The Wall Street Journal and Golf

Besides an editorial denouncing Senator Kerry as”Secretary of Golf” for his concern about corporate golf tournaments, the papers’ Golf Journal has been discussing the issue:

Newport, John Paul. 2009. “Golf Journal: Deals Amid the Distress.” Wall Street Journal (20 February).

http://online.wsj.com/article/SB123577656810997247.html?mod=todays_us_weekend_journal

“Since October, when American International Group was put in the stocks for staging a luxurious $400,000 weeklong retreat at a resort in California, one week after receiving $85 billion in federal bailout funds, corporations have been slithering under rocks when it comes to golf-related activities. Goldman Sachs, for example, last week canceled its big annual hedge-fund conference, scheduled for March, at the Fairmont Turnberry Isle resort in Miami. A company spokesman cited “the current environment.” The Ritz-Carlton resort at Half Moon Bay, Calif., said more than 30 business groups have canceled retreats there since last fall, at a loss of more than $2 million in revenue. Wells Fargo took out a full-page ad in several newspapers last weekend to defend its practice of rewarding employees with outings — it called such events “the heart of our culture because our product is service” — but nevertheless canceled all of its major employee-recognition events for 2009.”

The author concludes that the downturn offers golfers good deals.

Newport, John Paul. 2009. “Golf Journal: No Entertaining, Please — It’s Golf.” Wall Street Journal (28 February).

“The TMZ posting on Tuesday, concerning the title sponsorship of last week’s Northern Trust Open at the Riviera Country Club near Los Angeles, read to me like a parody in the Onion of a local news outlet pouncing on a supposed outrage. “We’re told Northern Trust paid millions to sponsor the PGA event which ended Sunday, but what happened off the golf course is even more shocking,” TMZ said.”

“Northern Trust wasn’t just treating clients to Diet Cokes while they walked around the course. It staged “lavish parties,” “a fancy dinner” and concerts for clients “with famous singers” such as Sheryl Crow and Earth, Wind and Fire. TMZ’s reporters spotted courtesy cars (standard at PGA Tour events) driving onto and off the Riviera property with people inside. Guests were reported to have left various functions with goodie bags.”

“Northern Trust accepted $1.6 billion in Troubled Asset Relief Program funds, despite record profits of $795 million and a solid balance sheet. The bank, in a letter to shareholders this week, said it didn’t seek the funds but accepted them to accommodate “the government’s goal of gaining the participation of all major banks in the United States”.”

“Understandably spooked, Morgan Stanley, which received $10 billion in TARP funds, quickly announced that while it would continue to sponsor the Memorial tournament in June, it would not entertain clients there. Wells Fargo, a $25 billion TARP fundee which took over sponsorship of a PGA Tour event at the end of April when it acquired Wachovia, said it would seriously cut back spending at that event.”

“Golf, with its traditional fat-cat image, is an easy target for abuse …”  But the author defends such activities as job-creating.

7 comments so far

  1. Brian McGovenr on

    Special events, like golf outings can be an incredibly effective way to market to the affluent investors and institutions.
    NT probably expected a substantial ROI from the sponsorship – but because the average voter will never get anywhere near the red velvet ropes – it has to be stopped?
    Would Barney Frank be happier if TARP firms stopped trying to raise capital altogether? Promoting a business requires spending money. Maybe he’d rather TARP firms limit their marketing to less public displays – even if the more conservative methods cost more and return less?
    Yes, I’m in the event industry and a former Wall Street devil … but today I posted an article on this fiasco from the POV of the small event business.
    We want banks to lend money – but when they put it right into the hands of hundreds of waiters, drivers, event designers, planners, hotel employees, hotel and restaurant owners – that’s bad?
    I hope Congress understands that by vilifying events they will cost hundreds of low skill workers their jobs and bankrupt many struggling event companies and venues.

  2. javier hernanez-miyares on

    the problem with this economy is that we have too many affluent investors who are catered to by legions of low skilled and low paid workers; between them are middlemen who reap great profits. we are in this predicament because for too long we have had golf outings for the few, and mini golf for the rest of us.

  3. mperelman on

    Javier, you got it correctly. Brian says that many low wage workers are, in effect, hostages of this luxury economy. The question is why the economy does not provide them with more meaningful employment than bowing and scraping before the rich.

  4. bob s on

    It’s time businesses and people started paying more attention bringing this country back and controlling their costs and expenses instead of wasting their time and money on a golf course. Golf is a luxury and right now with the economy in the condition we shouldn’t be indulging in luxuries. It’s time to buckle down and get serious, not romp around a golf course with a cocktail.

    Employment by golf courses is pitiful at best, usually consisting of minimum wage and no benefits. It’s the rich taking advantage of the working class….big time.

  5. False Nails · on

    i always look for golf courses with well-maintained lawn and golf courses with very clean recreational area ,’,

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