Pity the Poor Cash Cows
Warning: rant below.
Last week, Florida Marlins’ president David Samson was found whining his head off about how the Ichiro contract (a five year extension valued at $100 million) spelled the ruination of baseball. Pardon my french, but how many times do we have to hear this sort of crap? Every big new contract sends a shiver through the spines of weak-kneed owners and their media shills everywhere. Major league baseball managed to pull in more than $5 billion in revenue last season and, according to its commissioner, has never been in better shape financially than it is now. Ichiro’s team, the Mariners, themselves reported a net profit of $23 million last season. And, Ichiro has been the face of the franchise since he arrived in 2001, having adopted the team’s star-power mantle from Randy Johnson, Ken Griffey, Jr. and Arod, all of whom had departed Seattle in the previous three seasons.
Of course, whining about baseball’s finances is old hat by now. Despite his current optimism about the sport, Bud Selig has not always been prone to highlighting baseball’s financial well-being. In fact, Selig engaged for years in a novel anti-marketing campaign against his own sport, misrepresenting the game’s finances as dire in the years before the 2002 collective bargaining agreement and insisting repeatedly that multiple franchises faced imminent bankruptcy. How many folks remember that the Minnesota Twins were slated for extinction following the 2001 season, presumably due to their inability to be competitive in the grossly unfair and hopelessly broken economic system that was major baseball prior to 2002? Of course, the Twins’ owner, Carl Pohlad, was a billionaire, and one of the wealthiest owners in baseball. And, the Twins were so uncompetitive in subsequent years that they only won four out of the next five division titles, through last season, a run that began prior to the 2002 CBA that supposedly “saved” baseball.
Notably, prior to 2002, Selig repeatedly decried the payroll disparities between large and small market teams as the potential ruination of baseball. Of course, those disparities have become much larger since 2002, thanks in no small part to the agreement itself, and now Selig thinks the sport’s never been healthier.
So, when sports executives talk about their game’s finances, make sure you’ve got your bullshitometer handy. The media, of course, have done a godwaful job on the whole in bringing any proportion or perspective to the issue of finances in big-time athletics. This is why, from the moment sports fans are old enough to walk, they undoubtedly know that Arod is in the midst of 252 million dollar contract. But, how many people know, for example, that Angels’ owner Arte Moreno, has seen the value of his purchase appreciate by a quarter of a billion dollars just since 2003? Or, that Jerry Jones’ new football stadium monstrosity, to be completed by 2009 at a price tag in excess of $1 billion, will receive a subsidy of perhaps $325 million from the City of Arlington, described in SI by Richard Hoffer in the following, incredible, terms:
“The city of Arlington’s share was capped at $325 million, meaning that Jones pays for every add-on doodad — such as two 60-yard-wide flat screens hanging over the field — out of his pocket, 100%.”
Can you imagine a player receiving a $325 million dollar contract and a sports writer managing to ignore that handout almost entirely in order to focus on the players’ own largesse? (and, to repeat for the 100th time, there are few issues about which there is greater consensus among economists than that stadiums do not, by and large, produce a net benefit to the municipality in which they’re built).
There’s more: one “significant” story the past week has been that some of the larger revenue NHL teams are signing free agents to front-loaded contracts. According to Carolina Hurricanes’ play-by-play announcer John Forslund, and SI, these are “dangerous” for smaller revenue teams. I have written before about how Gary Bettmann, taking a page from Selig, essentially lied his ass off before and during the 2004-05 lockout about his sport’s finances. With a salary cap now in place, ensuring the owners’ beloved “cost certainty” – more or less a euphemism for “guaranteed profit” – forgive me for having little sympathy for NHL franchises that can’t make money even under the extraordinarily favorable labor agreement that the owners won two years ago.
“Dangerous” is supposed to mean that the sport is imperiled, that the cherished goal of “competitive balance” supposedly the animating concern of sports owners, commissioners and executives everywhere is their single focus is under threat. Well, it’s hogwash.
I don’t expect fans or the media to have sympathy for wealthy athletes. But, my God, do we really have to keep hearing about the woes of sports owners – who pocket tax-breaks and subsidies like it’s Christmas year-round – doing heroic battle with the constant specter of fiscal insolvency, when their investments continue to make them a mint, and taxpayers continue to line their coffers with sums of money that not even sports’ richest athletes can dream of? Would it be too much to ask to drop the ratio of mentions in the Arod-versus-Arlington-subsidy battle from its present one million to one to, I don’t know, ten to one?