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March 13, 2002
A WARM DAY IN HELL:
A WARM DAY IN HELL: Bud Selig is at it again, announcing that he will enforce the "60/40 rule" (which states that baseball teams cannot have debt exceeding 40% of their value) in a manner aimed to penalize teams that do things that Selig doesn't like - i.e., sign players to long-term contracts and obtain private (rather than state) funding for new ballparks. Joe Sheehan discusses the plan's faults in detail, most notably:
Selig plans to set the value of clubs at twice their revenues, a number presumably pulled from the same place as the rest of baseball's numbers.
Three teams--the Expos, Marlins, and Red Sox--were sold this winter. The Red Sox had revenues of $177 million in 2001, and were sold for $660 million. The Expos had revenues of $34 million, and were sold for $120 million. The Marlins has revenues of $60.5 million, and were sold for $158 million.
Setting the asset value of clubs at double revenues is vastly underestimating their worth. The formula appears designed solely to mesh with the underlying idea here: scare clubs into spending less on salaries, and away from privately-funded ballparks. Make every team like the Brewers: profitable thanks to the work of other organizations and a pliable statehouse, and damn the product on the field.
...Hasn't his basic thought process been revealed? Invest in your product, and you're the enemy. Better to get the money from 1) taxpayers and 2) ballplayers, no matter how many lies have to be told to get it.
Enough said.
Posted by Dr. Manhattan at 10:09 AM | Permalink
