03 September 2002

Sorry for the long layoff. I was away for the weekend, and have not had a chance to write anything since Thursday, I think.

I'm glad that a strike was averted, for the same reasons that most anybody would be: I like watching live, professional baseball, and it would be ridiculous for a bunch of guys making an average of $2.5 million to go on strike. INcidentally, I love it when they try to defend themselves, saying that $2.5 million is just the "mean" and that the median is around $1.9 million, and that "there are lots of huys in the majors making only around $600,000/year" Do they know how ridiculous that sounds? Do they really expect people to feel any sympathy for people making 15 times what we do? Asinine.

However, I do not for one minute think that this new Collective Bargaining Agreement (CBA) is The Answer. As I understand it, they came up with both a revenue sharing plan, about which you have probably already read, and a "competetive balance tax". These two things are supposed to help the smaller market clubs compete, and are supposed to help keep the players' salaries from getting out of hand. Also asinine. If they actually had a useful and decent revenue sharing plan, the tax would not be necessary. But I'll come back to that later.

The thresholds on the tax are pretty high, encompassing only a few teams, and they're going to rise over the next few years, possibly to include even fewer. Plus, the amount of the taxes are pretty low, so that there is still little to restrain George Steinbrenner from signing that Big Name Free Agent if he wants to. If King George has a payroll of $160 million next year, he'd have to pay a little over $7.5 million in Luxury/Competetitive Balance/Bud's Yacht Tax. Does anyone think that's really going to stop him? He's already agreed to pay Roger Clemens $10 million next year not to pitch for him, is an extra $10 or $20 million really going to make much difference? Similarly, the revenue sharing plan requires clubs to give up 34% of their revenue, which essentially gets divided between the teams equally, minus a commisioner's discretionary fund of $10 mil, and even this namby-pamby scheme will not be fully implemented for three years. This means that the teams will still be able to keep 66% of their local revenue, and that the Yankees will still have a $100 million advantage in revenue over the Montreal Expos, if you use Forbes revenue numbers, which are undoubtedly closer to the truth than the owners' reported numbers. Doesn't sound very competetive to me.

There are some much more creative, interesting, and useful ways of doing this "competetive balance" thing, if you subscribe to the notion that all the teams have to be on some kind of comparative financial footing in order to have any chance of winning the World Series. I for one, do not, and I think that Oakland GM Billy Beane and any fan of the Minnesota Twins would tend to disagree with that notion as well. However, for now, if we want to at least try to help out teams who are at a financial disadvantage, we can do so in much better ways than those the players' union and owners actually explored and upon which they eventually agreed. For instance, Derek Zumsteg, over at Baseball Prospectus, has written about a plan for revenue sharing that rewards teams who have found ways to make money in smaller markets (like Oakland, and penalizes those who should actually be making more (like my Yankees) given the size of their markets and the relative dearth of teams in them. It is based on census information on market size and Forbes reporting on revenue dollars for each team, both of which are available to anyone who wants to read them, directly from his article. He assumes that there is some threshold at which a team in a city of a particualr size (~4,000,000 people) should make a particular amount of money (~$92,000,000). Teams like the Phillies and Cubs, who are in huge cities but don't draw any fans because they usually suck hairy monkey ass, would be penalized. Similarly, teams in large markets that actually do well, like the Yankees, Red Sox and Dodgers, but are in such a huge market that they enjoy a big advantage on several teams in smaller markets, also get penalized. Teams like Minnesota, Oakland, and (unfortunately) the Brewers, would be rewarded for doing so well with so little. It's a pricey plan for teams like the Yankees, but it's just as pricey for the Mets, who don't do nearly as well. I'll show you:

Team__Forbes Revenue___ Shared Revenue
SEA __ $166,000,000 ____ $170,237,520.00
CLE __ $150,000,000 ____ $167,005,832.00
ATL ___$160,000,000 ____ $160,000,000.00
COL __ $129,000,000 ____ $157,338,116.00
MIL ___$108,000,000 _____$154,041,423.00
STL ___$123,000,000 ____ $147,862,333.00
SFG __ $142,000,000 ____ $146,903,082.50
NYY __ $215,000,000 ____ $144,869,268.25
ARZ __ $127,000,000 ____ $141,634,992.00
PIT ___ $108,000,000 ____ $138,329,272.00
BOS __ $152,000,000 ____ $132,826,912.50
KAN __ $85,000,000 _____ $128,564,323.00
CHC __ $131,000,000 ____ $125,905,965.75
CIN ___ $87,000,000 _____ $125,847,115.00
TAM ___$92,000,000 _____$123,552,113.00
TEX ___ $134,000,000 ____$123,540,485.50
HOU __ $125,000,000 ____ $119,321,978.50
SDP __ $92,000,000 _____ $111,070,588.00
NYM __$169,000,000 ____ $98,869,268.25
DET __ $114,000,000 ____ $97,102,912.00
LAD __ $143,000,000 ____ $96,789,624.75
CHW _ $101,000,000 ____ $95,905,965.75
OAK__ $90,000,000______ $94,903,082.50
BAL __ $133,000,000 ____ $94,370,994.00
MIN __ $75,000,000 _____ $92,891,493.00
FLA __ $81,000,000 _____ $81,000,000.00
TOR __ $91,000,000 _____$80,863,900.00
PHI ___ $94,000,000 ____ $71,011,109.00
MON __ $63,000,000 ____ $70,440,270.00
ANA __ $103,000,000 ____$56,789,624.75

It has a nice, smooth curve, with a disparity based not just on market size, but upon how well the teams use their market to their advantage. There is no incentive here to hide profits, as it is based on revenues. There is no incentive to field a AAAA team to keep payroll low, because the sharing is not based on payroll. There is only incentive to maximize revenue, so that you'll have as much left as possible after sharing. And there's no need for a salary tax, other than to artificially keep players from making whatever the market would bear, as teams will mostly be on much more level ground. Kansas City will be able to resign Carlos Beltran, Cleveland will be able to resign Jim Thome, and Milwaukee will be able to resign...umm...well, if they ever get anybody worth holding on to, they'll be able to resign him. Montreal will need to move, as we know, and Florida and Toronto will need to seriously consider the possibility too. Philadelphia and especially Anaheim will need to start fielding competetive teams by making smart decisions. I live near Philadelphia, and believe me, the people there would like nothing more than to have a good team to watch at the Vet, that isn't wearing green helmets. With some decent business decisions, there's no reason the Phils can't be up there where the Braves are, in the revenue plan AND in the standings.

The problems with this plan are that it is a little too extreme, and a little too creative for the narrow minded Lords of Baseball, and that it is based upon numbers to which the owners will not admit. This is the biggest stumbling block.

There are, of course, other plans. Ones not nearly as complicated, but again, ones that would require a little more creativity, open-mindedness, and foresight than the owners and players have ever exhibited.

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