Red Ink Across the Continent

In 1842 the American writer Edgar Allan Poe published ‘The Masque of the Red Death’, the tale of a great pestilence which sweeps across the nation, causing its victims to bleed to death in rather gruesome fashion. The protagonist, Prince Prospero, cares little for the suffering of his subjects and welds himself and some other nobles inside his castle to wait out the crisis in luxury. “The external world,” Prospero reasons, “could take care of itself.”

After five or six months “while the pestilence raged most furiously abroad,” the prince decides to throw a party of “the most unusual magnificence.” The tale came to mind after a summer transfer window in which the after effects of football going into cold storage forced clubs across the continent to tighten their belts, with the game hit by its biggest crisis in modern times – a plague of red ink, if you will.

Barcelona couldn’t raise the money to buy Memphis Depay from Lyon while Real Madrid, they of Galactico fame, did no business at all. Juventus cut €58m from their wage bill, with their incoming business based on loans and deferred payments, while Inter largely focused on cheap deals for veterans. Even Paris Saint-Germain, backed by Qatar, restricted themselves to loan deals and a restructured transfer for Mauro Icardi after his loan move last season.

It’s no surprise that Europe’s leading clubs were forced to take a reality check. Barcelona announced losses of €97m for the 2019-20 campaign, while their Clasico rivals have around €150m of bank debt. Juventus lost €89.7m, Milan €195m, Lyon €36.5m. Andrea Agnelli, Juventus president and chairman of the European Club Association [ECA], has estimated the total loss of revenues to clubs will touch €4bn and warned over 350 clubs would need some form of capital injection going forward.

Not everyone is tightening belts, though. In the Premier League’s television-gilded castle the revelry goes on. Much as Prospero declared it “folly to grieve, or to think” the world’s richest league went on pretty much as normal, the 20 clubs spending a total of £1.3bn for a net spend of over £860m. Compare that to an estimated net £107m in Ligue 1 and £16m in Serie A and you begin to get an idea of how much of an outlier England proved to be. Spanish and German clubs brought in more than they spent.

While it may be tempting to put this down to Premier League sides simply having more money to ride out the crisis, a closer look reveals what appears to be an alarming lack of long-term thinking. For the 2018-19 season English top flight clubs made combined losses of over half a billion pounds – and that was before the pandemic.

Chelsea were this summer’s biggest spenders at an estimated £226m, despite losses of £100m for the previous season, while Aston Villa splashed out £85m after recording a figure not far off that in losses for 2018-19. In Poe’s story the striking of a clock caused “a brief disconcert of the whole gay company” but the chimes that brought the end of the transfer window appeared to do no such thing.

Meanwhile, below the Premier League, clubs are bleeding to death. Crowd-free matches – and in many cases decades of mismanagement – have left the Football League particularly exposed to the crisis. Macclesfield Town have already gone out of business and more will surely follow if an estimated £250m black hole is not plugged.

Suggestions that the top clubs should bail out the lower leagues have either been dismissed or had serious strings attached. A plot by Liverpool and Manchester United to reduce the Premier League and put voting power in the hands of the ‘Big Six’ was thrown out, but it’s unlikely the issue will quietly fade away.

Premier League clubs may feel they don’t need the EFL, but it’s worth remembering that the likes of Gareth Bale, Dele Alli, Harry Maguire and Jamie Vardy all came up through the lower leagues. Simply locking the doors is not a solution, and if the pyramid collapses it’s those at the top who have the furthest to fall. And darkness and decay and red ink held illimitable dominion over all.

by Gaby McKay

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