Introduction

Among the sports leagues that Americans participate in, the National Football League continues to be a leading economic driver, and sports has become a significant contributor to the country’s economic activity. In light of the economic contribution that the football sector has made over the years, Raymundo notes that league revenues have been increasing, year after year, generating annual revenues over $10 billion in 2015. ^[1] The leading revenue streams include $6 billion from television rights, while the remaining $4 billion comes from sponsorships and merchandise marketing. Similarly, the average NFL team value has increased year after year since the early 2000s. Considering the economic contribution and impact of the NFL and the football sport in the US, it is crucial to compare the relative value generated during its founding years, the 1920s and 1930s, and today. The formative years commonly called the “Roaring Twenties,” was when the sport was played in small cities, and therefore, was unable to generate sufficient fan support to guarantee financial success. This paper compares the economic impact of the American football sector in America during the 1920s and 30s and the prime times of today when it generates billions in revenues.

Comparison of Football’s Economic Impact during the 1920-30s and Today

           Currently, the National Football League (NFL) is famed as the most successful organization engaged in professional sporting activities, both in the US and globally. As a result, having an NFL team in a given city, particularly in the United States, is regarded a major economic signal that the city and the surrounding communities will enjoy many advantages. The evidence of the value attached to the NFL team is that the franchises are sold at multi-billions of dollars, signaling the huge economic returns they offer communities and their respective owners or managers. The economic contributions of American football teams is a major economic boost for local, state, and local economies, considering that the moneys injected into the system improve the wellbeing of players, families, business, companies, and government authorities. For example, the incomes that the players make are a major boost for their respective families, affording them the benefits of favorable standards of living and participation in service delivery.            Firstly, the major similarity between the American football sector of the 1920s and 1930s and the one of today is that both attract high numbers of people, similar to other sports organizations, including the Major League Baseball. However, despite the similarity in the audiences and the following that American football enjoyed, the NFL of the 1920s and 30s became a major economic boost after growing from a small Middle American league played in small towns. After peaking, American football gained massive following among the people living in leading East Coast cities, which made it a major economic contributor at all levels of the economy. The American football of today is similar because it appeals to Americans from around the country, after gaining the massive following it does today, from the humble beginnings it had during the formative years. However, the football of today has a more profound economic contribution and impact, noting that it attracts viewership, television rights, and other revenue streams from audiences from around the world. This is most likely the only similarity in the two eras of American football, considering that the two eras show differences in almost every other area.  

           The football league of the time was not as financially successful and economically impactful as it is today. Firstly, in 1920, the NFL was called the American Professional Football Conference, and the name was changed to the American Professional Football Association during 1920 and 1921, and later renamed the National Football League (NFL) in 1922. The grand NFL of today came to being, through the merger of 1966 between the incumbent NFL and the newly established American Football League (AFL) in 1966, after the new entrant began getting lucrative television contracts and other financial deals. The merger process took effect in 1970 after the NFL absorbed the emerging and most threatening AFL, which helped the new team take better advantages of the existing football marketplace of the time. The merger brought major league reorganization to accommodate the ten AFL franchises and the teams under the NFL, including the Baltimore Colts, Pittsburgh Steelers, and the Cleveland Browns.

The difference in American football from the two eras is evident from the price amounts paid for the purchase of teams such as the New York Giants, which are a sharp contrast to the values of the NFL teams of today. During the 1920s and 30s, the buyers of football teams paid minimal amounts to purchase football teams, which is not the case today, highlighting the difference in the economic values they fetch and the contribution they make for the respective owners. For example, according to Liotta, the buyer of the New York Giants purchased it for $500 in 1925, which translates to an estimated $7,140 in today’s dollar value. The insignificant price paid for the team signals that the American football of the time did not have the profound economic impact it has on the various stakeholders that benefit from their activities, including players and team managers, and owners. The view of football teams as contributors of limited value resulted from the minimal economic contribution they had, especially, after the attractive revenues they gave reduced considerably, due to the devastation caused by the depression of the 1920s. Further, teams did not register exceptional performance that would appeal to many people from around the city, country, or the world, unlike the NFL teams of today.

           The NFL football of today (the 2010s and 2020s) has a different economic contribution and impact, considering the values attached to teams and the league as a whole. For example, according to Forbes Magazine, the value of top NFL teams in 2020 was in billions. The notable ones include the Dallas Cowboys, valued at $5.7 billion, the New England Patriots, valued at 4.4 billion, the New York Giants valued at $4.3 billion, and the New Orleans Saints, which is valued at $2.475 billion. The monetary value of the top teams shows that American football has a major economic impact on the owners, the players that earn millions, for example, Dak Prescott, who plays with the Dallas Cowboys, is paid $40 million per season. The value of the teams and the incomes that top earners make indicates that the American Football of today does not compare, in terms of economic impact, due to the increased value of the sport.

           The national football League (NFL) as it is known today was born during the 1920s and suffered major financial, among other struggles before it became the predominant enterprise it is today. During the formative years, the NFL was called the American Professional Football Association, which started operations as a college games organization, meaning that it commanded little to no economic influence and impact. At the time, paying the players participating in college sports was regarded wrong and in some ways, unethical, despite that professional baseball players received pay. By comparison, the American football teams of today pay some players in millions, for the contributions they make to the teams and the sport in general. Some good examples of highly paid players include Dak Prescott, a quarterback playing with the Dallas Cowboys, who is paid $40 million per season. Other highly paid players include Deshaun Watson, a quarterback playing with the Houston Texans, who are paid an annual salary of $39 million. The salaries that the players and team owners, among other stakeholders generate give a good indication of the economic impact and the contribution of the sport in the US.

           During the 1920s, commonly known as the Roaring 20s, American football attained the levels of national obsession it has today, the 2010s and 20s. The major economic difference between the 1920s and 30s and the current times (2010s and 20s) is that the economic impact and following from the following for the football sport was lost in 1929 when the depression hit Americans, and many could not afford to spend on the game. As a result, teams that have enjoyed kingly following became bankrupt, as the owners lost all their revenue sources. The best evidence of the impacts of the depression on American football during the times is the fact that in 1929, the NFL had 12 teams, but by 1932, the number had reduced to eight teams. The reduction in the numbers of teams reflects the loss of team revenues for the many that failed, signaling the insignificant economic contribution that the teams had for the local, state, and national community. The economic devastation caused by the depression went on, leaving the NFL and American football in general, in economic ruins. The economic devastation of American football continued, until 1937 when the remaining ten teams began rebuilding and restarting their operations.

           Owing to the limited following and influence of the teams, NFL games only attracted a fraction of the number that attends or pays to watch the games, today. As expected, many team owners struggled financially because the teams generated minimal revenues that could not offset the costs of team operations, and thus operated at a loss year after year. As a result, many teams registered losses year after year indicating that the sport had a minimal economic impact on the American community of the time, including the owners of the teams and the players. Some of the team owners that operated at losses include George Halas, the owner of the Bears, and Art Rooney, the owner of the Pirates Tea, which changed its name to Steelers. In many instances, the owners of teams were forced to finance the operations of their teams using debt and the contributions from well-wishers. Unlike the 1920s and 30s, the American football of today brings in hundreds of millions in revenues and over a hundred in operating income per team in 2020, exceeding the performance of other leagues such as the NBA, MLB, and the NHL. For example, Ozanian and Badenhausen note that Cincinnati Bengals, one of the less successful teams in the NFL, valued at $2 billion attracted less than $25 million from club-seat and ticket sales. The excellent performance shows that American football is performing excellently and continues to have a profound economic impact, despite the devastation caused by the Covid-19 pandemic.

Conclusion

Among the many sports leagues in American, the National Football League remains the leading economic driver and a major contributor to the country’s economy and general productivity. In light of the economic impact of the sport in the US and the American community of the time, it is crucial to explore the impact of the sport during the 1920s and 30s, and today, the 2010-20s. Comparing the economic impact of American football shows that, unlike today, the 1920s and 30s were not a time of excellent performance, noting that many team owners operated on debt and players did not receive payment because the focus was collegiate sporting activities. The similarities in American football for the two eras include that it attracted large numbers of audiences, who brought in the revenue the teams needed to continue their operations. However, the football of the 1920s and 30s also recorded minimal economic impact, due to the devastation caused by the depression of the 1920s, which reduced sport following considerably, and affected team performance adversely. Comparing the performance of American football during the two eras shows that it has remained a leading contributor to the national economy, due to America’s love for the sport.

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