Yes, European soccer clubs are hurting financially. No, a salary cap isn't the solution

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As European club soccer judders haltingly back into gear, it has in some ways felt like business as usual is just about restored. Minus the fans, or the organic crowd noise, of course. But in the transfer market, it’s entirely evident that the disruption from the coronavirus pandemic on the sport will be substantial for a good while longer.

In a typical June, the transfer market invariably hums with activity. If deals aren’t entirely consummated until the late-August and early-September deadlines across the continent, they are nevertheless in the works and feverishly speculated and reported on. So far, all we’ve gotten is Paris Saint-Germain converting Inter striker Mauro Icardi from loanee to permanent transfer and reports that Chelsea will sign RB Leipzig striker Timo Werner through his release clause, now that Liverpool has given up its pursuit in favor of re-signing members of its existing squad.

There’s a good reason for this torpor in the market. With seasons interrupted and delayed for months, and not wrapping up until sometime in July or even August, you can’t have players coming and going willy-nilly during the stretch run of the campaign. As such, most of the major leagues have pushed back their transfer windows as well. The Premier League and La Liga windows won’t open until late July, while Serie A’s remains shut until Sept. 1. The Bundesliga will allow deals as of July 1, but apparently only domestic ones until the other major European leagues wrap up.

Out of the big five circuits, only the French league opened as usual, back on June 8 — to no discernible effect on the rest of the market. And the conclusion of the Champions League, reportedly slated for mid- to late-August, presents another issue.

But the other factor is that whatever cash reserves most teams might have had were depleted by the losses incurred in the pandemic. Even with the seasons resumed, most major teams stand to lose tens of millions of dollars in missed ticket and gameday revenue, and in some cases TV money. They are waiting to sell before they buy, creating a standoff of sorts that can only be solved by a major injection of cash.

FIFA president Gianni Infantino hinted a salary cap could be coming to world soccer. (Photo by ATTILA KISBENEDEK/AFP via Getty Images)
FIFA president Gianni Infantino hinted a salary cap could be coming to world soccer. (Photo by ATTILA KISBENEDEK/AFP via Getty Images)

It’s no surprise that the two teams who have made major money moves, Chelsea and PSG, were flush already. The Blues were under a transfer ban during the last summer window, meaning they were sitting on cash. PSG, meanwhile, had run a rare transfer surplus. Both teams have the backing of uber-wealthy owners to protect them from any pandemic-induced financial calamity, buying them more freedom to invest.

FIFA president Gianni Infantino, however, apparently sees the sluggishness of the market and the abundant hurt in the soccer business as cover to impose reforms he’s long argued for.

“On the financial and governance aspects, I also heard some interesting proposals on a wide range of topics,” he said in an open letter to FIFA’s members and in a video. “From salary caps to transfer-fee caps or other taxation mechanisms, to the possible obligation for governing bodies, competition organizers and clubs to build reserves or to contribute to a reserve fund which can be of assistance in hours of need such as now.”

The headline there is the possibility of salary caps — although FIFA has no apparent jurisdiction to implement them unilaterally, only to coordinate with domestic federations to enact them — which would be a stark departure from soccer’s largely unregulated financial model and a first attempt to curb skyrocketing wages. It’s questionable whether it would hold up to a serious legal challenge, since the European Court of Justice ruled in the Bosman case in 1995 that anything that restricts the free movement of workers within the European Union is unconstitutional.

But aside from that, a salary cap is an affront to the players who allowed the sport to thrive as it has. It’s also a self-inflicted wound, as any league with a salary cap winds up endlessly bickering over it, sometimes resulting in labor stoppages.

Salary caps are a kind of self-protection for clubs who spend irresponsibly, or have fallen far behind their competitors. Yet the literal price is paid by the players, whose earning power is artificially constricted to shield their employers from their own profligacy.

The salaries are where they are because market forces have dictated that this is where they should be. No club has ever been forced to offer a high salary; there are two sides signing those contracts. Begin to undermine that simple but effective mechanism, and you complicate things needlessly and invite even more corruption into a sport that already struggles badly with transparency.

Worse still — and this is really the central point here — it’s unfair to the players. If we’re entering a time when the runaway profits and skyrocketing transfer fees and salaries will level off for a while, or recede, restricting those contracts further is both counterintuitive and punitive. Because it lays the blame for any financial mismanagement, or a lack of foresight, at the feet of the players, the one group that had nothing to do with either.

The players have shown every willingness to help the sport navigate this crisis, taking enormous temporary pay cuts in doing so. They don’t deserve to have their earning power depressed even further to compensate for the vices of poorly-run clubs.

Leander Schaerlaeckens is a Yahoo Sports soccer columnist and a sports communication lecturer at Marist College. Follow him on Twitter @LeanderAlphabet.

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