Coyote Blog

I have no idea why this town of 250,000 people is so fired up to hand money over to sports enterprises.  This time, its a Superbowl bid:

Glendale is throwing its support behind a regional bid to bring Super Bowl XLIX to the city in 2015.

In return for the prestige of hosting the National Football League game at University of Phoenix Stadium, Glendale must guarantee services such as public safety and sanitation for free and exempt game-day tickets from sales tax for the NFL.

When Glendale hosted its first Super Bowl in 2008, it saw $1.2 million boost in sales-tax revenue. But a city-commissioned study showed it cost the city $2.6 million in services.

The City Council on a 5-2 vote Tuesday approved the resolution. Councilwomen Joyce Clark and Norma Alvarez dissented.

Councilman Phil Lieberman asked for Glendale's cost to host the Super Bowl in 2015, but Deputy City Manager Cathy Gorham said she didn't want to speculate because "things change on a regular basis." The needs in 2015 may be much different from 2008, she said.

These guys are beyond parody. We lost money last time so lets do it again, and by the way lets be sure not to estimate our costs before we make this decision.  Here is a bit more:

Clark said the NFL's demands grow more "invasive" every year.

Clark ticked off requirements such as use of the stadium for nearly two months, final cleaning of the stadium and equipment as needed for free. The NFL doesn't pay state or local levies such as payroll, sales, use and occupancy taxes.

Clark cited two former host cities, Arlington, Texas and Miami Gardens, Fla., which did not shoulder the costs of a Super Bowl. In both those cities, the states stepped in and reimbursed them, Clark said. She said that communities that hosted the NFL game didn't see "big spikes" in their tax revenues.

"The city of Glendale should not be expected to pay the Super Bowl's costs without recompense when it benefits the entire region," she said. "We are at a disadvantage because the NFL is hosting in our city."

Alvarez, an ardent opponent of using taxpayer money for professional sports, said the city was in no position to be spending money for the Super Bowl with the economic crisis. She said she couldn't face her constituents if she supported the resolution when there are unmet community needs and employees are still taking unpaid days off.

Note the only alternative suggested - the alternative is not "let's not do this, it makes no sense" but "let's make sure we stick the costs on a larger group of taxpayers.

More articles on Glendale and sports subsidies .

Local NFL star Darnell Dockett apparently got pulled over by the police today.  Dockett live-tweeted the encounter, including gems like this:

-I don't know why the police always messing w/me I'm never gonna let them search my car with out a search warrant! No matter what!

-Police sitting here waiting on back up cuz I told them YOU NOT SEARCHING MY CAR! PERIOD! & now I'm sitting here! Owell I aint got shit 2 do!

-There R 3police cars and they are talking! I don't see A search warrant they won't see inside this escalade! I got all day hope they don't!

-Police said "do you mind if we look around in your Vehicle?" I said I sure DO! He said "I'm gonna call back up" I said u wanna use my phone?

You go Darnell.  Everyone who stands up for his Constitutional rights makes it easier for the rest of us to do so.

Name a multi-billion dollar industry where all the competitors in the industry have formed a single cartel.  This cartel performs many functions, but one of its highest profile functions is to aggressively punish any member who pays its employees more than a cartel-enforced maximum.

Believe it or not, there is such an industry in the US... college sports.  The cartel is the NCAA, and whenever the NCAA makes the news, it usually is with an enforcement action punishing a school for allowing any of its athletes to make more than the agreed maximum salary, which is generally defined as free tuition.  As folks are learning at Ohio State, even trading your autograph for a free tattoo is not too small a transaction to attract ruthless NCAA retaliation.

This ESPN page (via Phil Miller) shows 2010 athletic revenue by school.  Take the top school on the list, the University of Texas.  In 2010 its athletic program brought in over $143 million in revenues.  It paid its workers (athletes) who helped generate this revenue $8.4 million (in the form of tuition), or 5.9% of revenues.  Its hard to decide whether this is high or low, though this percentage of labor for a service business seems low.  Looking for an analog, we can turn to the NFL, which is currently negotiating a revenue split with players.  The issue is still under negotiation, but for years players have been guaranteed over 50% of total revenues.

Even the Olympics finally gave up its stupid distinction of amateur status, allowing the best athletes to compete whether or not someone has ever paid them for anything.  This only makes sense - we don't have amateur engineers who work for free before they give up their amateur status for the professional ranks.  I can still continue to earn my degree at college in programming while being paid by outside companies to do programming.   I can still participate in the school glee club if I make money in a bar singing at nights.  I can still be student council president if I make money in the summers at a policy think tank.  Of all the activities on campus, the only one I cannot pursue if someone is willing to pay me for the same skill is athletics.

Only the NCAA holds out with this dumb amateur distinction, and the purpose is obvious -- it provides cover for what otherwise would be rightly treated as worker exploitation.  And they get away with it because most of the members of this cartel are actually state governments, who are really good at exempting themselves from the same standards the rest of us have to follow.

My column is up this week at Forbes, and discusses the role of taxpayer money in professional sports.

A  critical battle is underway challenging the very heart of the professional sports economics model — and it is not the NFL labor negotiations.  The unlikely fight is between a struggling league (the NHL), a suburb with delusions of grandeur (Glendale, Arizona), and a small, regional think tank (the Goldwater Institute).   At stake is an important source of value for nearly every professional sports team:  taxpayer subsidies....

Consider the Arizona Cardinals new football stadium in Glendale, for example.  In part due to the promise of a Superbowl bid, the local taxpayers paid $346 million of the total $455 million cost of the facility — a building that will be used just three hours a day on ten days a year for its primary purpose.  By contrast, in 2010 Forbes valued the Arizona Cardinals at $919 million, meaning well over a third of the franchise’s value accrues from the public subsidy of its retractable roof palace.  It can be argued that much of the increase in player salaries and team owner wealth in the NFL over the last twenty years has come at the expense of taxpayers.

If anything, this example from the NFL understates the importance of public funding of stadiums.  Why?  Because of all the major sports leagues, the NFL gets the lowest percentage of its total revenues from its stadiums.  Leagues like the NBA, and in particular the NHL, are far more dependent on stadium revenue for their well-being.

Let’s return to precocious Glendale.  In 2003, the city agreed to publicly fund $180 million of the $220 million cost of building a new arena for the Phoenix Coyotes hockey team.  Whereas Glendale’s subsidy of the Cardinals represented about a third of that franchise’s value, their $180 million subsidy of the Coyotes represents over 130% of the current $134 million value of the team.  Stuck in Arizona and losing as much as $40 million a year, the team is literally worthless without ongoing public subsidies.

The column goes on to discuss yet another bond issue proposed by Glendale to subsidize these teams.

Great post from SM Oliva via Tom Kirkendal at Houston Clear Thinkers.  They both make a point I have been making for years -- that the large growth of major sports team revenues and player salaries is attributable, in large part, to enormous public subsidies

The NFL encapsulates, perhaps better than any other single business entity, the popular conceptions -- and misconceptions -- about capitalism and the nature of markets. The league is the epitome of statist "crony" capitalism. Its franchise operators demand huge government subsidies for stadiums while jealously guarding its prerogatives as a "private" business. Governments (and their media enablers) largely go along with this because they've been led to believe the NFL's popularity is so immense that no respectable city can go without a franchise.

Professional football is the ethanol of the entertainment industry. Since 1990, nearly every NFL franchise has either opened a new stadium, made substantial renovations to existing stadiums, or is currently in the process of obtaining a new stadium. Over this 20-year period the league's franchises obtained over $7 billion in taxpayer subsidies raging from direct taxes to publicly backed bonds. Ten stadiums are 100% government-financed, while another 19 are at least 75% government-financed. Every single franchise receives some amount of government subsidies.

Here is a great way to think about it -- many new NFL stadiums cost in the one billion dollar range.  That is a billion dollars for a building that is used 3 hours per day for 10 days a year (8 regular season and 2 preseason games).  A billion dollars for a building with 0.3% occupancy.  How can a private entity afford such an investment and still pay multi-million dollar salaries to their employees?  They can't.  Which is why you and I as taxpayers are so often on the hook for the costs.

Heck, here in the Phoenix area, we are hundreds of millions of dollars in the tank for a for-god-sakes hockey team, and about to spend hundreds of millions of more to support it.

Update: This reminds me of my Forbes article on triumphalism and large building projects

Mark Thornton of the Mises Institute wrote a few years ago about the “skyscraper index,” a correlation first studied by economist Andrew Lawrence, which purports to connect downturns in the business cycle with the construction of the world’s largest skyscraper. Thornton did not suggest the “skyscraper index” was an infallible predictor of economic downturns, but there was ample empirical evidence to suggest “the cause of skyscrapers reaching new heights and severe business cycles are related to instability in debt financing and that the institutions that regulate debt financing should be reevaluated, if not replaced with more efficient and stabilizing institutions.”

Cowboys Stadium may prove to be the NFL’s version of the Chrysler Building, where the groundbreaking occurred a month before the stock market crash of 1929. By most accounts “Jerry World” is the most opulent, luxurious stadium ever built for an NFL team. Not surprisingly, it is also a debt-ridden project that exists only because Jerry Jones had easy access to a government-backed credit card.

Kevin Drum wonders whether the proposed $700 million bid by Farmers Insurance for naming rights on a prospective LA NFL stadium makes any economic sense.   It is an interesting question.  I wrote:

This has always struck me as one of those agency problems, where the executive's incentives are different from the shareholders. Executives get a ton of benefits personally from this -- higher profile for the company which improves their profile and marketability, they get a prime box for the games, parties, etc.

Before the audience here slips into a round of corporate executive bashing, my sense is that the same perverse incentives are working for municipal leaders who have a mismatch with taxpayer interests when they shove huge amounts of taxpayer funds to owners in stadium deals (deals which economists speak with one voice on -- they never pay off for the community in full). One of the dirty secrets of these deals is that they generally include a sort of kickback in the form of boxes and club seats for the Mayor and city council's use (and sometimes multiple boxes for leaders of other government agencies in the town).

A month ago, the Arizona Cardinals mailed me (as a season ticket holder) my playoffs tickets.  I usually don't advertise myself as an Arizona Cardinals season ticket holder, just because numerous academic studies have demonstrated that this fact is not highly correlated with the average person's perceptions of intelligence.

Because of logistics and time limitations, when one gets NFL playoff tickets one typically gets a ticket for every possible game the team could play in.  Because there was an oddball small statistical chance the Cardinals could host an NFC championship game if a) the Cardinals won two playoff games, which has never happened in franchise history and b) all the top 3 seeds lost, they sent me NFC championship game tickets.  My son and I literally laughed out loud when we saw them.  Hosting an NFC championship game with a franchise that has not hosted any sort of playoff game for 60 years seemed, well, laughable.

Well, I just ran to my desk to make sure I actually kept the tickets, because with the Eagle's win today the Cardinals will actually be hosting the NFC championship game next week.  Go Cards!

I really enjoyed the game last night in Green Bay.  It is impossible on TV to communicate the energy and decibel level of that crowd, particularly in the first half before Dallas opened up a large lead.  But even with victory pretty much out of reach with 5 minutes to play, virtually no one left  (our Arizona fans would already have been out of the parking lot by then).

The game featured a 72,000 person crowd in a town of 100,000.  In a world where traditional groups are increasingly fragmented, the entire town is united in their dedication to the team.  The Packers are ubiquitous in town, so much so I can't even think of any good major-city analogy.  The best analogy I can come up with is that the game was more like a
high school football game in west Texas than a typical NFL game.  Even the cheerleaders look like a high-school cheer squad with girls in jumpers and guys with megaphones, in a world where the other 30+ teams all have pinup girls with breast enhancement. 

Yesterday, I had what will likely (given ticket prices) be a once in a lifetime experience for me -- I got to take my son to the Superbowl.  Our ability to afford this event really was a result of our living in the same city as the Superbowl.  The obvious reason for this is that we did not incur any significant travel costs and did not have to pay peak demand level hotel pricing.  The less obvious, but ultimately more important, reason was because we could afford to watch the ticket prices on the secondary market up until the absolute last minute.  If your were bringing a group from New York, waiting until Friday or Saturday to buy tickets might have been a bit uncomfortable, given other sunk costs. 

As it turned out, Superbowl ticket prices this year on the secondary market  (e.g. TickCo, Stubhub, et al) followed a parabola.  They were below their peak early-on, particularly since sellers did not have the tickets in hand.  You can buy tickets weeks before the Superbowl, but they will be listed as "for this general area."  You could end up in the front row or the back -- it is a bit of a crap shoot.  So they are cheaper because of this.  The peak pricing came the week before the AFC and NFC championship games when many sellers had tickets in hand and could advertise specific seats.  All along, I was looking for a ticket to just get in the door, so I was looking for the cheapest seats (likely upper deck end zone).  At their peak, there was nothing gong for less than about $3800 (when you included the seller commission or transaction fees, typically 10-20% for this type of ticket).  Beginning the Monday before the game, prices started falling  -first 10%, then 20-30%, and finally as much as 50%.  I jumped in towards the end of the week because a pretty good (or at least better than the worst) seat came up for a good price.  I am told by a friend who showed up on game day at the ticket company office that he got in for less than $1500.

Anyway, here is the stadium - yes it is kind of odd looking.  This was taken about halfway through our walk from the car to the stadium.  We just barely parked in the same county.  We showed up about 6 hours before game time and were in the last half of arrivals:

The stadium is a taxpayer-funded boondoggle that is a good hour away (on the complete opposite side of a very large city) from old Scottsdale where most of the parties and social activities and player hotels were. 

The security included a ban on any bag over 12x12x12 inches, a pat down, and a metal detector.  And the NFL did a MUCH better job than the TSA.  MUCH.  It is hard to see, but the tent on the left is about 1/4 of the length of the full security screening area.   They had  at least 25 lanes open in parallel.  Despite thousands of people, we had no wait at all (the lines below are all moving briskly and continuously).

And look!  We must be in the front row!  Well, of the upper deck, but these turned out to be great seats and, having watched prices for weeks, a very good price-value point (in context).  My son braves the wrath of all the surrounding Giants fans by wearing his Cowboys jersey.

I thought the fast set up and takedown of the stages was pretty amazing, and something you miss on TV.  Here is Tom Petty's stage going out (or in, I can't remember).  The funniest part was the crew of NFL guys who followed along with rags and buckets to dust off the grass after the equipment passed to make sure it looked good for TV.

We had a decent view of Tom Petty's back, which once I saw his scraggly beard was probably a good thing.  The crew of screaming fans at the stage was pretty funny.  They ran these folks out for Alicia Keyes, then kicked them out of the stadium, then ran them back in for Tom Petty, and then back out again.  I saw one show on TV last night, and the audience looked young, but to my eye the great mass of the crowd was middle aged women, which I thought was kind of funny.

And here is the last play and confetti burst:

It was a great, perhaps historic game, and we loved the whole experience.  Now back to work to pay those bills.

So, here are the [sports-related] events on my must-see list I have tackled:

Baseball all-star game, Superbowl, game at Fenway, game at Yankee stadium, 16th hole at the Phoenix Open, center court at Wimbledon, BCS Championship game, Daytona 500, personally playing golf at St. Andrews, Big 10 home football game, Rose Bowl, Cowboys home game [update: and an original 90s-vintage American Gladiators filming live]

Yet to be tackled:

the Masters, Packers home game, game at Wrigley, NCAA final four, SEC home football game (maybe Tennessee or the cocktail party), maybe at World Series, maybe a World Cup

What else?

Clearly, all the major problems of the world have been solved, because Arlen Specter wants to focus the Senate's time on the New England Patriots' violation of NFL rules for which they were severely punished and which violations in no way tread on any law, just NFL rules.

In a telephone interview Thursday morning, Senator Arlen Specter,
Republican of Pennsylvania and ranking member of the committee, said
that Goodell would eventually be called before the committee to address
two issues: the league's antitrust exemption in relation to its
television contract and the destruction of the tapes that revealed
spying by the Patriots.

"That requires an explanation," Specter
said. "The N.F.L. has a very preferred status in our country with their
antitrust exemption. The American people are entitled to be sure about
the integrity of the game. It's analogous to the C.I.A. destruction of
tapes. Or any time you have records destroyed."

Please, to the friends of Arlen Specter:  It is time for an intervention, before the man hurts himself any more. 

Next Up:  Kay Bailey Hutchison calls Jerry Jones in front of Congress to explain why the Cowboys gave up on the running game in the fourth quarter of this year's playoff game against the Giants.

This week, we in Phoenix are supposedly getting our payoff for subsidizing the hapless Arizona Cardinals with a billion dollar football stadium that is used for its intended purpose (football games) for 33 hours per year  (3 hours per game times 11 games:  2 Cardinals pre-season, 8 home regular season, Fiesta Bowl).  In exchange we get a nicer stadium (if I were to want to see a Cardinals game live) but worse TV options (because instead of the best game of the week, we have to see our home team).

The big selling point, the cherry on top of the sundae the NFL uses to push new stadiums, is a Superbowl.  Which is in town this week.  So far, the huge economic stimulus has not really poured into our household, but I guess I need to be patient.  Anyway, the timing seems good to link this article, which comes via the Sports Economist:

If you build it, they will come. This is usually the mantra of those in
favor of publicly financed sports stadiums, including the current
proposal for a new soccer stadium in Chester. In this case they
are visitors whose spending would turn devastated cities and
neighborhoods into exciting destination points. Local schools,
merchants, and residents all would benefit as municipal coffers swelled.

There's only one problem with this scenario. It's not true. Never has been. They
do come, but cities are not saved. Over the past two decades, academic
research has generated literally hundreds of articles and books
empirically challenging the alleged economic wonders of new stadiums,
even when they're part of larger development schemes. I have been
studying and writing about publicly financed stadiums for more than 10
years and cannot name a single stadium project that has delivered on
its original grandiose economic promises, although they do bring
benefits to team owners, sports leagues and sometimes players....

Why, then, given the overwhelming academic research challenging
stadium-centered economic development do political leaders (if not
average citizens) still support such projects? In a just-released
article in the Journal of Sport and Social Issues, my colleagues and I
studied media coverage of 23 publicly financed stadium initiatives in
16 different cities, including Philadelphia. We found that the
mainstream media in most of these cities is noticeably biased toward
supporting publicly financed stadiums, which has a significant impact
on the initiatives' success.

This bias usually takes the form of uncritically parroting stadium
proponents' economic and social promises, quoting stadium supporters
far more frequently than stadium opponents, overlooking the numerous
objective academic studies on the topic, and failing to independently
examine the multitude of failed stadium-centered promises throughout
the country, especially those in oft-cited "success cities" such as
Denver and Cleveland.

I can attest to the latter.  During the run up to various stadium-related referenda, the media was quite rah-rah for the stadium subsidies.  In fact, on radio, several talk show hosts denigrated voters who opposed the stadium subsidies as "stupid old retired people."  I remember calling in to a couple of talk shows opposing the stadium bills and being treated like a Luddite.

My article on sports team relocations and stadium subsidies as a prisoners dilemma game is here.

Because of the all-to-prevalent theory (which may become even more common if Jon Edwards becomes our next AG) that every accident must be the fault of the nearest person with deep pockets, I wasted an hour today.

I visited the NFL experience today with my son.  The NFLX is a kind of football-themed fair or amusement park that the NFL sets up near the site of each Superbowl  (HA HA NFL -- I said it.  I said "Superbowl" and not "the big game."  Come and get me).  After waiting in a reasonable line to enter, we found that to play the games (e.g. throw the football through a hoop) every participant (read 10,000+ people) had to individually fill out and sign a liability waiver and get a wristband attesting to the fact.  There were about 16 clerks at work, but it still was about an hour-long wait. 

It struck me that the NFL could have come up with a much better process.  Why not have people with Internet access (about everyone, since almost 98% seemed to be there with tickets they bought on the internet) print out the waiver and bring it with them already filled out?  The manager on-site claimed that Arizona state law and the Arizona AG required that the process proceed the way it did.  I give that explanation about a 50-50 between being correct and just covering their butt for something stupid.

Anyway, once signed, we had a good time at the event, and it was well worth the effort.

The NFL playoffs are absolutely my favorites sporting event of the year.  So of course I have to get on an airplane Sunday afternoon to get to a Monday morning meeting.  To get in the spirit, here is one of my favorite NFL spoofs, Peyton Mannings United Way commercial on SNL:

One of the problems with us libertarians is that we all sound like a bunch of academic dweebs when we talk.  Well, thanks to YouTube and Human Advancement, I saw Mike Lee, who I found unpolished but curiously entertaining as a defender of individual rights (though he's bit hawkish internationally for my tastes).  Anyone who can, in about 2 minutes, shift from Duke Lacrosse to North Korea to jury nullifaction has got to be interesting to listen to.

By the way, it is increasingly clear that Google and YouTube don't really want to be a free speech outlet, as they seem to be banning stuff as fast as it can be posted.  They are private concerns, and so can do whatever they like, and I can understand from their perspective why they want to avoid controversy  (though if they ban everything the RIAA wants banned and political groups of every stripe want banned and end up with just home videos of pet tricks, I am not sure it will remain as popular).  This in turn got me thinking about Neal Stephenson  (and I accused Mike Lee of rambling?)

In Cryptonomicon, one of the plot lines is a group of guys trying to create an offshore data haven free from threats by government censors, tax inspectors, and, I presume, copyright enforcers from the RIAA and the NFL.  While such a comprehensive haven may be out of reach, I do think there could be a great role for an offshore blogging/podcasting/video haven that would protect identities and be immune or out of reach from third party censorship.  The problem is that as an officer of such an endeavor, you would likely be subject to immediate arrest in many countries once you landed there.  Oh, that would never happen in a free country like the US would it?  Yeah, right.

As most people know, the NFL doesn't want you to use the word "Superbowl" when hosting a party, sale, event, etc, and they aggressively enforce their trademark on this term.  In response, since all the country does in fact have parties, sales, events, etc. associated with the Superbowl, folks have adopted the euphemism 'the big game" in their communications. 

I observed that this not only pointed out some of the silliness in our intellectual property laws, but also was counter-productive for the NFL -- shouldn't they want people talking about and holding events for the Superbowl?  I suggested a simple licensing program that would raise a little money and probably work better for everyone:

The NFL needs to offer a one time use license each year for a bar or
other establishment to hold a Superbowl party and actually use
Superbowl in the promotion.  The license would of course be
non-exclusive, and would carry a myriad of restrictions on how you use
the name, etc.   The license could be purchased for a price that would
be cheap for a business, maybe $200, and could be purchased right over
the web.  It would actually be easier, I think, to go after violators
because the NFL could point to the existence of a legal licensing
program the violator could easily have participated in.  I would think
they could easily bring in a couple of million dollars, not to mention
saving them enforcement money and PR headaches.

The NFL has decided to go in a different direction.  It is trying to trademark the term "the big game" so that term can't be used either (HT Overlawyered).  I particularly liked this from the application:

Disclaimer NO CLAIM IS MADE TO THE EXCLUSIVE RIGHT TO USE "GAME" APART FROM THE MARK AS SHOWN

Jeez, why not?  Who at the NFL is sleeping on the job here?

Well, that's what I get as a libertarian for trying to work within the system to make things incrementally better rather than going on one of my usual idealistic rants.  So I officially withdraw my previous suggestion in favor of a new one:  Trademarks should, at most, only give one the protection from someone else labeling a similar product with the trademarked name.  By trademarking Jif, P&G gets protection from another company selling peanut butter under the same name in the US.  However, any other use of Jif in communication should be entirely legal.  If I communicate to people that I am having Jif party, that communication is protected under the first amendment and P&G can't shut down my party.  If I want to put out a poster and sell it with Jif peanut butter labels and how they have changed over the past 100 years, I should have the right to do so.   Ditto if I want to print bumper stickers that say "Jif sucks."

Similarly, the NFL can be legally protected from having another group host a football game (and if I am in a generous mood, maybe any type of sporting event) and calling it the Superbowl.  And that is it.  They should not be granted an exclusive government monopoly to use the word Superbowl, or more ludicrously, "the big game":

posters, calendars, trading cards, series
of non-fiction books relating to football; magazines relating to
football, newsletters relating to football,notepads, stickers, bumper
stickers, paper pennants; greeting cards; printed tickets to sports
games and events; pens and pencils, note paper, wrapping paper, paper
table cloths, paper napkins, printed paper party invitations, paper
gift cards; paper party decorations, collectible cards; collectible
card and memorabilia holders, souvenir programs for sports events,...toys and sporting goods, namely, plush toys, stuffed toy
animals, play figures, golf balls, footballs, sport balls, toy banks,
playing cards, Christmas tree ornaments...Men's, women's and children's apparel, namely T-shirts, fleece tops, caps, headwear

And don't even get me started on Pat Riley's "Threepeat."

I'm not sure this one even needs comment, via Tom Kirkendall

A volunteer waitress and a widowed great-grandmother who tends bar at
the Lake Elsinore Elks Lodge are due in court later this month after
pleading not guilty to misdemeanor charges of operating an illegal
gambling operation.

Margaret Hamblin, 73, and 39-year-old Cari Gardner, who donates her
time as a waitress at the lodge, face up to one year in jail and a
$5,000 fine for allegedly running a $50 football pool [ed: yes, fifty whole dollars] at the facility,
the Press-Enterprise reported.

The charges stem from a Nov. 20 investigation by state Department of
Alcoholic Beverage Control agents into an anonymous tip that lodge
members bet on NFL games.

Behind the bar, the armed agents found an envelope with $5 from each
of the 10 members taking part in the pool. The person who came closest
to guessing the combined score of the Jacksonville Jaguars and the New
York Giants was to pocket the contents, according to the
Press-Enterprise.

"It was just regular 'Monday Night Football,' " said Hamblin, who
has tended bar for 40 years, six of them at the lodge. "We were sitting
at the bar, and the gang wanted to do something," she said, according
to the newspaper.

Timothy Clark, who heads the department's Riverside district, which
issued the citations, said football pools "are a violation of the law,
and we will take whatever we feel is appropriate action to ensure
compliance by our licensees," the newspaper reported.

Every year about this time, the NFL earns itself some bad press for busting some small bar or local group for using the word "Superbowl" rather than that catchy phrase "the big game on the first Sunday in February down in Miami."  This year, the bad press honor goes to the NFL for shutting down a party at a church in Indianapolis for having a screen too large.  (Hey NFL!  I am breaking the law!  I have a 110" front projection TV, twice the "legal" 55-inch limit, and I am showing the game on it at my party.  HA HA HA!).  And by the way, what lapdog legislator wrote this law for them, and did he get Superbowl tickets for life?

Now, I understand the situation with copyrights - if you don't defend them vigorously and even-handedly, you can lose them.  I seem to remember Exxon or some other chemical company lost the rights tot he name Formica when they let it be used too generically for counter-top materials.  And the NFL PR people use this defense every year, saying "we really don't want to shut down these folks, but we have to." 

I don't agree that individual words should be copyrighted such that their use in a broad range of contexts should be illegal.  I am fine saying that I can't create another peanut butter and call it "Jif."  I will accept P&G has some sole right in this country to that use.  However, I don't think P&G can tell me that I can't advertise a "Jif party" feature their peanut butter.  In the same way, I am willing to grant the NFL exclusive use of "Superbowl" to describe a sporting event, but I don't think that should restrict me from advertising that people should come to my bar to watch the Superbowl.  And just to add one more example so I have a "threepeat," I don't think Pat Riley should have any ownership in that word.   However, since copyright law is not going to change tomorrow, I will offer up a more modest change.

So here is my suggestion.  The NFL needs to offer a one time use license each year for a bar or other establishment to hold a Superbowl party and actually use Superbowl in the promotion.  The license would of course be non-exclusive, and would carry a myriad of restrictions on how you use the name, etc.   The license could be purchased for a price that would be cheap for a business, maybe $200, and could be purchased right over the web.  It would actually be easier, I think, to go after violators because the NFL could point to the existence of a legal licensing program the violator could easily have participated in.  I would think they could easily bring in a couple of million dollars, not to mention saving them enforcement money and PR headaches.

PS-  Welcome to the NFL intellectual property department.  I presume I included enough verboten uses of "Superbowl" to catch your search engine's attention.

PPS-  My Firefox spell checker (which I love!) does not have "Superbowl" in it.  I wonder, would the NFL consider it a copyright violation for a program to use the word "Superbowl" in its dictionary?

Last weekend I was watching an NFL game (I forget which one) and the team, which already had a solid lead, was considering going for a TD rather than a field goal at fourth and goal.  The announcer was going "Bad idea, bad decision.  Take the field goal and the sure points.  You don't want to risk getting the other team back in the game with the emotional prop of stopping you at fourth and goal."  Well, the team went for it and made the touchdown, after which the announcer said "I guess it was a good decision after all."

But was it?  If you choose to hit a nineteen in blackjack, and pull a deuce, was it a good decision?  If you  placed a 50-50 bet that a normal die roll will come up with a "6", and it does, was that a good decision?  I would say no.  I would argue that both decisions were bad decisions, despite the fact they happened to yield positive results for the decision-maker.  The reason is that, given the information the decision-maker had at the time of the decision, both moves have an expected value less than zero.

I won't bore my audience with a digression too far into expected value and decision trees.  Suffice it to say that the standard approach for making decisions in uncertainty is to list the possible outcomes of the decision, assign values and probabilities to each outcome, and then total up the sums.  The decision that yields the highest value times probability is the is the one that you would expect, on average, to yield the highest value.   Take the example of the bet on the die roll above.  If you bet a dollar, you would win a dollar on a roll of "6", which is a 16.7% probability.  You would lose a dollar on a roll of 1-5, which is a 83.3% probability.   The value of the "don't bet" decision is zero.  The value of the "bet" decision is 16.7% x $1 plus 83.3% x -$1 equals -$0.67.  So the "no bet" decision is best, since at zero it is higher than the negative outcome of the "bet" decision.  Here is a more complete discussion of the decision tree process.

A couple of provisos:

• When the situation is more complex, the trick of course is to assign the right values and probabilities.  We can assign these exactly for cards and dice, but it's a little harder for something in the business world, like say Enron's decision to enter the broadband business.  But managers are paid the big bucks to do their best.  And managers have tools at their disposal to manage their lack of information.  For example, once you build a base-case, you can ask questions like  "OK, I am not sure about the size of the broadband market, but how large does it have to potentially be to offset the risk involved."
• Like many real-world processes as the approach the asymptotes,  things get a bit squirrelly for really small probability events, particularly when they have very large financial values (positive or negative) attached.  Small probability positive events are essentially a lottery, and many people buy lottery tickets, even though we know the expected value is less than the price.  I play blackjack too, despite a negative expected value, because I get non-monetary benefits from the play.  Small probability negative events are called disasters, and are things we insure for.  Many times the decision to buy insurance has a negative expected value, but we do it anyway because we would sleep better at night knowing that we may be throwing away a little expected value, but we have pre-empted an event that would bankrupt us.  Here we get into interesting topics of risk profiles and risk tolerance, which I will avoid.

Unfortunately, in evaluating historical decisions, we often ignore the state of facts and risks the decision-maker faced at the time of the decision.  We argue Mead should have pursued Lee harder after Gettysburg, because we know now Lee's army got trapped behind a swollen river. The Chargers shouldn't have traded half their assets** to move up one spot in the draft to get Ryan Leaf.  And Enron should not have entered the broadband business.   We treat the decision makers in each of these as boneheads today (we even threw Skilling in jail, as much for his failed business decision as for any fraud).  But all of these evaluations are based on the outcomes, not on what the decision-makers were facing at the time.  Mead had been in charge of the army for less than a week, had driven Lee from a battlefield for the first time ever, and had a primary charge of defending Washington.  It is hard to believe today, but the Peyton Manning and Ryan Leaf were considered nearly equivalent in quality in the '98 draft, and the Chargers trade might have been perfectly appropriate if they had actually gotten a Manning-quality quarterback.  Enron's vision of broadband looked like it would become an enormous business, which in fact it did, just five years too late for them.

** The Chargers traded an inventory of picks and players to the Arizona Cardinals, who, true to form, did nothing with this goldmine.  The Cowboys, by contrast, arguably built a whole dynasty in the 90's off the slew of picks they got in the Herschal Walker trade with Minnesota.

I am not sure I find Nick Saban's $32 million contract with Alabama that surprising.  After all, Alabama considers itself a top-10 program but a series of rejections have made the job tainted goods.  When prestige won't sell, money is always the fall back.   And Saban has learned what most other college coaches have learned -- the NFL is a LOT of freaking work and stress compared to college.

My question is a different one.  My guess is that this makes Saban the highest paid state government employee in Alabama.  Is there any state where a college men's football or basketball coach is not the highest paid state official?

Donald Rumsfeld is resigning.  About time.  In the NFL, a head coach with his track record would have been fired a couple of seasons ago.  And I don't think any plan for Iraq going forward, no matter how enlightened, would be trusted at this point under his leadership.

Update:  Better and better, Hastert out too, at least from a leadership role.  Elections do matter.

Update 2:  It appears the Rumsfeld thing was in the works for a while.  Why didn't Bush drop him 2 months ago, a move that might have helped the Republicans in the elections?  I know everyone thinks Karl Rove is an evil genius but I just don't see it.  I don't see any brilliance in how the administration has communicated or the moves they have made.

You hear a lot of debate about what wins NFL Championships - is it offense, defense, the running game, the quarterback?

Well, if we look beyond what is probably the most important determination of success -- don't have any injuries -- I think the last few games have really proven the importance of having a great offensive and defensive line.  The Indianapolis Colts, the team that supposedly had everything, lost because the Steelers penetrated their O-line at will.  Both the winning teams yesterday won in large part because their lines pushed the other team's around the field. 

Good teams know this.  Bad teams, like our Arizona Cardinals, don't.  At the beginning of the year, the Cardinals were getting a lot of publicity because they had exciting new players at many of their skill positions.  I went to see their 3rd preseason game, and I knew then that they would suck this year, yet again, because their lines got pushed around by Denver's second team.  Denver, by the way, is a great case for building from the lines - for years they have turned no-name guys into thousand yard rushers because of their O-line.  Same this year in Pittsburgh.  The great Cowboys teams of the 90's had Aikman and E. Smith and M. Irvin, but it also had what may have been one of the great offensive lines the league has seen.

Unfortunately, the Cardinals, like many bad teams, feel the need to draft big-name position players that temporarily excite a lethargic fan base rather than really building unsexy offensive and defensive lines.  I mean, for god's sakes, we have drafted like 3 or 5 wide recievers in the first round of the last few drafts.  This team needs EVERYTHING and we are drafting recievers?

I discussed why I like the Football Outsider rankings of NFL teams and players here.  Typically defenses and offenses are ranked by total yards (given up and gained, respectively).  This is a really poor metric, as evidenced in part by the fact that Arizona is something like 3rd in the NFC in offense and 5th in defense by these traditional rankings.  The better football outsiders team rankings are here. 

A couple of observations

• Cincinnati #1 after five weeks.  Wow!  Both offense and defense in the top 6.  I know it is early, but the Outsider's way of ranking teams tends to be more reliable than traditional statistical approaches.  For example, last season after week 5 they had Philadelphia and New England ranked #1 and #2, and these two teams eventually met in the Super Bowl.  Cincinnati has had a pretty easy schedule to date, which will get harder as the season continues
• San Diego is by far the best 2-3 team out there.  They have had a brutal schedule, which gets better going forward.  They still should be considered a good playoff bet.
• Washington is easily the worst 3-1 team out there.  Expect them to start losing soon, particularly as their schedule remains tough.
• Philadelphia may continue to struggle.  The rankings show that their 3-2 record is no fluke, and they have perhaps the toughest schedule left to play of any team in the NFL
• San Francisco and Houston are really, really bad.  Historically bad.  I had been hoping that Arizona had a chance in the Matt Leinart / Reggie Bush sweepstakes, but SF and Houston will be tough to beat.
• Chicago is working on the Baltimore Ravens award, with the #1 defense to date in the NFL and the third to last offense.  Chicago has also been one of the least consistent teams (highest variance), but has one of the easiest schedules for the rest of the year, so still may have a chance if it can just to anything on offense.
• NY Giants and Indianapolis are solid #2 and #3, though you have to worry about the Giant's high special teams score pulling them up - these scores tend to regress to the mean over the season.  Is there anyone who wouldn't love to see a Manning-Manning Superbowl?

I enjoy many professional sports casually, attending an event or two every year, but the NFL is by far my favorite.  In the pre-season, there was a lot of hype that maybe the long-time hapless Cardinals would be decent this year.  I knew better, even from the pre-season.   Heck, my 8-year-old daughter knew better.

We went to see the last pre-season game against Denver.  In that game, the Arizona starters played for quite a while against the Denver 2nd team, and got beaten up.  Specifically, they could not run the ball and in turn their defense could not stop the run.  So it was no surprise to see them get blasted in their first regular season game against the Giants. 

The problem with the Cards is this:  They have spent the last several years drafting high-profile position players, including spending a jillion 1st round picks on receivers.  Great teams got that way because they invested in their lines - both O and D, even when such picks might be less popular with the fans on draft day.  The Cards have instead focused on drafting "names" who might help sell season tickets in the new stadium.  This neglect is very apparent today.  It doesn't matter how good your position players are if there are no holes for the backs and the QB is getting plowed to the turf on every play.  This is a 5-11 team that is fortunately playing in the NFL's worst division, so they may eek out 7 wins.  You heard it here first.

By the way, if you are an avid football fan, I recommend two sites to you.  The first is Football Outsiders, who have taken a Bill-James-like approach to football stats, rethinking metrics to provide a better insight into what teams really are good.  Make sure to check out their DVOA rankings - basically they compare every teams performance on every play against other teams in the same situation (e.g. 3rd and 8 on their own 45).  The other site is Greg Easterbrook's always entertaining Tuesday Morning Quarterback column, providing large doses of football clear thinking and haiku.

Larry Krueger, a radio personality for the San Francisco (baseball) Giants, recently ignited a firestorm by saying that he was frustrated by the Giants'

brain-dead Caribbean hitters hacking at slop nightly.

In response, Giants manager Felipe Alou has demanded Krueger's firing, asserting that this statement represents the worst sort of racism, and that he refused to accept Krueger's apology because "There's no way to
apologize for such a sin."

OK, at the risk that Krueger turns out to be a serial idiot with a long history of racism, I will deal with this statement solely on its face.  And in context, the reaction to his statement strikes me as extremely exaggerated.

Some background:  Typically, hitters can be thought of in two classes:

1. Picky hitters, that sort through pitches like my wife shopping for vegetables, carefully picking out only the best to swing at, and gladly accepting walks when they come.  These hitters are often considered more "thoughtful" hitters
2. Aggressive hitters, who swing more indiscriminately at pitches, and who often consider a walk to be a failed at-bat.  These hitters often described as "intuitive" or "natural" hitters, rather than thoughtful.

Some managers prefer the first type, some the second (for example, Miguel Tejada's being indiscriminate at the plate drove A's GM Billy Beane crazy, while other managers are happy to let him hack away for their team, given his huge numbers).  Which brings us back to the Caribbean.  What's interesting to me is that the Caribbean is not actually a race, but a location.  And in that location, it is very clear that hitters are schooled to be type #2 aggressive hitters.  Players in the Dominican Republic, Filipe Alou's home country by the way, have a saying:  "You don't walk off the island".  In other words, to get the attention of the US scouts and come to the majors from the Caribbean, a hitter is trained to be an aggressive type 2 player. They are taught that going down hacking is better than a walk.

In a sense, the Caribbean is a big (and very very successful) baseball school for training players to play in the US.  And it turns out that this "school" tends to teach players be more indiscriminate hackers at the plate.  Ask any manager in the majors if Caribbean hitters on average are less picky, more aggressive hitters at the plate and they will say "of course".

So, to some extent, Krueger is getting flamed for saying what everyone already knows.  Saying that Caribbean hitters can be indiscriminate hackers is like saying that PAC 10 quarterbacks tend to be more NFL-ready and polished than Big 12 quarterbacks -- its just a fact that is not always true, but is true on average given how they were trained.  Krueger's real mistake was probably using the term "brain dead", which can be a dangerous term when it has racial overtones, but in context probably refers to hitting style rather than absolute IQ.  I think Alou is reaching to say that Krueger was referring to Caribbean hitters poor English skills, but I will admit that he has more history with Krueger and may have reason to make this interpretation from past events.

NFL running back Onterrio Smith was apparently detained at the Twin Cities airport for possessing a device used to beat drug tests:

A search of a bag Smith was carrying April 21 turned up several
vials of dried urine and a device called "The Original
Whizzinator," which includes a fake penis, bladder and athletic
supporter.

Lets be clear on this - the device, is as far as I know completely legal.  Mr. Smith is not even in violation of NFL rules for possessing one in an airport - only actually strapping this bad boy on in an actual drug test would violate rules.  Apparently the police mistook the vials of dried urine for cocaine (I can already picture a future Will Farrell movie with a scene based on such a mix up).

Here is what scares me - why do we know about this?  Once it was determined that Mr. Smith did not possess any illegal devices or substances, he should have been left to go on his way.  Why are the airport police handing this story to the press?  Why were Mr. Smith's employers in the NFL notified?  Why isn't Mr. Smith and the contents of his luggage owed privacy?  What's next, stories about famous women found with vibrators in their luggage?