Across the Pond: Are CR7 and Kaka Just the Tip of the Iceberg?

Joe GSenior Writer IJune 11, 2009

ROME - MAY 27:  Carlos Tevez of Manchester United and Cristiano Ronaldo of Manchester United look dejected after Barcelona won the UEFA Champions League Final match between Barcelona and Manchester United at the Stadio Olimpico on May 27, 2009 in Rome, Italy. Barcelona won 2-0.  (Photo by Laurence Griffiths/Getty Images)

Across the Pond is a series that offers this Yank's take on major events in sports from Europe and the rest of the world. For the last installment, click here.

I've been crunching some numbers and the figures are staggering.

In just the past week, Real Madrid has doled out between $220-$225 million (depending on the exchange rate) to sign just two players.

According the CIA World Factbook, that's roughly equal to the GDP of Micronesia. Yes, Real Madrid has economic power equivalent to that of a small nation.

Add in the combined $137 million that Real splashed on Luis Figo and Zinedine Zidane in their other world record transfers and Madrid's massive spending power is perfectly illustrated.

Since 2000, Real have made four world record transfers. They've spent a total of roughly $360 million on just four players.

Granted, the four players that they've bought with that money have been some of the best in the world, but those players were purchased for an average of $90 million apiece (£54 million, to the Brits). Is anybody worth that much?

Just 11 years ago, the transfer fee record was set at £21.5 million pounds, for Denilson's move to Real Betis. It's taken just over a decade for the world record transfer fee to quadruple.

Every transfer window will have its own signature element of madness.

In the last two windows, we had one of the most obnoxiously protracted transfer sagas in history. Apparently this time around, we'll be witnessing grossly inflated transfer fees.

I've been looking at this with a mixture of shock and disgust because you don't have to look terribly far into the future to see the potential impact of the Madrid shopping spree.

Who else was expected to make a major splash in the market this summer?

Manchester City, and to a lesser extent, Chelsea.

City has only made one major move so far with their signing of Gareth Barry, but you can be sure that they'll be doing more as the summer progresses.

Thanks to their new ownership, the Abu Dhabi United Group, City has more spending power than anybody else on the planet. Now that they've seen that you can indeed put a price on anything, will they be more aggressive with their spending?

Remember, a deal for Kaka was seemingly all but done back in January. If this were an Al Pacino flick, Kaka's move to Madrid would spark a fit of jealous spending in an effort to prove that Man City could be just as powerful.

Chelsea could look to Madrid and feel even farther back in the race for European supremacy. It's no secret that the Blues are desperate for a Champions League title, but have kept coming painfully close each season, with defeats in the very late stages of the competition.

Abramovich already knows that Manchester United and Barcelona have proven themselves superior to his club, and now Madrid seems like another massive roadblock. Will this launch an epic spending spree in London as well?

We can't rule either scenario out. Both Chelsea and Man City will want to compete with the elite clubs, and both have the rich owners to allow that to happen.

The more unfortunate side to Real's spending is bound to be transfer fee inflation for other players. Think of a player that you would rate about half as highly as Cristiano Ronaldo. Is that player worth £40 million?

Think back to Ronaldo's 1997 transfer to Inter Milan, a then-record move that cost the nerazzuri £19.5 million. Was the 1997 edition of Ronaldo only a quarter as good as the 2009 edition of Cristiano Ronaldo?

Even accounting for inflation, in today's money that move would have cost roughly £30 million.

It's a simplistic argument, but on the surface that says that Ronaldo is less than half the player that Cristiano is.

I'll use this analogy. At my local watering hole, I can get a mug of Oberon (delicious local microbrew) for $4.50. A mug of Bud Light? Two dollars, because it's a piss-poor beer compared to Oberon.

A pint of Guinness, which I'll use as a stand in for Ronaldo because it's quite heavy, goes for about four dollars. A great beer in its own right, but given the limited production of Oberon and the nature of microbrews, isn't quite as expensive.

Back to my original point, I worry that Ronaldo's move (and to a lesser extent, Kaka's) is going to artificially inflate transfer fees.

We've already seen unreasonably bloated contracts in the States in Major League Baseball. Alex Rodriguez signed a record deal with the New York Yankees, in the neighborhood of $275 million.

Now, players of similar quality are holding out for large contracts that would have been unthinkable just five years ago. It's creating quite the disparity between the haves and the have-nots in the world of baseball.

Madrid's spending power could be quite damaging to a few clubs in that regard. But, with the economic clout of Abramovich and ADUG, it could just be the tip of the iceberg.