Tale of American greed

The talks in Major League Baseball’s attempt restart the 2020 season are stalled, and the optics are bad on both sides of the dispute. With 15 millions unemployed and untold numbers struggling to make ends meet, millionaires and billionaires are holding baseball hostage because they are greedy.

Where have you gone, Joe DiMaggio? A nation turns its lonely eyes to the owners and players in the sport with a clear path to return. Social distancing is not a problem on the baseball diamond. Why can’t they come together and be a model of togetherness in a divided country that can’t seem to agree on anything.

For the fan, it’s all about the game. But for owners and players, it’s all about the money. I was hopeful on Monday when the news broke that the owners had made a proposal to the players to start the season in early July. Then I found out that the owners’ proposal includes a revenue split with the players in 2020.

It came as no surprise to this was a nonstarter for the players. As we await a counter from the players, I am beginning to wonder if there really will be a 2020 season. MLB had revenues in excess of $10 billion last season, but there will be nothing close to that this year, with a short season and empty stadiums.

So, owners are looking to cut costs, and the biggest line item is player salaries. The owners agreed in March to pay players on a prorated basis, but they assumed that would be for a season with business as usual. But no fans in the ballparks is not business as usual, so the owners want to renegotiate the deal.

If owners agree to pay prorated salaries – 50.6 percent in an 82-game series – it’s hard to imagine they will turn a profit this year. So, what would be their motivation to agree to restart the season and lose money? The answer, again, is optics. While most businesses can’t afford to operate in the red for a year, this one can.

I did a little internet research on all 30 owners of MLB teams. Based on the most recent information  I could find, twenty of the 30 have personal net worth of more than $1 billion. The 30th is $400 million. The owners can afford to use the 2020 season as a loss leader. If they don’t, they will lose the PR battle.

Billionaires are smart businessmen, so I suspect they already know what I just said. My best guess is that the revenue-sharing idea was just part of the negotiating process. Owners are hoping the less-affluent millionaires will blink first and agree to a pay cut. If they don’t, they may offer to play more than 82 games.

 

 

 

 

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