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February 05, 2009
Bailed-out banks spend billions on ballparks
Bloomberg News has a rundown today of all the banks receiving federal bailout money that are currently engaged in naming-rights deals for sports stadiums. Given that banks have been pretty much the prime buyers of stadium names since the dot-com bust eliminated most other publicity-hungry corporations, it's a long list:
- Citigroup: Got $45 billion in TARP money, spending $400 million on rights to New York Mets stadium name.
- Bank of America: Got $45 billion in TARP, spending $140 million for Carolina Panthers naming rights. (It's also in talks with the New York Yankees on a stadium ad deal that would essentially be naming-rights without the actual stadium name - much like Adidas had at the old Yankee Stadium - and which could end up costing as much as the Citigroup/Mets deal.)
- JPMorgan Chase: Got $25 billion in TARP, spending $66 million for Arizona Diamondbacks naming rights, a deal it inherited when it bought Bank One.
- PNC: Got $7.6 billion in TARP, spending $40 million for Pittsburgh Pirates naming rights. (Yes, Pittsburgh comes cheap.)
- Bank of New York Mellon: Got $3 billion in TARP, spending $18 million for soon-to-expire naming rights to the Pittsburgh Penguins' soon-to-expire arena.
- Wells Fargo: Got $25 billion in TARP, spending $40 million for naming rights to the much-renamed Philadelphia 76ers and Flyers arena.
- Comerica: Got $2.25 billion in TARP, spending $66 million for Detroit Tigers naming rights.
- M&T Bank: Got $600 million in TARP, spending $75 million for Baltimore Ravens naming rights.
- BankAtlantic: Got $124 million in TARP, spending $27 million for Florida Panthers naming rights.
The lesson here: If you don't want government money going to sports naming-rights deals, you should probably bail out some industry other than banking.
If there's a silver lining, it's that, as Daniel Gross argues in Slate, buying giant billboards on the sides of sports facilities is actually a lot less wasteful than some other things banks could be doing with their money. Though if there's a dark cloud to that silver lining, it's that buying a billboard that only makes people say, "Hey, isn't that that bank that's only being kept solvent with federal dollars" doesn't seem to be working all that well for Citi.
I don't work for a bank, or a ballpark...but it might be a little less disingenuous if you listed when each of these naming rights deals was signed vice when these banks received TARP funds.
Since TARP only came into being four months ago, clearly all the naming-rights deals preceded the bailout money. But Kucinich and the rest who are criticizing this aren't saying anything about which came first - they feel that it's inappropriate for banks to keep spending money on stadium names when they're desperate for cash, regardless of when those deals were signed.
I don't know that I particularly agree with them, frankly, but that's the argument, anyway.
Posted by Neil on February 8, 2009 10:18 PM
As it's probably only a matter of time before many/most banks are nationalized* due to their expanding debts, the question morphs into 'do we want our GOVERNMENT owning commercial naming-rights for stadiums?'
(* http://www.commondreams.org/view/2009/02/15-3)