technological development of cable and satellite TV, that “opened the door to new revenue streams and new entrants to the market” (ibid.: 120). In 1983, the Football League (all 92 clubs) received £5.2 million from the BBC and ITV for TV rights, a figure that increased to £44 million from ITV in 1988 (ibid.: 122). With the formation of the EPL in 1992, the 20 clubs in that elite league received £305 million from the newly formed BSkyB (Conn 2005: 57).
This explosion of TV money, however, needs to be understood within its broader social context. It is a merit of Collins’s analysis that it does not fall into a “technological determinism” of any kind. He acknowledges that this boom in the “football industry” could not have taken place without the onset of the neoliberal regime of global capitalism. During the 1980s, the decline of trade union movements, the dismantling of welfare schemes, the collapse of the associated social-democratic project, and the implosion of the Soviet Union led to the “almost unchallenged supremacy of capitalism and its ideology” (Collins 2013: 120). Not only did football benefit commercially from the deregulation of markets associated with the Thatcher regime in England, but the prevailing ideological climate which glorified the kind of competition and nationalism that is inherent in competitive football made it even easier for the sport to perform its legitimation function.
However, despite emphasizing the broader social changes which facilitated (or even necessitated) changes within football, Collins falls short by simply describing these changes as a “late twentieth century counter-reformation” (ibid.: 120). He does not consider the relationship between these changes and the profitability crisis of the 1970s; neither does he delve deeper into the fact that English football clubs were floated in stock markets for the first time in the 1980s, thereby turning them into vehicles for financial speculation (Conn 2005: 42). In other words, he does not emphasize that, without simultaneous changes within both football and TV, the marriage between the two would have remained elusive. In the next section, I point out the key moments in the history of television and football in England, emphasizing how the combination of the two made possible the formation of the EPL as an instance of dispossession.
5. Privatization and Financialization: The Twin Pillars of Dispossession
In his essay “Neoliberalism as Creative Destruction” (2007), David Harvey defines accumulation by dispossession (ABD) as “the continuation and proliferation of accretion practices that Marx had designated as ‘primitive’ or ‘original’ during the rise of capitalism.” While such dispossession can take several forms, two of the most important and salient ways in which ABD is effected are privatization and financialization.
Harvey identifies the corporatization, commodification, and privatization of public assets as a key feature of the neoliberal project. The primary objective of such privatization is “to open up new fields for capital accumulation in domains formerly regarded as off limits to the calculus of profitability” (Harvey 2007, emphasis mine). The range of possible domains that can be privatized is vast. They include public utilities (water, telecommunications, transportation); social welfare provisions (public housing, education, health care, pensions); public institutions (universities, research laboratories, prisons); and even warfare (as illustrated by the “army” of private contractors operating alongside the armed forces in Iraq).
Financialization, or more specifically the increased international mobility of financial capital since the late 1970s, is characterized by its “speculative and predatory style” (ibid.). The way in which financial capital made gains during the ’80s and ’90s was to valorize certain locations that would witness increase in prosperity and devalue other locations that would experience crises and crashes (Vakulabharanam 2009). Harvey emphasizes that it was deregulation which allowed the financial system to become “one of the main centers of redistributive activity through speculation, predation, fraud and thievery” (Harvey 2007).
Both of these manifestations of ABD (financialization and privatization), their mode of functioning, as well as the usual outcomes associated with them, can be related to the occurrences within English football and television since the early 1980s.
5.1. The plunder of football
If we look at the internal structure of English football, we see that, although the game itself was never immune to commercial exploitation, the accumulation function has drastically increased in importance in recent times.
5.1.1. The early years: Regulation of accumulation
Commercial interest in football began of course in the late 19th century itself. As football developed into a mass spectacle, “the men backing the clubs saw they could charge the spectators to watch” (Conn 2005: 20). This led to increased competition between clubs, to the better players being lured by clubs with more attractive pay packages, and ultimately to the reluctant acceptance of “professionalism” by the FA in 1885. As early as 1910, Arsenal football club had voted to turn itself from a club to a company, arguing that such a move would enable it to build itself up financially and thereby to compete more vigorously.
The possibility of profit-making in football was kept under check, however, by stringent FA rules. Conn (2005) describes these rules in detail, which included strict directives that shareholders could not receive dividends worth more than 5 percent of their shares and that no director could receive remuneration of any sort from a football club. Moreover, the FA rules also stipulated that if a club were wound up and its assets sold, then any surplus left after paying off debts had to be paid to “[s]ome other club or institute in the city or county…Or charitable or benevolent institution” (ibid.: 25). Thus, the FA removed any incentives for asset-stripping in football in order to insist that football clubs were “not vehicles for keen-eyed speculators to cash in on an emerging leisure industry on the cusp of the twentieth century” (ibid.: 25).
Besides focusing on limiting profit-making from football, the FA also put in place rules to ensure an equitable distribution of revenue among football clubs to ensure fair competition. In the first half of the 20th century, the main source of earnings for clubs was gate revenues. From the inception of the Football League in 1888, clubs agreed on the principle that “some sharing was necessary to safeguard the competition” (ibid.: 39). Otherwise, the big clubs with larger stadiums could earn much higher revenues and unilaterally improve their performance both on and off the field. Although the amount paid to the away club varied in the early days of professionalism, it finally settled at 20 percent of gate revenue in 1919 and did not change until 1983 (ibid.: 40). Even when the first TV deal was offered to the League in 1965, £5,000 from the BBC, the money was distributed equally among all 92 clubs. Thus, up to the 1970s, the egalitarian financial structure of English football underpinned the rough evenness of the game on the field.
5.1.2. Profitability crisis, neoliberalism, and dispossession
The profit rate in the United Kingdom fell to 8.5 percent in the 1970s from 16.1 percent during the 1960s. 12 It is no mere coincidence that the attempts to eat into the egalitarian financial structure of English football also began during this period. In 1978, Martin Edwards, whose father Louis had bought the bulk of Manchester United in the 1960s, found a way to make big money out of dividends despite the FA restrictions. He did so by increasing his shares through a 1:208 rights issue. Through several rounds of share-buying, the Edwards family increased its holding of United to 74 percent and as a result even the 5 percent dividends became a proper windfall gain. It is important to note that while the Edwards family was making money out of a football club, their own family meat business was in serious financial trouble and was wound up in the late ’70s (ibid.: 41).
In 1981, more rules were relaxed following a threat by the big First Division clubs to break away if the lower leagues did not agree to their demand for more money. Martin Edwards, who eventually made over £100 million from his Manchester United shares, was centrally involved, and he made his famous comment at the time: “The smaller clubs are bleeding the game dry. For the sake of the game, they should be put to sleep” (ibid.: 45). The FA caved in to the threat and relaxed its historic prohibition against directors being paid; they could now receive a salary as long as they worked full-time at their clubs. Simultaneously, the cap on dividends was raised from 5 percent to 15 percent of the value of shares, a move that businessmen such as Edwards argued would “encourage investment in the professional game” (ibid.: 40). The people looking to make money from football, however, continued to push harder. In 1983, sharing of gate revenues was scrapped, a move which favored the big clubs with large stadiums. In the same year, Irving Scholar, a property dealer, decided to float Tottenham Hotspurs, a club he had bought into a couple of years back, in the stock market. This was another first in the history of English football. In working on this deal, however, Scholar’s lawyers came up against the longstanding FA restrictions against unlimited dividends and distribution of surplus in the event of liquidation. They came up with an ingenious plan to evade the rules: they formed a holding company, made the football club a subsidiary, and then floated the holding company. The same device was adopted by many other clubs to bypass the FA rules that tried to protect clubs from precisely this: financial speculation.
Coupled with the process of converting clubs into avenues for financial speculation, the big clubs continued their demands for an increased share of the pie. In 1985, they threatened to break away once more unless they got more money and power. The compromise this time was a substantial change in the sharing of TV money from an equal distribution throughout the League to 50 percent to the First Division, 25 percent to the Second, and 25 percent between them to the Third and the Fourth. This was a significant change, against the background of the new TV deal with the BBC and ITV in 1983 worth £5.2 million. As mentioned before, the TV money increased to £44 million from ITV in 1988 and the First Division claimed half of it. The emergence of satellite TV and the deregulation of television, however, was set to multiply this amount several times over. The businessmen, such as Edwards, running the elite clubs were well aware of this and they moved in for the final kill. The League’s self-appointed “Big Five” – Manchester United, Arsenal, Liverpool, Everton, and Tottenham—held their own private meeting with an agent of BSkyB to discuss their wish to break away from the League completely. Assured that BSkyB would pay them big money for TV rights if they did so, they went to the FA with their proposal. The ruling body, by then weakened by internal squabbles and disagreements with the League, agreed meekly to the deal, fearing that the big clubs would break away anyway if the FA did not consent (ibid.: 51-52). Finally, in September 1992, as planned, the FA Carling Premiership was launched. The TV rights were sold for £305 million for the next 5 years, this huge amount gobbled up by the 20 self-appointed elite clubs of English football.
What needs to be emphasized is that all the successive changes outlined above were arrived at in a way that has no semblance of a democratic process of decision making. They were pushed through mostly by the “Big Five”—clubs controlled by businessmen looking to make quick speculative profits—who used the threat of exit at every stage. This is why the changes can and should be understood as leading to a process of dispossession that excluded the overwhelming majority of the football establishment from sharing in the subsequent monetary benefits from the formation of the EPL.
5.2. Privatization of television and the marriage with football
The explosion of TV money was what gave the final push to the formation of the EPL. However, this would not have been possible without simultaneous changes in the television industry that were pushed through by successive Thatcherite governments. A closer look at the history of television in the UK brings out the role of government policy and nepotism that enabled the marriage between TV and football.
5.2.1. Marxism once more
The theoretical framework that best illuminates the momentous changes in British TV from the 1980s onward is the brilliant analysis of mass media and advertising by Baran and Sweezy (1964, 2013). In a chapter originally left out of their magnum opus Monopoly Capital (1966) and later published as “The Quality of Monopoly Capitalist Society: Culture and Communications” in the Monthly Review, Baran and Sweezy dissected the functioning of the book publishing and broadcasting industries in the United States. Their key point was that while book publishing had become increasingly oligopolistic in nature over time as a result of changes in technology that facilitated the move from craft to mass production, the much younger television industry had already been established by government policies as a tight oligopoly. They also stressed the importance of a phenomenon that has come to be known as horizontal concentration in the literature on the political economy of communications (Mosco 2006). This refers to the fact that increasingly firms in one line of media, say newspapers, have come to own or have merged with firms in other lines such as radio and television. Most importantly, however, Baran and Sweezy emphasized that what drives television broadcasting is advertising revenue. Privately owned mass media must earn advertising revenue to survive, which means it must cater to a large audience. This results in the increasing dominance of television broadcasting by politically inconsequential areas: quiz shows, sports, and debates on “more or less innocuous public issues or among speakers of not too widely divergent persuasions” (Baran and Sweezy 1964). Further, in order to gain economies of scale, both advertising and mass media tend to become increasingly national in scale and witness massive merger movements of local networks. Looking at the recent history of British television, we see that it is almost an exact playing out of Baran and Sweezy’s analysis of the U.S. scenario.
5.2.2 The road to deregulation
Television broadcasting began in the United Kingdom in 1936 as a public service free of advertising. In 1955, the first attempt to create commercial television in the UK was undertaken. As a result of the Television Act (1954), the Independent Television (ITV) network was created, which, unlike the BBC, had to pay for itself from advertising. Nonetheless, ITV functioned as a heavily regulated monopoly and as a federation of regional companies. Each network was required to base itself in a different region and cater exclusively to it.
During the 1960s and ’70s, although some changes were made to the ITV map, the basic structure of the regional arrangement was left untouched. Moreover, television was also insulated from private investment and market competition. The decade of the 1980s changed all of this and together with the Broadcasting Act (1990) laid the foundation for further changes that continue to this day. The story of that decade is one of the increasing opening up of the industry to private capital and also one of nepotism, because it was really the personal relationship between Margaret Thatcher and Rupert Murdoch that allowed the latter to push through his own agenda at all costs.
The changes during the ’80s can be thought of as occurring in two broad phases. During the first half of the decade, labor was disciplined and new technologies of production established in mass media such as newspapers. During the second half, Thatcher and her acolytes turned their ire towards the structure of the TV industry itself.
In 1979, the ITV faced a massive industrial strike that actually ended with a defeat of the broadcasting companies against the labor unions. Even as they lost revenue, the companies agreed to pay up dues to workers. As a result, the early to mid-’80s were spent by Mrs.Thatcher in reforming industrial relations in all spheres including broadcasting. Initially, the regional networks went along with this policy, since they saw this as a dismantling of “years of over manning and restrictive practices without effective opposition” (Fitzwalter 2008: 36). Two of the most important events in this offensive against labor were the miners’ strike (1984-85) and the “Wapping dispute” of 1986-87. The defeat of unions in the former paved the way for the ultimate privatization of the British coal industry in 1994, whereas the latter was not only a political victory for the Thatcher government but also a personal one for Murdoch and his News Corp International. The dispute began in January 1986 when Murdoch secretly moved his newspaper operations to a new digital printing plant in the London district of Wapping from the erstwhile “Fleet Street” (London’s former center of newspapers). As a result of the move to digital technology from hot lead printing, 5,000 workers were on the verge of losing their jobs (Lang and Dodkins 2011: 54). In the ensuing strike, the London police and the UK government lent their wholehearted support to protect the Wapping news center of Murdoch (which came to be known as “Fortress Wapping”) and to break the power of the printing unions. It is difficult to resist citing Murdoch’s own views on the episode:
Fleet Street unions had not lost a fight in living memory. But we were encouraged by Mrs. Thatcher’s victory in the miners’ strike and by signs that authorities were prepared to protect private property from the actions of massed pickets….The immediate result of our victory was greater freedom and flexibility, and higher profits, for News Corp. (Murdoch 1990)
It was undoubtedly such “encouragement” and increased profits that allowed Murdoch to start pushing towards television.
The joy of the regional networks, however, was to be short-lived as the government moved in to privatize the entire TV industry. In December 1986, the Home Secretary Douglas Hurd announced that ITV and the BBC would be required to take 25 percent of independent production, to be achieved within 4 years. This was not welcomed by either of the two corporations, who would have to sack their in-house production staff as a result, while still having to bear the fixed overhead costs. In the same year the licence for Direct Broadcast Satellite (DBS) was given to British Satellite Broadcasting (BSB), a consortium of UK media giants Pearson, Reed, Granada, and Virgin. However, doubts remained about the profitability of the venture because it required a large investment upfront and the returns were also likely to be slow. When BSB refused Sky entry into its consortium in 1988, Murdoch announced that his Sky Channel would be launched separately as a UK-based service, using the Luxembourg-based Astra satellite. Sky TV went on the air in February 1989, while BSB was repeatedly delayed by technical problems and finally made it in April 1990 (Morrison 2015). However, UK viewers were used to the tax-funded BBC and the commercial free-to-air ITV. Thus, they needed to be lured to sign-up for pay TV, especially since it generally involved the purchase of a satellite dish. At the initial stages, therefore, Sky was incurring weekly losses of £4 million after start-up costs of £120 million, and in August 1990 it reported annual losses of £257 million (ibid.). However, BSB’s losses were even greater and it struggled to achieve the target of 400,000 satellite customers it had very optimistically budgeted. Ultimately, it was the merger between BSB and Sky in 1990 and the creation of BSkyB that ensured the survival of Murdoch’s empire. Despite being called a merger, however, it was in effect a takeover. Most of BSB’s staff were sacked, executive jobs primarily went to Sky employees, and it was decided that the new channel would continue to use the Astra satellite. All of this, however, was a clear breach of cross-media laws in the UK, where Murdoch’s newspapers should have prevented him from owning more than 20 percent of any TV channel. That the new channels would be broadcast via the Luxembourg-based satellite was the “‘offshore’ fig leaf used to wave through the merger” (Morrison 2015). This was, in effect “[a] last present to Rupert Murdoch from Mrs. Thatcher’s dying government” (Fitzwalter 2008: 75). Finally, after the private meeting with the “Big Five” mentioned earlier, the radical decision to form the EPL was matched by an unprecedented decision to award exclusive live broadcasting rights to BSkyB in 1992. It was a move which backed Murdoch’s view that football (and sport more generally) could be used as a “battering ram” for TV, something which he had learned from Kerry Packer’s breakaway movement in world cricket 15 years previously (Morrison 2015). Thus, it is important to emphasize once more the mutually reinforcing relationship between the accumulation and legitimation functions of football. The deregulation of television may have opened up an avenue for private investment, but huge initial losses meant that the £305 million that Murdoch offered to the Premier League in 1992 was out of the realization that the loyalties of English football fans made them the only people “addicted enough to their TV fix to be prepared to pay for a satellite dish” (Conn 2005: 103).
Concomitantly, the final nails in the coffin of the erstwhile regional structure of the ITV were put in by the passing of the Broadcasting Act (1990). Licences were opened up to highest bidders to encourage private investment. This was followed by several changes in the ownership rules of ITV companies over the next decade that sparked off a stream of destructive mergers and takeovers and a complete breakdown of the regional structure of the ITV (Fitzwalter 2008: 89-91). As recently as October 19, 2015, UTV in Northern Ireland, which had begun its operation in 1959, decided to sell its TV stations and brand to ITV PLC for £100 million. Thus, the effects of the 1990 act are being felt to this day. Baran and Sweezy’s analysis of the need for centralization of privately owned mass media could not have been more clearly vindicated.
5.3. Consequences
Several commentators agree that the formation of the EPL in 1992 had huge impacts on the financial structure of English football. For example, Dobson and Goddard (2011) agree that the breakaway has “…had profound organisational and financial implications” (141). As I have argued, it is possible to interpret the formation of the elite league as the culmination of events that began in the late 1970s as a response to the erstwhile profitability crisis. When we look at the consequences of those changes, the link with the crisis and the nature of dispossession in football becomes even clearer.
Within football, there have been two major consequences that are mutually reinforcing. The first is the huge inequality that has come to define English football since the breakaway. With the scrapping of gate-sharing and with the money from TV rights going to the already rich, inequality inevitably followed. The gap between the Premier League and the rest has been growing steadily, and in 2005 David Conn estimated that the elite league owned “85 per cent of professional football’s assets” (Conn 2005: 120). This means that while EPL stars receive six-figure weekly wages, the game suffers from immense neglect at the grassroots level and several lower league and non-league clubs barely manage to eke out an existence. There is, however, a deeper level of inequality within the EPL itself. From its inception, the new TV and sponsorship money was split in three ways. Only half was shared equally among all clubs. A quarter was reserved to be paid out as match fees to clubs selected by BSkyB for coverage. The remaining quarter was distributed according to where a club finished at the end of the season. This structure clearly indicates the circular relationship between success and money: money buys success, success earns more money. Conn (2005) demonstrates in great detail how this financial structure has made the already rich richer and how clubs who get relegated from the EPL often go down a spiral of losing money, losing big players, and ultimately, in some cases, going bankrupt. Although the EPL pays a certain amount of “parachute money” to relegated clubs, it is never enough to make up for the fall in earnings. The lower leagues simply cannot match the financial bonanza that is on offer in the top league.
The question that arises then is: who were the people who benefitted from the explosion of TV money and financial speculation in football? The answer is unambiguous: businessmen whose own businesses had failed or faced trouble during the ’70s and ’80s and who “found it all rather easier” (ibid.: 43) to make money from football. The example par excellence of this trend is David Dein. Dein was a commodity broker, principally of sugar, who bought into Arsenal cheaply in 1983. 13 That same year his own company was plunged into crisis with high debts and it finally stopped trading in 1989 (ibid.: 42). As the TV money started flowing in and the EPL was formed, share prices started rising. In 1996, Arsenal moved into a stock market called OFEX, which allows shares to be more easily traded. Dein sold 3,000 of his shares that year and made £4.05 million. Then in 2007 he sold most of his remaining shares to the Uzbek-Russian oligarch Alisher Usmanov for £75 million (Goldblatt 2014). This was surely a proper windfall for “…a tycoon whose own company had collapsed” (Conn 2005: 58). An even more extreme example is that of Ken Bates at Chelsea. He bought the club for £1 in 1982 and made a profit of £17 million when the club and its huge debts were sold in 2003 to Russian oil king Roman Abramovich, a man who typifies the “…shocking detail of Russia’s post-Communist privatisations” (ibid.: 7). These examples can be multiplied. Both Conn (2005) and Goldblatt (2014) emphasize this point several times in their work: the people who have always pushed for so-called “reform” in English football have been businessmen, owners of venture capital firms, and the like, who have looked to make speculative profits from football clubs when other avenues seemed to have been exhausted. They have done this either through making windfall gains, such as Edwards, Dein, and Bates, or by paying themselves a handsome share of the operating profit to act as directors. These were, as Collins puts it succinctly, “dealers and traders who had learnt their skills in the global casino of the financial markets” (Collins 2013: 122).
In terms of the effects on the television industry, the unceasing drive towards centralization in ITV has already been alluded to. The major winner from the formation of the EPL, however, was undoubtedly Rupert Murdoch and his media empire. Following BSkyB’s 2014 acquisition of Sky Italia and a majority 90.04 percent interest in Sky Deutschland, its holding company British Sky Broadcasting Group plc changed its name to Sky plc. According to its official website, the enlarged group will serve 20 million customers across five countries: Italy, Germany, Austria, the UK, and Northern Ireland. While combined program spending amounts to £4.6 billion, annual revenues are more than £11 billion.
To summarize, the story of accumulation by dispossession in English football is as follows. The profitability crisis of the 1970s continued into the ’80s when the profit rate was even lower at 6.1 percent. 14 Several simultaneous attempts were made by capitalists in this decade to accumulate by dispossessing people. Relevant for our analysis is the privatization of telecommunications and the conversion of football clubs into vehicles of financial speculation. My argument is that neither of these changes were democratic or spontaneous. They were pushed through for the benefit of a tiny minority at the expense of the majority. Moreover, it was only the coming together of the two processes (after the secret meeting between the “Big Five” and BSkyB) that led to the formation of the EPL, thereby enabling speculative profits on the one hand and the immense growth of TV companies on the other. This was a clear case of a transfer of assets and wealth from the lower to the upper classes.
6. Conclusion
In this paper, I have simply pointed to the significant interlinkage between changes within football and broader social processes, with specific reference to the formation of the EPL. The task now is to advance research with regard to the multiple ways in which the dynamics of global football and global capital intertwine and affect people’s daily lives. Two possible directions such research can take are the following.
First, as mentioned in the introduction, the money flowing through the Premier League and its precise link with global financial flows needs to be analyzed. Recently, disturbing news has surfaced of FIFA executives being paid huge sums as bribes in return for voting for a country to get World Cup staging rights and to grant sports companies TV rights of footballing events (Conn 2015). Not only does this underline once more the importance of sport to broadcasting companies, it also raises the question of why the right to stage mega events is accorded such importance. Here, it can be fruitful to analyze the kind of property (stadiums primarily) and infrastructure development that staging a World Cup leads to. Surplus capital is allowed to flow into such projects, but popular movements against it, such as those in Brazil in 2014, have questioned whether government support of such investment is a useful way to deploy public funds. Moreover, such a phenomenon is not necessarily restricted to major sporting events. The scrapping of gate-revenue sharing in England led to a scramble among clubs to build larger and more attractive stadiums. Arsenal football club’s relocation to a bigger stadium actually led to spatial reconfigurations in the city of London. This involved the taking over of an erstwhile waste processing station and the buying out of small-scale businesses in the surrounding industrial estate, the relocation of the waste station to a residential neighborhood primarily occupied by the lower middle-class and the poor, and a long legal battle that was ultimately won by the financial oligarchs running Arsenal. This has had an impact on property values as well as the daily lives of the hundreds of households now living with a waste station on their doorstep. This kind of interlinkage between sport, property values, spatial reconfiguration, and accumulation is worthy of critical analysis.
Second, at a more theoretical level, the structural questions alluded to in the discussion on the alienating character of modern sport deserve attention. Marxist theory has never been able to adequately resolve the question of how to relate social objectivity and subjectivity. This was the most important reason for the turn to psychoanalysis and to a study of the role of culture in social change in the works of Antonio Gramsci and the Frankfurt school theorists. Arguably, it was also an important factor in the turn towards intellectual currents such as poststructuralism and postcolonialism in the humanities and social sciences. Attempts to develop Marxist analyses of cultural phenomena must engage seriously with this question. My approach in this paper to this problem is necessarily provisional, and efforts to engage with the structural tensions at a more fundamental theoretical level might be worthwhile.
To conclude, it can be said that any attempt to build a communist alternative to capitalism must engage critically with the role of sport in creating alienated consciousness in society and its use as a vehicle for accumulation. Hopefully, a meaningful politics of transformation can succeed in disentangling football’s capacity to enthrall and enthuse from its more sinister aspects.
Footnotes
Acknowledgements
I would like to thank Michael Keaney, Davide Gualerzi, and Brigitte Bechtold for their helpful comments and suggestions as referees. Many thanks as well to Madhuri Karak, Soumava Basu, Andrew Sartori, Carol Heim, Mwangi wa Gĩthĩnji, and Vamsi Vakulabharanam for comments on an earlier version of the paper. The usual disclaimer applies.
Declaration of Conflicting Interests
The author declared no potential conflicts of interest with respect to the research, authorship, and/or publication of this article.
Funding
The author received no financial support for the research, authorship, and/or publication of this article.
1
What I will refer to as “football” throughout the paper is known as “soccer” in many parts of the world, including the United States.