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View Full Version : What if the Sox had a $70 mill payroll?


gosox41
11-25-2003, 07:44 AM
This is purely hypothetical, of course considering the owner. But let's say JR did raise the payroll to $70 mill. Currently the Sox have $58 mil tied up in the team after JG signed. Let's say the Sox bring back Buehrle at $3.5 and then sign Millwood for $10 mill per. That would make the payroll above $70 mill.

Now let's also assume the Sox don't make any other moves this offseason. I just have some general questions that I'm curoious to hear the answer to. I'm really curious about what is said so please be honest. If I had the time I'd keep track of who said what so I can call them on it later when there is complaining about something else.

1. Would you be thrilled that JR opened up his wallet? Would you attend more games because of it?

2. Do you think this team would go to the playoffs in 2004 if they essentially kept the roster as it is right this second and brought in Millwood?

3. If the team did get off to a bad start, or fell flat on their face, would you be less likely or more likely to attend games later in the year.

4. Regardless of payroll, if the team started off 20-10 or 10-20 would this effect the number of games you attend?

5. Do you think increasing the payroll automatically makes the team better?

I'll answer my own q's. I am a season ticket holder and I would be thrilled if JR spent more money. But it obviously doesn't affect the number ofgames because I paid for 81 and I'm not paying all that money to sit at home or at least not give the tickets away.

I do not think the team the way it is right now stands a chance of making the playoffs, even if Millwood signs here (doubtful at best.) If the team did fall out of playoff contention I would expect attendence to drop. All those 30K crowds after the All Star game when the Sox had a $53 mil. payroll will go out the window if the $70 mil. payroll team is bad.

Lastly, for those who have been reading my posts for the time I've been here, I do not think spending more money means the team is going to win.

If the above hypothetical scenario did occur, it is very possible the 2004 Sox would be a lot worse then the 2003 Sox.

Bob

cornball
11-25-2003, 07:59 AM
Personally, I don't care if they spend 25 million....just win.

Unfortuately, your odds increase when you spend money because you would most likely have better/proven players.

This team need a fast start to create excitement in the fan base and to have a chance down the stretch in which JR may spend. He will not put the upfront money to win.

ondafarm
11-25-2003, 08:39 AM
I think the boneheaded manager of the 2003 White Sox couldn't have managed the 27 Yanks into the playoffs. The current White Sox roster has plenty of talent and a decent manager should be able to win the division. Given a few decent signings and a deal or two and the White Sox could contend for the pennant.

CubKilla
11-25-2003, 11:17 AM
Originally posted by gosox41
This is purely hypothetical, of course considering the owner. But let's say JR did raise the payroll to $70 mill. Currently the Sox have $58 mil tied up in the team after JG signed. Let's say the Sox bring back Buehrle at $3.5 and then sign Millwood for $10 mill per. That would make the payroll above $70 mill.

Why sign an overpriced Millwood for $10 million when you could probably sign an overpriced Ponson for $6-$7 million? That would leave you $2.5-$3.5 million to sign a Hawkins-type BP arm or a stop-gap 2B.

To answer your questions, I am a walk-up fan. Because of working a rotating shift, season tix are usually out of my realm of practicality. Having said that, I still attended 11 games last season..... after putting myself on a Sox-better-make-a- commitment-to-win hiatus after the debacle I witnessed on 5/24 and 05/25. Having said that.....

1. Yes.
2. Yes..... but only if a Millwood or a Ponson is acquired. As is right now? No.
3. As likely as usual until, like '03, the Organization refuses to make changes if the team is struggling come the end of May.
4. No.
5. Not necessarily. But on paper and in the eyes of most fans? Yes. It shows a commitment to win..... in most cases.

Lip Man 1
11-25-2003, 12:00 PM
What if the Sox had a 70 million dollar payroll?

Better question to ask would be, 'when are pigs going to start flying?'

It's much easier for Uncle Jerry to keep the payroll below the median MLB average, get his nice stadium deals, blame the fans for problems he created and laugh all the way to the bank.

The man is an absolute business genius.

(and for gosox 41, Trader Tim etc. yes Uncle jerry makes a profit. It may 'only' be a million dollars but that's still money in the bank. he laughs...Sox fans, the city of Chicago and the State Of Illinois get screwed)

Lip

gosox41
11-25-2003, 05:56 PM
Originally posted by Lip Man 1
What if the Sox had a 70 million dollar payroll?

Better question to ask would be, 'when are pigs going to start flying?'

It's much easier for Uncle Jerry to keep the payroll below the median MLB average, get his nice stadium deals, blame the fans for problems he created and laugh all the way to the bank.

The man is an absolute business genius.

(and for gosox 41, Trader Tim etc. yes Uncle jerry makes a profit. It may 'only' be a million dollars but that's still money in the bank. he laughs...Sox fans, the city of Chicago and the State Of Illinois get screwed)

Lip

Lip,
Again, do you have proof of Jerry making a profit? I think it's wrong to jump to conculsions. Also, even if makes only a "million" profit, that is divided by 60 owners. JR is not a majority share holder of this team. And for a guy worth a few hundred million, a couple of hundred thousand or so on the profit the team allegedly turns is chump change.

Bob

Daver
11-25-2003, 06:30 PM
Originally posted by gosox41
Lip,
Again, do you have proof of Jerry making a profit? I think it's wrong to jump to conculsions. Also, even if makes only a "million" profit, that is divided by 60 owners. JR is not a majority share holder of this team. And for a guy worth a few hundred million, a couple of hundred thousand or so on the profit the team allegedly turns is chump change.

Bob

Bob,he could spend 150 mil on payroll next season and still turn a profit,because the franchise is worth ten and a half times what his partnership group paid for it 23 years ago.

gosox41
11-25-2003, 07:25 PM
Originally posted by Daver
Bob,he could spend 150 mil on payroll next season and still turn a profit,because the franchise is worth ten and a half times what his partnership group paid for it 23 years ago.

Daver,
Only if he sells. Have there been anyone recently coming in with legit offers lately that value the team at 10.5 times what JR paid (or even close to that)? On paper he may turn a profit, but of course for that we'd have to go back over the last 23 years of his ownership to see what his total losses/profit are and then compare it to his selling price.

Also, if he does increase the payroll to $150 mill. for 2004 then that is money JR has to pay out next season. Where is he going to get that kind of cash flow to pay out such a high payroll. I'm sure you realize the team doesn't do anywhere near that kind of cash flow. They may get half of that, maybe a little more. I doubt the players and their agents will feel justified if the owner can't pay them but shows them on paper how much the team may be worth.

Until someone comes up with an offer for the White Sox and pays them it can't be counted on as turning a profit.

Bob

Lip Man 1
11-25-2003, 07:30 PM
Bob:

Let's turn the question around shall we? What "proof" do you have that Uncle Jerry isn't making a big profit?

Outside of the "word" of some of your friends (whom I don't know and have no reason to believe if they are actually connected with the Sox, that they are going to disclose any substative financial information to you) can you offer any "proof?"

All I know is what I see, a sweetheart lease, a payroll below the mediam MLB average for 2003 and almost two millions fans in attendence in 2003.

Lip

cornball
11-25-2003, 07:58 PM
Originally posted by Lip Man 1
Bob:

Let's turn the question around shall we? What "proof" do you have that Uncle Jerry isn't making a big profit?

Outside of the "word" of some of your friends (whom I don't know and have no reason to believe if they are actually connected with the Sox, that they are going to disclose any substative financial information to you) can you offer any "proof?"

All I know is what I see, a sweetheart lease, a payroll below the mediam MLB average for 2003 and almost two millions fans in attendence in 2003.

Lip

I concur totally and Daver also makes the valid point. Based on past and future profits.

This business if your serious about winning will cost money. A 60 million dollar payroll, although too much for 25 men collectively is not enough...if you want to contend.

dickallen15
11-25-2003, 08:25 PM
If the White Sox had a $70 million payroll, tickets would be double what they are now, just like in New York, Boston, the Cubs. Fans would be complaining about that. And if the White Sox had a $70 million payroll people here would be calling Reinsdorf cheap, wondering why it wasn't $100 million

joecrede
11-25-2003, 08:28 PM
Originally posted by Lip Man 1
Bob:

Let's turn the question around shall we? What "proof" do you have that Uncle Jerry isn't making a big profit?

Lip, what do you consider a big profit to be?

chisox06
11-25-2003, 08:40 PM
The crazy thing is that even with a payroll at 70 Mil, that wouldnt put the sox even in the top 10 (around 11-12) in payroll. Considering this is the 3rd largest market in the US 70 mil would be adequate at best. The 50-55 Mil JR is looking at right now is ridiculous and is nothing but an insult to the fan base. Again, its hard to believe that the owner of this team is its worst enemy, not a good combination for puttin a winner on the field.

Daver
11-25-2003, 08:51 PM
Originally posted by dickallen15
If the White Sox had a $70 million payroll, tickets would be double what they are now, just like in New York, Boston, the Cubs. Fans would be complaining about that. And if the White Sox had a $70 million payroll people here would be calling Reinsdorf cheap, wondering why it wasn't $100 million

When you can show where players salary have a direct correlation to the price of a ticket I may consider your argument,till then this post means nothing.

RedPinStripes
11-25-2003, 08:59 PM
Originally posted by gosox41
Daver,
Only if he sells. Have there been anyone recently coming in with legit offers lately that value the team at 10.5 times what JR paid (or even close to that)? On paper he may turn a profit, but of course for that we'd have to go back over the last 23 years of his ownership to see what his total losses/profit are and then compare it to his selling price.

Also, if he does increase the payroll to $150 mill. for 2004 then that is money JR has to pay out next season. Where is he going to get that kind of cash flow to pay out such a high payroll. I'm sure you realize the team doesn't do anywhere near that kind of cash flow. They may get half of that, maybe a little more. I doubt the players and their agents will feel justified if the owner can't pay them but shows them on paper how much the team may be worth.

Until someone comes up with an offer for the White Sox and pays them it can't be counted on as turning a profit.

Bob

Why do youthink he hasnt sold? Do you actually think Jerry would own this team for 23 years if his bank account just shrunk through the years? You're listening to Jerry too much when he cries broke and blames the fans for it. Belive me, Jerry and half the people who work for the Sox that speak to the public are bull****ters.

gosox41
11-26-2003, 07:37 AM
Originally posted by Lip Man 1
Bob:

Let's turn the question around shall we? What "proof" do you have that Uncle Jerry isn't making a big profit?

Outside of the "word" of some of your friends (whom I don't know and have no reason to believe if they are actually connected with the Sox, that they are going to disclose any substative financial information to you) can you offer any "proof?"

All I know is what I see, a sweetheart lease, a payroll below the mediam MLB average for 2003 and almost two millions fans in attendence in 2003.

Lip

I have no proof about acutal numbers. If I did you'd probably be the first to come out and say they were doctored anyway. What I do have is someone I know well who has seen the #'s and broke some of them down for me.

It's a lot more then what you have. Just rumor. And rumor that is obviously very ignroant of business knowledge. Does JR own SportsService? A month ago some thought he did.

What you see in a sweetheart lease doesn't necessarily mean a profit is being made. Maybe it means JR is able to extend his payroll that much higher because of the lease. You don't know, but being a member of the media you seem happy to take what little facts you know and form a strong opinion. There's another media member who does that who writes for the Sun Times.

You can believe what you want, as you will anyways. But you seem to waste so much time and effort complaining yet you continually support this team financially. It makes no sense. Tradition and memories are nice. But this is the real world. We have a phrase at work when it comes to the current business climate: "Adapt or die" I've seen companies not make changes for whatever reason only to continue a vicious cycle of losing $$ and ultimately going under. What you're doing by complaining about the team in words, but in actions continuing to support this team is the same thing. You may not go under financially, but you seem to be expending a lot of effort into something you believe (this team is cheap, JR is a liar) but when puch comes to shove you're more then happy to line JR's pockets.

Bob

Bob

gosox41
11-26-2003, 07:42 AM
Originally posted by Daver
When you can show where players salary have a direct correlation to the price of a ticket I may consider your argument,till then this post means nothing.

Just to jump in, I don't know about the correlation between the two, and don't really care. I do know that revenue received from the sales of tickets goes to pay for the teams expenses (ie payroll.) There may not be a direct correlation, but there is a definite indirect correlation.

Bob

gosox41
11-26-2003, 07:43 AM
Originally posted by RedPinStripes
Why do youthink he hasnt sold? Do you actually think Jerry would own this team for 23 years if his bank account just shrunk through the years? You're listening to Jerry too much when he cries broke and blames the fans for it. Belive me, Jerry and half the people who work for the Sox that speak to the public are bull****ters.

Listening is a skill. I never said he was going broke. I know for a fact that this team has had some profitable years. But to think they make money every year is wrong.

Bob

hold2dibber
11-26-2003, 08:07 AM
Originally posted by gosox41
This is purely hypothetical, of course considering the owner. But let's say JR did raise the payroll to $70 mill. Currently the Sox have $58 mil tied up in the team after JG signed. Let's say the Sox bring back Buehrle at $3.5 and then sign Millwood for $10 mill per. That would make the payroll above $70 mill.

Now let's also assume the Sox don't make any other moves this offseason. I just have some general questions that I'm curoious to hear the answer to. I'm really curious about what is said so please be honest. If I had the time I'd keep track of who said what so I can call them on it later when there is complaining about something else.

1. Would you be thrilled that JR opened up his wallet? Would you attend more games because of it?

2. Do you think this team would go to the playoffs in 2004 if they essentially kept the roster as it is right this second and brought in Millwood?

3. If the team did get off to a bad start, or fell flat on their face, would you be less likely or more likely to attend games later in the year.

4. Regardless of payroll, if the team started off 20-10 or 10-20 would this effect the number of games you attend?

5. Do you think increasing the payroll automatically makes the team better?

I hear what you're saying, and I'm sure JR is thinking the same thing. Why raise the payroll to $70 mm from $56 mm when spending the extra money doesn't guarantee a winner or improved attendance. My answer is two fold:

(1) if the payroll stays at $56 mm, the Sox are going to have to trade Magglio and they still won't be able to add any significant pieces. So they'll be significantly worse (having lost Colon, Maggs, Everett, R. Alomar, Gordon and probably Graffino) than last year's team. The team would be unlikely (IMHO) to win half of its games and they'll draw MUCH less than they did last year. And they'll lose money.

(2) A $70 million payroll, on the other hand, would give the Sox a chance to be a contender this year. It's not guaranteed - but at $70 million, KW could put together a much better team. At $70 million, if he can move approximately $10 million in salary (not an easy task, I admit), he'd be able to add a front line starting pitcher, a CF or 2B and a bullpen arm. Those are big holes on the team right now, and filling them, in these weak division, would at least give them a chance. If it doesn't work, KW can conduct a big summer sell off and cut the team's losses.

In my opinion, to not increase the payroll beyond the high $50mm's is pretty much a guarantee for a lousy season (and financial losses for ownership), but an increase to $70 mm-ish would give the team at least a chance to win and make some money for ownership.

PaleHoseGeorge
11-26-2003, 08:31 AM
Originally posted by gosox41
Listening is a skill. I never said he was going broke. I know for a fact that this team has had some profitable years. But to think they make money every year is wrong.

The value of the franchise is the surest way of measuring how much money the ballclub is capable of generating. As has been noted here often, JR's investment is worth roughly ten-times what he paid for it.

He and his investment partners don't want to show a book profit or the IRS will come and wet its beak. To the contrary, showing a loss is probably what JR & Co. want the most.

This isn't too complicated, folks. Anyone who has planned an estate understands the basic principles. JR & Co. have already made their fortune and they simply need a place to keep their money, preserve and grow the principal, and avoid as much taxation on the income as possible. Owning an incorporated baseball team meets all of these criteria very neatly.

1.) You can assign the book value of your purchase price (and thus realize tax savings) to the personal services contracts of your top-paid employees (i.e. the players). Furthermore you can depreciate the value of these contracts and realize tax savings. Go ahead and try to sneak this accounting trick past the IRS owning Microsoft. You'll end up in jail.

2.) Paying the players' contracts cost real money, but that's okay because they are the primary reason your investment shows no profit. You've got more than enough $ to pay them (your personal worth has increased several fold thanks to the appreciation of your initial investment) and you make up the rest by the mountains of cash that baseball's 81 home games generate every year. In fact the positive cash flow baseball generates dwarfs every other sport, including football's.

3.) Your books show you losing money (or making very little) and thus all the cash you made from drawing 1.5 million fans who drank rivers of beer and ate mountains of concessions (none of which you paid even a fraction of what they are worth to the suppliers) and you've effectively cut the IRS out of your investment. That's a far better deal than you could get for yourself depositing your money at the bank -- or even by owning the bank, for that matter.

You get the taxpayers to pay the freight on your single-biggest capital cost, your stadium. You get a sweetheart lease that let's you keep virtually all the cash your operation takes in. You get one of the fattest TV/radio deals in the country because you're not dumb enough to buy a team that isn't located in one of the 3 biggest media markets in the country.

Then you sit back, cry poor, and let your apologists blame the fans for the ongoing mediocrity of the operation's one supposed goal: winning a championship. Sure, you'll win a championship, but not unless it is won on *your* terms and that means being prudent with your investment (i.e. watching it grow).

Here's my prediction: Jerry Reinsdorf will sell the Sox when either he is too tired or infeebled to do it any longer, or the value of his franchise suddenly begins to decline. I'm betting it is the former, because the latter is a long, long way from happening.

Lip Man 1
11-26-2003, 11:09 AM
Gosox:

Then can you please explain as much as you remember what your friends have told you.

You state that they have broken down some numbers for you. Then please explain them to us so that we may better understand them. Especially those others like PHG who do have a business understanding and can help explain them.

Unless your friends told you this information in confidence then you should not have any trouble revealing this. A column would be the perfect way to get this information that you are privy to out to Sox fans on this site. Then perhaps PHG or Trader Tim or someone can write a follow up column explaining this information or even contradicting it from a business perspective.

With respect I think this is an excellent idea and would like you to consider this. You obviously are intelligent and write well so I don't think you'll have much difficulty doing it.

If you don't, or won't, then what it comes down to is that you are still asking me to trust your friends and Uncle Jerry and I'm sorry, I can't do that. Uncle Jerry lost my trust many years ago.

And I do have a question for you about your multiple statings of "supporting" Uncle Jerry by attending games theme. I live in Idaho. I personally haven't been able to get back to Chicago for years so I am not giving money to Uncle Jerry by attending his games, but in the past when fans on this same web site have advocated boycotting the Sox, and just watch or listen to them through the media, they have been ripped as being bad fans.

So what's the answer Gosox?

Lip

PaleHoseGeorge
11-26-2003, 11:17 AM
Can we please tone this down? Nobody is compelled to write anything on behalf of anyone around here. You either substantiate your facts or stand down. Fair?

If you want to do more, we have avenues to permit such things around here. They are completely voluntary, as they should be.

Lip Man 1
11-26-2003, 11:26 AM
PHG:

I was respectfully asking GoSox to provide some evidence of his statement. He said he was told certain things. If they are not in confidence I'd like to know them to help eliviate my ignorance.

Without evidence he is asking me to trust him and his sources when he makes his statements.

That's not exactly fair is it?

Lip

miker
11-26-2003, 11:31 AM
George is right...the boards this morning have been running hot. As much we have the right to state our opinion, I'm not so sure that turning on each other is the way to get anything accomplished, considering the franchise's 40-plus years of futility and the current ownership's track record.

Is the Lee for Choi deal the reason everyone is so steamed?

PaleHoseGeorge
11-26-2003, 11:32 AM
Originally posted by Lip Man 1
PHG:

I was respectfully asking GoSox to provide some evidence of his statement. He said he was told certain things. If they are not in confidence I'd like to know them to help eliviate my ignorance.

Without evidence he is asking me to trust him and his sources when he makes his statements.

That's not exactly fair is it?

Lip

Suggesting somebody write a column is not asking them to provide evidence. You can do one without the other. Nobody is ever required to write anything, least of all a column.

Everyone here ought to be intelligent enough to treat unsubstantiated opinions for what they are. Nothing more needs to be noted. That is what is "fair."

Iwritecode
11-26-2003, 12:09 PM
Originally posted by miker
Is the Lee for Choi deal the reason everyone is so steamed?

It's just depressing to see the team that is in DIRECT competition for fans, money, merchandise, etc. make moves that will surely help them reach the post-season (again) while on our side of the fence we keep reading about how the Sox don't have the money to add any significant players or even keep the good ones they have now. Then read about how it's OUR fault because we don't show up to watch the crap they put on the field. Even when we do show up (wasn't the attendance over 2 million last year?) we still get the same song and dance. It's getting old. 86 years and counting...

:selljerry

Lip Man 1
11-26-2003, 12:49 PM
Sox attendence in 2003 was 1,900,000 and change. Less then 300,000 below the median MLB attendence for last season.

For comparison sake the median MLB payroll in 2003 was 70 million. The Sox spent about 54 million (give or take)

Is the fact that the Sox were off 300,000 from the average attendance equal to the fact that the Sox are around 15-16 million less then the average in team payroll?

The difference doesn't seem to equal out does it?

Lip