Economic Crisis and its Effect on Football

My son Akshay's first article.
First it was a credit crunch, and now it's a global crisis - but football teams seem to have sleepwalked their way through it, with Manchester United spending £30m to get Dimitar Berbatov, Manchester City being taken over by Abu Dhabi United Group, owned by Sheikh Mansour bin Zayed Al Nahyan and Liverpool spending millions on every Spanish footballer that was ever born.
Finally, football clubs are beginning to see the magnitude of the crisis at hand and they don't like what they see. Everton's Bill Kenwright has already admitted that it's a game for the billionaires and the club's finances have hit rock bottom with Kenwright forced to mortgage the club's future against a stadium that may not even get the go-ahead. Everton are in a bad state and badly need someone like Anil Ambani to bail them out - but the three who maintain the debts are the three in the frontline: Liverpool, Chelsea and Manchester United. Together they owe £1bn worth of debt - and Football Association Chairman Lord Triesman says that the debt of these three clubs alone constitutes a third of the debt owed by English football clubs.
Take a look at West Ham today, with Chairman Magnus Eggertson having to issue a statement saying that the club will not be affected by Landsbanki going into receivership. As of 12 September 2008 the club terminated its contract with its main sponsor, XL Leisure Group which had been placed in administration. The club is already set to hand out millions over the Tevez affair and have had to scale back their spending plans as a result. What happens when the Glazers of Manchester United or Gillette & Hicks of Liverpool wind up in trouble? Liverpool has already put the new stadium on hold...
Just as nobody predicted the collapse of Lehman Brothers, nobody has predicted the collapse of a Premiership football club.
The Premier League, of course, have tried to deflect attention away by claiming that the FA itself is heavily indebted and that clubs' income is proportionate to their expenditure - but the debt packages that have been tied into Liverpool and Manchester United are just as murky as any of those that have been bringing down American banks - and now banks around the world.
As long as there are billionnaires around to bail out clubs, those with chairmen who view their clubs as playthings will survive - until they get bored or see their fortune halved overnight and decide they're going to stop playing around. Arsenal, too, will remain solid – although still suffering from £43m in debt, invested wisely in their stadium and a youth scheme that is paying dividends. But there are clubs in the Premier League who have been playing around with debt - and if one does start to struggle, it could pull the others down with it.
The future? Unless every Premiership club gets itself a billionaire, then the Premier League clubs ought to think along the lines of the Championship, which sees clubs start on a relatively equal footing and punishes those with poor financial records. However, even in this volatile market, I don't see that happening unless a club collapses. And as long as there's debt involved, there remains a possibility that we might see Sir Alex carrying the items from his desk out of Old Trafford in a cardboard box. A small one, but not as crazy as Lehman Brothers or Manchester United's own sponsors AIG going bust.

Akshay Bhende