Recently, the Birmingham Business Journal interviewed me and my colleague Darin White (@sports_biz_prof on Twitter) about the case for and the case against government financing for a domed stadium (info here; subscription required).
Over the weekend, I re-read Rolf Dobelli's excellent The Art of Thinking Clearly and was surprised that I'd forgotten this excellent passage from his chapter on "Alternative Blindness":
Let's say your city is planning to build a sports arena on a vacant plot of land. Supporters argue that such an arena would benefit the population much more that (sic--typo) an empty lot--both emotionally and financially. But this comparison is wrong. They should compare the construction of the sports arena with all other ideas that become impossible due to its construction--for example, building a school, a performing arts center, a hospital, or an incinerator. They could also sell the land and invest the proceeds or reduce the city's debt.
This is what I meant when I said city leaders are thinking about the problem incorrectly. If the important question is "how do we get more sports and convention traffic?" then maybe building a domed stadium and convention center is the answer. However, that's not the right question. If we're interested in making Birmingham a nice place to live and branding the city as a forward-thinking, visionary place, then a stadium has to be compared to the alternatives. The spillovers, if they materialize at all, are almost certainly not large enough to justify tens or hundreds of millions of dollars in government spending on a stadium and convention center expansion.
The Edifice Complex is strong, and it is hard to dislodge. The important institutional question, I think, isn't "should cities pour money into bread and circuses?" but "how can we design rules that would prevent them from even considering such things?"