Owners are doing just fine
Team value increases have outpaced salaries to players
Before jumping all over Tampa Bay Rays pitcher Blake Snell for having the audacity to open his mouth about his health and financial well-being this week, let’s brainstorm a hypothetical scenario together.
How about the MLB owners offer the players not just a share of the revenue to return to baseball in 2020, but a share of the team’s ownership?
What, that sounds too steep? Ah, right, because it’s become second nature to jump to the defense of any businessman who is prioritizing profits. That’s just capitalism. Nothing wrong with that.
But as soon as a professional athlete tries to do the same thing, look out.
In the middle of a global pandemic, baseball now has its own version of a world war as half the onlookers jump all over Snell for suggesting he won’t return to the field without making at least a prorated version of his alreadyagreed-upon contract.
The issue stems from the dispute between MLB owners and the players, who already agreed in March to pay players only a prorated version of their contracts in 2020. If they play 81 games instead of 162, they make half their salary.
Fine by both sides. They already agreed on that.
But now the owners are saying, wait a minute. We won’t be making as much money this year — approximately 50% of revenues come from gate receipts and spending in the park during games — and without fans, we’ll have less cash. Obviously.
So the owners want the players to agree that, until the economy bounces back, or until fans are allowed in the stands, players must make even less money. They may not make merely a portion of their own salaries, but instead they should simply share the revenue that comes in from TV deals and advertising, etc., during the pandemic, and that’s that.
“We make less money this year, so you do too,” is essentially the message.
And for some reason, so much of the country this week nodded their heads in agreement while yelling at Snell — who was quickly backed by others in baseball, including Bryce Harper — for standing up against it.
Let’s check the accounting books real quick, shall we?
Rays principal owner Stu Sternberg, along with financial partners, purchased a 48% stake in the Rays in 2004 for $65 million (estimating the total value of the franchise to be $135 million at the time).
Since then, the Rays have been one of the lowest-spending teams in baseball, with a bottom-three payroll in six straight seasons. According to the Tampa Bay Times in 2018, “the Rays are considered one of the biggest revenuesharing recipients, getting what is believed to be about $45 million a year.”
And yet their estimated net worth, according to Forbes, is now $1.05 billion.
Do the math on Sternberg’s 48% investment of $65 million — it’s now worth an estimated $504 million.
It stands to reason, under the same idea that stems from the owners’ request to share the revenue with the players, that if Sternberg’s
investment has gone up about eight times in 16 years, that players’ payroll will have gone up about the same.
Except it hasn’t. Sure, players are making a lot more now than in 2004. But not eight times as much. In 2004, Manny Ramirez was the highest-paid player in baseball making $22.4 million; it is now Gerrit Cole at $36 million. The average salary was about $2.3 million in 2004; it is now $4.4 million.
So the players are making less than two times what they made in 2004, while at least one owner has seen his investment grow by almost eight times.
For a local angle, let’s check in on John Henry. His group bought the Red Sox for about $700 million before the 2002 season. The Red Sox are now worth about $3.3 billion, an increase of almost five times. But it’s Snell who is the problem? Snell, who won the Cy Young Award in 2018 while making about $550,000 under MLB’s ridiculous salary structure, is inarguably underpaid. He was due $7 million this year.
If he makes a prorated portion of that in an 81-game season, that’s $3.5 million. That’s all he’s asking for. After taxes, assuming the highest bracket of 37%, he’d make about $2.2 million for playing half a season in unusual circumstances while putting himself at great personal risk.
Not only is he risking his health, but he’s risking his arm and longterm well-being. Doctors and trainers I’ve spoken to agree with Red Sox pitching coach Dave Bush, who told me Monday he’s concerned about injuries in 2020. The unusual schedule and too quick of an increase in workload after a long layoff will almost certainly result in some pitchers enduring career-altering injuries.
We can sit here and yell at Snell for sounding uneducated, for calling the coronavirus “the rona,” for saying “I’m going to get mine” as it relates to getting paid in the millions while about 20% of the country is unemployed and struggling right now.
Or we can look to the owners and hold them accountable, too.