Business Columns & Blogs

NBA, China both deserve thought

Here is some stuff I know, the current controversies and contentions edition:

 • As Tacoma’s city administration careens toward a consultant’s study on landing a basketball or hockey franchise for the T-Dome – a plan nicely dismantled by TNT columnist Peter Callaghan last week – it bears noting that one of the professional sports leagues the city hopes to court is not, at the moment, an operating entity.

 • The National Basketball Association has already canceled the first two weeks of the new season, amid suggestions that the entire schedule might be scuttled if a new labor agreement can’t be worked out with players.

 • The NBA contends it needs concessions in order to avoid losing hundreds of millions of dollars a year, adding that the majority of its teams are in the red. The players, not surprisingly, question the league’s accounting as well as the proposed remedies for whatever financial ills actually exist.

 • For all the municipal bumbling that surrounded the sale and eventual move of the Sonics, Seattle got one thing right: It could not afford to fix an irretrievably broken financial model when the NBA wouldn’t do so itself.

 • Professional sports, as structured, do not work financially without heaps of subsidies in the form of incredibly generous stadium and arena leases. As we saw with Seattle, sometimes they don’t work even with them.

 • KeyArena is a perfectly decent place to see a basketball game. It is not, however, sufficiently large or gaudy to finance the NBA in the style to which the league, team owners and players would like to remain accustomed. A new arena, such as those proposed for Bellevue, Renton, the south end of Boeing Field, Auburn and every vacant lot in the region, might not have done the job either, and would have been obsolete the moment some other bedazzled municipality opened an even flashier sports playpen.

 • The Tacoma Dome already faces a multitude of problems as a home to an NBA or NHL franchise – the odd configuration of the building, the city’s spotty record in supporting hometown teams, traffic, the lack of corporate sponsors vs. the available pool in Seattle or the Bellevue-Redmond corridor. It would serve the city well to tell those pushing for recruitment of a team, “Eh, get back to us when you work out that whole money thing.” It may be awhile before the phone rings.

 • The U.S. Senate has passed a bill aimed at punishing China for artificially holding the value of its currency low against the dollar, thus giving it an unfair trade advantage. Although the bill is likely to go nowhere in the House, the debate has inflamed warnings of trade wars and retaliatory measures.

 • This is as much a domestic tiff (“free” vs. “fair” traders) as it is an international spat, and the state of Washington stands to catch it from all sides, what with its ports handling big volumes of goods from China; planes, logs, ag products and software going in the other direction; and companies here trying to access that market while contending with lower-cost competition.

 • There’s a school of sentiment that says China holds all the power in this relationship. But the U.S. is not without some leverage. China needs the U.S. market, and our raw-material exports, to keep its economy afloat; shutting off that market in a prolonged trade fight hurts them at least as much as it damages us.

 • Currency exchange rates aren’t the most pressing trade issue between the two countries (the giveaway or theft of technology and intellectual property will prove more damaging to the U.S. in the long run). But if a little noise about our unhappiness is what it takes, a well-timed, well-placed eruption might be just the ticket.

Bill Virgin is editor and publisher of Washington Manufacturing Alert and Pacific Northwest Rail News. He can be reached at