Little to celebrate.

Photographer: Alexander Nemenov/AFP/Getty Images

A Losing Coach Russia Can't Afford to Lose

Leonid Bershidsky is a Bloomberg View columnist. He was the founding editor of the Russian business daily Vedomosti and founded the opinion website Slon.ru.
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For a coach whose team can lose to pretty much anyone, Fabio Capello is remarkably expensive. The manager of the Russian national soccer team is a living reminder of everything that has gone wrong in Russia in the last three years.

Today, the executive committee of the Russian Football Union, known as RFS, was expected to announce Capello's resignation. Instead, after a meeting, the federation said he would stay on, at least for now. To kick him out, the RFS would need to buy out his contract for more than 21.5 million euros ($24 million). The organization doesn't have that kind of money, and the only person who can provide it -- Alisher Usmanov, Russia's richest man and the part-owner of London's Arsenal soccer club -- hasn't agreed to do so.

He's already done a lot: In February, he loaned the RFS 400 million rubles ($7.4 million), and another 300 million this week. Both sums were needed to pay Capello's back wages at the rate of 7 million euros a year. Will he come through this time? The soccer bureaucrats will just have to wait to find out, while Capello continues to experiment with a hopeless team crimped by gross mismanagement of the sport.

Russia first hired a foreign coach for the national team, Guus Hiddink, in 2004, after the squad lost 1-7 to Portugal -- its most humiliating defeat. Another billionaire, Chelsea club owner Roman Abramovich, paid his salary of 2 million euros a year. It was a revolution: While many Russian fans demanded a competent coach from overseas to lift up the team, it was a difficult political decision. In Russia, as in many other countries, soccer fandom is directly linked to patriotism, and to some occasional fans, the national team's performance even has geopolitical implications. So was putting a foreigner at the wheel a disgrace, or was it a sign that Russia was a new kind of global power, wealthy and not shy about opening up to the world?

It all depended on Hiddink's performance, and he performed. In 2008, after many experiments with the lineup and some harsh functional training, Russia took third place in the European championship, the nation's best post-Soviet achievement to date. On its way to the bronze, it trounced the Netherlands, Hiddink's native country. I still remember that game and the jubilant honking of, it seemed, every one of Moscow's 4 million cars in celebration. Russia was a European country with a European coach and one of the best teams on the continent.

After that fairy-tale episode, Russia's national team has been led by a succession of foreign coaches: first, another Dutchman, Dick Advocaat, then Capello, a major star who had coached the best European clubs and then managed England's national team, where he was liked and respected by players, if not by association officials. 

The only way to lure him to Russia was to offer oodles of money. The RFS agreed to all of Capello's terms in 2012, and he did OK at first, helping Russia qualify for the 2014 World Cup in Brazil, where he was the best-paid coach. Once there, the team died early, but Capello had a new contract. The weekly Novaya Gazeta published it in April. The salary, bonuses and perks are incredible. Apart from the guaranteed 7 million euros a year, for example, Capello was to receive more than 14,000 euros per month to rent an apartment in Moscow, enough to secure a palace. And should he be fired before the 2018 World Cup in Russia, he would be due about 32.6 million euros, minus what he would have earned by that time. 

Most likely, this contract mechanically continued the terms agreed in 2012. That year, Vladimir Putin had just been re-elected for his third presidential term. Russia still seemed to have ambitions to modernize and become a global player, and it still had profits from oil priced at more than $100 per barrel. But economic growth was slowing as the state tightened its grip on the economy and bureaucrats and law enforcement bosses took a greater cut of businesses' profits. There remained lots of money and glamour, but the country was no longer performing.

Neither was Capello's team. He simply had too few good players. In the Russian national championship, clubs aren't allowed to field more than seven foreign players (out of 11) in a game, which means Russian stars don't really compete with the expensive foreign "legionnaires," as they are known. Clubs need them to fill the quota, and the native players make millions, even if they are no match for their teammates from Europe, Latin America and Africa.  

Capello has been extremely thorough, looking at every eligible player in the national championship. In the latest game, a European championship qualifier against Austria, he suddenly played two youngsters without Premier League experience. It smacked of desperation: Russia lost 0-1. During the 2014 World Cup, Usmanov called Capello the Russian team's best player, adding wryly, "But he can't be on the field." So Russia isn't certain its team will qualify for the European tournament, lagging behind Austria and Sweden.

In the current political climate, tolerating a foreign manager of the national team seems unpatriotic. If he loses, it's an indignity. "Pitiful," Putin's chief of staff Sergei Ivanov muttered to journalists after the Austria game. The big oil money is gone, the economy is in recession, so the RFS has constantly held back Capello's salary. Only Usmanov has allowed the organization to get rid of the arrears.

Starting next season, the cap on the number of foreign players will be lifted on Putin's personal orders, allowing clubs to play as many foreigners as they want in any single game, provided they have no more than 10 on their rosters. That should boost competition, but the change probably comes too late for Capello, or his successor if Usmanov coughs up the severance money, to do anything in time for Euro 2016 and even the 2018 World Cup. Russia has chosen to part ways with the West, but it doesn't have any great ideas about what to do on its own. What's going on with the national soccer team is evidence of this sorry state of affairs.

This column does not necessarily reflect the opinion of Bloomberg View's editorial board or Bloomberg LP, its owners and investors.

To contact the author on this story:
Leonid Bershidsky at lbershidsky@bloomberg.net

To contact the editor on this story:
Max Berley at mberley@bloomberg.net