There is an important word that has been badly abused of late. That word is “investment,” and it seems at risk of losing its meaning entirely.
Years ago, HR departments and management gurus grabbed on to it and started talking about “human capital investments,” and we let it slide. Pretty soon government ministers discovered it lends a responsible air to the act of handing out other peoples’ money. Spending is reckless, but investing is clever. We let that slide too, but we shouldn’t have.
If only we had called their bluff on all those political and ethereal “investments,” then maybe we wouldn’t have had to endure the spectacle of federal ministers donning hockey jerseys this month to urge Ottawa to make a $180-million “investment” to build a hockey arena in Quebec City. If we had objected to any number of transparent pork-barrel spending projects before then, maybe the Quebec government wouldn’t have so eagerly pledged its own $180-million share, or the city its $50 million. But we didn’t. They did. And now we’re left to wonder if deficit-plagued taxpayers will soon be subsidizing pro hockey in La Belle Province.
Neither Conservatives nor the Liberals could quite bring themselves to endorse or disavow the idea, even after days of vague ramblings and circular bafflegab. For now, most seem to believe that the idea is dead. Unless it isn’t. These things are never easy to bury. Sure, plenty of people are howling that the idea is indefensible (another word that’s getting thrown around indiscriminately these days). But that’s not quite true: publicly funded sports arenas have plenty of defenders, namely, the rent-seekers, entrepreneurs and politicians who stand to profit at public expense.
Stadiums rank second only to monorails in the hall of fame of money-sucking public works sinkholes. Giants Stadium in New Jersey and the Kingdome in Seattle are long gone, but their combined US$190 million in unpaid public debt lives on. Houston’s Astrodome sits empty most days, but the county is still paying off US$32 million in debt from its construction in 1965. All three levels of government took a bath on Toronto’s SkyDome. So maybe it’s merely Quebec’s turn.
Regis Lebeaume recently won the Quebec mayoralty race by promising to revive the Nordiques, and provincial and federal counterparts would love a bit of his popularity to rub off. Some even made the case that this arena would be just the thing to calm separatist sentiment — like a big $400-million apology for Meech Lake. There’s also the always-popular claim that sports stadiums are tourist attractions. And of course, you can defend the project on the basis that pro hockey is a religious force that transcends all rational thought in Canada, and only a soulless snob wouldn’t be willing to fork over millions to see the Habs and Nordiques face off again.
But what you can not do is defend the idea on the basis that it is an investment likely to yield benefits for the province, let alone the country. Even the upside to the city is negligible. Study after study has shot down the notion of stadiums as generators of growth, because of a phenomenon known as economic replacement. Simply put, all those dollars spent at the game merely replace spending that would have gone to something else in the region. Every ticket bought to the hockey game is a ticket foregone at a nearby ski hill or movie theatre. Every beer bought at the rink is a beer not guzzled at a city bar. There is virtually no additional tax revenue generated, and aside from temporary construction jobs, and a few part-time service jobs, new employment is zilch.
Naturally, the proponents of the bucks-for-pucks trial balloon did their best to inflate their proposal with fancy investment talk. They even commissioned a feasibility study from Ernst & Young and filled it with dollar signs. The tale they weave has a happy ending, but you have to get used to some of the more fantastical elements of the plot. For instance, as my colleague Philippe Gohier has previously noted, the authors project an annual profit of about $1 million, but don’t include an estimated $4.5 million in maintenance costs or roughly $4 million in property taxes in the calculations. They also suggest that New Glasgow, N.S., (a nine-hour drive away) would be part of the catchment market for the venue. In terms of pure fantasy it beats The Chronicles of Narnia, but a warning: it’s only available in French (you see, the city wants the rest of Canada’s money, not it’s opinion).
Yes, it’d be great to see the NHL return to Quebec City. But let millionaires pay for their toys. And when they try to sell you on this investment, look them in the eye and say, in the words of Col. Sherman T. Potter, “That’s horse hockey.”