When Roman Abramovich decided to buy a football club, the first places he looked were Spain and Italy. But ownership there seemed rather complicated. In Italy, many of the families who owned clubs had been doing business with each other for generations. In Spain, horror of horrors, the fans themselves owned the biggest clubs. As for the Bundesliga, Abramovich never seems to have considered it.

And so in April 2002 he flew to Manchester to watch United. Afterwards, Dominic Midgley and Chris Hutchins reported in their book Abramovich, Rio Ferdinand drove him back to Manchester airport, and the Russian charmed the player by joining in a singalong with a fellow passenger, Ferdinand's four-year-old half-brother.

Not long after, the story goes, Abramovich was flying over London in a helicopter when he spotted a football stadium handily located near Knightsbridge. "What's that?" he reportedly asked. It was Chelsea. Abramovich bought the club, sealing the deal over a bottle of Evian water with the departing owner Ken Bates in the Dorchester Hotel. This was 2003, and that Evian toast opened a new era in the Premier League: rich foreigners buying traditional English clubs and making them the best in the world.

Many believe that this era of English supremacy now is – or should be — coming to an end. English clubs currently account for somewhere over half the £6 billion that Europe's football clubs cumulatively owe. Portsmouth won the FA Cup in 2008, then tumbled into administration and almost went bust. Manchester United are £590 million in debt. It all reminds one of Michel Platini's warning to indebted European football clubs two years ago. "If this situation goes on," Uefa's president said, "it will not be long before even some major clubs face going out of business." That seems to be the premise of the angry Select Committee of British MPs now running an inquiry into "football governance".

Equally bad, in the eyes of the critics, most big English clubs are owned by foreigners like Abramovich who have no traditional ties to their playthings. Platini speaks for many when he grumbles, "Football was created because Manchester City's players were against Manchester United's players. Today I don't see why Manchester City's Qatari president is against the American president of United," and he chuckles at the absurdity of it all. (As it happens, Manchester City's owner is Sheikh Mansour of Abu Dhabi, but the point stands.)

Meanwhile Germany — lest we forget, the biggest country and economy in Europe — has begun looking curiously like the future. Bayern Munich's president Uli Hoeness crows that his club and the Bundesliga have rosy prospects, because unlike certain people they aren't mired in debt. Christian Seifert, the Bundesliga's chief executive, has warned the Premier League, "In the long run, the product is in danger."

It's time to ask whether the Premier League really is in trouble. The answer: absolutely not. In fact its growth may have only just begun.

The story of the Premier League is the story of modern Britain. Since the 1980s English football has passed through the same stages as the British economy itself. Stage one was the embrace of capitalism. About the time that Margaret Thatcher began encouraging profit-seeking in the 1980s, turning the formerly sleepy City over to foreign banks, the first English clubs entered the stock market.

Stage two was striking it big. In 1992 a deep British recession creaked to an end. Just then, the Premier League was founded and its TV rights were sold to BSkyB. Suddenly only British people who bought satellite dishes could watch the top division. But the government allowed it, because post-Thatcher Britain trusted the free market — the other essential condition for the league's rise. A more social democratic Germany saw football as a public good, to be shown free on state channels. That's why only in English football have annual TV revenues risen more than 1300 per cent since 1992.

For decades various countries had taken turns to provide the world's dominant league. In the 1950s it was Colombia — of all places, in the 1970s Holland and then Germany. Serie A was the fashionable league of the 1980s. But by May 2008, when Chelsea and Manchester United squared off in the Champions League final in Moscow, there was only one league that mattered.

The newly glamorous English clubs attracted some pretty bizarre owners. When Vincent Kompany signed for Manchester City from Hamburg, and was expecting to say hi to City's Thai owner Thaksin Shinawatra, he was told the meeting had been cancelled because Thaksin had had a spot of bother and needed to go into hiding. Still, not to worry. Keith Harris, the pink-faced banker who specialises in brokering takeovers of English football clubs, always had a queue of foreigners ringing his mobile asking if there were any Premier League clubs going spare.

Finally, in late-stage capitalism, came overleveraging. While the UK covered itself in debt, so did its football teams. In 2005, the Glazer family of Florida financed its takeover of Manchester United by loading the club with hundreds of millions of pounds of debt. United paid £40m interest in the 09-10 season. That's enough to buy three Mesut Özils. When United and Chelsea met in that match in Moscow in 2008, the two teams had a combined £1.5bn in debt.

Other clubs found their own ways to burn money. In the summer of 2008, just before the global economy crashed, I visited the Swiss architecture firm Herzog & de Meuron in Basel. These were the people who built the Tate Modern art museum, Munich's Allianz Arena and Beijing's 'Bird's Nest'. In their offices, I was introduced to three bright young architects who were designing a "stunning waterfront stadium" for Portsmouth FC. Peter Storrie, the club's then chief executive, had said, "We have only one word to describe this stadium. Perfection." Portsmouth had recently acquired a new gung-ho personality under their then owner Alexandre Gaydamak. Gaydamak's father is a Russian-Israeli arms dealer, who in the course of an upwardly mobile career had been sentenced to six years in jail in France.

Portsmouth's new stadium hasn't been built. Last year, when the club appeared in the Companies Court on a winding up order, it became the new symbol not just of English football but of Britain itself. The spendthrift club was the average spendthrift Briton writ slightly larger. Portsmouth had debts of about £138m, nearly double its annual turnover. The McKinsey Global Institute calculated last year that total British public, corporate and private debt was about 4.7 times bigger than Britain's annual economic output.

In fact, the Premier League's debt bubble bears an uncanny resemblance to the debt bubble that brought down the global economy. Instead of Americans buying houses they couldn't afford, here were English clubs buying footballers they couldn't afford. In both cases there was the same overconfidence, the same embrace of foreign capital, the same conquest of tradition by money, the same cheerleading by English-speaking nations while continental Europeans watched and scoffed, and the same unpayable debts. In September 2008, two days after the collapse of the American investment bank Lehman Brothers had signalled the collapse of the global economy, Platini grumbled to me at Uefa's headquarters in Nyon, "In football, many buy Ferraris and can't pay for them." And not just in football.

The irresistible conclusion would seem to be that where Lehman Brothers went, English clubs will follow. That might even be what some want: a moral reckoning. However, it won't happen. English clubs aren't going to collapse under their debt, nor shrink to the size of foreign clubs, nor be eaten by rapacious sugar-daddies. Banks might disappear, but football clubs are sturdier constructions.

As Stefan Szymanski and I show in our recent book Why England Lose, football clubs almost never go bust (even if you really want them to). Their brands are too old, too strong, and too global. "We must be sustainable," clubs say, parroting the new global cliché. In fact they are fantastically sustainable. Dozens of English professional clubs have entered insolvency proceedings since 1992 yet only tiny Aldershot folded, and even their supporters simply started a new club almost identical to the old one. Football clubs survive even when they go bust. You can't get more sustainable than that. Portsmouth and the rest will always be with us, in some form or other.

Banks fold, but almost every tin-pot British football club has survived the Depression, the Second World War, recessions, appalling managers and corrupt chairmen. If football clubs really did collapse under their debts, there would now be almost no football clubs left.

The reason: they are too beloved to go bust. Creditors dare not push them under. No bank manager or tax collector wants to say, "Portsmouth is closing. I'm turning off the lights." Luckily, society can keep football going fairly cheaply. Contrary to popular opinion, football is not big business. This is a titchy little industry. The total revenues of the whole European professional market in the 2008-09 season were €15.7bn (about £13bn). Tesco's revenues for 2010 were £57bn.

Because clubs never go bust, they can safely take on fortunes in debt. If things go wrong, they simply don't repay their debt, the old directors walk away, and new ones come in promising to sweep up the mess (while also buying shiny new 'Brazil international' centre-forwards). A club like Bayern, which shuns debt, is really missing a trick. Bayern could easily borrow a few hundred million euros to turn itself into the best team in Europe. Even if it flushed the money down the toilet and then said "Nanananana" to the lenders, the club would survive. Right now Bayern is a shiny self-sustaining debt-free business whereas English clubs aren't. But the point of a football club isn't to have nice accounts. It's to win trophies.

In any case, it's simply not true that the biggest English clubs have taken on hundreds of millions in debts in order to buy good footballers. Chelsea and Manchester City have no significant debts: their billionaire owners have written off the money that they poured into the clubs. 

Manchester United is, historically, as prudent a business as Bayern Munich. Before the Glazers showed up, the club ran itself like a typical conservative midsized northern English company. It managed the "performance risk" inherent in football – one referee's mistake and your profits vanish – by shunning debt. Even today it pays its players only with the money it actually makes. The Glazers loaded debt onto the club for one purpose only: to finance their takeover. United's football business doesn't need debt.

Arsenal, also very cautiously run, took on debt to build their new 60,000-seat Emirates stadium, which is now sold out for every game at perhaps the highest ticket prices in European football. Arsenal are rapidly repaying their debt and at this pace will soon, for the first time ever, have the financial clout to match the likes of United and Barcelona. The consultants Deloitte now rank the club in the top five of the "Football Money League", ahead of Chelsea, with revenues in the 2009-10 season of €274m.

It's only the second-rank English outfits that have sunk into debt in order to perform on the pitch: lower-division clubs, Portsmouth, and Liverpool, hampered by their base in England's poorest city and without a league title in 20 years. A small club that gets into debt generally has to drop a division or two, because it finds it hard to keep borrowing: that's what is now happening to Portsmouth. But a big club like Liverpool simply finds itself a new rich owner. Owning Liverpool is a status symbol, like owning a Rembrandt. Manchester United, too, last year attracted a consortium of rich fans called the "Red Knights" who were reportedly willing to buy the debt-ridden club for £1bn. The Qataris were apparently happy to pay even more. According to Wikileaks, even the Burmese military junta considered making a bid. But the Glazers weren't interested in any offers. These clubs are hardly collapsing under their debt.

If debt won't sink the English, then some say the imminent demise of football's sugar-daddies will. From next year, Uefa begins phasing in its rules for "financial fair play". Essentially the aim is to force clubs to spend only as much money as they generate themselves. That is, clubs will no longer be allowed to spend money that comes from sugar-daddies, bank loans or any other outside sources. These regulations only come into full effect in 2018; until then, clubs will be permitted limited losses. But long before then, subsidies on the scale that lifted Chelsea to the European elite (and made Manchester City a decent team) will become impossible. Liverpool will no longer be able to borrow like it used to. Then, surely, the quality of the Premier League will decline?

Once again, with apologies to the Germans and Platini, the English will be just fine. The idea that the strength of the Premier League rests on oligarchs and sheikhs is a misunderstanding. In fact, these people are just a bonus. Even without them, English clubs generate the most money in the world. Here are Deloitte's estimates for the 2008-09 season.

As Seifert notes, English clubs don't even need to go into debt in order to outdo their foreign rivals. "Even if you were to pay €500m less in salaries," he says, "you would still have the best players, because who should pay them more?"

The end of external funding should hit Spanish and Italian clubs harder than English ones, because the Spaniards and Italians generate much lower revenues of their own and are therefore more reliant on external funding. Internazionale would never have won the Champions League without the hundreds of millions of pounds that their owner, Massimo Moratti, has poured in over the years. He might be a local, and a lifetime Inter fan, but he's just as much a sugar-daddy as Sheikh Mansour or Abramovich. Soon Moratti's funding too will become illegal. The same goes for Silvio Berlusconi at Milan, and indeed most other Italian club owners.

Real Madrid will do fine without the easy bank loans they can get just for asking, because their own TV revenues are huge. Other Spanish clubs are less lucky. The likes of Valencia and Atlético Madrid have long been propped up by banks, often ones attached to local governments. These clubs have already ceased buying superstars, and certainly won't be returning to top table at the casino once "financial fair play" takes effect.

If clubs' own revenues really become decisive, then the Premier League and the two big Spanish clubs should run away from the rest, with only the rising Bundesliga in pursuit. The end of sugar-daddies might doom historically mid-sized clubs like Manchester City or Chelsea; but it won't hurt big clubs like Arsenal and Manchester United. In fact it will make their lives easier, because they will no longer have to compete with sugar-daddy-funded upstarts for the best players.

The painful truth that people like Platini and Hoeness have to confront is this: the Premier League is the richest league because it's the best-loved league. It makes the most money because fans — in England and outside — adore this overpriced, foreign-owned, foreign-staffed operation. Sure, the league is an expensive globalised bazaar. In today's world, that inevitably evokes fears that come from far outside of football. Platini told me that Manchester City should have a local owner. "Otherwise why should the club call itself Manchester? They should call themselves, I don't know, Coca-Cola. And if you don't have English players, why play in England? It's as if 100 per cent of people in the French government were foreigners."

Yet the awkward fact is that fans don't seem to mind. The distrust of foreign money so widespread in France, Germany or the US remains very weak in England. We long ago flogged off loads of our companies to foreigners. Rolls-Royce now belongs to BMW, for instance. Cadbury, the traditional 'British' chocolate company, was recently bought by the American corporation Kraft.

It's true that when the Glazers bought United, some disgusted United fans founded an anti-money breakaway club called FC United; but there have probably been more articles written about FC in upmarket football magazines than there are spectators at its matches. Glazer or no Glazer, Manchester United's stadium still packs in 76,000 every week.

Those 76,000 are paying a foreign owner for the right to watch foreign footballers. Most players in the Premier League now come from outside England. Some of the biggest clubs have wisely almost dispensed with Englishmen altogether. Platini hates this. He wonders whether Liverpudlians or Mancunians can identify with a team full of foreigners. Well, they seem to manage. Judging by the Premier League's record crowds despite its record ticket prices, fans still identify enough even if English football arguably no longer exists. England can have an excellent league, or it can have an English league, but it can't have both. Fans seem to prefer excellence. Why should they complain about some of the world's best footballers flocking to provincial towns like Bolton, or Newcastle, or — until recently — Portsmouth? William Bush, director of public policy at the Premier League, asks, "What happens when we turn the fans off? Well, we haven't turned the fans off yet. Something's working." The league remains excellent. Even in the two seasons before this one, in which first Barcelona and then several teams outdid the English in the Champions League, English teams earned more Uefa coefficient points in European competitions than any of their rivals. Cumulatively, they remain the best.

Admittedly the Bundesliga has slightly higher average attendances: 42,500 last season, compared with 34,151 for the Premier League. But that's only about 25 per cent more spectators than England, whereas Germany has 60 per cent more inhabitants. Crucially, too, Bundesliga tickets are cheaper, so no wonder people buy more of them. Person for person, the English show a much greater willingness to pay to watch football than the Germans do.

And it's quite likely that the Premier League's dominance will only grow in the coming years. Until very recently English clubs made almost all their money inside England. In 2003 I asked Manchester United's then finance director, Peter Draper, what percentage of their revenues came from abroad. "The square root of nothing," he replied.

That is changing fast. The model of local leagues is fading in football. Even in Argentina, with its historic league, people increasingly watch Arsenal on TV. That's even more true in the US, China, Japan, and, now, India. Their soccer fans mostly came of age in this era of globalisation. They care little for their local teams. They want a world league. That must be the Premier League, because it clearly isn't the Champions League (featuring Hapoel Tel Aviv, MŠK Žilina and CFR Cluj). The market for English clubs is the world, and the clubs have only just started to tap it. The Americans who have bought several big English clubs are betting on this growth. They know that American sports clubs will struggle ever to find a market abroad; Arsenal, Liverpool, Manchester United or Aston Villa have a lot more potential on foreign TV than do the New York Yankees or the Dallas Cowboys.

Let's take Nigeria — a country with a proud local football tradition of its own — as our case-study. During the African Cup of Nations in 2008, the Nigerian Muhammed Musa, who teaches mass communications at the University of Canterbury in New Zealand, returned to his native land and found something surprising: Nigerians are turning off Nigerian football.

In recent years 'football show houses' have opened all around the country, Musa discovered. Often the show houses are simple sheds, where people pay entrance fees to watch English games as humble as Fulham v Bolton on TV. "These places are jam-packed every weekend," said Musa.

He visited show houses during the Nations Cup to observe the crowds, he said, "but to my surprise there were not many people there". Even when Nigeria played, few Nigerians turned up to watch. The proprietors of the show houses told Musa the Nations Cup was ruining their finances. "People are not interested in this thing," the owners complained. "We can't wait for this to end so the Premier League can resume." 

What particularly struck Musa was what had happened to national TV news. The programme had begun at 9pm since time immemorial, and had helped build the nation by gathering all of Nigeria together in front of TV sets. These days, though, it sometimes moves from its traditional starting time if it clashes with a game between two of England's Big Four clubs. "Now this national we-ness is built around Liverpool v Chelsea," Musa marvelled.

People love these clubs – sometimes too much. Nine deaths were recorded in one town alone when Chelsea and Manchester United met in Moscow in 2008. After Barcelona beat Manchester United in 2009, an angry United fan in the town of Ogbo killed four people when he drove his minibus into a crowd. "We have not seen people supporting their national team with their blood," Musa concluded, "but we are seeing people support corporate teams with their lives. The importance of the nation is diminishing, and what is replacing it is allegiance to a corporate club."

The corporate clubs are making ever more money out of that allegiance. From 2010 through to 2013, the Premier League will earn a total of £1.44bn from selling its foreign rights abroad. Per year, that works out at four times what the Spanish league makes from its foreign rights, six times what Serie A gets and fourteen times the Bundesliga. And the English sum is unlikely to fall. The largest foreign TV market of all, the US, is fast turning onto soccer: American viewing figures for the last world cup were almost 50 per cent higher than for the 2006 tournament. The USA-Ghana quarter-final drew 15 million live viewers in the US, comparable to the average game in baseball's World Series or basketball's NBA finals. Increasingly, Americans are buying subscriptions to see the Premier League on TV. In many American college dorm rooms nowadays, hungover students gather round the flatscreen on Saturday mornings to catch Arsenal v Blackpool or Everton v Villa.

An English friend of mine who lives in Miami experienced something similar himself the other month. Flying back into the US, he had his passport thumbed through by a suspicious customs official. The man even studied his place of birth. "Burnley," the chap murmured. And then he said: "You had a good result last night."

"The funny thing is," mused my friend afterwards, "it was only a League Cup game."

As the world turns onto English football, sugar-daddies and debt spending could become irrelevant. As more and more Nigerians, Floridians and even Burmese (watching en masse outdoors in deathly silence at 3am) switch on, the league will only become more dominant. The many who resent the Premier League will have to content themselves with dreaming about Armageddon.