Citigroup Inc., eager to quell the controversy over how lenders are using government bailout money, is exploring the possibility of backing out of a nearly $400 million marketing deal with the New York Mets, say people familiar with the matter.
In a statement Monday, Citigroup said that “no TARP capital will be used” for the stadium — referring to government funds from the Troubled Asset Relief Program. But as it revisits the pact, Citigroup is essentially acknowledging that the volatile political climate could make it untenable for the bank to proceed with the deal.
The Mets deal was attacked last week as an example of misplaced spending by financial institutions that needed bailout funds. Reps. Dennis Kucinich (D., Ohio) and Ted Poe (R., Texas) wrote to Treasury Secretary Timothy Geithner on Wednesday, asking him to push Citigroup to dissolve the Mets deal.
I can’t really get into this story very far, and it’s the worst kind of story as far as I’m concerned (I’m not a big fan of business-of-baseball stories and I hate being compelled yet again to mix baseball and politics), but a few quick observations:
1. So much for the brief era in which the Mets appeared to be getting closer to financial parity with the Yankees. I’m not that personally familiar with the state of the naming-rights market but I have to assume that it will be very hard to get an equivalent contract in terms of annual revenue or duration.
2. Sadly, if Citi does exit the deal, it will be tough to get a name that fits as well with the team and the city – I dread some phone company or regional bank that changes its name every three years, or something silly like “Vitamin Water Park.” And I swear, if they end up naming it “Obama Field” I’m not going to be responsible for my actions.
3. As you can see if you’ve seen pictures or been by the park, the colossal Citi signs have been up for a while now.
4. We have not even seen the beginning of how Washington politicians are going to be micromanaging entities that have accepted taxpayer money. More on this another day, but while I supported the original Paulson Plan – which involved the federal government buying bonds in arms-length transactions in the hopes of recovering most if not all of its original outlay – I can’t possibly support any of the more expansive bailouts that have been done since, not least because of the galloping corporatism that is unleashed when the government goes from being a mere customer of private business to an investor, donor and business partner.