Comments on: Your taxes hard at work.. uhm I mean at play

By: Barry Posner

Barry Posner — Mon, 05 Jan 2004 20:55:03 +0000

This isn’t new. Malaysia sponsored the Stewart F1 team for a few years, and also sponsored Minardi when Malaysian driver Alex Yoong was behind the wheel in 2002. Several state enterprises have sponsored teams, as far back as Saudia Airlines sponsoring Williams in the early 80s – when bin Laden enterprises was also a Williams sponsor :-) Not to defend this action, but $4 million is a drop in the bucket comapred to public expenditures on stadiums in North America. Hell, in Pittsburgh public funding of new stadiums was defeated by initiative, yet the pols still figured out a way to get public dollars into them.

By: shanti

shanti — Thu, 01 Jan 2004 19:40:38 +0000

I think that some of the earlier comments on the money/tourism aspect of the sport are relevant to evaluating whether this is a good decision or not. Yes, this is about sponsoring a single driver for a year and it is unusual for a government to do that in F1. But, F1 is a huuuuge money-making enterprise—both for teams and countries who host races. And there is alot of importance attached to a “home” race if a driver or team is popular. For example, the Brazilian GP was the place to go if you were a Senna fan and wanted to see him. Likewise, when Ferrari is doing well, everyone wants to be at the Italian GP. So, if this guy does do well, Hungary will probably benefit by more than $4 mn worth of tourism, fees from the FIA governing body, maybe TV rights (I can’t remember if countries share profits from TV rights with the FIA or not, sorry). I also agree that this may be a strategy to keep Hungary on the GP schedule. So, I think if this is pure charity on the government’s part, it would probably be considered a bad use of funds (or at least less good than some other uses). However, if they see it as a money-making venture, whose proceeds can then go to a social cause of some sort, then maybe it’s not so egregious.

By: J E Thelin

J E Thelin — Wed, 31 Dec 2003 08:21:48 +0000

F1 may be a fast and essentially dangerous sport, but aside from two accidents killing trackside workers (one of which was an unfortunate one-in-a-million freak event), there have been no fatalities in the sport since 1994.

By: J E Thelin

J E Thelin — Wed, 31 Dec 2003 08:21:12 +0000

By: Zizka

Zizka — Wed, 31 Dec 2003 00:03:19 +0000

D. Chris—yeah, if you have your country’s hopes pinned on a single hero in a blood sport, there’s the possibility of having it backfire. But the Hungarian libertarians will certainly have an answer ready.

By: Jon H

Jon H — Tue, 30 Dec 2003 18:55:47 +0000

Diff. Chris writes: “What if the Hungarian driver not only sucks, but gets himself killed in the process? This is not a problem that you face when you send an Ilie Nastase out there with a racket.” Eh, the driver knew the risks. The skiers on a nation’s olympic team could get injured or killed during competition, so F1 isn’t that unusual in that respect. Plenty of sports involve a risk of serious or fatal injury. I recall a Chinese athlete, I think a gymnast, who was paralyzed during a practice or competition a few years ago.

By: a different chris

a different chris — Mon, 29 Dec 2003 21:44:08 +0000

In a freestanding sense I find this insane on so many levels I hardly know where to start, but in a comparative sense I don’t see any difference between what the Hungarians are doing and what every other major (and some not so major) government does when it comes to sports. Except for one minor point: What if the Hungarian driver not only sucks, but gets himself killed in the process? This is not a problem that you face when you send an Ilie Nastase out there with a racket. Zizka: I can’t decide if it is sadder to watch the public purse robbed on playboxes for millionare and billionaires, or to contemplate the fawning over top high school atheletes vis. equally outstanding scholars.

By: zizka

zizka — Mon, 29 Dec 2003 20:53:08 +0000

To an American there’s nothing unusual about spending public money on sports instead of education or welfare. It’s a way of life here—most notably when funding stadiums for professional sports. I hate the subsidies even though I’m something of a sports fan, but I never find them surprising any more.

By: EKR

EKR — Mon, 29 Dec 2003 15:50:12 +0000

Well, it’s always tough to draw tight analogies that only let you focus on the point you’re trying to make. But, no, I wasn’t trying to suggest that Hungarians would have pride in Rothko, but rather that they would enjoy seeing his painting. That’s one variety of benefit. Pride in one’s countryman (in the F1 case) is another. It seems to me that you’re arguing that one variety of benefit is inherently superior to the other. Is that not your argument? You make two points wrt the Olympics: (1) That people represent their country, as opposed to F1, where people represent themselves. (2) That there is no limit on participants. While I agree that point (1) is formally true, I think it is practically false. People seem to have an enormous pride in their countrymen or women when they participate in international sporting events, whether or not they are competing as part of some national team. Consider, for instance, the pride that Lance Armstrong has aroused in American cycling enthusiasts. Now, it’s true that Lance is riding for USPS, so that does muddy the water a bit, but there was a similar reaction to Greg Lemond, even when he was riding for La Vie Claire. (2) It’s true that in principle there are an unlimited number of drivers from any country but in practice, there appear to be about 20 active drivers total whereas any given country probably has an Olympic team in excess of 20 people. So, I think it’s quite plausible that some Hungarians would feel national pride in a Hungarian participating. I take your second paragraph to be primarily an argument that Hungarians are unlikely to take pride in seeing a Hungarian in F1. However, are you saying that even if they did anyway this would be an illegitimate expenditure? If not, then it seems that we’re really discussing whether they do take pride in it, in which case that seems like an appropriate matter on which the government should be making judgement calls, no?

By: eszter

eszter — Mon, 29 Dec 2003 11:11:14 +0000

Rothko is not a Hungarian artist so the analogy is still not good if the point was to suggest that Hungarians take pride in seeing the participation of a Hungarian in some event (or seeing the artwork of a Hungarian in a gallery). More importantly, as I said in my earlier post, people in Hungary can already see Formula One races so this subsidy was not about making a new event/experience available to them. Yes, I’m sure participation in the Olympics is expensive.. for every nation.. as is participation in other world championships. But my impression is that Formula One is a different type of sporting event with private participation where participants represent themselves (or the cars or companies) more than a particular nation. My impression is that there is no limit on number of people from any particular country (but perhaps I’m wrong there). In contrast, each country only enters the Soccer World Cup with one team, only has one soccer team in the Olympics, etc. I don’t think the comparison is completely valid.

By: EKR

EKR — Mon, 29 Dec 2003 03:55:13 +0000

I’ve got to agree with Dan here, which is surely one of the signs of the apocalypse. The presumed benefit from the Rothko would be that people in Hungary could go see it, which they would consider to be valuable. The presumed benefit from the F1 sponsorship is that Hungarians can derive pleasure/national pride from knowing that one of their own is racing in F1—and watching him on TV, I guess. Now, I have no idea whether more people in Hungary would prefer to have their money spent on a Rothko or on F1, but I don’t see any a priori reason why one expenditure would be legitimate and the other not. Incidentally, I note that Hungary sent a team to the 2000 Olympics in Sydney, and in fact collected 17 medals. I’m suspecting that Hungary spends much more than $4 million on Olympic athletes (off the top of my head, I’d guess that it’s about 50-100k/athlete) Although there are of course more than 1 athletes, this still strikes me as a case where a relatively large sum of money is being spent to benefit a small number of athletes, again presumably with the rationale of national pride. Is it the principle of the thing or just the amount you object to?

By: Jon H

Jon H — Mon, 29 Dec 2003 00:54:26 +0000

Eszter writes: “The gov’t is sponsoring one participant in a race here. The benefit to the masses from that one person’s participation is unclear. Formula One is already broadcast in Hungary so people already have access to watching the race. ” I’m sure it’s multiple races, not just one race. And I think the point is not just for Hungarians to see it, but for people in other countries to see it.

By: eszter

eszter — Mon, 29 Dec 2003 00:03:27 +0000

Dan, I probably took the discussion in the wrong direction. The Rothko example wasn’t a good analogy for other reasons either. If the gov’t decided to pay a person $4 million to travel somewhere and take a look at a Rothko painting (or take a course in Rothko-style painting) that would have been a better analogy, in my opinion. The gov’t is sponsoring one participant in a race here. The benefit to the masses from that one person’s participation is unclear. Formula One is already broadcast in Hungary so people already have access to watching the race. There is even a racetrack in Hungary (referred to by others in this thread: Hungaroring) so interested parties have relatively easy means to going and watching the race in person (e.g. they don’t have to travel abroad). This money is going towards one person’s participation in it. It is not a public good in that sense, it serves one private individual. I did not articulate this point clearly earlier, thanks for pushing me on it.

By: Dan Simon

Dan Simon — Sun, 28 Dec 2003 23:37:18 +0000

You appear to be claiming that there is a huge, obvious moral difference between government-funded cultural entertainments that fall under the category, “sports” and government-funded cultural entertainments that fall under the category, “arts”. In fact you suggest that the difference is so great that the former are clearly egregious and appalling, while the latter clearly are not. Now, I’m willing to accept your assurance that your distinction is not based on the “highbrow”/”lowbrow” cultural divide. Perhaps, then, you’d like to explain your true criterion for distinguishing between them? It’s certainly not obvious to me.

By: Jon H

Jon H — Sun, 28 Dec 2003 23:24:40 +0000

Another thing to note is that, as far as government financed boondoggles go, $4 million is relatively cheap. Had the plan instead been something that involved construction of a building – a cultural center, say – it likely would have cost at least $10 million. And, these days, it probably would have involved Frank Gehry and a goopy titanium monstrosity. Worst case, you have ill-considered things like the UK’s millenium dome. Even for a wealthy country, that billion pounds could surely have been better spent. A Formula 1 team might not be the wisest expenditure, but it surely could have been far, far worse.