PaleHoseGeorge
01-22-2002, 09:21 AM
Maybe this point is so obvious to everyone, nobody thinks to bring it up. Action speaks louder than words, so hear me out about what the owners do, rather than say, that betray the true motives behind what MLB is doing these days.
The issue for Bud and his fellow owners has nothing to do with competitive balance (they've ignored it since the 1920's when the Yankee dynasty first began). The issue isn't skyrocketing salaries (they are the ones freely offering the guaranteed contracts to the players). The issue isn't equitable sharing of revenue (they've never done it in the history of the game). Finally, the issue isn't the need to contract weak franchises in poor markets (the furor they've stirred in Minnesota and on Capitol Hill proves that point).
The REAL issue for owners is keeping them, the current set of owners, in business. For at least thirty years now (perhaps sixty if you believe Bill Veeck), the primary way for owners to make money is buying and selling their team. There are huge tax benefits for rich people (or people savvy enough to know how to get rich) that owning and selling a team provides. Veeck explained all of this in his book, Veeck as in Wreck , back in the early-60's. If you don't understand what I'm talking about, get a copy of the book at the library and read it.
After years of operating this way, the owners now want more. This is the meaning behind Reinsdorf's infamous quote before the last big strike in 1994-95, "The economics of baseball are screwed up."
Screwed up for who? It's not like any owner has lost money on the sale of their franchise since the time of "the golden era" of baseball in the 1950's. (If it was such a golden era, why were franchise values falling, and the Yankees still winning all the championships?)
So it's really simple: the owners who own the team right now want to retain ownership of their teams indefinitely. They don't ever want to sell in order to cash in big-time. They want to retain ownership of the team indefinitely, effectively blocking the market forces that otherwise force small family operators (like Veeck or Clark Griffith) to sell to larger, more-capitalized buyers (like Reinsdorf or Pohlad).
Thus, the REAL threat to owners comes from the increased value of their franchises--and the big-buck conglomerates (like Rupert Murdoch and Fox, or Ted Turner and AOL/Time Warner) that have the financial interest--AND RESOURCES--to wipe out all of the older, smaller operators if they so desired. The price of playing this game of poker has gone up.
Owning a baseball team is no longer a mom & pop operation. However, the sport of baseball is doing just fine. The sport will survive just fine whether Jerry Reinsdorf owns the Sox for another 50 years or not. The same can be said for most any other franchise (and the one exception, Montreal, can be attributed more to mismanagement than fan indifference. Read ex-commissioner Bowie Kuhn's book, Hardball , for his opinion about Montreal as a fine major league city).
Don't fault the owners for wanting more. Who can blame them? If you made several different investments and soon discovered one of them (baseball) outperforming most of the others for capital appreciation, you wouldn't want to sell it either. Reinsdorf bought the Sox (in 1981) for a measly $20 million. Steinbrenner got the Yankees (in 1973) for an incredible $10 million, LOL!
Next time you hear someone suggest baseball is a dying sport, ask yourself whether it's dying for the fans or dying for the current owners? More often than not, you'll surprise yourself with the answer.
The issue for Bud and his fellow owners has nothing to do with competitive balance (they've ignored it since the 1920's when the Yankee dynasty first began). The issue isn't skyrocketing salaries (they are the ones freely offering the guaranteed contracts to the players). The issue isn't equitable sharing of revenue (they've never done it in the history of the game). Finally, the issue isn't the need to contract weak franchises in poor markets (the furor they've stirred in Minnesota and on Capitol Hill proves that point).
The REAL issue for owners is keeping them, the current set of owners, in business. For at least thirty years now (perhaps sixty if you believe Bill Veeck), the primary way for owners to make money is buying and selling their team. There are huge tax benefits for rich people (or people savvy enough to know how to get rich) that owning and selling a team provides. Veeck explained all of this in his book, Veeck as in Wreck , back in the early-60's. If you don't understand what I'm talking about, get a copy of the book at the library and read it.
After years of operating this way, the owners now want more. This is the meaning behind Reinsdorf's infamous quote before the last big strike in 1994-95, "The economics of baseball are screwed up."
Screwed up for who? It's not like any owner has lost money on the sale of their franchise since the time of "the golden era" of baseball in the 1950's. (If it was such a golden era, why were franchise values falling, and the Yankees still winning all the championships?)
So it's really simple: the owners who own the team right now want to retain ownership of their teams indefinitely. They don't ever want to sell in order to cash in big-time. They want to retain ownership of the team indefinitely, effectively blocking the market forces that otherwise force small family operators (like Veeck or Clark Griffith) to sell to larger, more-capitalized buyers (like Reinsdorf or Pohlad).
Thus, the REAL threat to owners comes from the increased value of their franchises--and the big-buck conglomerates (like Rupert Murdoch and Fox, or Ted Turner and AOL/Time Warner) that have the financial interest--AND RESOURCES--to wipe out all of the older, smaller operators if they so desired. The price of playing this game of poker has gone up.
Owning a baseball team is no longer a mom & pop operation. However, the sport of baseball is doing just fine. The sport will survive just fine whether Jerry Reinsdorf owns the Sox for another 50 years or not. The same can be said for most any other franchise (and the one exception, Montreal, can be attributed more to mismanagement than fan indifference. Read ex-commissioner Bowie Kuhn's book, Hardball , for his opinion about Montreal as a fine major league city).
Don't fault the owners for wanting more. Who can blame them? If you made several different investments and soon discovered one of them (baseball) outperforming most of the others for capital appreciation, you wouldn't want to sell it either. Reinsdorf bought the Sox (in 1981) for a measly $20 million. Steinbrenner got the Yankees (in 1973) for an incredible $10 million, LOL!
Next time you hear someone suggest baseball is a dying sport, ask yourself whether it's dying for the fans or dying for the current owners? More often than not, you'll surprise yourself with the answer.