Baseball - revenue sharing, salary cap, contraction

Great Debates
21

Minty, you are making a strong case that the income disparity was always there. I wonder if I could trouble you one more time to go back to your source one more time to check the attendance figures for the Red Sox and Cardinals during the time that the Braves and Browns were doing so poorly. This would help clarify how much of the poor attendance was due to lack of success and how much due to the market.

Typically, when a league expands, one of the major factors they consider in granting franchises is the potential for success in the different locations. If one location has far greater potential than another it is likely that that location will get the new franchise. Any new location that you might relocate the Expos to is likely to have been considered on the list of locations for potential expansion. Since that location did not get the franchise while Florida et al did, it is not likely that that location has significantly better potential than Florida. And since Florida did not work out, it is quite possible that the new location will not work out either.

Of course, it is always possible that it will. Other factors besides potential revenue do enter into the consideration, and the franchise committee might have simply judged wrong. But getting a new franchise (or venture of any sort) going is always a risky undertaking. And at a time when baseball has failing franchises, it does not make sense to scrape the bottom of the barrel to try to come up with new ones.

22

This board has been dominated by postyers who side with the players, who insist that everything in baseball is hunky-dory, that any owner who claims financial hardship is either a union-busting liar or an incompetent who DESERVES to lose money.

Folks, wake up and join the 21st centiry. The “union busting” owners are ancient history. Charlie Finley is gone. Calvin Griffith is gone. Likewise Gus Busch, Gene Autry, Horace Stoneham, and Tom Yawkey. Today, most teams are owned by major corporations, and several are owned by media conglomerates. Do you REALLY imagine for a second that companies like Disney or Time-Warner (which think NOTHING of paying Tom Cruise or Harrison Ford $20 million for a single film) are miserly “union busters” that resent having to pay big bucks to athletes?

Get this: Disney is fed up with the baseball business and wants to unload the Angels. If DISNEY wants out, my hunch is, the future ain’t as bright as Don Fehr and the Pollyannas claim.

I should also point out that baseball ISN’T thriving on its own merits in a free market. On the contrary, baseball would be DEAD in numerous markets, except for massive handouts by moronic taxpayers. The Indians aren’t a success story because they’ve been well managed- they’re a success story because taxpayers built them a luxurious new stadium and gave it to them for a song.

Folks, there are LOTS of unsuccessful businesses that could stay solvent if the taxpayers were dumb enough to build their facilities for them, and to shower them with hundreds of millions of dollars!

Now, I don’t believe ANY city government EVER had any business building stadiums for privately owned ballclubs. I wish that Camden Yard and Jacobs Field didn’t exist, frankly, because they set horrible precedents. But NOW, I can’t blame any team that tries to blackmail its city by threats of folding or moving.

The Expos and Twins have to compete with teams receiving huge subsidies from taxpayers. Under the circumstances, Jeff Loria and Carl Pohlad would be very foolish not to demand the same kinds of subsidies their competitors get.

But maybe I’m wrong. MAYBE DOn Fehr is right, and threats of contraction are just union busting tactics. MAYBE the Expos and Twins are the most profitable enterprises in the history of sport (no doubt, Fehr’s paid flunky, Andrew Zimbalist, will release a “study” to that effect any day now)- if so, here’s a chance for the players to put their money where their mouths are.

If baseball is REALLY as profitable as the players insist, let the players collectively buy the Expos and Twins. Let the players show us how it’s (supposedly) done!

23

Just for the record, this is inaccurate. Only 48% of the Jacobs Field financing was through taxpayer revenue. The other 52% came from Dick Jacobs and from the sale of special bonds by Cuyahoga County. The park is still fully owned by the Gateway Economic Development Corp. and the Indians pay rent for the use of the facility.

24

[QUOTE]
*Originally posted by astorian *

I realize that seven years is a long time by Internet standards, but IRL, it ain’t that long ago.

But here’s the one I love:

Funny you should suggest this, because according to Boswell, they’ve got a pretty sensible solution to save at least one franchise:

As Boz goes on to say, that would be a lot cheaper than $250 mil.

25

The St. Louis Browns suffered from a combination of poor management and an unfortunate arrangement with the Cardinals over their stadium, Sportsman’s Park.
The Browns owned the stadium and the Cardinals were tenants. However when the Cardinals got to be good, there was pressure to expand the seating capacity of the stadium by the people of St. Louis. So the Browns did and they had to pay all of the capital costs and had little opportunity to recoup because the team sucked and nobody wanted to see their games. Meanwhile, the Cardinals paid the same amount of rent.

And while the Browns had to spend money to keep Sportsman’s Park in good condition, the Cardinals spent their money on building an extensive farm system.

But prior to 1920 or so, the Browns were THE team in St. Louis. But Rogers Hornsby and Branch Rickey changed that perception and sent the Browns off on a long downward spiral.

26

Isn’t it true that the Browns once drew only 80,000+ fans for an entire season?

When comparing the attendance of the Yankees and the Senators, you have to take into account their stadiums. In the 1950s, Yankee Stadium had a capacity of around 67,000, according to http://www.ballparks.com. But the Senators played in tiny Griffith Stadium, whose capacity was a mere 32,000. Even if the Senators had had a great team in the '50s, there’s no way they could have out-drawn the Yankees playing in Griffith. There’s also no way they could have earned enough revenue to afford great players from selling tickets and concessions (and radio). And without a great team, they never could have made enough to build a better ballpark as the Yankees did after getting Ruth. (They don’t call Yankee Stadium “The House That Ruth Built” for nothing.)

The Senators were screwed.

Here is why contraction won’t help MLB:

27

Up front, let’s be honest about our arguments. There seem to be two groups of people here.

  1. The players (and their supporters) say “Everything in baseball is just fine, and if some teams aren’t doing so well, let George Steinbrenner share his big revenues with them.”

  2. The owners (and their supporters) say, “There are too many teams that can’t afford to be competitive, and player salaries must be kept down (by a cap, or some other method). If that means a few superstars can’t make as much as they’d like, too bad.”

Bottom line is, BOTH sides are quite eager to give away somebody ELSE’s money! BOTH sides think it’s only fair and logical that the OTHER side should forego revenue for the sake of the game. Jason Giambi sees a chance to get rich, and he doesn’t want a salary cap. That’s understandable. If I were Giambi, I’d feel the same way.

George Steinbrenner is raking in big bucks, and doesn’t see any reason he should share it with the Expos. THAT’s understandable, too. If I were Steinbrenner, I wouldn’t want to share my money, either.

So, what’s the solution? How do we make Giambi AND Steinbrenner happy? Answer is, we can’t, and we won’t. There simply ISN’T a reasonable solution. There ISN’T a win-win scenario. ANY solution will cost SOMEBODY a ton of money, and that somebody will fight like hell against it.

IF there were still cities with taxpayers stupid enough to shower money on existing teams, there’d be a way out. But there aren’t any such cities at the moment. So, unless one side or the other is feeling extraordinarily generous (fat chance!), contraction is the only viable solution.

And, on the plus side, the NL East teams that had to host the Expos several times a year will now get to play against REAL teams instead, and that can only HELP at the box office.

28

Sorry, but the Abstract only has stats for the highest and lowest teams, not a team-by-team breakdown attendance. They might be available somewhere online, but I don’t have time to check right now.

BTW, this is sooooooo much better than yet another terrorism thread. Of course, it could be argued that the owners are engaging in a little terrorism themselves in this matter. :wink:

29

I can actually be useful in a thread! :slight_smile:

Total Baseball (3rd edition, at least) has attendance breakdowns per team. Looking at the 1930s (sorry about the table-- I tried to format it better!):

Year 1930 1931 1932 1933 1934 1935 1936 1937 1938 1939
Browns 152k 179k 112k 88k! 115k 81k! 93k 123k 130k 109k
Cards 508k 608k 279k 256k 325k 506k 448k 430k 291k 400k
Red Sox 444k 350k 182k 268k 610k 558k 627k 560k 646k 573k
Braves 464k 515k 507k 517k 303k 232k 340k 385k 341k 285k

I can type in more, if wanted. Looks like the Browns were just perrenially hopeless (though they did outdraw the Cards in 1944, for what that’s worth) and the Cards drew fans based on their success. I don’t know what happened in 1934 to swing 200k fans to become Red Sox fans instead of Braves fans, but whatever it was lasted until the Braves left town.

Just a bit of anecdotal evidence: I caught a few minutes of a videotape (I think it was “When it was still a game” or something like that) while on line at a store, and a former Browns player was saying how the Yankees would purchase the contracts of any good players they had, even if they only intended to keep them on the bench or as backups. The Browns were so revenue starved that they couldn’t refuse the offers, but couldn’t develop a core of good young players as a result. So, clearly the problem’s been around a long time and is probably not as bad now.

I think they ought to move the Expos to New Jersey and have done with it.

30

Well, let’s see: I’m just this guy, reading the papers. I live near Washington, DC, which hasn’t had a baseball team for thirty years, but could support one easily.

Baseball has some teams that are having trouble competing, due to being in poor markets. We’ve got a place for one. Seems win-win enough to me, and certainly so by comparison with contraction.

Now, back to this ‘telling other people how to spend their money’ stuff.

Who made contraction an issue? Not the players, not the fans. Just the owners. They’re the ones who say contraction’s necessary for “the good of the game”. But contraction’s a pretty drastic move, in a sport that has a major stake in historical continuity. By raising the issue in the first place, they’ve opened up the floor to others who are suggesting less severe remedies to their problems.

Sure, they involve other people’s money - but so what? If you tell me, “my business is in such trouble, that I’ve got to close a couple of plants,” and I give you a number of ways to avoid that, coming back with “you’re trying to tell me how to spend my money” is pretty bogus. I certainly am telling you how to spend your money - but you invited my opinion.

I responded directly to you in my previous post. You’ve chosen to ignore it. I believe I mentioned the D.C. area in that post. You’re wrong.

31

I disagree with this. The third group of people (e.g. me) feels that things are not fine, but this does not necessarily mean that player salaries have to be kept down. Baseball as a whole is doing OK, some teams are not. All that is required is some method of leveling the playing field.

Why are you so sure of this? Washington didn’t do too good of a job of it last time around, and now they have the Orioles to compete with.

32

Question: Major league baseball and twenty-eight owners will be buying out two clubs to the speculated price of $250M per. (One reason for this price, by the way, is that it’s high enough to preclude anyone from coming in and offering to buy the club. If MLB gave Pohlad $100M to fold his franchise, and someone came along and offered $150M to purchase and run the Twins, baseball’d look pretty silly saying no.) Given that…how are the owners benefiting financially from contraction? Even if television revenues will then be divided up between twenty-eight teams rather than thirty, this in no way makes up the financial ground lost by paying half a billion dollars to fold the two teams. Who is this benefiting, other than the Expos and Twins ownership?

I lean more and more towards the notion that contraction is a punitive threat (one the owners will carry through if needed) against communities who refuse to publicly fund new stadiums for their teams.

33

I think you have to find out the actual numbers (of both TV revenue and buyout) before asking this question.

One thing that does support this theory is the strange announcement of the closing of two “teams to be named later”. This may be to give the closings less of an aura of finality, and allow them to back out. We’ll see, I guess.

34

The television contract is $2.5 billion over six years. So where thirty teams would each make $13.8 million a year from TV revenue, twenty-eight teams would each make around $14.9 million a year from the contract, or $1.1 million more. Woo hoo.

(I just went to find a cite for that revenue contract, but my LAN’s acting up. Feel free to call me on those numbers if they’re incorrect.)

35

I actually have it as just under $1M. But you have to consider that the payments to the contracted franchises are a one shot payment, so they can’t be directly compared.

Also, I think the poorer teams are currently being subsidized by the wealthier teams, under the revenue sharing scheme currently in effect. This would eliminated (for those two teams) under contraction.

I don’t know. The number I have in my head is $200M (per team), but I could be wrong.

36

Gadarene, Chris Isidore of Money magazine agrees with you:

He says baseball would be better off moving teams to Las Vegas or Sacramento. (They’d need a dome to play in hot, hot Vegas, though.)

And get a load of this:

They’re planning to pay that money to owners to make them LEAVE instead of getting them to move??

As far as Montreal is concerned, IMHO, they have lost baseball. >8,000 per game is just not enough. There are minor league teams who draw better. They may as well move the Expos to Vegas or Portland, Oregon (another city suggested for expansion or movement).

37

I doubt Portland could handle an MLB franchise. The only major league sport is has is the NBA, and I doubt a mediocre MLB team, which is what Portland would get, would be able to outdraw the typical Blazers game (which are all sellouts).

38

:confused: Um, I may be missing something here, but why would a Portland franchise need to outdraw the Blazers? The MLB and NBA schedules hardly overlap at all. I’d think that the support Portland has shown for the Blazers–and I’m an Oregonian who thinks the prospects for Portland baseball are just so-so–be an argument in favor of baseball expansion there?

IzzyR: I guess I repeat my previous question: who benefits–financially or otherwise–from contraction? And Izzy, I’m not sure why you’re so fatalistic about the prospect of baseball in other markets. Your argument seems to be that since they didn’t grant any other cities teams in previous rounds of expansion, that means that there are no viable candidates for relocation (especially given that the Florida baseball teams have done poorly). First, each expansion is a discrete number of teams–they weren’t just going to grant new franchises to any city that looked good. When the Rockies and Marlins–and then the Diamondbacks and Devil Rays–were added, MLB had set out to add two teams and no more. Who’s to say that Charlotte or Las Vegas or Memphis or New Orleans or Northern Virginia weren’t extremely attractive candidates in their own right? I don’t think that you can logically point to the “failure” of the Florida franchises as proof that other locations not chosen would do poorly also. Don’t forget that the Marlins won a World Series after just five years (and now, even after Huizenga’s fire sale, have a fantastic farm system that might make them next year’s favorites in the NL East). Also, while Tampa Bay is truly an execrable franchise (due in no small part to awful front office management), for all we know the state of Florida is particularly ill-suited for major league baseball of the non-Grapefruit League variety. Look at how Colorado and Arizona, the other recent expansions, have fared. Pretty darn well, I’d say. I just don’t think you can authoritatively state that there are no good markets left for major league baseball.

Last time around? What was that, 1974? From what I’ve heard, the Angelos factor is the only thing preventing the Northern Virginia market from housing a thriving major league franchise. Plenty of potential fan support and no shortage of people wanting to own the team. I think RTFirefly can back me up on this one.

39

The second Washington Senators team became the Texas Rangers in 1972. In fact, RFK was built for them (and the Redskins), but they played in it for only ten seasons. (The original Senators became the Minnesota Twins in 1961. The original Senators began playing in 1901.)

40

This is a good article detailing the financial success (!) of the Twins in recent years.