The collapse of football: how the toxic weed of Strategic Default took over our game.

by Tony Attwood

If you take homeowners who in recent years spent far more than they should on buying a house on a mortgage, you can liken them to clubs who’ve also taken the “everyone else is doing it!” approach of reckless financial management.  Instead of living within their means, they’ve run up debts they can’t possibly pay.  Responsibility vanishes.  For the home owner responsibility to the family, to those from whom money is borrowed – it all goes.   In football responsibility to the supporters is thrown aside like sweet wrappers.

On the other side of the coin we have The Arsenal who fit into the  “responsible homeowners” model who, while it hasn’t been easy, have lived within their budget even when it was restrictive to do so.

At first being “responsible” seems boring, dull, unadventurous. Like the sad teenager who sits at home studying while the up-and-at-em kids are out racing motorbikes around the local streets.  Like the manager who won’t go out and spend billions on new players why elsewhere is a man who says, “We’re living the Dream”.

But as motorbike kids have or cause horrendous accidents, and as the risk-it-all neighbours are declaring bankruptcy and irresponsibly walk away from their debts, the nerdy student gets the top job while The Arsenal  emerge as the safest credit risk on the footballing block.

No, it hasn’t been easy.  Yes, other clubs (or homeowners or boy racers) might be signing the big names, buying bigger houses with bigger garden gnomes and stealing bigger motorbikes.  But Arsenal have been the good stewards, taking care of what they have, wisely husbanding resources and planning for the future.

Just as the US economy, indeed most of Europe as well, will surely see much leaner times ahead, those homeowners who took the hard decisions early, and those football clubs like Arsenal who have taken care to structure themselves with a long-term plan, will surely come out so far ahead of the financial pack that the nay sayers will be humbled into submission.  At least those of them who have any honesty and wish to retain any sense of credibility.

To show what we mean here is an extract from Taipan Daily: “Strategic Defaulters” Are Barbarians Looting Rome

The Road to Hell…

You cannot have a functional economic system in which a critical mass of participants decide “not paying their debts” is okay. When the system is allowed to rot, the system eventually breaks down.

Believe it or not, it comes back to culture. In a culture where paying one’s debts and honouring one’s commitments is seen as a clear moral obligation, the rule of law is intact. When the state of the union is good, these cultural norms are subtly reinforced in a thousand different ways. A sense of fairness – though frayed at the edges at times – generally prevails.

When you lose that sense of cultural obligation though – when people start saying “Forget the mortgage, let’s go have a steak and visit the casino” – the social fabric is torn asunder.

Just imagine you are a strapped homeowner yourself (and well you might be), fighting hard to pay the bills and keep your head above water.

If you are struggling with all your might, but then look left and right to see your neighbours living high on the hog, what are you going to think? How are you going to feel?

It’s like a toxic weed… strategic default begets more strategic default. Immoral behavior spawns more immoral behavior. “If the neighbors are doing it, we can too… and we would be fools not to.” People just stop caring.


This economic example can be applied directly to football. If the other teams in the EPL are all borrowing money without the slightest notion of how they are ever going to pay it back (aside from the almost pathetic cries coming from Everton – “is there a billionaire in the house?”) then everyone copies the style and approach.  As the article says, “If the neighbours are doing it, we can too… and we would be fools not to.”

But as the economy at large shows, it can all go utterly wrong.  Later in the article from the Taipan Daily there’s rather nice snippet about Greece.

“In the wealthy suburbs of northern Athens, the New York Times reported last month, only 324 residents admitted to owning swimming pools on their tax forms. That number seemed low to Greek tax investigators, so they made some calculations of their own based on satellite photos of the area.

“Their estimate of the actual number of pools, as opposed to the 324 reported: 16,974.

“When lying about assets becomes such an epidemic that more than 98% of the citizenry does it, the economic system can no longer be called functional. And that is partly why Greece, a country that dined well for years on the credit of others, is now staring down the prospect of a brutal, crushing depression. The bread and circus money has simply run out.”

We are not going to say that Leeds United, Cardiff City, Portsmouth, Hull City, or any other club in trouble has lied about its assets.  Nor that the Portsmouth three, all due in court shortly to face charges of tax evasion, are crooks.  The courts will decide and of course we don’t have evidence of that.  But we note with interest just how excited HMRC (the tax collection agency in the United Kingdom) is getting about football.

HMRC go fishing in the pools where there is something to be had. Pay your personal tax, your corporation tax, your value added tax, and every other tax fairly, and on time, and HMRC just give you the occasional once over.  But where they smell cheating and corruption they come looking – and these days HMRC are as much in the news as the clubs and individuals they are looking at.  HMRC looking at football is symptomatic of what is going on here.

Here’s a final extract from the article we’ve been quoting…

“…when we see spreading evidences of immoral, anti-social behavior… a wholesale abuse of trust and trampling of the rule of law, accompanied by a “who cares” style shrug… we can know that the entire capitalist system is in peril.

“If people no longer care about paying their debts (as strategic defaulters do not), the system stops functioning. Meanwhile, if those who do pay their bills (and pay their taxes) are overwhelmed by outrage at the sight of “free riders,” the cohesion of the political system breaks down too.

“You cannot have a healthy economy where anyone with a retained sense of social and moral obligation feels like a sucker… where adherence to values and principles brands one a dumb cow waiting to be milked.

“When we try to pinpoint the source of all this rot – when we “seek the source” – where does the trail lead?

“In your humble editor’s opinion, it leads back to government.”


And the parallel with football is… the crazed culture that leads Real Madrid to spend £80m on a player without having the money to pay for him, when the whole of football is based around loss making and not paying debts, and when it is protected by a wholly artificial “football debts” rule that means that time and again St John’s Ambulance finds that it is not paid for its work at football grounds because it is not “a football debt”, when Barca-loan-us try to buy Cesc Fabregas without having first paid for Henry and Hleb, then we know it is all going wrong.

The fact that the Catastrophists want Arsenal to jump into bed with the loss making nutters and crooks shows really just where they are coming from.

But, to return to the article we’re quoting here, “When we try to pinpoint the source of all this rot – when we “seek the source” – where does the trail lead?”   The answer is of course FIFA for the world game, and the FA and EPL for the English game.  The FA, who cannot seem to hold onto a chief executive for more than a few months, and the EPL now being sued by HMRC, and who seem to think that £3bn combined debts is “ok”.

However, all nonsense comes to an end, and this is the end for the crooks, con men, and catastrophists who have run football for years.  Fortunately for all of us, Arsenal retained its values.  We should all be thankful for that.


Before you comment please read this

Next season’s squad: we’ve signed four, the fifth is identified, and the sixth would be another steal from Barca if it comes off.

The Untold Index

The Index of Very Ancient but still Quite Interesting Things

What to read in between World Cup matches

22 Replies to “The collapse of football: how the toxic weed of Strategic Default took over our game.”

  1. Tony — Excellent article. I like the analogy. “Barca-loan-us” is genius.

    Would you then say that UEFA is like the IMF with the Champs League and the Financial Fair Play Rules? It opens up a whole new can of worms…

  2. You are so spot on with this article I must say.

    Slightly off topic but not entirely: Since I found your blog some time ago now, and when facing fans of MU on Flemish websites they all laughed at me in the way that you all know to well: what have you won in X years. I always have responded to that with saying that they are facing major financial troubles, gave them the advice to enjoy every moment of it because it would be over in the not so far future. More laughs came from them as they thought that MU was a team that never would have any financial troubles.
    Since a few months-weeks-days as also over here more and more articles come in our media about the situation from Liverpool and MU they are not so loud anymore. In fact you can read the fear between the lines. And their last line of defence is starting to be : yeah but Arsenal is also in debt. To which I respond that we actually pay off our debts.
    And now you can see them hanging on to any good news they think they can find to chase away the nightmare they could be facing.
    Only yesterday I said to them : Arsenal will have the last laugh. I don’t know if you can smell fear over the internet but it sure looked like that, er, smelled like that.

    And the fact that we are doing it in a totaly different way compared with the others is something that makes me even more proud being a gooner.

  3. Someone said that “football is the biggest social organisation in our society”. It keeps kids of the street, gives them something to look after, keeps them fit and so on. And when this football in general itslef is breaking all the rules then there is something rotten in society.

  4. Every club (including even Real Mad, Man Untidy, CSKA Fulham & Liverpool) that’s felt the need to reconsider its strategy in the last couple of years has ended up saying; “We need to be more like Arsenal”.

    Every time the Premier League or UEFA thinks of doing something to halt the madness in football, they end up doing things Wenger or Arsenal have advocated or which nevertheless justify strategic decisions we took several years in the past.

    Yet, the media, and many of our gullible fans continue to paint Wenger, and our board as lunatics, and perverts.

    It’s amusing to watch.

  5. Barca-loan-us Classic.. Great article Tony, we’ve missed you. Just checking you say Barca-loan-us still owe us money from Henry & Hleb.. How much do they owe?

  6. Excellent article. I don’t think that £3bn debt is that bad a thing, as long as that debt as all gone into things like new training facilities, new stadiums, improved stadiums etc etc. Alas, however, we all know that (taking away Arsenals debt on the Ems of course), that nearly all this debt as either gone straight into players and agents pockets, or to banks and hedge funds, and dodgy owners.

  7. Hello Tony, another great article. I only discovered your website yesterday (thanks to arseblog) and I’m very happy I did. It’s a relief to discover, after frequenting many other football blogs and forums, that there are still intelligent, rational Arsenal fans who appreciate the huge challenges that Wenger is facing.

    I’ve long suspected that many of these online ‘Catastrophists’ as you call them were a small but very vocal minority, and many of them possibly not Arsenal fans at all, with a specific agenda to create negativity among the fans towards the club and management. So I read your articles about this with great interest.

    Untold Arsenal is now bookmarked and will be part of my daily reading.

    Getting back to this article, I thought this was a particularly interesting point:

    “You cannot have a healthy economy where anyone with a retained sense of social and moral obligation feels like a sucker… where adherence to values and principles brands one a dumb cow waiting to be milked.”

    This can be easily applied to Arsenal, where we are now seen as the ‘sucker’ for not joining in with everybody else and spending with complete disregard, and accused of lacking ambition for not doing so.

  8. About the Hleb and Henry deal. Many transfer deals are done with a down payment. Barca owes us money, yes. But Arsenal agreed to do so with Barca and therefore Arsenal get paid over time. You can look at it as a loan where Arsenal are the bank, and we probably get interest of some kind on it too. It is a very common thing these days, there are of course clubs who end up not being able to pay back in time.

  9. Tony

    I wander if you got to see last nights late Panarama programme on the BBC , it was about football debt and primarily focused on the Glazers?

    Although they got our debt wrong by saying it was £400M whereas its half that, they went in to detail saying that because of the poor state of the Glazers USA investments surplus cash from Man Utd would be most probably used to prop up their failing American enterprises.

    They basically said that Man Utd current £45M interest payments would shortly more than double, effectively wiping out their operational profit – all to help their non football USA operations!

    If you can get to look at a recording perhaps you can put out your own views on what they said?

  10. Absolutely outstanding article, Tony. Definitely the best I’ve read in ages, It is spot on, on so many levels – possesses more eloquence and clarity then the whole of the mainstream media… combined!

  11. Would you agree, Mr Attwood that it is a toxic weed that carries out keystroke stealing of intellectual property on personal PCs of others, particularly those who are your customers?

    Would you agree that it is a toxic weed that refuses to allow a banking customer to cash in securities to pay off debt in its entirety, stonewalling for 14 weeks before being shamed by a Cabinet Minister into doing their lowly job, then failing to carry out basic instructions of transferring the excess sum after debt repayment into a current account, hardly the hardest action in the banking industry, is it?

    If you do, then Arsenal FC and Arsene Wenger are toxic weeds in the first case and a major corporate client of Arsenal FC, who rent a box at the Emirates, are toxic weeds in the second case.

    You need to look at what Arsenal FC and their corporate clients get up to behind closed doors before being so black and white in your assertions, friend.

    Ask Arsene Wenger how he knew about a spoof job chat between a Real President and Sam Allardyce I wrote, but did not distribute, the day Allardyce resigned from Bolton. Ask him how he knew about a spoof chat I wrote between Shinawatra and Eriksson at Man City, which I did not distribute. He knew. And if he knew that hanging his daughter from the roof of the Emirates was the price for lying or stonewalling, he’d admit it tomorrow morning……..either he got it from Sky, or he got it from UK national titles, or Arsenal FC were doing the bugging directly. Or a consortium of the EPL organised it. I don’t care who did. There’s no excuse for it. And no excuse for a moraliser like Wenger doing it or being part of it.

    I don’t want to hear about ‘competition’. The words despicable and SCUM come to mind, Mr Attwood.

    And I’d like your dear Belgian referee, so outraged about so many aspects of English life and culture, to comment on whether that is normal in Belgium and whether he, in fact, parcipates in such peep shows.

    Because if he does, or if he thinks it’s OK, I’d like to meet him next time he comes to the Emirates.

    To teach him the basics of respect, manners and proper comportment. Because if I was doing what he had coming to him, it’d be a baseball bat to the skull. But being a pacifist and all that, I’d need to be more subtle than that……..

    As senior officials of FIFA expressed outrage in the Press about this kind of spying today. After I emailed our PM, deputy PM, the BBC and the Daily Telegraph about it.

    Just so we know where our Belgian arbiter sits you understand………

  12. Good article Tony – I enjoy this site very much 🙂

    I agree with your overall point but I must say that waking away from a home mortgage is not always an immoral thing to do.

    A mortgage is an agreement between the provider and the borrower. If it is advantageous to the provider to sell the house and leave the borrower homeless he will do so in a second. Then why should a borrower stay in his house if it is not beneficial to do so?

  13. Rhys, I am sorry to say that I really don’t follow your argument at all, and I don’t know what many of the points you are making are all about. I simply don’t have the knowledge of the events that you are writing about, and because you give no detail, I can’t follow the points.

    I think that when an article is published here, the writer (be it me, Walter, or anyone else) tries to set out clearly his position and develop the argument. Facts are given and conclusions drawn.

    But in the piece you have written above, I can’t separate the facts from the conclusions, and you have lost me completely. I’m sure that’s just me not focussing properly, but I’m sorry, I can’t reply, because I don’t understand.

    May I add one other thing. I have gathered over the course of a number of posts that you feel that it is not right that Walter, as a citizen of Belgium, should criticise the way certain things are organised in English football.

    OK, that’s your point of view, but as far as I understand what you are saying, you are taking that further and turning your point of view into an attack on Walter personally, and I don’t think that is reasonable on this site.

    You can certainly make the point that a Belgian citizen should not criticise aspects of English life, but you have done that, and I have to say I disagree with you. I find Walter’s writing most respectful to English culture and society, and his criticism of football in England is generally far less severe than mine.

    If you find Walter’s commentaries offensive, so be it, but I would ask you to leave that matter for now, since it has been aired, and I, as editor, disagree, and I am not going to restrain Walter in what he writes, in any way.

    My view is that this site is for every Arsenal fan, whether he/she comes from north London or Chile, whether he/she attends games or not. The only requirements I have imposed are those found on the “Before you comment please read this” page – and in essence that says, “please construct an argument rather than make statements, and try to be polite” (along with a few other bits).

    Of course I welcome contrary arguments to points put forward in articles, but I need to understand the context of these points. And please, no more attacks on Walter.

  14. Rhys,

    Seriously…Your posting is so erratic and strange I have to say you may need to look into some professional help. I said it before and I say it now “don’t forget to take your meds.

  15. Tony, just ignore that Rambling Racist Lunatic who thinks that he can paint others with his own brush. He rants but makes no sense.

  16. I am glad it is not only me that could not make head nor tail from Rhys’ latest rant.

  17. Rhys —

    1. What the hell are you talking about?

    2. What do you have against Walter?

  18. Rhys I read it twice and it still doesn’t make sense at first it seemed as if Wenger and the board were involved in some sort of corruption then upon a 2nd reading I realized your an idiot LOL!

    please if you gona post anything here please include facts.

  19. Steady on guys. I think everyone deserves a chance to explain where they are coming from, and Rhys deserves that chance as much as anyone.

  20. @Tony,

    You may want to take a look at my review of Real Madrid’s finances, where I made a number of surprising discoveries:

    1. They are profitable (at least for the moment).
    2. Their net debt is only €38m according to UEFA’s Financial Fair Play definition, though their own accounts give a figure of €327m, which is probably a fairer reflection of their business model.
    3. Their wages to turnover ratio is 46% – exactly the same as Arsenal’s.

    Of course, that is not the whole story and there is a sting in the tail (or two), but food for thought. You can find the article at:

  21. The swiss ramblers article on Bayern Munich is also excellent as well. Anyone heading over there to read the Real Madrid piece, should have a good look at that too.

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