A New Era of Spending

The Barcelona sponsorship marked, for many, a turning point in professional soccer that had been a long time coming. Despite its existing popularity, a free fall in television prices during the early aughts had exposed the sport to hundreds of millions of potential fans around the globe, propelling it to new heights. Fan bases exponentially grew — according to journalist Simon Kuper and economist Stefan Szymanski in their international bestseller, Soccernomics, the estimated number of Manchester United supporters more than tripled over five years, jumping from 75 million in 2003 to a whopping 333 million in 2008.

European clubs began scheduling summer tours and developing partnerships in countries such as China, the United States, and India. With new fan bases watching overseas, TV deals, and, by extension, shirt sponsorships continued to rise steadily. Then, Qatar arrived, and with it came a new kind of spending. By the time Barcelona had announced its $35 million per year partnership with the Qatar Foundation, their biggest rivals, Real Madrid, were only earning half of that from their sponsorship with bookmakers Bwin. Since then, sponsorships and broadcasting rights have risen exponentially, as seen by last season’s record-breaking $6.6 billion TV rights deal for the English Premier League.

Financial Doping

In recent years, Qatar’s cash-heavy entry into the game of soccer has come to epitomize the sport’s commercialization. Around the time of Barcelona’s shirt deal, another Qatari group was exploring investment opportunities nearby. Between 2011 and 2012, Qatar Sports Investments (QSI), a state-backed financial arm, completed a series of investments to obtain full ownership of French club Paris Saint-Germain (PSG), which it valued at $130 million. Two years later, PSG President Nasser al-Khelaifi told the Financial Times that there had always been a clear vision for the team: “To be one of the best clubs in Europe.” Over the next few years, PSG would splash hundreds of millions of dollars to acquire high-profile talents such as Zlatan Ibrahimović and Ángel Di María.

Barcelona, on the other hand, was making some changes. On July 1, they replaced their Qatar Airways sponsorship with the Japanese internet service provider Rakuten. As if in retaliation, Qatar would once again involve the Catalan club in another record-breaking deal. This time, however, it was for a player—Neymar da Silva Santos Júnior, the club’s twenty-five-year-old Brazilian star, who would join PSG in a whopping, unprecedented $264 million deal.

Neymar’s move shook the transfer market, more than doubling the previously standing transfer record that had been set in 2016, when Manchester United paid $116 million to lure Paul Pogba from Juventus. The move was met with dismay and outrage: Javier Tebas, the president of Spain’s top soccer league, denounced the PSG transfer as a case of “financial doping.” Many others, including Liverpool coach Jurgen Klopp, pointed to it as a mockery of Financial Fair Play rules — a set of financial terms specifically created by UEFA, Europe’s governing soccer body, to control overspending.

Under current European regulations, clubs are not allowed to exceed debts of over €30 million, or nearly $35 million, in a three-year period. PSG, now considered a European heavyweight, rakes in hundreds of millions of dollars each season from sponsorships, broadcasting revenue, and stadium sales, among other sources of income. But that revenue alone would not be enough to compensate for Neymar’s $264 million price tag and his $53 million annual salary, according to Forbes. The magazine pointed to PSG’s nebulous €175 million sponsorship with the Qatar Tourism Authority — a branch of the Qatari government — as the club’s key to bypassing FFP rules that ban clubs from balancing losses with owner equity.

An Open Prison

Yet why would the Gulf country spend so much money, and risk so much, all over a game of soccer? It appears that the Neymar transfer was just the latest in Qatar’s attempts to improve its public image, which has been dinted since FIFA shocked the soccer community by naming it as the host of the 2022 World Cup. Shortly after the announcement, a flurry of reports began to question the bidding process; Qatar, which had been labeled the only “high risk” country of the nine under review by FIFA, had somehow managed to advance in every round.

Later, it was revealed that Qatar had paid a whopping $27 billion in “lobbying” to sway officials on the FIFA Executive Committee, the forum tasked with reviewing World Cup bids. Officials received personal jets, trade deals, and, as part of a deal to get Spain’s vote, the now-infamous sponsorship between Barcelona and Qatar Airways. The country had even recruited Pep Guardiola, a former player and manager of Barcelona, to endorse its World Cup bid.

The bid drew fierce backlash, especially among corporate backers, who demanded that FIFA conduct an internal review of the process. An independent investigator was hired to complete an internal report, which was published in 2014 and cleared Qatar of any wrongdoing. But hours after it was released, the investigator, Michael Garcia, issued a statement claiming that the report contained “numerous materially incomplete and erroneous representations.” Last June, the international body released the report after a German newspaper intended to publish it.

Qatar, relieved from any potential punishment by FIFA, went on the offensive, accusing its critics of “prejudice and racism.” Khaled al-Attiyah, the foreign minister at the time, told Reuters, “It is very difficult for some to digest that an Arab Islamic country has this tournament, as if this right can’t be for an Arab state.”

Over the coming years, Qatar will pour at least $200 billion into the construction of lavish stadiums and sporting facilities, but little of this money will end up in the hands of migrant laborers, who total over 90 percent of the country’s workforce. Migrant workers live with few, if any, labor protections and are subjected to work long hours, under temperatures that often surpass 120 degrees. Most are paid abysmal wages, denied requests to leave the country, and, sometimes, die due to unbearable work conditions — conditions that have led the Nepalese ambassador to Qatar to refer to the Gulf nation as an “open prison.” There is no exact figure tallying deaths, though it is assumed to be in the hundreds, or perhaps thousands. Qatar insists that “not a single worker’s life has been lost.”

The exploitation of labor to build stadiums for prestigious tournaments is not exclusive to Qatar. Russia and Brazil have both reportedly abused cheap labor for their own stadiums. Earlier this year, Russia was accused of forcing North Korean laborers to work in “slave-like conditions” after a 2013 law exempted employers connected to the World Cup from the country’s labor regulations. Meanwhile, apart from its recurring labor rights violations ahead of the 2014 World Cup, Brazil had also reportedly engaged in warlike strategies to clear out villages and favelas. Such practices — and the bald lack of accountability for the states that used them — laid the groundwork for Qatar’s unprecedented abuse of labor in the face of global scrutiny.

Rather than end its distasteful labor practices, Qatar has turned to flashier methods for buffing its public relations façade. Xavi, a former Barcelona star and now an ambassador for the 2022 World Cup, in June called for “an end to the blockade.” The country is also rumored to have stricken a deal to recruit Neymar as an ambassador for its World Cup. Most recently, Qatari-owned PSG has hogged headlines for crafting a multi-layered deal worth upwards of $214 million with AS Monaco to snatch eighteen-year-old prospect Kylian Mbappé, all the while avoiding FFP sanctions. UEFA, in response, has opened a formal investigation into the club’s compliance with financial rules.

Taking Back the Game

None of this is particularly new. International soccer, and Europe in particular, has long embraced a set of loose financial regulations — Qatar’s unfettered spending has only accelerated a cancer that has already been spreading for years. Now that soccer’s globalization has unlocked a new international fan base for Europe’s top clubs, teams like Barcelona and PSG are selling more jerseys, filling more seats, and, with bloated budgets, competing with each other for the same elite players.

As a result, a shrinking group of European clubs determine the value, wages, and, ultimately, success of players around the globe. Youth development programs have become one of the biggest losers, as clubs have lost any incentive to develop homegrown talent when they can afford a quick fix. Even Barcelona has begun to slow recruitment from La Masia, its once celebrated soccer academy.

On top of that, some teams have attempted to milk local fans by raising ticket prices to unreasonable sums. Last year, Liverpool fans staged the first-ever walkout over a hike in stadium ticket prices, and eventually forced the club to scrap the plan. This kind of pressure has led some clubs in England to freeze ticket sales or offer subsidies. Malcolm Clarke, chairman of the Football Supporters’ Federation, said in an interview last year that under the Premier League’s latest TV deal, the league could afford “to let every single fan in free for every game and still have as much money” as before.

Fans have resisted the corporatization of clubs before. In Austria, when Red Bull took over SV Austria Salzburg and subsequently rebranded it to FC Red Bull Salzburg, some of the club’s supporters responded by creating a new team with the club’s original name.

At a higher level, there has already been an attempt to slow the growing inequality in soccer through FFP regulations, but it seems as if much of it has been in vain. PSG was already fined in 2014 for breaching UEFA’s debt ceiling, though recent events seem to indicate that the club is no longer intimidated by financial regulations.

Regional confederations — particularly UEFA — need to set more stringent and easily enforceable rules to ensure smaller clubs are not dwarfed by a handful of wealthy clubs. Domestic leagues, on the other hand, can push for an even distribution of TV rights and support player unions. Currently, four in ten professional players around the world currently do not receive payments on time.

Imposing stricter reforms, however, might prove to be difficult. Recently, Europe’s biggest clubs blackmailed UEFA into granting each of the region’s top four leagues — Spain, Italy, Germany, and England — four guaranteed spots in the Champions League, the continent’s most prestigious competition. The clubs threatened to form a closed super league that would effectively replace the European competition. UEFA expressed resistance to this plan, but would struggle to effectively contain it unless FIFA steps in.

As for the World Cup, media coverage should continue its focus on labor abuses in Qatar. In 2013, Human Rights Watch denounced the UAE’s use of English club Manchester City to “effectively launder the reputation of a country perpetrating serial human rights abuses.” The same should be done now with Qatar.

The most vital reform at the moment is eliminating corruption. Recent shakeups within FIFA and UEFA — sparked by a US investigation that led to multiple high-profile arrests within FIFA — and increased public support for anticorruption efforts present a novel opportunity. UEFA’s new president, Aleksander Ceferin, has vowed to stand firm against stakeholders and to rectify “imbalances” within European leagues. The situation at FIFA seems less promising, but a simple remedy exists — to create two independent bodies: one to actively fight graft and corruption, and another to promote the game itself. With increased scrutiny and public pressure leveled on FIFA, this is possible, though it may ultimately be a battle to be fought for years to come. But as fans begin to spread more awareness and resist the whims of executives, there is still hope for a beautiful, and more equitable game.