A Modest Proposal for FIFA

I have this theory that if you love fútbol your relationship with FIFA is a lot like a heroin addict’s relationship with the Taliban. We hear gruesome stories about what they do to bring us the good stuff, but we really don’t want to know the details. 

John Oliver said it beautifully on his show last night:

That’s about the size of it, isn’t it? We know that there’s no level of corruption FIFA could stoop to that would make us even consider not watching Brasil 2014.

Instead of having a vote, every four years FIFA should auction off the right to host the World Cup.

We’re hooked. We know it. They know it. It’s tawdry. But it’s like that.

Still, it’s sort of remarkable. The world’s favourite sports event is run by a kind of mafia: a sprawling, worldwide Limited Access Order headquartered in Zurich, of all places.

If you’re like me, though, the detailed allegations that Qatar bribed its way to being awarded the 2022 World Cup to the tune of $5 million is remarkable for all the wrong reasons.

I mean, just $5 million? That’s peanuts!

We need a sense of proportion:

  • Just a few years back, Cameroon’s (notorious) football association got $24 million for a stadium renovation project and every last penny was stolen with a grand total of zero statiums were renovated. When its head goes on vacation to France, he needs 43 hotel rooms at the cost of $40,000/night.
  • The Nigerian FA managed to charge around $5 millionfor the TV-broadcast rights for their domestic championship and kicked exactly zero of it down to the clubs.
  • When Ivory Coast’s FA received $1.6m a year from the Ivorian Petrol Refinery Company, SIR, local clubs never got any of the money.
  • In my own country, Venezuela, the same hyper-corrupt FA-head has been bleeding the FA dry for 4 decades and is immovable, even though we’ve qualified for the World Cup 0 times in 7 tries during his tenure.

Football bureaucracies are soft-targets for rent-seeking all over the developing world. A culture of easy-going looting seems to permeate the sector. FIFA, at the apex of that pyramid, reflects the values of the FAs that compose it. That’s the opposite of surprising.

What’s surprising is that a World Cup – an event that typically costs in the billions to tens of billions of dollars to stage – could be bought this cheaply.

Considering that, by some estimates, Qatar – a place where money virtually spurts out of the ground – has none of the infrastructure ready at all and may be prepared to spend $200 billion to stage the event, the $5 million in bribes Bin Hammam apparently doled out for votes is risible: 0.0025% of the cost of the event. He could’ve spent ten times as much and we’d still be talking about a rounding error.

The real scandal here is that Developing Country reps on FIFA’s executive are willing to give out one of the prime goodies in their bags for next to nothing.

Calls to reform FIFA to stamp out corruption are about as old as goal-line controversies. But let’s get a grip: you’re not going to be able to “reform” the corruption out of a global federation made up of lots of really really corrupt national federations.

What you need is transparency – real transparency.

So here’s a modest proposal: instead of a vote, every four years FIFA should auction off the right to host the World Cup.

Aspiring hosts would put together a technical proposal that would be evaluated by an independent set of auditors. Provided the proposal meets minimal organizational standards, they’d then be invited to submit a sealed bid to FIFA’s Executive Committee with the size of the bribe they’re willing to pay to host the event.

Economic theory suggests a Vickery Auction design would be technically efficient at eliciting truthful bids from aspiring hosts. The highest bidder would “win”, and they’d have to pay the bribe pledged by the second-highest bidder. The bribe would be apportioned to national FA officials in proportion with the number of registered amateurs who play football in that country. They would then be allowed to simply pocket the bribes, spending them on the same luxury vacations and villas they spend the current bribes on.

Not only would this substantially increase the amount of money going to developing countries but it would do something the current system utterly fails at: give football officials a real incentive to develop football in their own countries. By pegging the size of the bribe you get to pocket to the number of kids you interest in Football, you’d make FIFA into something it hasn’t been in years: a real force in spreading the popularity of the sport among young people.

It’s win-win!

4 thoughts on “A Modest Proposal for FIFA”

  1. Would you believe me if I thought, until the Qatarstrophe, that your proposal was how the system actually worked?
    Its the only thing that makes sense: you pay FIFA for the right to hold the World Cup and they organize the stuff. I always thought it was an auction and now I realize it was a “secret vote” thing that makes no sense at all because OF COURSE THEY WILL BRIBE EVERYBODY FOR **** SAKE WHO CAME UP WITH THIS SYSTEM ANYWAY:

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