Jimmy Burns's Blog, page 22

Radio vibes

There was no TV coverage of last night´s World Cup qualifier between Belarus and Spain. The price of TV rights was pitched too high by some greedy company and Spanish TV collectively refused to buy. So I along with thousands of other La Roja fans were left with the only option of listening to the game live on Spanish radio.

I tuned in , driving back to Barcelona from Madrid, across Castile and Aragon, over terrain that held together in its diversity, like a patchwork-delighted to hear the commentary praising Barca and Real Madrid players interconnecting in a flowing rhythm of possession and passing football and beautifully creative goals-one by Jordi Alba, a hat-trick by Pedro.

Tuned in to the footie, I forgot for a moment the deep political divisions that afflict the Spanish state, from region to region, from Catalan to Castilian, from club to club. Against this, how does one explain the coherence and spirit of the Spanish national team? They draw it from within themselves, this sense of common purpose, of being better at it than anybody else, knowing how to win, with grace, one for all , all for one.

 

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Radical Politics in the Camp Nou

 

Whatever last night´s El  Clasico is remembered for, it won´t  necessarily be for its football. The game was not so much a battle between two teams, but a series of individual encounters focused on a duel for supremacy between players of different nationalities, neither of the two Spanish -Messi and Ronaldo.

Brilliant as their goals were, each have scored better ones, and their involvement in the collective efforts of their colleagues insufficient to determine the supremacy of one side or the other. As for the teams, Tito Vilanova´s Barca still lacks the fluidity and intricate inter-play that marked the best of the Guardiola era, while Mourinho´s Real Madrid counter-attacks were missing  their characteristic ruthlessness and accuracy.

By contrast , the pro-Independence of Catalonia mosaic that covered the stadium on the 17 minute 14 seconds of the game was a masterful exercise in political propaganda pulled off with the brutal effectiveness  of a bomb attack. It lasted less than a minute but its impact was immediate and widespread , its fall-out enduring, its longer term consequences a subject of unresolved, and acrimonious debate which divides today´s media in Madrid and Barcelona.

The mosaic had a certain Gaudiesque outrageous flair about it, but was not a  spontaneous act. Rather it was a meticulously planned political stunt, designed to momentarily divert the attention of a mass global audience of soccer fans and focus them on a political issue that while  some may be familiar and indeed sympathetic with (there were Scottish and Palestinian flags in the Camp Nou last night), the majority are clueless about.

Until last night, I doubt for instance that many followers of La Liga outside Spain had the number 1714 registered in their heads as the date that Catalans lost their rights after backing the wrong non-Spanish king in the War of Supremacy. Now fans from Tangiers to Tokyo  will at least now know the totemic nature of a date in the modern context of  Catalonia´s  conflict with Madrid  over the independence  issue – a key political battle , the outcome of which will have a profound impact on the future composition of the Spanish state, and potential reverberations across Europe.

For last night the pro-Independence campaign managed to outflank the club´s own president Sandro  Rosell who was elected on a pragmatic and essentialy apolitical platform at odds with the radical Catalan nationalism of  his predecessor Joan Laporta-today a fervent independista. In an instant,at 17.14 exactly, the Camp Nou was politically radicalized with a collective passion not seen since 1977 when , within two years of the death of Franco, the stadium and the club helped promote a call for the return of regional government within a new democratic unified Spanish state, allowing thousands of Catalan and Basque flags to be flown for the first time in  a Barca stadium since the Spanish Civil War.

Back then, thirty-five years ago,  there was an evident synergy between the mood in the Camp Now and the wishes of a clear majority of Catalans and non-Catalans across a broad centre to left political spectrum in Spain united in the spirit of democracy after four decades of dictatorship. Today,  increasingly frustated and angry Catalan nationalists  are on a collision course with the centre right Spanish government led by Mariano Rajoy- what Catalonia´s regional president Arturo Mas proclaims as a right to self’determination-an election followed by a referendum posing the choice of independence  stubbornly dismissed by Madrid as an irrational and constitutionally illegal separatist act that threatens the disintegration of a European state.

For Catalan independendistas , last night´s El Clasico- steeped as it has been for decades in the political mythology that gives the sporting encounter its unique dynamic and excitement, was an opportunity clearly not to be missed. A certain air of complicity engulfed members of the Barca presidential box which included Mas himself , sitting next to Rosell, two seats away from Real Madrid´s clearly uncomfortable VIP visitor president Florentino Perez.

The controversial mosaic , tolerated by FC Barcelona´s management and not smuggled in, upped the political ante by intruding on the game rather than serving as a prologue to it as had the earlier official club mosaic, with its traditional and politically neutral Barca hymn.

Whether the cause of Catalan independence –as opposed to a more moderate  automous Catalonia with more rights within rather that outside a Federalist Spain -is genuinely popular enough to secure a convincing majority of voters remains to be seen. As uncertain is the voting intentions of Barca fans  , and in what political direction Rosell takes the club from here on.

But last night´s generally peaceful atmosphere showed signs of bubbling over. Near the Camp Nou a group of female Real Madrid fans suffered sexual verbal abuse, while a male Real Madrid fan walking on his own was surrounded and physically threatened by local fans who in turn found their access to some bars blocked by riot police.

  And the 17.14 stunt had an aggressiveness about it that smacked of populist nationalism reminiscent of Real Madrid´s  Santiago Bernabeu on  a bad day, but unworthy of a sporting institution like Barca that defines itself as more than just a sporting club to be a cultural and social expression of Catalanism in its broadest democratic sense, open to the world.

As for the game itself, it delivered its own crude symbolism:  the result-a 2-2 draw with missed opportunities on both sides- reflecting the Catalonia/Madrid political stalemate. Apart from the brilliance of superstars, its one saving grace was the way Real Madrid and Barca players, led by Iker Casillas and Xavi,  embraced each other at the end of it all, in an image of respect and reconciliation that Spanish and Catalan politics tragically lacks.

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Is Tito following Mourinho?

Deputies don’t necessary  go on to make good  bosses. Look no further than Gordon Brown and Mariano Rajoy.

In football it’s a mixed picture. Carlos Queiroz went from Ferguson’s assistant to managing Real Madrid (not a happy time)to being Ferguson’s assistant again, before pursuing an unexceptional  career as national coach with Portugal, and now Iran. By contrast Mourinho laid claim to being a ‘special one’ after serving as Bobby Robson’s assistant and translator at Barca. He went on conquer more than Robson did.

FC  Barcelona now have Tito  Vilanova who grew up and lived under Pep Guardiola’s shadow before succeeding him as manager. Guardiola was more than just a manager. He personified an institutional ethos and style that had evolved over decades. He contributed to Cruyff’s ‘dream team’ as a player, and managed his own team through one of the most glorious period’s in the club’s history, during which he enjoyed periods of unprecedented supremacy.

Tito- never a great player, and sharing none of Guardiola’s natural charisma-knew he had a tough act to follow when he took on the biggest job of his life. He knew his job could well be on the line if Barca got off to  a bad start and started losing early on in the season. He has also been lumbered with the injuries of key players like Iniesta, Pique,Pujol and now Thiago. He has consequently adopted a strategy aimed at winning at all costs, drawing  on the mixed bag of resources he has available to him, and making outcomes more dependent  than ever on the suitability of his substitutions -much like Mourinho does at Real Madrid.

I don’t know if Tito is on the road  to success or perdition but I am not passionate about the way Barca play at present- they have lost some of their style and solidarity. They don’t hold the ball as well they used to, and lose it too easily. There is less fluidity of play, less apparent enjoyment. Messi  seems less at peace with himself and with others.  The risk is that Barca in the process, like Real  Madrid,  may lose  a clear sense of itself as a team.

 

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So where do Barca’s best interests lie?

An interesting comment from Francesc to my earlier blog on Barca and Catalan Independence prompts a follow-up .

Those who follow me on twitter will know some of the specific  technical issues that concerned me about last night’s FC Barcelona match against Granada. They included worries about Villa’s limitations as a player compared to Pedro and Alexis both of whom track back and associate with the rest of the team more than him,  Valdes’s sloppy clearances , and Song’s unconvincing performance   as centre-defender.  I was also unimpressed by Messi’s prolonged  and angry verbal exchange with Villa, which struck me at odds with the much proclaimed central ethos of Barca as a team-one for all, all for one, and no prima donnas .

It was  a game of two halves , however,  to the extent that Barca became a different team with Xavi coming off the subs bench  and putting on the captain’s band. Now that Pep has gone, this is a team that needs either Xavi or Pujol in charge of ensuring harmony on the pitch.

But Francesc’s comments returns me to a much broader  question which is likely to become increasingly debated in the coming months: where does FC Barcelona’s long-term political and economic interests lie?

Francesc suggests  that it simply does not make (presumably political or commercial)  sense for FC Barcelona to remain in La Liga when domestic games take on the character of last night’s- a clearly superior Barca frustrated for over 80 minutes by the crude tactics of a Spanish provincial town club that has been struggling with relegation and bankruptcy.The club’s real stage is in Europe although the question  of whether Europe will accept an independent Catalonia remains unresolved.

In an extensive article on the finances of Spanish football published in the September issue CNBC’s Business magazine

http://www.cnbcmagazine.com/story/kicked-in-the-teeth/1695/1/

I  note that at a football conference in Doha last November, Barca president Sandro Rosell suggested a breakaway European league might start by 2014 unless UEFA gives in to demands from the major clubs for a smaller domestic league and an expanded, if more exclusive Champions League capable of boosting its worldwide TV audience.

However, as I quote in the same article, Spain’s national coach/manager Vicente Del Bosque believes it would be a mistake to scrap the Spanish league from which he picks his players- and thinks English fans in particular , given their tribal loyalties to club teams, would lead a popular rebellion against a Super League.

Del Bosque argues instead for a Spanish league where TV revenue is more equitably distributed  although he suggests that Barca along with Real Madrid are quite happy with the status quo. He told me: “It’s not good for the future of the game to have just two clubs dominating everything although it’s going to be difficult  to change things. Real Madrid and FC Barcelona are very powerful.”

Many fans consider FC Barcelona a Catalan club but the future of the club and its place in the world remains as uncertain as the future of Catalonia itself.

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Why today’s Barca does not fit easily into an Independent Catalonia

Some debate in Catalonia was generated earlier this month by the fact that FC Barcelona president Sandro Rosell  decided to attend the march of La Diada in a personal and not institutional capacity so as not to throw the club onto the independence bandwagon- a cause  which opinion polls show just under fifty per cent of voters in Catalonia do not support. I think Rosell was right, as was his  decision that the team next season should have the Catalan colours as their third preference strip, not their first. It shows pragmatism, if not necessary cautioun in a somewhat  volatile atmosphere.

Persecution personified by the execution by Franco forces of Barca president Josep Sunyol  is written into the mythology of Barca’s history, as is a certain identification with democracy and the common good. The punchy and highly marketable slogan ‘Mes que un club’  (more than  just a (football) club) alludes not just to the club’s insertion  in a  Catalan society that is proud of its culture, but its ability to represent values that go beyond narrow partisan or nationalist interests.

Nationalist politics has given FC Barcelona its edge and arguably its passion at key moments such as when, after the death of Franco, the club supported the return from exile of Josep Tarradellas as President, not of an independent but an autonomous Catalonia under the rule of a constitutional  Spanish monarchy.

The politics of Barca was inevitably  bound to be sharpened by the current controversy surrounding Catalonia’s   constitutional  status. There is also a widespread respect, and justifiably so , for the club’s youth academy La Masia and the way it has nurtured some of the best talent in world football.

But Barca today is a global brand which also cuts across narrow  political, cultural, and social interests in its organisation not just in terms of its fan base, but its players and sponsors.  Its main financial lifeline are multinational- the Qatar Foundation , Nike, and the TV rights it shares with Real Madrid. La Masia is not a nationalist university- it is a training school for scouted talent where ethics of good conduct, tolerance,  and team work are an indispensable part of the curriculum , not political or religious dogma. Some of Barca’s most active fan clubs are in Madrid and Andalucia where members have no wish to see Catalonia split from the rest of Spain.

If Barca has secured an unprecedented mass  following worldwide it is not so much down to its politics as to its style and success as a team .  Some of its best Catalan-born players-Pique, Xavi, Pujol- may wave the Catalan flag but they also enjoy being part of Del Bosque’s La Roja. Some of Barca’s best non-Catalan players- Messi, Iniesta, Pedro and Villa  included- also seem happy enough with their current national status.

The logical outcome  of Catalan independence is that FC Barcelona would find itself playing –as it did for a brief period leading up to and during the Spanish Civil War- in a Catalan as opposed to a Spanish league, and its Catalan born players would cease to play for La Roja  and form a Catalan squad instead. Whether  this would benefit either Barca or its players, let alone its fans,  is an open question.

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Real Madrid vs Man City: almost a tale of two halves

I have to say that of all this week’s Champions League encounters, none will come as close to holding my attention as much as this Tuesday’s encounter between Real Madrid and Manchester City.

The game is being played between two clubs that are approaching this season’s competition with a paradox in common. They share the strutting arrogance of ruthless trophy hunters whose model of big spending on  star signings , while winning championships, has nevertheless fallen short of the globe-trotting success story their fans were promised. Rather than unassailable, the true fortunes of both  clubs remain somewhat unpredictable at present. Reputations are at stake, not least that of their highly paid managers and one or two of their highly paid players.

Philosophically these are clubs that now prioritise the individual over the team, the ‘star’ foreign signing over youth development, who look for a quick return for every buck invested, and who are quite prepared to dispose of out of form players -and managers if necessary- like rusty widgets who have lost their place on the production line.

To be fair, Real Madrid’s president Florentino Perez and the club’s voting members who  have been complicit in his project have been at it rather longer than Man City under Sheikh bin Zayed al Nahyan Mansour-more than  ten years in fact have passed since the Spanish club got going with the likes of  Ronaldo (the Brazilian one), Figo, Zidane, and Beckham, ousting Vicente Del Bosque as too old fashioned and surplus to requirements, and ending up with Mourinho who earns an estimated euros 14.8m in a country that struggles to  pay its own public employees.

According to a recent survey published in the Daily Telegraph, in  the first three years under Mansour, Man City spent £266 million cash on players after sales. Over the same period the cumulative outlay on wages was £390 million, meaning City were spending on salaries alone more than their income, of £365.3 million, although the club would point to the £61.6 million they spent on the regeneration of area of Manchester.

Real Madrid have spent a great deal more in  Euros since Florentino Perez’s  galactico project was first conceived .Madrid have splurged further millions in recent years on the likes of Cristiano Ronaldo, Kaka, and Benzema although they waited until the very end of the last transfer window to pay a knock-down price for Modric.

Tuesday’s game has been typecast by some commentators as a clash between an aristocratic (Real Madrid) and a nouveau riche (Manchester City) of the game. The comparison leaves unanswered why Man City has appointed Ferran Soriano a former member of the FC Barcelona management board as its CEO.

Soriano’s book ‘Goal’(subtitled the ‘Ball doesn’t go in by chance’)  published in English last year nonetheless provides some insight into the man’s thinking. Appointed vice-president and general manager of  FC Barcelona in 2003, Soriano writes of what he describes as the remarkable turn-around of the  club which hadn’t won a trophy in four  seasons and then went on to win La Liga three years running and the Champions League twice in  three years.

So what is Soriano’s recipe for success? This how my former FT colleague Roger Blitz incisively summarized the ambition and limitations of the Soriano project when he reviewed ‘Goal’ for the newspaper last December. “Far from retrenching to look after the concerns of the local, Catalan market, Barcelona – under the presidency of Joan Laporta – sought to become one of football’s biggest international brands.

You also carry out some basic housekeeping – in this case, discovering how many of the club’s registered members were still living (all but 9,000, it turned out) and answering phone calls. You increase ticket prices by up to 40 per cent, beef up the marketing operation – by copying Manchester United’s strategy – and tidy the place up a bit.

Next, you set about getting players to win matches. This is the hard part. No one familiar with European football will find much out of the ordinary in Soriano’s chapters on “the winning team” and “leadership”. The right head coach is critical, as is recognizing when to ship out ageing and uninterested superstars.”

Soriano’s book by contrast glosses over that aspect of FC Barcelona most of its own fans and other fans most admire-the importance attached to La Masia, its youth academy which has developed the club’s style and ethos with the likes of Messi, Xavi, and Iniesta.

The book also pays little attention to the fact that the club left behind by his boss after Soriano had quit, was not exactly a bed of roses in financial terms. When Sandro Rosell succeed Joan Laporta as Barca President, revised accounts approved by the club’s general assembly, which represents the interests of 175,000 fee-paying members who own the club, showed that instead of making the Euros 11m profit that Laporta had claimed in his last season at the helm, the club had in fact  lost Euros 79m- allegations strongly denied by Laporta and now the subject of ongoing court proceedings.

Soriano’s book  also ducks the issue of the imbalance in wealth across La Liga clubs, caused in large part by Barcelona and Real Madrid grabbing the bulk of television rights revenues, transforming the two clubs into a virtual unassailable duopoly.

It will be interesting to see how Soriano deals not just with the more equitable TV rights distribution  of the Premier League but also with the British media which has  a tradition and quality of investigative journalism which its Spanish counterpart lacks.

 

 

 

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Spanish Football’s financial meltdown

By Jimmy Burns

Forget about the Spanish junior team’s poor showing in the Olympics. Spain stills boasts the best soccer in the world. Earlier this summer its senior national squad, nicknamed La Roja, won the European Championship, setting a record as the first nation to win three consecutive major international tournaments in four years. Last season five Spanish clubs – Real Madrid, FC Barcelona, Valencia, Athletic Bilbao and Atlético de Madrid – reached European club competition semi-finals. Of these, Athletic Bilbao and Atlético went on to play in the final of the Europa League.

“Sport is one of the most powerful sectors of a country brand and probably the most immediate and effective way to exert soft power and reach a global audience,” says Enrique Ruiz, Spanish Tourism’s former head of global marketing. In 2010, Ruiz secured a marketing agreement with La Roja in the run-up to the World Cup in South Africa as part of a series of deals involving Spanish stars playing in the English Premier League and Real Madrid, the most powerful club in the Spanish La Liga. As La Roja approached the finals, as favorites, Ruiz pre-booked a worldwide ad campaign – seen by the readers of 25 major newspapers and 85 million YouTube and Facebook users – with the slogan:”Congratulations boys! The way we play is the way we live.” Spain won the final, securing its first ever victory in the tournament, with a goal by the FC Barcelona star Iniesta.

If Spanish soccer could be judged simply by its quality and success on the field, the sport and possibly the country itself would be laughing all the way to the bank. Instead, even Ruiz’s ambitious marketing campaign has been cut back as the Spanish government slashes public spending in the midst of an unprecedented economic and financial crisis. “Austerity bites, and unfortunately the government will not be renovating our agreements,” laments Ruiz, who now lives and works in London.

But the problems for Spanish soccer go way beyond a lack of government resources. As the new season gets underway, the sport remains embroiled in a dispute between a majority of medium-sized and small clubs and the big two, Real Madrid and FC Barcelona – the world’s richest soccer teams, with revenues of €479.5m and €450m respectively, according to the last Deloitte ‘rich list’ – over TV revenues. Real Madrid and Barcelona in recent years have taken around half the annual €600m pot of TV income, enabling them to buy the best players and pay exorbitant wages. The remaining 18 teams have earned far less than their peers in rival European leagues, where collective bargaining allows for fairer revenue distribution. Consequently, these teams believe they have no chance of challenging for the title. Seville-based Real Betis, one of Spain’s best-supported teams, was forced to seek court protection from its creditors.

According to soccer business analyst Fabian Lares of Madrid-based JB Capital Markets, the dominance of Real Madrid and FC Barcelona is linked to a genuine global mass following based on star players and one of the most enduring and fascinating rivalries in world sports. This translates into substantial revenues from merchandising and sponsorship.

According to Deloitte’s Football Money League, based on data for the 2010/11 season, Real Madrid’s commercial revenues (mainly merchandising and sponsorship) rose by €21.6m (14%) to €172.4m, with strong revenue accounted for by the club’s shirt deal with Bwin, its continued kit partnership sponsorship with Adidas and partnership with Emirates Airline. FC Barcelona’s revenue increased from €122.2m in 2009/10 to a club record of €156.3m in 2010/11, boosted by a €15m contribution from the new shirt sponsorship deal with the Qatar Foundation.

Lares says that the absence of a level playing field when it comes to TV revenue is in danger of backfiring, with fans losing interest in seeing any other encounter than El Clásico, as the matches between the two giants are known. “Spanish football likes to project itself as the world’s greatest league, but the reality is that the sector has been in a bubble just like housing. In fact you could argue that the bubble has burst.

It can no longer sustain an economic model on TV contracts unless these are renegotiated,” he adds.

And yet the model appears to be evolving, albeit at a glacial pace. Last year, a collective deal was discussed by the 20 clubs in the Spanish First Division. For the first time, clubs offered a ‘parachute payment’ to protect teams that are relegated: the sudden drop into the second division – and the drop in TV income from at least €12m to at most €2m a year – has seen too many clubs, still obliged to pay First Division wages, plunged into administration and financial crisis.

Under the deal, 45% of the money will be shared among 16 clubs, with the final amount depending on pay-per-view hits, league position and other variables. That left four clubs. Valencia and Atlético de Madrid, the country’s third and fourth most popular clubs, would receive 11% of the total, while Madrid and Barcelona would take 35% between them. As The Guardian‘s correspondent Sid Lowe put it: “The inequality would be enshrined. The bulk of Spain’s teams had signed away their chances of success but prevented their destruction. They no longer aspired to be the best; but they did aspire to stay in business. They had agreed, if a little reluctantly, to the status quo.”

But if discussions on the proposed deal bought some breathing space, it didn’t secure lasting peace. With the official start date of the 2012/13 season set for 19 August, Spanish soccer was facing disruption for the second consecutive year. Last year it was players taking strike action over wages; this year it is the TV contracts issue that has spun into fresh controversy, with GolT (Mediapro) and Canal+ (Sogecable), the two main TV platforms where spectators can watch games, not only claiming to represent the interests of different clubs but arguing over which matches they could broadcast and when.

The problems of Spanish soccer have been fuelled by a combination of factors: reckless spending, poor regulation, complicity between clubs and politicians and sheer greed. According to recent government assessments, clubs in the top two divisions owe €752m in unpaid taxes – a spike of €150m over the past four years. The top division alone held a combined debt (not just in tax terms) of €3.53bn last year.

In fact football is a mirror image of the country as a whole, with clubs in past years making huge investments in players and stadiums while getting deeper and deeper into debt. The case of Valencia football club provides a cautionary tale.

In 2007, in the midst of the property boom, it decided to buy itself a new 70,000-seat stadium – even though it had fewer than 40,000 members. The €300m cost was supposed to be financed by the sale of the land from its old stadium for €400m. Two years later, mired in the property-market crisis, construction stopped when the club realised that it could not find buyers for the old stadium. Lax financial controls had also left it heavily in debt, forcing it to sell off its star players.

Such has been soccer’s popularity, the government has been reluctant to call in the unpaid tax for fear that it will cripple the sport and provoke riots among fans. But UEFA, the European football authority, has tabled plans for a financial fair-play system under which all affiliated clubs wishing to participate in international competitions would need to break even on football-related income and spending. They will be permitted losses of €6.6m in the first two years, or up to €60m if a wealthy owner makes a one-off payment to clear debts. Real Madrid and FC Barcelona are not afforded such a luxury because the teams are owned by their club members, so they are having to be far more cautious than they have in the past on expenditure in order to balance their books. This summer has been the first in many years in which both clubs postponed any decision on a star signing. (Real Madrid waited until the very end of the transfer window to pay a knockdown price for the Croatian player Luka Modric, who was desperate to leave the Premier League club Tottenham Hotspur.)

It was not always thus. If soccer is among the few sectors to have been affected somewhat belatedly by the crisis gripping the nation, it is because it has long inhabited a world with its own privileges and rules, protected by its own fiefdoms. “Spanish soccer has for years been good entertainment. But it’s also been a far from transparent business, with opaque transfer deals and large-scale money-laundering, ” says Juan Milagro, a Madrid lawyer specialising in tax advice.

In soccer terms, Spain was a late developer compared with northern Europe. The country’s businessmen and traders learned it from British engineers and seamen in the late 19th century, with some of the early clubs earning royal patronage. But it was only in the aftermath of the Second World War that Spanish soccer came into its own as a popular mass sport, not just tolerated but actively encouraged by the Franco dictatorship as a diversion from the country’s political problems.

Few figures loom larger over the development of Spanish football into a global sport than the late Santiago Bernabéu, president of Real Madrid, whose eponymous stadium has endured to this day as one if the great sporting ‘cathedrals’, to which fans from around the world pay pilgrimage.

The stadium was built in the late 1940s by Bernabéu – a volunteer in the Franco army during the Spanish Civil War, and a fanatical supporter of the club – as the symbol of the new centre of power within Spanish soccer. During the postwar years, soccer clubs were given privileged access to petrol, a rare commodity in those days, for travel to away matches, and club presidents were able to draw on limited sums from a state support fund for sporting facilities. Bernabéu got one better on his rivals, getting the Franco state to help fund the building of the biggest stadium in the country.

Once the Bernabéu was built, its namesake set out to create a star-studded team led by foreigners, among them the Argentine-born Alfredo Di Stéfano, regarded as one of the best players in football history. Thanks to this team, the club enjoyed a golden decade in the 50s and early 60s, winning a succession of European Cups.

Those golden years were very much in the mind of the current Real Madrid president – construction magnate Florentino Pérez – when he set out at the start of a new millennium to transform the club into a global sporting entity. During a period of untrammelled economic growth, fed by easy credit and ambitious building projects, he renegotiated his club’s historic debt, modernised the Bernabéu and bought a renewable stable of international stars, including David Beckham. Real’s manager, José Mourinho, earns an estimated (and unprecedented) €14.8m a year, according to the magazine France Football.

If soccer is littered with examples of clubs that have brandished chequebooks and wound up with financial headaches, then Pérez seems to have worked even bigger miracles with Real Madrid’s balance sheet than its team sheet. In May 2001 he balanced the books through a complex property deal, exploiting the location of the club’s old training ground on the outskirts of Madrid. The deal involved the development of the land for commercial and public use, including the construction of four skyscrapers.

More than a decade later, Pérez’s construction company ACS is struggling while the powerful, politically influential Real Madrid navigates its own troubled waters. Its last two major signings, both in 2009 – of Portugal’s Cristiano Ronaldo for £80m (€93.9m) from Manchester United, and the Brazilian midfielder Kaka for €65m from AC Milan – were funded by Caja Madrid, a savings bank at the heart of Spain’s financial crisis. With five similar insitutions, the entity was absorbed into new bank Bankia, which looks set to be the main recipient of an emergency bailout by the European Central Bank. To make matters worse, the club’s sponsorship by an online betting firm registered in Gibraltar is the subject of a court case by a business association that claims the company is illegal under Spanish law.

Over at FC Barcelona, the development of perhaps the most talented and successful group of players in history secured a record €150m sponsorship deal with Qatar and a boost to merchandise sales around the world. But according to Carlos Tusquets, a leading banker and financial adviser to FC Barcelona, the club has had to adopt a cautious approach to buying expensive star players, having decided the price tag of Athletic Bilbao’s Javi Martinez is “too expensive” and delaying a final move to secure Neymar, the emerging celebrity of Brazilian football, who plays for the São Paulo club Santos. “We’ve got to see if the prices make sense and make sure we can afford it,” says Tusquets. “We have been reducing our debt.”

Three years ago, FC Barcelona’s success on the field was overshadowed by allegations made by its newly elected president, Sandro Rosell, that under his predecessor, Joan Laporta, spending had gone unchecked and the consequences brushed under the carpet. The result – according to revised accounts presented by Rosell and approved by the club’s general assembly, which represents the interests of 175,000 fee-paying fans who own Barcelona – was that instead of making the €11m profit that Laporta claimed for his last season, it had in fact lost €79m.

Laporta has strongly denied the allegations, which are the subject of court proceedings. But the feuding has damaged FC Barcelona’s reputation. The club – a standard-bearer for the Catalan national identity – has always claimed to have ethical and political principles that distinguish it from other Spanish clubs, with a strong democratic tradition. Its slogan defines FC Barcelona as being “more than a club”.

By its very nature, Barça is a social, cultural and political family. One unwritten rule was that, however visceral your attacks were while campaigning for the presidency, you wouldn’t then expose the most unsavory aspects of the previous administration. The new management, however, is arguing that it is precisely this culture of opacity and impunity that needed changing, as an obligation to the fans who are Barcelona’s owners and to set a higher standard.

One of the longest-serving football club presidents in history – Jose Lluís Núñez, who was in charge of FC from 1978-2000 – was sentenced to six years in jail last year after being found guilty on charges of bribery and falsification of documents. Josep Maria Huguet, the inspector of taxes in Catalonia from 1985-1994, received an 11-year term for falsifying tax returns in return for cash and properties at preferential rates.

Núñez had made a fortune out of the reckless and poorly regulated urban growth that took place in Catalonia during the last two decades of Franco’s rule (1957-73). One of his more notorious developments involved buildings in the picturesque Eixample district. To increase floor and parking space and speculate on property prices, Núñez’s bulldozers flattened old walls and imposed a crude urban monotony across a large swathe of the Catalan capital. In 1975, the year of Franco’s death, Núñez’s company constructed a hideous housing block next to Gaudi’s magnificent Sagrada Família, in the exact place where the original plans had at one time promised an extension of the religious masterpiece.

During his time as president, FC Barcelona’s membership swelled from 77,000 to more than 103,000 and its annual revenue from 817 million to 14.9 billion pesetas. It also won several trophies, including La Liga and the 1992 European Cup (its first) with manager Johan Cruyff’s ‘dream team’. Cruyff was well rewarded financially during Núñez’s presidency, as were managers such as César Menotti, Terry Venables and Bobby Robson and foreign star players such as Cruyff himself in the 70s, Diego Maradona, Gary Lineker, Michael Laudrup and Ronald Koeman.

Things would be looking far worse for FC Barcelona were it not for the TV broadcasting contracts that it shares with its main rival. Lawyer and long-term Real Madrid supporter Juan Milagro believes that the economic advantage gained by Spain’s two big clubs over their domestic opponents is now so great that the days of the Spanish League are numbered. “This is an irreversible process. The fact is that there are too many football clubs in Spain losing money, and too many Spaniards simply happy to go on watching the two big historic rivals fight it out,” he says.

Milagro foresees the gradual development of a much smaller Spanish League, rather like the US’s, with Real Madrid and FC Barcelona eventually forming part of a Super European League with clubs from France, Italy, England and Germany. The idea of such a league has been periodically discussed since the late 1990s when it was raised by the Italian company Media Partners, only to be shelved when UEFA reorganised its international tournament calendar to prioritise the lucrative Champions League tournament. In recent years Pérez and Rosell, presidents of Real Madrid and FC Barcelona respectively, have revived it.

At a soccer conference in Doha last November, Rosell suggested a breakaway European league might start by 2014, unless UEFA gives in to demands from the major clubs for a smaller domestic league and an expanded, if more exclusive, Champions League capable of boosting its worldwide TV audience. European soccer is regulated through a memorandum of understanding between clubs and UEFA that was signed four-and-a-half years ago. When this expires in 2014, the top clubs will no longer be legally bound to play in UEFA’s Champions League or, crucially, to release their players for international friendlies or tournaments, including the World Cup. The Spanish big hitters have had some support for the idea of a breakaway Super League in France, Italy and Germany. Although big English clubs have tended not to get involved publicly in the debate, and seem quite happy with the competitiveness, popularity and riches of the Premier League, the two global soccer overlords, UEFA and FIFA, look likely to come under increasing pressure from clubs that want to have greater control over their finances and the games they play. Analyst Fabian Lares believes such a Super League is “still far away”, with senior figures in Spanish football far from convinced that it will necessarily be in their interests, let alone a popular move with their fans.

National coach Vicente del Bosque thinks Spanish football’s success and popularity should be exploited as a brand at a time when the country appears to be the sick man of Europe.”La Roja cannot solve the problems of the country but it can serve as an example of a united team,” he says.

He believes it would be a mistake to scrap the Spanish league from which he picks his players – and thinks English fans in particular, given their tribal loyalties to local teams in their own country, would lead a popular rebellion against a Super League. “Can you imagine soccer without the English Premier League?” he says. “As for Spain, we need a league where revenue is more equitably distributed. It’s not good for the future of the game to have just two clubs dominating everything, although it’s going to be difficult to change things. Real Madrid and FC Barcelona are very powerful.”

Published in CNBC BUSINESS magazine September 2012

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Evo’s Bolivia:Far from seventh heaven

The colonial church of San Francisco in La Paz, founded in 1548, is a beautifully textured mixture of Christian imagery and Indian mythology. The facade and ceiling  mixes  in saints, Christs and Virgins with tropical birds, reptiles , and sweet corn.

On a recent Sunday, the church was the setting of a controversial ceremony : a Jesuit priest officiated the marriage of Bolivia’s neo-Marxist vice-president  to a popular TV newsreader just a day after the couple dedicate their love to each other  in Tiwanaku, site of a prehistoric indigenous ceremonial centre.

To supporters of  President Evo Morales, the marriage of his powerful number two to a TV newsreader  in two of the country’s oldest and most venerated locations, under the umbrella of two different cultures, symbolises the dynamism of a left-wing political project that has cultural diversity and inclusion at its centre.

Vice-president Alvaro Garcia Linera , a former guerrilla fighter  these days  is usually seen in a designer suit  and  sporting a flash tie.  To Morales’s detractors , LInera’s marriage to the glamorous Claudia Fernández would be a farce were it not for the fact that behind the fashion-conscious exterior lies  a very calculating politician, who is not to be taken lightly. This “very tough cookie”, as one European diplomatic put it, is  one of two  key strategists and ideologues behind the  controversial Morales regime.

Serious arguments  over what in a less politicised environment would simply be the subject of  a photo-spread in a celebrity magazine are symptomatic of the tension in Bolivia  as Morales tries to perpetuate himself in power with a radical style and  programme that have gained him some powerful opponents, as well as friends,   not least in the Catholic Church.

Morales , an Aymara Indian, baptised Catholic and former coca leaf grower, was elected in  December 2005 with the laudable pledge to end  centuries of marginalisation and discrimination. The state has pumped money into  education and heath  projects for the poor ,and both the hydrocarbons and mining sectors have been partly nationalised.

As the Morales’ revolution approaches its seventh anniversary, the parameters of government remain officially set by a new constitution ( voted by referendum ) that decrees respect for indigenous  customs, languages and forms of justice. “What we are seeing is a quantitative jump in our way of life, in our ways of thinking and doing democracy,” says Juan Ramon Quintana the Minister of the Presidency. “We have broken with the liberal tradition of one citizen one vote and adhere to a more dynamic political and social landscape that recognizes multiple ways of participating in a very complex society with a  very varied geography,”

Quintana, a well educated  former  army officer turned political fixer, is the other eminence grise behind Morales, who, as president, is still the undisputed Caudillo, or strong man of MAS (Movement for Socialism), the broad left wing  grouping he formed prior to reaching government.

I met Quintana  in the office  he occupies just yards away from the president’s in the neocolonial palace in La Paz’s Plaza Murillo. But for some ceremonial guards dressed in 19th century uniform, the building has a disarmingly relaxed if occasionally chaotic atmosphere of a non-government organization. I was waiting in line, behind a charming Methodist  pastor who declared that Bolivia had become a more tolerant and ecumenical society since the new constitution defined the country as a secular state in which no one church had a privileged status any more.

Only the groups of riot police lingering in the plaza, and the careful security checks carried out by some plain clothed officers (trained by the Cubans) remind one  this was  the heart of the Morales regime, with all its contradictions.

Bolivia’s one Catholic cardinal the Archbishop of Santa Cruz de la Sierra, Julio Terrazas took on Morakes with the Catholic bishops, opposing government efforts to end Catholic religious education in state schools. Morales reversed the plan after protesters took to the streets.  Terrazas has maintained a certain diplomacy, speaking of Morales’ “many qualities”  such as his ability to speak to poor people, telling what they want to hear. But Terrazas has also said that at times the presaident’s ways and  “betray him.”

In a recently published book of interviews the media-weary Terrazas told his chosen interlocutor , a priest “I think the President is playing the part he’s been told to play: the savior of the indigenous world. He presents himself as someone who will save the indigenous people from the rest of the world and claims to have a personality that is almost on the level of religious leaders. All these insinuations show up very clearly in some of his attitudes.”

“They say,” the cardinal added, “that the biggest and most beautiful things are always just one step away from the ridiculous, and he could cross that line if he continues to try and change things that aren’t for him to change. He could be a model for Latin America if he were able to respect differences, benefiting from all cultural values without mixing in external ideologies.”

Relations between Bolivia’s Episcopal  Conference and the Morales regime have been strained since the Catholic Church  lost its official status. They have been particularly on  edge ever since Terrazas’s   home was bombed in 2009. The attack was blamed by the government on an alleged foreign terrorist conspiracy  against President Morales financed by local right-wing businessmen in the province of Santa Cruz. Its version has been questioned in a bestselling book   by an investigative journalist which shows evidence suggesting that that the government itself, with support from Venezuela, instigated  the plot with the aim of discrediting its opponents.

The case remains far from open and shut. Equally confusing is the government’s recent bizarre decision to launch a criminal prosecution against the widely respected Church-funded news agency Fides, for alleged  “racism and discrimination”. The agency’s Jesuit editor José Gramunt de Moragas has  strongly  denied the charge which follows the radio  reporting  of   a poorly phrased speech Morales himself made about  inhabitants of the province of Santa Cruz . “They are shooting the messenger,” Fr Moragas commented.

The Government blames such conflicts  on sectors of the Catholic Church who, as they have done since colonial days, have sided with the privileged white population.  “There are (unnamed) Church figures who talk about ‘justice’ while eating five meals a  day and drinking a lot of wine,” Quintana commented, while making clear that the government did not consider itself at odds with all Catholics. “There are progressive sectors whose work we support and who are true interlocutors of liberation theology,” he emphasized.

State-Church relations could be far worse if as in neighboring Peru, the local Catholic  Church was dominated by Opus Dei. While Opus does have a presence in Bolivia , one of the strongest Catholic influences in the country is that of Spanish-born Jesuits, with a long tradition of radical missionary work with indigenous groups. Today, sixth formers of St Ignacio, La Paz’s Jesuit run school for the sons and daughters of rich Bolivians, do  voluntary service working in poor rural communities as part of their education. And the  Jesuit officiating the vice-president’s wedding  was  the elderly  Fr Mauricio Bacardit who has been a close friend of Morales since the president’s days as a militant rural trade unionist. “Evo Morales used to call him ‘my father’ because he was a kind of spiritual guide whenever there were political conflicts in the province of Santa Cruz, “Xavier Albo, a fellow Jesuit who has become more critical  of the president told the Bolivian newspaper Pagina 7.

The governing political grouping MAS contains within its ranks, alongside members of the communist party, indigenous community leaders, miners and socialist intellectuals, priests and lay Catholics who believe that Bolivia, historically one of the most politically unstable and backward countries in South America,  is embarked on a necessary project of social and economic transformation in favor of the formerly downtrodden and excluded .

Albo, a trained anthropologist and  dedicated student of indigenous movements, has supported those protesting the government’s decisoun to push ahead with a Brazil-funded highway across a pristine natural Amazonian reserve in the north of the country inhabited by indigenous groups whose rights and traditions are now at risk in apparent violation of the constitution.

The disputed road is central to Morales’s  drive to boost infrastructure and investment. “This is a political battle over the control of a territory we believe should be part of the country’s development,” says minister Quintana  who suggests that the opposition is being fuelled by “ global ecological activists.”.

What Quintana  doesn’t say is that the territory holds strategic importance for coca growers of Aymara and Quechua origins, the president’s most loyal constituency. This is one of the reasons why the issue of the highway  has sparked clashes between them and other indigenous groups from the Amazonian lowlands, who fear that the area could turn into a safe haven for cocaine producers and traffickers. Elsewhere the country’s rich mineral resources are being fought over by self-employed miners and displaced  Indians, while the government considers bringing back foreign investment and technical know-how the state sector lacks.

Morales’s constitution enshrines the values of ‘Mother Earth’ and equality of race and status. But in mineral-rich Bolivia, the ecologists are on the defensive, and some citizens are more equal than others.

(An abridged version of this article appeared in The Tablet on the 15th September 2012)

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Why Cameron is doomed

Change in British politics can as easily creep up on one as happen rather suddenly. Think on Churchill’s election defeat post WW2.

The Poll tax riots in March 1990 and the massive demonstration against  the war in Iraq in February 2003, marked the end of  the popular  legitimacy of the two other towering post-war prime-ministers, Thatcher and Blair.

In recent days the heckling of the chancellor George Osborne by thousands of spectators at the Paralympics will I think eventually take its place in the history books as symbolic of David Cameron’s political displacement.The message of the crowd was loud and clear: there are heroes in our midst, but you certainly are not one of them; we do not  believe the Government is doing enough to support people with disabilities and Osborne is a hypocrite.

Osborne’s public humiliation was followed by a cabinet reshuffle which while keeping him in post left a distinct impression of his  Prime-Minister throwing the last dice before the coalition implodes. It says something about the mess the Tory party finds itself that a third runway at Heathrow airport becomes not just the main topic of economic debate, but also a question of political survival-for west London MP’s who will lose their seats if the runway goes ahead, and Boris who clearly relished the prospect of a bruising fight over the issue. As for the Lib-Dems, they surely can’t for long remain partners with a Conservative team  that has evidently lurched to the right.

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Farewell Neil Armstrong

Most of us of a certain age can probably remember where we were in July 1969, that day (or night) Neil Armstrong  walked the moon- it was that kind of defining moment in history that prompted that profound phrase, rather popular at the time of stoned heads: “Today’s the  first day of the rest of your life.”

I was thirteen, at a summer camp outside Madrid, learning to sail with a group of Spanish and foreign kids. They included a girl from Paris, three years older than me, who showed me what a French kiss was as we danced slow one night in a small informal discotheque that doubled up during the day as a canteen.

I thought that was a pretty special night, until the following one when I walked up a mountain side, alone and,  on  a starlit Quixotic  night , gazed at the moon and imagined the first man walking on it. Only later, would I catch the blurry image of the act itself, on TV.

Thanks to my Spanish  mother, and British father, my early childhood heroes had included other legendary  explorers – Columbus, Darwin, and Scott- but Armstrong’s achievement took me into another dimension, literally, physically, and spiritually- sublime poetry in a courageous act that seemed to take us closer to God and the true beauty of his creation – ‘ a small step for man, a giant step for mankind’ .

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