Put a Fork in this Turkey—a New Stadium is a Luxury We Cannot Afford

Minnesota Governor Mark Dayton has called for a Special Session of the Legislature the week of Thanksgiving to pass legislation for a new Minnesota Vikings stadium.

The Minnesota Vikings have bandied ideas about for years for a new NFL football stadium to replace the Hubert H. Humphrey Metrodome.  Their current $1.1 billion proposal would site a new professional football stadium at the defunct Arden Hills Twin Cities Army Ammunition Plant.  The Vikings would pay $407 million, and they are asking for $350 million from Ramsey County, $15 million from the Metrodome, and $300 million from the State of Minnesota, leaving a funding gap of about $39 million or more.

I, myself, don’t agree that a new Vikings Stadium is a wise investment of State resources.

1. Primary sector economic activities are the only sustainable source of new wealth creation.  Those who grow stuff, mine stuff, manufacture stuff, invent stuff, are the only people who can introduce new activity into our economy.  The rest of us just move money around, including retail, services, and luxuries like sports.
2. Essential infrastructure facilitates both primary, and secondary/tertiary economic activity.  Water & sewer, many roads, the electric grid and broadband benefit many people across a jurisdiction.  Sports are not essential infrastructure.
3. Some jobs are created by entertainment venues, during initial construction and ongoing events.  However, there is an opportunity cost that balances out supposed benefits.  These “new” jobs are based on local spending that substitutes for other local spending that would happen anyway.  If I can’t go to a sports game, I’ll go fishing or to a museum… or maybe even save my money.  The argument that sports induce economic activity is a classic example of Bastiat’s Broken Window Fallacy.

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Economic development is based on the assumption that a small public/private investment today will lead to a larger public/private benefit tomorrow.  Expanding primary sector enterprises offers the best opportunity to build local economic activity.  Investments in essential infrastructure leverage primary sector economic activity across a community.  The minimal economic benefits of professional sports, however, comes at a high opportunity cost.

Now let me step back from pure economics a moment.  Communities are not built on economics alone.  As Strong Towns blog has pointed out, parks and recreation help build really great places to live.  To paraphrase: We don’t build parks because we are wealthy, we are wealthy because we built parks.  I’ve seen a couple presentations on the Arden Hills brownfield site, and I have no problem with this use at that site.  I just have a problem with building a turkey and calling it a golden goose.

That said…

Now it’s up to Minnesota’s Legislature to express the will of the people.  There’s really two questions here.  First, do we want to keep the NFL in Minnesota?  Myself, I really don’t care.  People expect a major metropolitan area like the Twin Cities to have certain amenities available, including major league sports facilities.  It’s part of the cost of doing business, but it’s no part of economic development.

Second, if we want the NFL in Minnesota, who should pay the price?  Should the taxpayers of the state subsidize a playground for millionaires?  Why shouldn’t Zygi pay his own darn bills?  If we are going to pony up from the public purse, what way would create the greatest public benefit, or at least minimize the public pain?  It’s time to be honest with the people of Minnesota about the costs and benefits of this project.

That ball’s in St. Paul’s court now.  It seems pretty clear to me:  Professional sports are neither primary nor essential—they are a “nice to have” luxury, and a luxury our State’s taxpayers simply can not afford.

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