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IGNORED

538: Owners trying to screw the players to typical profits


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https://fivethirtyeight.com/features/mlb-owners-say-they-could-lose-4-billion-even-if-games-are-played-does-that-math-add-up/

The numbers are obviously only estimates, but they’re fairly educated estimates. The most damning point:

“In other words, the owners’ proposed salary-reduction scheme looks like a clever sleight-of-hand designed to cause a shortened season — in the midst of a life-changing pandemic for millions of Americans — to essentially give them the same profit as they made during a full season in the midst of a baseball boom.”

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1 hour ago, Pancake Bear said:

https://fivethirtyeight.com/features/mlb-owners-say-they-could-lose-4-billion-even-if-games-are-played-does-that-math-add-up/

The numbers are obviously only estimates, but they’re fairly educated estimates. The most damning point:

“In other words, the owners’ proposed salary-reduction scheme looks like a clever sleight-of-hand designed to cause a shortened season — in the midst of a life-changing pandemic for millions of Americans — to essentially give them the same profit as they made during a full season in the midst of a baseball boom.”

I'm beginning to think the they are going to reach an impasse very soon. Baseball in 2020 may just be too difficult to play under the circumstances. It's nobody's fault. 

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29 minutes ago, nate said:

It is all a negotiating tactic, but expecting the owners to bare 100% of the attendance losses is unreasonable by the players IMO.  You can't ask for 100% prorated pay when no fans are paying to attend the games.

Except the math works out so that the owners make the same in a season without any attendance and half the games...   

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55 minutes ago, nate said:

It is all a negotiating tactic, but expecting the owners to bare 100% of the attendance losses is unreasonable by the players IMO.  You can't ask for 100% prorated pay when no fans are paying to attend the games.

Also, we're told they deserve to make huge profits when times are good because they take the risk of the losses. 

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1 hour ago, eaterfan said:

Also, we're told they deserve to make huge profits when times are good because they take the risk of the losses. 

They do take the risk 

GMJ, Hamilton and Pujols were all huge risks that didn’t pay off for Arte.

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It's hard for me to figure what the hell else owners are spending their money on that would make their $150 mil player budgets just "half" or their total expenses. I know some of you on here eat that up but it HAS to be bullshit. The entire minor league system costs them the equivalent of a backup journeyman middle infielder, and their front offices are staffed with interns and minimum wage workers. Same goes for ushers and money making concessioners working a whooping 82 nights a year who are going to remain out of work. 

Give me a fucking break.

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7 minutes ago, AngelsLakersFan said:

It's hard for me to figure what the hell else owners are spending their money on that would make their $150 mil player budgets just "half" or their total expenses. I know some of you on here eat that up but it HAS to be bullshit. The entire minor league system costs them the equivalent of a backup journeyman middle infielder, and their front offices are staffed with interns and minimum wage workers. Same goes for ushers and money making concessioners working a whooping 82 nights a year who are going to remain out of work. 

Give me a fucking break.

Or maybe the pandemic issue is something that’s too complex and the owners just don’t want to deal with it unless there are plenty of monetary safe gaurds in place that protects their financial interest no matter what happens that the players won’t agree to. It’s too big a gamble for both sides. 
 

Impasse 

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23 minutes ago, AngelsLakersFan said:

It's hard for me to figure what the hell else owners are spending their money on that would make their $150 mil player budgets just "half" or their total expenses. I know some of you on here eat that up but it HAS to be bullshit. The entire minor league system costs them the equivalent of a backup journeyman middle infielder, and their front offices are staffed with interns and minimum wage workers. Same goes for ushers and money making concessioners working a whooping 82 nights a year who are going to remain out of work. 

Give me a fucking break.

You're forgetting the owner's family each make $1 million a year as VP of do nothing.

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1 hour ago, RendZone said:

They do take the risk 

GMJ, Hamilton and Pujols were all huge risks that didn’t pay off for Arte.

I do not think you quite understand what ownership "risk" means.  Those were bad signings and on-the-field business decisions, but not risks of ownership.  You could even make the argument that the Pujols signing was a business success considering the additional TV revenue rights/contract, advertising, merchandise sales, brand building, etc. created by such.  On the field he was not a success to the team win/loss wise, but financial wise it's VERY debatable.  

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31 minutes ago, Randy Gradishar said:

But if player salaries make up the majority of the costs, are you saying you understand the owners' POV because they need to cut that down? Or are you saying they are making way more than they claim and need to shut up?

It's both. The owners are trying to reduce player salaries because that is the significant source of their expenses. They are all making way more than they claim to be. They pay themselves millions in salary every year, hide revenue from the league in friendly television deals paid by stations they own, and bank ever increasing amounts of equity in their team. After that they show the players and the tax man a P&L two or three million in the red and cry poor.

The owners are at risk of seeing an actual decline in profit this year and, as billionaires, they are not used to that idea. MLB is a sure thing and the idea that there won't be huge profits this year, or that they could actual lose a little money is a non-starter for them.

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39 minutes ago, RendZone said:

The fans took the risk on Hamilton? Do tell.

Yes. Arte is spending $160 million either way because he's bringing in ~$200 million a year and his team is appreciating by another $25-50 million annually. If he doesn't sign Hamilton he signs Torii Hunter and a pitcher to get to that $160 mil. When Hamilton gets cut, he stays at $160 mil and brings in a replacement level left fielder who doesn't change the payroll. When Hamilton gets dumped on the Rangers for ~$7 million in savings the Angels bring in a ~$7 mil left fielder in Cameron Maybin. When Hamilton's $25 mil contract is off the books the Angels bring in a $25 mil LF in Justin Upton.

Arte sets the budget, the profits are locked in, the fans and the organization are the ones bearing the risk of the signings.

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It will be intresting to see how many players are released and left unsigned next season. All of the mid tier guys with five years but are only league average are going to dissappear. Minor league teams have been cut so no sense writing contracts for these guys when you barely have space for real prospects. 

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