The Kirch media empire's looming insolvency has endangered the country's soccer leagues, and Chancellor Gerhard Schröder wants the taxpayer to help out.
Germany’s soccer teams are in trouble, and the government wants the taxpayer to help them out.
The reach of a looming insolvency for German media giant KirchMedia has extended into the country’s premier soccer leagues. With at least 6 billion euro owed to its creditors, Leo Kirch’s concern looks unable to pay the league’s clubs for the rights to broadcast their games.
KirchMedia owes the Bundesliga a combined 100 million euro in May and August. The prospect that they’ll be able to pay up is getting smaller each day. Insiders reported that a rescue package involving Rupert Murdoch and Italian Prime Minister and media magnate Silvio Berlusconi, among others, appeared to have met with defeat Thursday night, sending the German government scrambling for solutions.
Kirch’s money is the main income for a majority of Germany’s soccer clubs, both in the premier and secondary leagues. With that pipeline shut off, experts worry the division between poor and rich clubs will widen with many clubs facing an insolvency of their own. Left standing would be rich teams such as Bayern Munich, Bayer Leverkusen and Borussia Dortmund who rely on top-rung sponsorships to pay the million-euro Brazilians and Eastern Europeans who help them win championships.
Not "handing out money"
Dortmund fan and German Chancellor Gerhard Schröder has decided to take action, floating an idea that Germany’s states and federal government would provide 200 million euro in guarantees to the Bundesliga, ensuring its survival for the time being.
The government, of course, doesn’t want to just "hand out money" said Economics Cabinet Secretary Alfred Tacke, Schröder’s special envoy in this case.
The 200 million euro guarantees will come with conditions. Like poor countries receiving foreign aid from the World Bank or International Monetary fund, Germany’s soccer teams will have to "adapt their structures," said Tacke, in a money-saving direction.
Tacke said the government wants to hinder further divide between the rich and the poor on the soccer pitch. But it’s much more than that.
Soccer über alles
With so many tradition-rich German companies, like Holzmann and Fairchild-Dornier, declaring insolvency recently, the prospect that the national sport could be compromised could heap more burdens on Schröder in this tightly-contested election year.
On the other hand, using taxpayer money to support a bunch of rich teams and athletes hasn’t been the best tack either.
"If you have to pay construction workers at Holzmann less, than that should also go for the income of soccer millionaires," said Willi Lemke, education senator in Bremen and former manager of the Bundesliga club Werder Bremen.
Sports politicians within Schröder’s own Social Democratic Party and his government’s junior coalition partner, the Greens, have also come out against the proposal. Some opposition politicians, like Roland Koch of the Christian Democratic Union, said soccer players themselves need to pitch in and help out.
Opponents enjoy the support of a majority of the German people, who are loathe to see the millions in taxes they pay each year go to soccer players making more than triple their salaries.