If I had the time, I could write a few thousand words on this subject, but I promise to keep it as succinct as possible:
With MLB player free agent signing season in full swing, management of MLB teams have publicly announced their budgetary concerns, what they can afford, luxury tax issues, etc. as a warning to fans that they may not be able to acquire the on-field talent that fans would like to see in the beautiful stadia the fans’ taxes paid for.
Mark Lerner, owner of the very recent World Series-winning Nationals (Mark’s chief skill is having a successful and wealthy father), recently told Nats fans that with regards to Anthony Rendon and Stephen Strasburg, the Nats can “…only have one of those two guys. Again, not up to us – we can give them a great offer…”
Sorry, I was wrong. Mark Lerner is very skilled in the art of condescension as well.
Not to be outdone, the Cubs need to “clear money before engaging in negotiations”, because they’re due to pay a $6.34 million dollar luxury tax penalty.
(Author’s note: As I’m writing this it’s 8:33 am and just thinking about this is making me wonder if it’s too early for a drink.)
For some perspective, $6.34 million is to the Cubs is what $160 bucks is to the average American. Yes, I did the math. Imagine having an asset that has shown an upward growth in a straight line for five decades, and thinking $160 was too much to invest. “(Raises eyebrows, twists head, exhales) Gee, honey, I don’t know $160 is a lot and five decades of growth is too volatile for us to take that risk…”) Imagine how big of an ignoramus (or bullshitter) one would have to be to think and behave like that.
Let’s back up a little for a few reminders:
One: The value of MLB franchises increasing dramatically, consistently and exponentially directly coincided with the advent of free agency. Forget a posthumous, far too late induction into the Hall of Fame, all team owners should have a monument of Marvin Miller in their personal offices.
Two: If you own a business that annually increases in value, you are turning a profit even if your end of year tax returns show you broke even every year. For example, Bob Nutting bought the Pirates for $92 million and they are now worth $1.3 billion. So Bob Nutting is sitting on a check for over $1.2 billion as we speak – just because he hasn’t cashed it yet doesn’t mean he doesn’t have it. So he can say the Pirates break even or turn a modest profit, but that’s a smokescreen – they’ve added $52 million per year on average since Nutting was one of the purchasers 23 years ago before annual profits.
So let’s use the Pirates and Bob Nutting as an example. I’m hoping if we use them as an example, the absurdity of teams like the Nationals and Cubs crying about their budgets and what they can “afford” will seem even more ridiculous by comparison.
The Pirates have grown on average $52 million yearly for over two decades. They start every season with over $60 million from TV, merchandising, and MLBAM revenue. Plus, teams like the Pirates get luxury tax revenue from teams like the Cubs and Red Sox annually as well. That’s over $100 million in the checking account each season before a ticket is ever sold before a hot dog is ever purchased or before a crappy $11 dollar beer is ever chugged.
In other words, the Pittsburgh Pirates could have added the salaries of Mike Trout, Bryce Harper, and Manny Machado, have them play in an empty stadium and still turned a profit.
That’s the fucking Pittsburgh Pirates. Imagine what the Yankees and Dodgers can “afford”.
“But Jon, that’s assuming the rate of growth for the franchises continues to rise.” Again, the value of MLB franchises has never gone down. And the above example not only dismisses ticket revenue, but it also dismisses the extent to which having good players and winning adds to the value of the franchise.
Look, if your position is “Yes, I get the owners aren’t very interested in winning. Their primary obsession, even more than making money, is keeping the money they already have. Making sure that no one – players, fans, anyone – can get more of it than the bare minimum.” Then that’s a discussion we can have some time because this isn’t the place to get into moral or philosophical discussions.
But if your position is any version of “They have to run their business like the local hardware store or gym”, “but our ticket and beer prices will go up with player salaries”, “but if we sign player A we won’t be able to sign player B” or buy into the notion that the greedy players are the problem, I’m telling you that you are misinformed. And your misinformed opinion is feeding into the M.O. of the people creating the problem.
Stop being a shill. That’s Michael Kay’s job.
Thanks to Joe Sheehan and Rob Mains for this – a lot of what I’ve learned about this I’ve learned from reading their work. And thanks to MLB Trade Rumors for the quotes – even though I think some of their writers are nephews of MLB team owners the way they carry water for them.
Did I miss something? Let me know.
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