Boras: MLB owners are crying wolf

[DrungoHazewood]

But what's more relevant to the Orioles is that they're acting in a reasonable, responsible manner for a team in their place in the success cycle. Who cares what everyone else is doing, since they're spending according to the team's best interest (or close enough).

See this bit from a recent BP chat:

R.A.Wagman (Toronto): Shawn - do you think it may be easier for some franchises do devote more energies into bringing more people into the stands, creating excitement in marketing the game itself and using funds generated from that to building an improved team, than it would be to build a winner without the fan base and hope the fans follow afterward?

Shawn Hoffman: Bill James always said that the only two things that bring people to the ballpark are a good team and free stuff. I don't think you can grow gate revenues purely through marketing; if you have a bad team and you want to stock up on cash for when you have a contender, it almost has to come through cost cuts, and this is the model we've been seeing more and more: field a low-cost team, save money, use some of the excess in the draft and internationally, and use the rest on player payroll when your team is actually in contention.

That's the Orioles' plan almost to a tee. It's the standard way of doing business for a team like the Orioles.

Yes, it would be nice if the Orioles had a Roman Abramowitz-type benefactor willing to lose $millions to satisfy his ego. But we all know that's ridiculous, and Bud and the other owners wouldn't sign off on someone like that anyway.

[srock]

The MLBPA is half of the equation. They agreed to the CBA just like the owners. In over simplified terms: the players avoided a salary cap, the owners got the current revenue sharing system. As a result, it is possible for 'poor' teams to operate at a profit without spending huge on players. But the players are also happy. They are rich, have a decent free agent system, and keep playing baseball.

This may or may not be sustainable, but until MLB revenues start to drop, I see no reason either side would want to significantly change the system. Sure, the MLBPA will likely get some concessions boosting pay or benefits for the average player and owners will get a bit more revenue sharing money, but this system IS NOT BROKEN. At least not from a business standpoint. Increasing revenues and steady profits are proof.

This won't change unless fans stop paying attention causing the revenue to drop. Then the two sides will have to reshape the system to fit new economic conditions.

[jerios55]

I can't believe I actually agree with Scott Boras here but he makes some good points in this Boston Globe article:

Boras might as well be directly speaking to Peter Angelos who time and time again has been saying the economics of baseball have been getting out of hand. With the money that they are getting from MLB and revenue sharing, there is no excuse for some of the low payrolls that we are seeing in baseball from certain teams, the Orioles included.

Yes he has a point, but spending more money isn't the problem in baseball. As long as it's players union/agents vs. owners, the only people really getting the shaft are the fans.

Boras can cry all he wants, but it's partially due to the large, very poor contracts his clients have gotten that have made owners fear big contracts. People on this board talk about how crippling these contracts can be for a team and the wouldn't go over XXX amount of dollars. If people can see the problems when it isn't their money, clearly you can see why the owners would have a problem.

[JTrea81]

Boras and Rob Manfred had a back and forth in Rosenthal's latest:

Just like when he does a player negotiation he lies about the numbers in order to get the price up, now he's taken that to the macro-economic level and lying about industry numbers in order to get player (contract) numbers up," Manfred said. "There is no one club getting $80 or $90 million in combination from revenue sharing and Central Baseball. Not one."

Boras cast doubt on Manfred's statements generally, saying he "has never disclosed information about funds that teams get from Central Baseball or revenue sharing."

"Rob Manfred works for the owners, has always worked for the owners," Boras said. "The information I've gathered is from documented, substantive sources — the Daily News, the SportsBusiness Journal. I stand on the record of documented information, not on the basis of information of someone who is biased due to his employment."

The money from baseball's central fund includes revenues from licensing, properties, national-television contracts and advanced media. According to the New York Daily News, each team received $35 million from the fund in 2008.

And that includes the Orioles BTW...

On Wednesday, however, two club presidents — Frank Coonelly of the Pirates and one American League executive who asked to remain anonymous — insisted that the $35 million figure is inaccurate. Yet, Boras claims the number will be higher — perhaps as high as $46 million — in 2009.

Manfred, speaking generally about Boras' view of the sport's finances, continued, "What he's talking about is a fantasy, an absolute fantasy. We are in a very difficult economic time and anybody who misstates the numbers in an effort to create the impression that baseball is insulated from these difficult economic times is misleading you."

Boras said there is a way to settle the discrepancy — by requiring clubs in the next collective-bargaining agreement to disclose the amount of money they receive from the central fund and from revenue sharing.

The players could ask for such a stipulation because they agree to revenue sharing as part of the CBA. The central fund also is linked to the revenue-sharing plan.

"Fans have a right to know what money their team is given," Boras said. "If clubs don't want to disclose it, then don't accept the subsidy. If they do want to accept it, disclose it. Their choice."

I like this idea. It would make the owners more accountable for the money they are getting.

Boras is saying what I've been saying all along and I'm glad somebody prominent is finally calling the owners on their refusal to spend the cash that each club is awash in...

[Dipper9]

Boras and Rob Manfred had a back and forth in Rosenthal's latest:

And that includes the Orioles BTW...

I like this idea. It would make the owners more accountable for the money they are getting.

Boras is saying what I've been saying all along and I'm glad somebody prominent is finally calling the owners on their refusal to spend the cash that each club is awash in...

You are something else Trea. So the guy on YOUR side happens to be one of the most hated men in the game, and the man who has been largely responsible for the ridiculous contracts in MLB. That's a great ally there Trea! You never cease to surprise me.

[waroriole]

Boras and Rob Manfred had a back and forth in Rosenthal's latest:

And that includes the Orioles BTW...

I like this idea. It would make the owners more accountable for the money they are getting.

Boras is saying what I've been saying all along and I'm glad somebody prominent is finally calling the owners on their refusal to spend the cash that each club is awash in...

I stand on the record of documented information, not on the basis of information of someone who is biased due to his employment."

That's real cute Scott.

[TiredofLosing20]

Both parties are clearly biased. But Boras makes a point. Why not just disclose the books. Clearly they are not legally required to open their books to the public but if things are as "tough" as the owners say they are then simply open the books and show it.

To me, where there is smoke there is usually fire. It is clear the owners are hiding something. What better way to gain leverage over Boras then to prove him absolutely wrong about this. Unless of course he is right. I just think it is interesting that the owners refuse to talk about this openly. If the numbers Boras is throwing around are correct well then it certainly changes my perspective. Obviously Boras has an agenda but if he is right then I surely would look at MLB very differently than I do today.

[TinCup]

Both parties are clearly biased. But Boras makes a point. Why not just disclose the books. Clearly they are not legally required to open their books to the public but if things are as "tough" as the owners say they are then simply open the books and show it.

To me, where there is smoke there is usually fire. It is clear the owners are hiding something. What better way to gain leverage over Boras then to prove him absolutely wrong about this. Unless of course he is right. I just think it is interesting that the owners refuse to talk about this openly. If the numbers Boras is throwing around are correct well then it certainly changes my perspective. Obviously Boras has an agenda but if he is right then I surely would look at MLB very differently than I do today.

:agree:

Allerdings!!

That's German for "indeed"!

[Frobby]

It is frustrating that we don't really know the expenses and revenues of major league teams very accurately, but they aren't government institutions and they are not publicly held companies, so all this talk about the public's "right to know" is simply rhetoric. There are thousands of privately held businesses that are patronized by the public, where we have no idea of their financial status, incuding very large companies. Just to name a few, Cargill, Publix, Mars and IKEA are privately held. Could Mars make a bigger Snickers bar for the same price and still turn a profit? Beats me.

[tvz1997]

Could Mars make a bigger Snickers bar for the same price and still turn a profit? Beats me.

Frobby knows nothing about candy bars.

[BaltimoreTerp]

It is frustrating that we don't really know the expenses and revenues of major league teams very accurately, but they aren't government institutions and they are not publicly held companies, so all this talk about the public's "right to know" is simply rhetoric. There are thousands of privately held businesses that are patronized by the public, where we have no idea of their financial status, incuding very large companies. Just to name a few, Cargill, Publix, Mars and IKEA are privately held. Could Mars make a bigger Snickers bar for the same price and still turn a profit? Beats me.

It could be argued that if Mars produced and sold Snickers in government-subsidized (or outright paid-for) facilities and claimed they needed those facilities to survive, that could change the need for the public to know their financial information.

[Frobby]

It could be argued that if Mars produced and sold Snickers in government-subsidized (or outright paid-for) facilities and claimed they needed those facilities to survive, that could change the need for the public to know their financial information.

I follow the logic. However, the O's do pay rent at OPACY, and whatever deal they cut, that deal is done. It's not like the Md. Stadium Commission can revoke the lease if the O's don't make their finances public. Also, with any large business (like Mars) you can be sure they are getting government subsidies someplace. If every company that got big subsidies had to make their finances public, we'd be in a whole different world.

[RShack]

It is frustrating that we don't really know the expenses and revenues of major league teams very accurately, but they aren't government institutions and they are not publicly held companies, so all this talk about the public's "right to know" is simply rhetoric. There are thousands of privately held businesses that are patronized by the public, where we have no idea of their financial status, incuding very large companies. Just to name a few, Cargill, Publix, Mars and IKEA are privately held. Could Mars make a bigger Snickers bar for the same price and still turn a profit? Beats me.

Saying it's just rhetoric seems unduly dismissive. What you said is consistent with the facts and the current state of the law. That just means it's legal, but that doesn't mean it's right. Lots of things are legal that aren't right.

As long as they have antitrust exemption, which is essentially society giving them special privileges, you can make a good case that the public should get to see the books. It's not just a bunch of teams, it's MLB as a gov't sanctioned monopoly.

You can also make a good case that companies above a certain economic size should have their books be open like publicly traded companies, even if they are privately held, just because of an economically large company's impact and potential impact on society. Regardless of whether a company is public or privately held, it still operates in, and benefits from, the society from which it profits, so a valid argument can be made that the books should be open regardless of ownership status. You may or may not agree with that argument, but it's not a silly or empty argument.

[DrungoHazewood]

Saying it's just rhetoric seems unduly dismissive. What you said is consistent with the facts and the current state of the law. That just means it's legal, but that doesn't mean it's right. Lots of things are legal that aren't right.

As long as they have antitrust exemption, which is essentially society giving them special privileges, you can make a good case that the public should get to see the books. It's not just a bunch of teams, it's MLB as a gov't sanctioned monopoly.

You can also make a good case that companies above a certain economic size should have their books be open like publicly traded companies, even if they are privately held, just because of an economically large company's impact and potential impact on society. Regardless of whether a company is public or privately held, it still operates in, and benefits from, the society from which it profits, so a valid argument can be made that the books should be open regardless of ownership status. You may or may not agree with that argument, but it's not a silly or empty argument.

Those are perfectly fine arguments and opinions, but there's almost zero chance MLB is going to open their books, willingly or not.

The upside of doing what Boras wants is getting to tell Boras "gotchya!" One of many downsides is millions of fans and writers and wannabe GMs screaming, JTrea-style, every time their team turns a 5 cent profit.

And Congress has shown absolutely no inclination to change the laws.

This is all a moot point.

[Frobby]

The point about baseball having a judicially-created antitrust exemption is, in my opinion, totally overrated. Someone please explain to me how that exemption has put the baseball owners in a more advantageous position today than the owners of football or baskeball teams. Maybe it meant something at the time of the Kuhn v. Flood decision, but Marvin Miller and Donald Fehr succeeded in pretty much vitiating any practical effect of that ruling, by creating one of the strongest unions in the world and one that has pretty much gone undefeated in court over the last 38 years in every other respect.