The Myth of the "Victimized Small Market Teams"

[Caryatid]

The teams every talking head on the radio loves to cite when talking about the "cancer that is payroll disparity" in baseball are the Devil Rays, Pirates, and Royals. "See! These teams KNOW that when the season begins, they have no shot, and that's baseball's fault." They then go on to explain that, somehow, a salary cap would save parity in baseball.

 

For them, here's Jayson Stark:

 

" At least four teams -- the Marlins, Devil Rays, Pirates and Royals -- are getting more money from their good friends at MLB than they're spending on their entire payroll (this is before they sell one ticket).

 

This is true. All of them, according to sources, rake in around $30 million in revenue-sharing handouts alone -- plus another $20 million to $30 million in TV, radio, Internet and Central Fund payoffs (generated by national TV contracts and licensing deals).

 

That comes to $50 million to $60 million, by our count. But their payrolls, by anyone's count, come to slightly less than that. Or, in the Marlins' count, to insanely less. "

 

Using this information, among other sources, I would submit that baseball's perceived lack of parity has as much to do with inept ownership and management among certain teams as it does with their collective payrolls.

[Ding Dong Johnson]

I don't buy the notion of inept ownership. They are there trying to maximize their profits. Greedy may be a word, destined for solvency is probably more accurate. They skimp everywhere because, aside from revenue sharing, they don't have a great stream of income. Maybe their management teams are inept, but that may also be a result of getting what they pay for.

[Wilson A2000]

Aren' the Marlins losing a lot of money though?

[soccer10k]

I don't buy the notion of inept ownership. They are there trying to maximize their profits. Greedy may be a word, destined for solvency is probably more accurate. They skimp everywhere because, aside from revenue sharing, they don't have a great stream of income. Maybe their management teams are inept, but that may also be a result of getting what they pay for.

 

Some moves might be inept ownership, but in the Marlins case it's definately maximizing profits. They know that they can get a bunch of young guys for cheap by trading all of their expensive star players. Every owner knows they are running a business and have different strategies as to maximizing profits.

[Caryatid]

It would seem that the simplest plan for making a profit is to allocate enough money to maximize the best product you can sell. Clearly, the system that exists allows for teams in Pittsburgh, KC, and Tampa to profit by NOT creating a good product, which is antithetical to how business should work.

 

Clearly, it is possible to create a championship (and thus, profitable) team by spending $60-70 million. These teams are simply not doing it right. Yes, the income disparity between the Yankees and every other team is problematic. But that should not give these inept organizations a free pass to play the victim.

[sethuel1]

Aren' the Marlins losing a lot of money though?

no way. Not this year.

[Productive Outs]

Aren' the Marlins losing a lot of money though?

 

http://www.hardballtimes.com/main/article/beyond-belief/

[Jehrico]

I thought teams that were getting money from the revenue sharing had to put those funds back into the team. I don't see Selig enforcing this. Just another reason he should go...

[NewUserName]

During the Hockey lockout I had several arguements with fans that teams like the Red Wings are good for the sport. Spend money put a competitive team on the ice. Grow large fan base reap benefits. As opposed to teams like the Blackhawks, cut payroll, complain about the system run fans away. There is nothing that a salary cap is going to fix a stupid franchise like the Blackhawks.

 

I think a great example of how a good team is run is the Cardinals. St Louis is not a large market, actually it is one of the smallest in baseball. However they have invested money into a winning product, expanded their fan base and are able to pay salaries to be a competitive team. I would contend that Pittsburgh, KC, Tampa and Florida could all be competitive if they were willing to invest more into their teams instead of trying to make a widen the profit margin. I am pretty sure that KC actually made more profit last year than the Yankees. So I feel no pity except to their fans who are being lied to. Pittsburgh wouldnt sell their team to (Dallas Mavericks owner whos name excapes me). If they are losing so much money why are they not bailing out? Again have to feel sorry for Pittsburgh fans who are being lied too.

[Backtobanks]

Aren' the Marlins losing a lot of money though?

 

I don't think any professional team "loses" money. Look at the huge profit the owners turn when they sell a team after owning it for a few years. These owners are business people and they don't own teams as a hobby. Don't forget the tax write-offs they get on depreciating players over the life of their contracts.

[Caryatid]

Aren' the Marlins losing a lot of money though?

 

 

 

http://www.hardballtimes.com/main/article/beyond-belief/

 

My favorite line from that article:

 

"Even if Bodley's worst-case scenario were to come true and Jeffrey Loria did go bankrupt, well it's like this: when you factor in the money you get from revenue sharing, merchandising, MLB.com, national television, local television, radio, even before you sell a single ticket or hot dog and you've got a friggin' monopoly on your product plus the mega tax breaks that come with owning a major league sports team and you still go belly-up—then chances are you're too bloody stupid to be in business anyway."