"When the accumulation of wealth is no longer of high social importance, there will be great changes in the code of morals.
We shall be able to rid ourselves of many of the pseudo-moral principles which have hag-ridden us for two hundred years, by which we have exalted some of the most distasteful of human qualities into the position of the highest virtues"

( JM Keynes, "Economic Possibilities for our Granchildren" 1930 )

Monday, June 28, 2010

Panem Et Circenses XXI Century

I read the news today “ G20 nations commit to halving budget deficits by 2013” , an headline that resumes the main agreement reached at the last weekend G20 summit. Any observer understands that under the “deficit reduction”
codename lies a whole structure of more budget cuts, less social rights and toughest auterity plans.

Coincidence or not, these days the world seems to be more busy with the World Cup in South Africa . Did anybody in the South hear the above headlines “Austerity for all”???. The level of salaries and bonuses paid and or promised to the national teams and managers indicates that the distance between "Austerity " Canada (G20 meeting) and South Africa is larger than ever. The following table details the annual salary of 32 national team managers that are disputing the World Cup (the data was gathered by the Argentine newspaper OLE) (in USD)

It should be noted that these figures are outflows from public institutions and they do not include the millions of USD destined as salaries and bonuses for the players. It is evident that these salaries are much higher than the average level in their respective countries, in many cases even above the salary of the Head of the State. If you go through the list, you will find that the countries which spend millions on salaries for a few suffer from a complete spectrum of social malaises : Countries with scandalous levels of HIV, other with huge absolute poverty levels, countries that poured billions into a bankrupted finance system, countries with huge unemployment rates and some on the brink of bankruptcy.

And yes, I am aware of the "theory" that the extravagant salaries are not financed from public coffin (i.e. there is no real loss for the country ) but paid indirectly by “sponsors” ,bonuses from FIFA or whatever obscure source ( as Spanish Secretary of Sports claimed). Sorry, but that´s a poor argument: Any NATIONAL football team is a public asset and players, coaches and any professional involved are mere representatives of a nation and as such should be paid a fair salary( let alone the enormous personal publicity they gain for free during such events). And if they refuse to reprsesnt the country, it´s OK , there will always be candidates willing to play football for a decent salary. From that perspective , any extraordinary income belongs to the owner of the asset, the public, and the decision how to make use of these funds is a matter of public choice.

However, the lack of an explicit debate on the issue doesn’t mean that the salaries´ level is not another implicit de facto political decision that sets social priorities in favor of the Football Circus. A reminder from history : During the heydays of Rome, the populace enjoyed the “Bread and Circus” free Combo, a tool used by the governing Elite as a mean to appease social tensions and gain poltical power. From that perspective we are in a worst situation than the average Roman : We are not only asked to pay to enjoy the “national” spectacle (through publicity, PPV …etc) but the modern equivalent of bread (i.e. social rights) is being scarified in the name of a selective austerity. “The Times, they are a changin´”?? Not so sure.

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