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Tuesday, August 11, 2015

Can San Diego Walk Away from the Chargers?

You are not ready to negotiate until you are willing to walk away. This means that if everything else fails, there are no options, the other side doesn't want a win-win outcome, and you would substantially lose by an agreement you have to be willing to walk away. San Diego and the Chargers seem to be at an impasse and one or the other might walk away. Are there other options?

That doesn't mean San Diego shouldn't fight to keep the Chargers in the city. Nor does it mean they shouldn't pitch their case to the NFL in order to gain additional leverage that can be used to bring the Chargers back to the table.  It does mean that at the end of the day if it doesn't work out it could be necessary to walk away.

It doesn't matter if discussing labor relations or the Chargers. If one side absolutely cannot afford to walk away under any circumstances then they are not really negotiating. Leverage and options are low and it gives one side more leverage to dictate the terms of an agreement. In the case of stadiums this could include tax contributions, new stadiums, tax reductions, and more.

To truly know if one side can walk away all of the options must be explored and evaluated for feasibility and opportunity. The most advantageous courses are taken and the secondary courses are maintained as options. The secondary courses for San Diego may be many and if the Chargers decide to leave lots of ideas will hit the airwaves. It would have been better to know those options in advance.

I believe that the Chargers add value and retention is important. However, that retention may come with too big of a cost. Sometimes finding an alternative course may do more to spark the economic development of San Diego than a subsidized team. Studies have been mixed about how much a team really helps local residents. For example, could a water plant, an innovation complex for new businesses, biotech development, a soccer stadium, or manufacturing site generate higher economic input? Answering questions like this requires research and comparative analysis.

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