Assessing the Fallout

Literally every paper in the UK Tuesday is running a prominent “Manchester City in crisis” story (see the end of the post for an array of links). The most alarmist perhaps is The Sun, which has made Mark Hughes’ future as manager its lead sports story. Other papers are weighing in with a range of details about City’s financial problems, the Corluka and Ireland transfer stories, and the fact that the Premier League will be seeking an early meeting with Thaksin Shinawatra demanding an explanation for why he is a fugitive from justice.

There’s plenty of fact, speculation, and attempts to connect the dots in the various stories to chew on. Here though is our assessment of the most important developments to date.

1. Thaksin is done as a politician in Thailand. The virulent attack on the Thai courts in Thaksin’s handwritten fax to Bangkok TV stations (translated and reproduced verbatim here) has not gone over well in Thailand, and it’s clear Thaksin cannot go back for quite a long time, if ever, let alone return to a position of power. Thaksin has in essence renounced Thailand.

That is a hugely important development for Thaksin, and more especially for the future of politics in Thailand. It is also relevant to Manchester City insofar as one of this blog’s key reasons for being critical of Thaksin’s ownership of the club is the worry that he would use the club as a prop to boost his legal and political aspirations. He certainly tried, but it didn’t work. Consequently, in evaluating whether Thaksin should own the club going forward, the evaluative criteria naturally will shift more towards whether his doing so is good for City and less as to its possible impact on developments in Thailand.

This is not to say Thaksin’s influence will or can totally dissipate in Thailand. Reporting in the Bangkok Post today indicates that Thaksin’s departure was planned two weeks in advanced with knowledge of top government officials. The key, however, is that the ruling PPP party recognized Thaksin as a liability whose presence was making governance difficult-to-impossible. Wanted by no one, Thaskin has become a man without a country as well as politician without a party.

2. Thaksin has probably kissed his frozen fortune away. Even with Thaksin skipping bail, some analysts could still imagine a grand bargain being struck in which Thaksin was convicted, then received a royal pardon, and then ended up getting at least a large chunk of his frozen assets back. That seems much less likely now; Thaksin’s statement is unlikely to be received warmly by the king, and it’s unlikely whatever continuing legal efforts Thaksin makes in absentia to recover those assets can succeed while he is a fugitive from justice.

That development is important for Manchester City insofar as funds used to bankroll the spending spree of the past two years, as well as possibly to buy the club itself, may have been provided (or borrowed) with the expectation that by now, the cash would be there. That is to say, if Thaksin has been using his presumed eventual capacity to access all his wealth to gain access to further money used to bankroll City over the past year, then he and the club naturally will face financial difficulties once the bills come due.

I cannot pretend to know the specifics of Thaksin’s financial dealings with City but scenarios such as the above (cheers to Prestwich Blue from the boards for some good posts on this) seem highly plausible, especially in light of multiple reports that as late as July Thaksin had borrowed money from John Wardle to help meet payroll. Minimally, lack of access to funds Thaksin had been banking on mean he is unlikely to have the resources to convert City into a European power, as promised.

3. The third and final key development is simply the obvious fact that the Premier League is on full alert to this situation and will presumably be beginning legal inquiries in preparation for the near-certainty that Thaksin will soon be convicted in absentia on corruption charges. Richard Scudamore has already stated that the league will be taking heavy guidance from the judgments of the Home Office; reports also indicate that Scudamore wants to meet with Thaksin (who was photographed shopping in London on Monday) to discuss recent developments.

One interesting question, yet to be probed by the media, is whether the offenses Thaksin is likely to be convicted of in fact correspond to the schedule of offenses listed under the Fit-and-Proper-Person Test. Specifically, it seems unclear whether a conviction for the general offense of corruption is sufficient to trigger the rule, or whether Thaksin must be convicted of breaking a law for which there is a UK equivalent.

Those are the most important developments to this point. Tomorrow we’ll weigh in with a few scenarios (good, bad, and ugly) about how this situation might ultimately reach a resolution, and also with some comments about what the Premier League need to do to address this situation.

Now as promised, links from Tuesday’s papers:

The Independent

The Sun

The Mail

The Guardian, I

The Guardian, II

The Times

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