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FIFA Crisis the Result of Crony Capitalism?

June 2, 2015
1,625 Views

Last week, led by Loretta Lynch and the US Department of Justice, indictments were handed down on foreign FIFA officials alleged to have engaged in corruption – chief among those alleged activities was accepting bribes for a World Cup.

In a rather bold press conference the DOJ announced nine FIFA officials, both current and past, were charged with racketeering, money-laundering and wire fraud.

 

If Only FIFA Was Operated Like a Free Market

The IB Times reported “The U.S. Justice Department alleges the FIFA officials, along with five third-party marketing executives, accepted more than $150 million in bribes and kickbacks in exchange for preferential treatment on the sale of media, television and hosting rights related to FIFA events.”

Rumored to be a corrupt organization for years by some of soccer’s global fan base, FIFA is now in crisis thanks to its potentially covert marriage with crony capitalism – a system where powerful officials are given carte blanche to decide who wins and loses. This is a system that absolutely despises the free market because it can’t be rigged…

In FIFA’s crony capitalism case, some of the bureaucrats near the top are alleged to have accepted bribes to sway votes that decided which countries were granted special events such as South Africa’s World Cup, and which marketing deals got the green light.  The alleged determining factor, as in all crony capitalist schemes, came down to who was willing to bribe their way to victory. It appears FIFA may have been ran more like the mob than a sports organization…

 

FIFA: A Product of Crony Capitalism?

The FIFA corruption allegations have demonstrated crystal clear the danger of letting any governing body grow too powerful. Without proper checks and balances in place, bureaucratic organizations can create the very corruption citizens entrust them to stomp out.  The more power given to a governing body over an entire industry (or country) the less of a free market you may get. And as may be the case with FIFA, crony capitalism thrives when officials become so powerful they only have to answer to each other and those paying the bribes.

With the heat cranked up on the largest sports organization on earth, five days after being re-elected FIFA’s President, Sepp Blatter announced today that he will be stepping down. Ironically, just a day after being re-elected last week, Blatter stated when asked if he would step down in light of the recent corruption allegations, “Why would I step down? That would mean I recognise that I did wrong.”

Hmmmm….

Oh, and apparently Mr. Blatter is now facing an FBI corruption probe.

Innocent until proven guilty of course, but this reeks of crony capitalism.

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Like all of you entrepreneurs and investors out there, Aaron has been in the trenches. He is the founder of an influential online media and PR company. From oil wildcatters to mining prospectors, tech gurus to medical doctors, and even celebrities, Aaron has helped market and expand brand awareness for a diverse range of publicly traded companies ran by entrepreneurs from all walks of life.

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