Know your oligarch: Cruz Azul doesn’t have a crazy rich guy, but its collective is still messed up

You don’t have to read Animal Farm or look at the Soviet Union to know “collectivism” is not always a synonym for “progress,” and if you put your faith in capitalism, you likely consider “collective” a dirty word. Ayn Rand probably had panic attacks at the term’s mere mention, and Conservatives have banned its use. While it’s ok to have a “team” take the field, there almost always has to be an “individual” figurehead steering the ship.

Cruz Azul, however, shatters that mold. The Mexican club is in fact owned by a company, but a company with a unique collectivist structure. That’s awesome in theory. You don’t have to be subjected to the whims and wishes of sugar daddy owners, but instead have a stable and altruistic group running the show. Sadly, in practice, things haven’t always worked out that way.

Let’s start at the beginning, late in the 19th century. The Mexican Commerce Code, passed in 1889, sought to modernize Mexico by encouraging “cooperative” businesses models. Two foreigners, Henry Gibbon and Joseph Watston, then founded a collective cement company called Portland Cement, located a few hours west of Mexico City in Hidalgo. Soon rechristened Cruz Azul, the company faced a crisis during the Great Depression, but the employees convinced the governor of Hidalgo to pass an expropriation law that left the business firmly in the workers’ hands.

Around the same time, Guillermo Macias and Carlos Garces formed an amateur club consisting of Cruz Azul workers. U.S. soccer history buffs will recall that a similar trend had emerged there decades earlier: Bethlehem Steel, a prosperous company at the time, fielded a soccer team from 1907 to 1930. However, the Great Depression marks a divide in U.S. and Mexican history, social, and economic policy. Bethlehem Steel FC folded, but Club Deportivo Cruz Azul, founded in 1927, still exists. Guess which workers nationalized and took over the company?

After nearly 40 years, Cruz Azul’s players wanted to make the leap to the professional leagues. With the company prospering, the collective agreed to finance and build a proper soccer stadium, the Estadio 10 de Diciembre, which paved the way for the team to enter the Liga de Ascenso. It made the Primera in 1964, dominated in the 1970’s, and has eight titles to its credit.

But success has been sparse in recent years – no, make that decades. And Cruz Azul has learned a hard lesson: Cooperatives don’t always cooperate. In 2011, president Guillermo Alvarez Cuevas was voted out, with some suspecting him of raiding the Cruz Azul piggy bank for personal gain. However, Cuevas pulled a Latin America leader classic and refused to budge. He simply ignored the vote and stayed on as president. A series of lawsuits followed, in which Armando Valverde Talango accused Cuevas of embezzlement and money-laundering. Somebody then accused Valverde of making false declarations, and federal police busted into a Cruz Azul meeting, beat up some executives, and threw him in jail sans an arrest order.

Now the smoke has cleared, yet Cuevas is still in charge. Valverde still heads a committee. The two have “resolved their differences,” but socios and fans of Cruz Azul want to know – what was resolved? Can the peace last? If embezzlement is going on, that can’t help the business, which can only hurt the club. Cruz Azul only moved to Mexico City in 1996, but this case reeks of good old-fashioned white collar chilango chicanery. And it stinks to high heaven.

Currently, Cruz Azul are only treading water in the Primera. It’s rather depressing that a collective, as opposed to a spoiled heir oligarch, could cause such scandal, leaving the club struggling. We complain about the billionaires handling our sports clubs, but would we really do a better job?