Financial state of baseball: New Quotes from Brewerfan Agent39

[FVBrewerFan]

 

There is absolutely competition. The competition for the Brewers is any other form of entertainment. Packers, Bucks, Badgers, Poto, Summerfest, State Fair, a nice dinner out, etc. Entertainment dollars can flex, but it's still basically a finite amount.

 

If you like professional baseball, and have a demand for professional baseball, you have only 1 option.

 

Like someone said above, if there were only a limited number of allowed breweries, so you had to go to them only for beer, their prices would be higher than if they also had to compete with other breweries. It does not matter that there are other alternatives in the "beverage industry". Yes you could choose to buy wine instead, but if you specifically have a demand for beer, you are being up-charged more than the actual free market price that would exist if more breweries existed.

 

Well, the difference is you would be forced to get beer from that brewery at that price. With MLB, you can choose to watch on TV for "free." If enough people do that, they will need to respond. I don't go to anywhere near as many games as I used to. I just won't pay that much for parking and tickets for the 12-15+ games I used to go to. Not because I don't have the money, or I'm trying to send a message. I just choose not to.

 

By the way, before I would ever stoop to buying wine I would make my own beer if prices were too high

[topper09er]

The supreme court of the United States specifically ruled that MLB was "exempt" from the Sherman anti-trust law. Everyone acknowledges that they are a monopoly, that was never in the question. They just have a special exception because it was deemed they were not engaging in "interstate commerce" because it was just the nature of the sport that different clubs from one state would travel to another state for a game.

 

No one ever claimed that the National and American leagues did not actually conspire to push out the Federal league (which they did do). Instead it was ruled that this conspiracy was not illegal because baseball was not a form of interstate commerce.

[topper09er]

 

By the way, before I would ever stoop to buying wine I would make my own beer if prices were too high

 

That's the right attitude.

 

But it just illustrates my point, if prices get too high people look for alternatives. There are no alternatives for baseball.

[KeithStone53151]

 

By the way, before I would ever stoop to buying wine I would make my own beer if prices were too high

 

That's the right attitude.

 

But it just illustrates my point, if prices get too high people look for alternatives. There are no alternatives for baseball.

 

That's fair, there are ways to consume/enjoy baseball cheaper than others. As he said, if ticket prices and concessions get too expensive...less people will attend and switch to watching on TV. The league will have to adapt. That's the market working effectively.

[KeithStone53151]

https://www.fanragsports.com/inside-baseball-scott-boras-weighs-in-on-slow-market/

 

Boras has some interesting takes, but at the same time all I see is him wildly overvaluing his players and blaming the owners for not overpaying. I really hope a few of his players spend months sitting out because of their outrageous contract demands. That guy is absolutely terrible for the game.

[Cool Hand Lucroy]

I think part of the issue is just not knowing the financial state of these teams. Pittsburgh is a great example. They are crying poverty, but their valuation has jumped 500% and they're posting strong operating revenues as far as I can tell. I just don't buy the idea that these are private business. They may not be full-on public utilities, but they're closer to that than they are to IBM or Target.

 

If the Brewers operate at a 70 million payroll this year (I don't think they will), they'll end up pretty significantly profitable. I'd love to be able to see the numbers and do some basic math on the maximum possible profitable payroll threshold for each team. It seems to me simply requiring an ownership group to get within x percent of their max payroll would help at least a little bit, but MLB teams don't seem to want to release those figures. It seems a league with an anti-trust exemption (as was mentioned earlier) and public stadium financing should at the very least be held to some level of transparency.

[clancyphile]

https://www.fanragsports.com/inside-baseball-scott-boras-weighs-in-on-slow-market/

 

Boras has some interesting takes, but at the same time all I see is him wildly overvaluing his players and blaming the owners for not overpaying. I really hope a few of his players spend months sitting out because of their outrageous contract demands. That guy is absolutely terrible for the game.

 

I think teams are taking a closer look at their budgets.

 

Why pay a TOR starter $25 million a year in free agency when you can make do with #2 starters and a killer bullpen? Even if you get an expensive arm ($8 million/year), that still saves $17 million per year for other players.

[jerichoholicninja]

I think part of the issue is just not knowing the financial state of these teams. Pittsburgh is a great example. They are crying poverty, but their valuation has jumped 500% and they're posting strong operating revenues as far as I can tell. I just don't buy the idea that these are private business. They may not be full-on public utilities, but they're closer to that than they are to IBM or Target.

 

If the Brewers operate at a 70 million payroll this year (I don't think they will), they'll end up pretty significantly profitable. I'd love to be able to see the numbers and do some basic math on the maximum possible profitable payroll threshold for each team. It seems to me simply requiring an ownership group to get within x percent of their max payroll would help at least a little bit, but MLB teams don't seem to want to release those figures. It seems a league with an anti-trust exemption (as was mentioned earlier) and public stadium financing should at the very least be held to some level of transparency.

 

Who is crying poverty? Unless you're one of the teams in LA, Chicago, or NYC it makes no sense to dole out huge free agent contracts. Or really even huge contracts to resign your own guys. Barring a few exceptions, players have pretty much hit their peak and may even be declining by the time they reach free agency. It's just stupid to pay a 32 year old declining player 3-4 times as a 26 year old for the same or slightly better production. Especially when the younger player will probably get better while the older one is only going to get worse. In the case of Pittsburgh, it's way smarter to trade guys like Cole and McCutchen for prospects when you're not going to compete. Throwing money at either of those guys just to placate your fans is going to set the organization back and fail in the long run.

[Cool Hand Lucroy]

 

Who is crying poverty? Unless you're one of the teams in LA, Chicago, or NYC it makes no sense to dole out huge free agent contracts. Or really even huge contracts to resign your own guys. Barring a few exceptions, players have pretty much hit their peak and may even be declining by the time they reach free agency. It's just stupid to pay a 32 year old declining player 3-4 times as a 26 year old for the same or slightly better production. Especially when the younger player will probably get better while the older one is only going to get worse. In the case of Pittsburgh, it's way smarter to trade guys like Cole and McCutchen for prospects when you're not going to compete. Throwing money at either of those guys just to placate your fans is going to set the organization back and fail in the long run.

 

It is "smarter." I don't dispute that. It's also, however, a recipe for a work stoppage. I understand the wisdom of what Pittsburgh is doing, but the "Moneyball" idea of exploiting market inefficiencies is also becoming a way to justify not paying for production. If you're a really good player in the MLB, there's a strong chance you'll never get a big contract. Seriously. Teams will pay the arb salaries year-by-year, and then you'll hit 31 and they'll say, "You're past your prime." It's a shell game.

 

Don't get me wrong. I don't feel too bad for a guy who makes 20 million in a six year baseball career. But when the owners are running up numbers in the hundreds of millions, even billions, well, it's all relative, isn't it?

 

If I were a young MLB player, I'd be pissed. If I were Jimmy Nelson, I'd be scared. Eventually, the union will get tired of the benefits of the system going to the Stantons and Harpers and Kershaws, and then the owners will have to significantly change the system or face the possibility of a work stoppage.

 

Players are held accountable for results and constantly evaluated. All I'm suggesting is that we see more information on how the owners are managing their obligations, and not just to "efficient spending" either. IMHO, paying guys what they are worth to the extent possible is part of that, in the same way taking care of the environment and giving miners fair benefits is part of a coal company's job. It's not the only thing, or even the biggest thing (certainly we'll all disagree about to what extent it matters--I personally think the social responsibility piece should be much more emphasized across society, but that's just me), but I think it has to be part of the conversation. Just talking about owners as "smart" misses the fact that sometimes they're also being "exploitative," at least relative to baseball, and I think that means we need to have the conversation about what the owners obligations are, understanding that Milwaukee and Pittsburgh are going to have different ones than LA and SF and NY and Chicago.

[jerichoholicninja]

 

Who is crying poverty? Unless you're one of the teams in LA, Chicago, or NYC it makes no sense to dole out huge free agent contracts. Or really even huge contracts to resign your own guys. Barring a few exceptions, players have pretty much hit their peak and may even be declining by the time they reach free agency. It's just stupid to pay a 32 year old declining player 3-4 times as a 26 year old for the same or slightly better production. Especially when the younger player will probably get better while the older one is only going to get worse. In the case of Pittsburgh, it's way smarter to trade guys like Cole and McCutchen for prospects when you're not going to compete. Throwing money at either of those guys just to placate your fans is going to set the organization back and fail in the long run.

 

It is "smarter." I don't dispute that. It's also, however, a recipe for a work stoppage. I understand the wisdom of what Pittsburgh is doing, but the "Moneyball" idea of exploiting market inefficiencies is also becoming a way to justify not paying for production. If you're a really good player in the MLB, there's a strong chance you'll never get a big contract. Seriously. Teams will pay the arb salaries year-by-year, and then you'll hit 31 and they'll say, "You're past your prime." It's a shell game.

 

Don't get me wrong. I don't feel too bad for a guy who makes 20 million in a six year baseball career. But when the owners are running up numbers in the hundreds of millions, even billions, well, it's all relative, isn't it?

 

If I were a young MLB player, I'd be pissed. If I were Jimmy Nelson, I'd be scared. Eventually, the union will get tired of the benefits of the system going to the Stantons and Harpers and Kershaws, and then the owners will have to significantly change the system or face the possibility of a work stoppage.

 

Players are held accountable for results and constantly evaluated. All I'm suggesting is that we see more information on how the owners are managing their obligations, and not just to "efficient spending" either. IMHO, paying guys what they are worth to the extent possible is part of that, in the same way taking care of the environment and giving miners fair benefits is part of a coal company's job. It's not the only thing, or even the biggest thing (certainly we'll all disagree about to what extent it matters--I personally think the social responsibility piece should be much more emphasized across society, but that's just me), but I think it has to be part of the conversation. Just talking about owners as "smart" misses the fact that sometimes they're also being "exploitative," at least relative to baseball, and I think that means we need to have the conversation about what the owners obligations are, understanding that Milwaukee and Pittsburgh are going to have different ones than LA and SF and NY and Chicago.

 

I don't agree with a lot of that, especially because I really don't care how much the owners make, but I agree with the general point. GM's are only looking to sign a player if it's below market value, which is not a bad strategy, but I'm pretty disappointed if Stearns passed on all those short term, (relative to what every other player gets paid) inexpensive relievers because they weren't under market value. I've said it many times, you don't get extra credit for signing only cheap, undervalued players. Last year, having even one half way competent reliever from day 1 gets us to at least the wild card game.

[Cool Hand Lucroy]

Absolutely fair.

 

Some of this gets into political/economic stuff that's just really hard to get a consensus on, even limiting the conversation to baseball. I certainly understand the argument that the owners invest risk and it's their money, etc., even if it's not one I personally subscribe to.

 

The idea of accepting the risk of an overpay, though, is very important, I think. If not spending money is the only good way to run a team, and the FO is always afraid to pony up market value for a free agent, that could have (and did have, as you point out) a pretty direct impact on wins and losses.

 

Maybe it's just about accepting that efficiency and smart management doesn't mean avoiding the FA market entirely and there is such a thing as a good deal that hurts a team 3 years down the road.

[Thurston Fluff]

https://www.fanragsports.com/inside-baseball-scott-boras-weighs-in-on-slow-market/

 

Boras has some interesting takes, but at the same time all I see is him wildly overvaluing his players and blaming the owners for not overpaying. I really hope a few of his players spend months sitting out because of their outrageous contract demands. That guy is absolutely terrible for the game.

 

I think teams are taking a closer look at their budgets.

 

Why pay a TOR starter $25 million a year in free agency when you can make do with #2 starters and a killer bullpen? Even if you get an expensive arm ($8 million/year), that still saves $17 million per year for other players.

 

Add to it the number of years they have to pay a top level starter vs relievers and it's a no brainer. Combine that with the player not being as good as late in their careers like they were in the steroid era and paying a lot for a long time is just a stupid thing to do. Boras just isn't keeping up with the times.

[dacbrewers]

https://www.fanragsports.com/inside-baseball-scott-boras-weighs-in-on-slow-market/

 

Boras has some interesting takes, but at the same time all I see is him wildly overvaluing his players and blaming the owners for not overpaying. I really hope a few of his players spend months sitting out because of their outrageous contract demands. That guy is absolutely terrible for the game.

 

He isn't paid by the clubs, he makes his money by making his clients money. He does the same thing every agent does. Just because he can put any value on a player, doesn't mean he will get it. Yea, he's over the top sometimes but he's doing his job to get his guys the most money and he accomplishes it most of the time.

[monty57]

I don't agree with a lot of that, especially because I really don't care how much the owners make, but I agree with the general point. GM's are only looking to sign a player if it's below market value, which is not a bad strategy, but I'm pretty disappointed if Stearns passed on all those short term, (relative to what every other player gets paid) inexpensive relievers because they weren't under market value. I've said it many times, you don't get extra credit for signing only cheap, undervalued players. Last year, having even one half way competent reliever from day 1 gets us to at least the wild card game.

 

From a player acquisition standpoint, free agents are paid for in money while players under team control are acquired via trade.

 

What is interesting with this offseason is that the value of team control has gotten so high relative to the monetary cost of free agents that Stearns seems to be considering trading away guys with team control (Brinson, Santana, Phillips, Shaw, maybe even a SP if we sign Darvish) and then paying free agent prices to fill the spots. Baseball isn't a completely free market (there are very few truly free markets in the world), but It is still a market. Like any market, prices will rise and they will fall. If the trade value of Brinson and Phillips gets extremely high while the free agent value of someone like Cain gets abnormally low, it may make sense to trade the youngsters and sign the vet.

 

This will be a pretty shocking development if it happens, but I love that Stearns seems to always be looking at the current market inefficiencies and does not at all care to follow the current trend. I think in the not-too-distant future teams will be studying what Stearns has done in order to try to better build their own teams.

[Oxy]

Excellent thread--thank you Brewerfan denizens.

 

There needs to be expansion. And not necessarily to Mexico City or Montreal-- but to Manhattan, Jersey, Brooklyn, and another LA team.

 

I'd prefer breaking up large markets and keeping the rules simple as opposed to adding all sorts of rules and clauses to try to redistribute revenue from large markets to small markets.

 

This isn't likely to happen, but I'm not sure why not.

[Patrick425]

Interesting comments from Brandon Moss regarding the pace of the offseason. Basically saying that owners are just taking advantage of what players bargained for and he doesn't blame them for doing so.

 

https://www.mlbtraderumors.com/2018/01/brandon-moss-slow-free-agency-offseason-cba.html

[markedman5]

This should go over well.........

[brooks_quichenick]

Massive profits to the owners, players not getting their fare share... the players will go on strike in the next year or two and somehow the average joe MLB fan will side with the billionaire owners who do nothing for the sport itself.

[tmwiese55]

We pegged it in this discussion here didn't we. I still think all this will end up leading to a shift in moving pay to earlier in players career. IMO that's the clear hiccup right now, 10-15 years of evidence on how badly these mega contracts age has led to this offseason. And that has combined with the stricter tax and the big markets all trying to reset their tax and space for the better FAs next year. Bit of a perfect storm.

[Samurai Bucky]

This should go over well.........

I may be missing the boat, but are the Brewers part of this "collusion?" It seems like they are willing to increase the salary of their club for their players from $63M (http://www.stevetheump.com/Payrolls.htm) to possibly around $87M (https://www.brewcrewball.com/2018/1/30/16943418/milwaukee-brewers-2018-payroll-projection-update-3). That is a 37.5% increase! I'm guessing the players are complaining more about the big market teams.

 

Let me guess... the owners should take a loss or break even? I suppose Arte Moreno shouldn't make more than Albert Pujols, right? What's a cool $25M a year amongst friends?

 

I didn't realize how little minor league players make. Isn't it something like $12K/year? I don't think they should be making $100K, but $12K? I'm sure the players union doesn't give a rat's back side about them.

 

I work in a struggling business that due to many circumstances, is forcing some of the ownership to not take a paycheck. I have also not taken a paycheck at times. Neither side -- especially the players -- have any sympathy from me. I certainly won't cry over this as I'm working extra hours this weekend to keep the company going.

 

Perspective...

[Fear The Chorizo]

That statement makes me smile - you know how players could make alot more money based on the same actual $ offers provided by owners? Eliminate the agents or renegotiate their cut of these contracts. They're the biggest squeaky wheel that has nothing to do with on-field performance and entertainment.

[brooks_quichenick]

This should go over well.........

I may be missing the boat, but are the Brewers part of this "collusion?" It seems like they are willing to increase the salary of their club for their players from $63M (http://www.stevetheump.com/Payrolls.htm) to possibly around $87M (https://www.brewcrewball.com/2018/1/30/16943418/milwaukee-brewers-2018-payroll-projection-update-3). That is a 37.5% increase! I'm guessing the players are complaining more about the big market teams.

 

Let me guess... the owners should take a loss or break even? I suppose Arte Moreno shouldn't make more than Albert Pujols, right? What's a cool $25M a year amongst friends?

 

I didn't realize how little minor league players make. Isn't it something like $12K/year? I don't think they should be making $100K, but $12K? I'm sure the players union doesn't give a rat's back side about them.

 

I work in a struggling business that due to many circumstances, is forcing some of the ownership to not take a paycheck. I have also not taken a paycheck at times. Neither side -- especially the players -- have any sympathy from me. I certainly won't cry over this as I'm working extra hours this weekend to keep the company going.

 

Perspective...

 

You not taking a paycheck "to keep the company going", or working extra hours "to keep the company going" is your prerogative, and frankly really stupid. If your boss can't afford to pay you they shouldn't own a business. Period. Everyone else in the world shouldn't be expected to be ok with their labor being exploited just because you seem to enjoy it.

 

The players are workers, just like you. They make more because the profits in their industry are higher than yours. Why do you hate the players more than the owners? Does everyone here worship at the feet of their boss or something? I watch baseball to see incredible athletes do incredible things, not to root for the owners pinching pennies to inflate their massive portfolios of wealth.

[TURBO]

 

You not taking a paycheck "to keep the company going", or working extra hours "to keep the company going" is your prerogative, and frankly really stupid. If your boss can't afford to pay you they shouldn't own a business. Period. Everyone else in the world shouldn't be expected to be ok with their labor being exploited just because you seem to enjoy it.

 

The players are workers, just like you. They make more because the profits in their industry are higher than yours. Why do you hate the players more than the owners? Does everyone here worship at the feet of their boss or something? I watch baseball to see incredible athletes do incredible things, not to root for the owners pinching pennies to inflate their massive portfolios of wealth.

 

Maybe you should have a look around the forums and see how we basically treat each other... Seems most of your posts are combative in some way.

 

Just relax, and maybe think about how you phrase your comments. Your time here has been short, but not very positive.

[stoutdude04]

 

You not taking a paycheck "to keep the company going", or working extra hours "to keep the company going" is your prerogative, and frankly really stupid. If your boss can't afford to pay you they shouldn't own a business. Period. Everyone else in the world shouldn't be expected to be ok with their labor being exploited just because you seem to enjoy it.

 

The players are workers, just like you. They make more because the profits in their industry are higher than yours. Why do you hate the players more than the owners? Does everyone here worship at the feet of their boss or something? I watch baseball to see incredible athletes do incredible things, not to root for the owners pinching pennies to inflate their massive portfolios of wealth.

 

Players are only worth what someone is willing to pay them. It appears that owners have realized that baseball spending has gotten out of control. I am not sure they are 'pinching pennies' simply because they are unwilling to fork over millions of dollars for potential risks.

[stoutdude04]

the billionaire owners who do nothing for the sport itself.

 

Really? The owners do nothing?