FOOTBALL'S DARKNESS AT NOON
PART 2 of 3
Mickey Blue Eyes
CLAYTON: I'm not the enemy.
EDENS: Then who are you?
"MICHAEL CLAYTON." A film by Tony Gilroy (2007).
4. The conflict: Everton Football Club as example.
Thus the inescapable contemporary problem for all supporters: As a minimum you have to stay in existence or settle for a lower playing status if you don't want to go under completely. Get it wrong and you could easily destroy the club you support. Meanwhile, those who were first to take advantage of the new set-up have monopolised the game's honours. But that monopoly continues to reduce and harden into even fewer clubs. You can't have it two ways under capitalism. The condition and circumstances of Everton Football Club and most others are a classic example of sheer economic brutality in the Premier League set-up. Moreover, the tangible modern history of the club flies in the face of a swathe of urban football myths nurtured in typical wishful thinking and old wives' tales. It is time to confront and correct these too.
After promotion from the old Second Division in 1954 the club finished 11th, 15th, 15th, 16th, 16th and 15th before John Moores bought a controlling interest in 1960, whereupon they finished 5th, which was the highest since winning the Championship in 1939, and then went on to one of its great eras in the 1960s. But the subsequent reality is the club was in decline for many years from the later ownership period of John Moores and his surviving family. He actually left the board of both Everton and the family business in 1977, though he maintained his enthusiasm for football as long as his health permitted - and that included increasing minority shares ownership of Liverpool FC. When he fell seriously ill his direct influence ceased and he left behind no financial trust and no administrative framework to help protect the future of the club. Everything had depended on his determination, personal charisma, whims and financial guarantees. As his health wavered, so did his control of the club. Once he died in 1993 - within a year of the creation of the Premier League - there was never going to be an adequate replacement. He was the last of a kind.
Despite these events there was a revival in the second half of the 80s when the Howard Kendall-Philip Carter partnership conjured a wonderful five years of success. After John Moores died his family showed no real interest in keeping the club or maintaining its status in the game even though their total assets were valued at £1.2 billion in 2009. When they eventually sold it to Peter Johnson in 1994 presumably they walked away with a tidy profit, as did David Moores when he sold his interest in Liverpool Football Club in 2007 and supposedly made anything up to £88 million. Thus ended the family's control of Merseyside football, though John Moores' grandson John Christopher Suenson-Taylor (3rd Baron Grantchester, or Lord Grantchester or John Grantchester as he is more widely known) continues to own eight percent of Everton without showing any discernible interest in buying or running the club, or displaying the ability to do so even if he did. But it is doubtful if John Moores would have survived in the new football era anyway, since his estate was valued at "only" £10 million after his death, which implies he would have had to persuade the family or the banks to help support his hobby. However, events at Everton and Liverpool suggest the family were unwilling to use their assets for football economics guarantee purposes and this probably precipitated their decision to get out of the sport altogether. By then the game was well down the road to uncontrolled inflation, delusion and worse, all of it brought about through creation in 1992 of the Premier League and its dog-eat-dog diet. In one of the supreme ironies in the history of the game two of the most spectacular playing casualties of the new set-up were members of the so-called "Big Five" instrumental in its creation, Everton and Tottenham Hotspur. Philip Carter has since conceded the then board missed a vital moment in reconstructing the club at all levels at the start of the boom and post-Moores, including the provision of a new stadium.
Enter Peter Johnson and his unlamented, careless tenure between 1994 and 1999. He used the dubious method of a shares rights-issue to buy out the Moores controlling interest, which really should have sounded alarm bells from the start. Despite winning the FA Cup in 1995 these five years marked an accelerated decline in the club's status until relegation was a continuous threat. It has been a constant battle to exist in the system ever since. Whatever his motives, his controlling interest was a disaster for the club at a time when regeneration was badly needed and he claimed he was the man to provide it. It has taken years to recover. However, he also owned Tranmere Rovers and the FA forced him to choose between the two clubs just as Johnson's non-football business declined dramatically. He was obliged to sell Everton at a quick profit, thus demonstrating yet again, if it was needed, how important the connection between personal wealth and ownership of a football club. As inflation gathered pace it became increasingly difficult if not impossible for the local butcher or baker to make much consistent difference at the topmost level of the game. Now more than ever it became a matter of access to international capital. For that you needed the financial network available only to those with huge capital reserves or assets. If your personal assets were limited, so was your access to capital. How personal reserves and assets were obtained in the first place scarcely mattered. Football history, nostalgia and sentimentality counted for nothing, except as an accountancy definition of "good will" and how it affected club revenue.
Bill Kenwright headed a consortium named True Blue Holdings Limited that bought the club in December 1999 in a deal which valued it at about £30 million, considerably less than the £50 million valuation proposed by Johnson as an opening sales ploy. Nobody else showed serious interest in competing for the buy-out, then or since, though a few other consortia made perfunctory offers at the time. Precise details of the winning consortium and how it funded the deal, and who owed what-to-who have never been revealed, but it is safe to say Bill Kenwright could never have funded the takeover out of his own pocket or from personal guarantees. He simply didn't own enough liquid wealth. Reputedly the funds came from a dizzying cocktail of bank loans, Gregg family loans and financier Philip Green loans. The full extent of Green's involvement is still not clear, though there are enough rumours to keep the Women's Institute and your local ale-house in perpetual gossip. It was a fragile arrangement bound to become rickety at the first rumblings from Paul and the late Anita Gregg (each much richer than Bill Kenwright) while each owned the same number of shares which in total outvoted him.........but not the rest of the board of directors in the holding company, which is the main reason the Greggs lost the ensuing boardroom battle - perhaps also thanks to a formal agreement between them. Paul Gregg knew nothing about football, as he admitted openly in an interview with me, a fact which became crucial when he tried to manipulate public opinion. This, of course, begged the question of why he became involved in the first place.
Eventually civil war broke out as the board split into two factions when the Greggs decided to get out and, probably, regain at least whatever they had put into the original deal. Gregg had promised to "stand by" Everton for the now-defunct Kings Dock new stadium project, but he balked when it came to signing the cheque for £30 million in 2003, thus finally dooming the scheme, though there was enough "guilt" to share with everybody connected with it. At which point the situation became unsavoury and ugly and was probably compounded by a looming separation between Paul and Anita Gregg. Then in summer 2004 the Greggs invented an "investment plan" designed to try to win over the fans - some of whom were foolish enough to believe it - and promoted it through an amateurish PR campaign. Paul Gregg claimed participation of "a blue blooded Englishman" who, he said, was Suenson-Taylor. But Suenson-Taylor quickly back-pedalled from the suggestion and it petered out as suddenly as it appeared. Gregg's campaign failed when Bill Kenwright's faction then promoted the "Fortress Sports Fund" in retaliation, plainly set up to neutralise Gregg's fantasy. Behind the scenes you can bet there was unrelenting psychological and financial warfare that culminated in the dissolution of True Blue Holdings in 2004. Finally the Greggs sold their shareholdings to Robert Earl, a friend of Bill Kenwright's and Philip Green's, in October 2006 and left the club. For the time being all was peaceful. (Within a year Gregg tried to buy into Sheffield Wednesday but clashed with a fans group and pulled out. Then a year after that he was reportedly involved in a putative takeover of Southampton. This is remarkable persistence for a man who said he knows nothing of football and went a full year without attending an Everton match while still a director and shareholder.)
Bill Kenwright is a rich man by average citizen standards, but with comparatively small assets measured against every other owner. He doesn't even make the FourFourTwo Rich List 100 which has a bottom-line worth of £15 million per individual. But he and the other directors will undoubtedly make a large profit when eventually they sell the club, as they must and as he said they will. It is doubtful to say the least if the Greggs would ever have joined the consortium without that possibility. It is still unknown if they made a profit from the sale of their shares to Robert Earl, but Paul Gregg's silence since indicates they were at least content with the settlement.
Thus the present directors will follow in the footsteps of the Moores family and Peter Johnson and other transient owners of other clubs. Naturally their level of sell-on profit will depend on the final settlement. Given the nature of the factional split with the Greggs there is no reason to think Bill Kenwright will do anything less than fight savagely when it comes to making a deal and if his own survival is at stake. That's the way business works. If you don't like the sight of blood, then look away now. Anybody who thinks the man is a pushover simply hasn't analysed his business career and how he got there, or for that matter how he dealt with the Greggs. And while he hasn't got the John Moores millions to back him up nobody of any intelligence seriously doubts he shares the same loyalty for Everton Football Club, though you will always find some ale-house or internet crackpot with paranoid mutterings about "train sets" or some other loony conspiracy theory. His rocky tenure wouldn't have lasted ten years if it were not so. I suspect the reality is that - quite apart from a profits motive - at some unfathomable level he really needs the club as much as any other football fan cursed with that kind of irrational attachment. The difference is he actually got to own it because nobody else wanted it enough to pay for it. But only he knows his motivation (or mixture of motivations, if there is any) for owning the club. That remains the case at the time of writing. Claims that other buyers have been sufficiently serious or capable are so stupid they are laughable. A genuine competitive attempt to buy the club would be known within days because the bidder would make sure it was made public in much the same way Paul and Anita Gregg did when they started their boardroom civil war. That is the way takeovers usually work.
His day-to-day ownership problem has been the same as everyone else's in the system: How to regenerate the club, make it successful enough to sell, raise enough borrowings and run a steady ship. I warrant it has given him a lot of sleepless nights even to get to the current relatively modest position. But the headaches and desensitised single-minded ruthlessness it has inevitably prompted will be more than compensated for by the profit he walks away with, as it was when the Moores family and Peter Johnson sold on. Likely there will be a huge sigh of relief that it is one less migraine in his life, Evertonian or not.
Meanwhile, CEO Robert Elstone must interpret the football world as he finds it not as he may or may not wish it to be. Currently, the game operates a so-called "free market model" and he must act accordingly or fail at his job. Strategic club policy is not in his hands because that requires directors' consensus, not anarchy. As described above the club was eventually publically put up for sale, but at the time of writing there have been no public bids or even major expressions of interest. And there matters rest for the time being, though it is certain a tightening economy will cause serious problems in the next half decade for all football clubs, Everton included, if the whole system is not improved.
5.The roots of it all.
To hear some talk you would think the game reached its present position overnight, a proposition that simply isn't true. Yes, creation of the Premier League in 1992 was managed very quickly but it was preceded by years of corrosive neglect, wilful ignorance, miserable terrace thuggery and general decline that made it much easier to push through opportunistic change when the crunch came. At the time everybody connected to the game was at fault...... owners, administrators, players, media and fans, no exceptions. Too many had buried their heads in the sand too long and hoped the problems would go away, or even gloried in them. Instead, we got lethal disasters at Heysel, Bradford and Hillsborough. Now people had had enough and were ready to settle for almost anything different. Instead of much-needed improvement we got the Premier League and its gang of attendant spivs. It was the road to hell.
Enter a series of political and business opportunists aided by profiteering media owners backed by the extreme right-wing reactionary Thatcher government. They were the only game in town and they proved deadly at every long-term level of cultural and financial health. What passed for the Left and Liberalism retired to the hills to fight a long guerrilla war. The field was given up to the most reactionary government in living memory. The football "solution" synethised into an extreme right-wing Monetarist "solution," as it was bound to. One nightmare of physical disasters and all-round deluded ignorance was replaced with a system which was physically safer and superficially more appealing, but now even more cynically exploitative, distant and certain to fail eventually.........and even more deluded, if that was possible. It was two steps forward and three back. Whichever way you look at events you cannot avoid the fact that profit motive was and continues to be at the root of virtually every development since. By the mid to late 1980s gang-land Chicago economics had taken over on both sides of the Atlantic and across much of the planet. The governing factors in this kind of political movement are Monetarism and Objectivism. Even Blackburn Rovers owner Jack Walker couldn't compete as a modern equivalent of John Moores.
But the roots of the professional game have always been riddled with greed, class warfare, plain nastiness and corruption, and no amount of misty-eyed sentimentality can change that part of its history. Professionalism was finally conceded by the Football Association in 1885 after years of attempting to keep the game as the preserve of public school south-east Englishmen. The players formed their union the Professional Footballers Association in 1907. From that moment players conditions of employment stayed within the retain-and- transfer system until it was challenged by George Eastham in 1961. The logical conclusion of freedom of movement was finally reached eighty-eight years after the founding of the union when the Bosman case was judged at the European Court of Justice in 1995. Contemporary political culture had trumpeted "freedom of trade" so the establishment could scarcely refuse a reasonable request for just that when it was placed before their courts by the players. In that respect the establishment was hoist on its own petard.
In the intervening period the game further developed its own system for controlling players even as very young children. Institutionalised corruption was complete. Now the only way to stop this evil is to make it illegal for children to be the subject of money transfers and agents until they reach the age of majority, and any individuals who break the law to be jailed for considerable periods. We either believe in protecting the innocence of our young or we don't. There can be no half measures and there should be no mercy for crooks. Nor should anyone think genuine loyalty can be bought, since that is an ethical and emotional commitment intrinsic to character. Professionalism and capitalist profiteering doesn't recognise it, never has, and never will.
The English game reached its organisational nadir with the founding of the Premier League and its logical conclusion, rampant greed and profiteering. A wider logical conclusion was the founding of the European G14 Group in 2000, a cynical attempt to divide, own and monopolise the game by extreme right-wing media spivs Rupert Murdoch and Silvio Berlusconi and the fourteen (later eighteen) clubs they took with them. Both stood to make even more media profits if they succeeded in their aims. But thankfully G14 couldn't garner enough support and eventually disbanded in 2008 behind the excuse-charade of an agreement on payment for players on international duty. However, they had managed to completely change the form of European competitions with the scam of defeated teams allowed into the Europa League after elimination from the laughably named Champions League. What had been separate, wonderful knock-out competitions were bastardised into group leagues, one as a selling-plate, for no reason other than maximising profit. With that, what had been special European occasions became little more than a branded, profiteering confidence trick to the benefit of nobody but the TV companies, players' earnings and owners' profits. It became a near-artificial money-making spectacle. Humiliatingly, commercial sponsorship led to players as running billboard adverts. Even the spectacle itself became surrounded by moving electronic advertising. The game was painted into a corner by ownership greed and an immoral economic system. It needs more money, and the more it gets the more it needs. More is never enough. That's how greed inflation works. So it should come as no surprise that the G14 Group has morphed into the European Club Association. The blood-sucking vampire is not yet dead.
A very brief look at the administrative structure of the English and international game demonstrates the formidable problems facing anybody who wants radical change:
The Premier League is a corporation governed by a board of directors. The shareholders are its member clubs, who elect the board. A veto is allowed to the Football Association in respect of the Chair and Chief Executive. In short, the League is owned and run by majority shareholders from each club. So control is in the hands of the same people who already control individual clubs. The same applies to The Football League, which has an eight-man board of directors. The Chair and one other are independent. The remainder are from member clubs. The Football Association is a not-for-profit organisation responsible for overall development and discipline of the game from grassroots to international level. It is run by a twelve man board of directors. Three of them are directors in the Premier League and five of them are directors in the Football League. Four are "national game representatives." It also has fifty-five County and Affiliated Football Associations who develop and administer local football. From all of this it can be seen the circle, the monopoly, is complete. The clubs (read: owners) have majority control of the professional game in England. Any so-called "clash" between the professional clubs and the FA is a chimera, an artificial "controversy," since all major decisions are virtually dictated by the clubs themselves. It isn't a matter of Club V Country; it is more a personality battle for egomaniacs and profiteers.
Beyond that, the European game is overseen by the Union of European Football Associations (UEFA), which is administered by an elected President and fifteen man executive committee. Currently it is the governing body for fifty-three national associations. Its policies are decided by the associations at an annual Congress. Global responsibility for the game rests with the Fédération Internationale de Football Association (FIFA), which has two hundred and eight national associations affiliated to it and six continental confederations. Its organisation is similar to UEFA. It too is run by an executive committee consisting of a President (elected by its Congress in the year following a World Cup), eight vice-presidents and fifteen members. Its policies and elections are decided at a bi-annual Congress by the national associations, though in recent times this has become an "extraordinary" annual meeting. In both the UEFA and FIFA Congresses each association has one vote irrespective of size. The corruption of both organisations is thoroughly explored in Tom Bower's excellent investigative book Broken Promises (Simon and Shuster 2003).
The brief description above demonstrates how far administration of the game has developed and how it is open to manipulation by a few networked individuals at all levels. It also shows fans have no real power in the game they play, support and finance. At present their only effective tool is withdrawal of all three and that flies in the face of an instinctive love of the sport.
Any hope the media would help stem the tide of greed disappeared when the first media instigator and profiteer was the Australian/American Rupert Murdoch as he developed what later became Sky TV. But efforts to spread the largesse failed as first ITV Digital and then Setanta suffered bankruptcy and Murdoch and a few others headed for near-complete monopoly. But the game's owners gave way to corporate and individual greed instead of forcing change in the interests of the sport. Despite this, all was not well in the self-styled capitalist utopia. Over time mainstream media found its grip loosened on their manufacture of consent. Traditional methods of delivering news and information declined steeply in the face of developing information technology. Media monopoly ownership and control is threatened by internet free broadcasts and streaming. Each passing day sees the appearance of intelligent, articulate and well written fans websites and opinions, often far better and more informative than anything you can find in the press or broadcast media. The change is as profound as the establishment of the printing press; it has not yet realised even one percent of its potential. The result has been an increasingly strident and ludicrously obvious wave of mainstream right-wing reactionary propaganda. But none of it could obscure the increasing number of football club bankruptcies and fans angry discontent. By 2010 events had a spontaneous momentum which has not yet gathered full speed.
But of course the media and virtually everyone in it is only interested in furthering their own commercial interests, not the game. For instance, without football it is doubtful if Sky TV could survive, which is why this fan does not subscribe to it. However, the culprits never learn, as demonstrated by James Murdoch's delivery of the most recent McTaggart lecture and, worse, his attempt to physically intimidate the editor of the Independent newspaper. One journalist exception is the socialist writer John Pilger, a convinced opponent of exploitation of every kind. Another is much-respected Manchester City fan and journalist-writer David Conn, but he too now faces a joust with his conscience over the purchase of the club he supports by the Al Nahyan family of feudal Abu Dhabi. By September 2009 even Conn was apparently prepared to at least tolerate the financial model. He seems to prefer "successful" football existence via a rich foreign owner to a lingering parochial football "death." There is no sharper illustration of the problems faced by football fans everywhere. Take all this further and you are obliged to ask yourself: What, apart from nationality, is the difference between Al Nahyan family ownership of Manchester City and Moores family ownership of Everton and Liverpool for over thirty years? Is it just a matter of scale? If one is right, why is the other wrong?
However, by midpoint of the first decade in the new millennium the intellectual case for Monetarism, Objectivism and Friedmanite economics had imploded. Nobody believed it by then, not even its instigators. It was the total failure forecast at its inception by the Left. The so-called "free market model" was dead and buried. It had been tried, had a clear and unobstructed run.........and failed with disastrous consequences. It enriched a few at dreadful social cost. It was never anything more than a regurgitation of outdated Victorian economics in a different form. The transnational banking collapse of 2008 was merely its painful wake. But the pendulum had started to swing back long before. The knock-on effect on football was and is entirely predictable.
To be concluded in Part 3.
 "The Football Business" by David Conn (Mainstream Publishing) (1997), pages 148-152.
 "Financial Times" interview with Milton Friedman, 'Targeting the Quantity of Money,' June 9th, 2003; and "The Age of Turbulence" by Alan Greenspan (New York: Penguin Press) (2007), page 244.