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Sunday, July 14, 2024

Does Major League Baseball have an ownership problem?

Even though the pandemic has brought everyone financial losses, the cost-cutting has been a long time coming

There is no question that COVID-19 has brought financial hardship to people across the world. The sports industry is no exception, as the loss of fans, sales and TV ratings were all factors that contributed to the substantial losses in these leagues. As much as it hurts these teams, they’ll likely recover, as the amount of money that they possess is enough to keep them afloat for however long this lasts. But although these losses may alter the future spending of some professional sports teams, the issue of money in Major League Baseball (MLB) runs deeper and began even before the pandemic. 

With an estimated loss of $1 billion, the shortened season coupled with no fans in attendance hit MLB hard. This caused many losses of jobs for minor leaguers, club employees and even workers in the stadiums as teams looked to save money. Even a big team like the Boston Red Sox cut the salary of anyone making over $50,000 a year as a way to lessen the losses. The Pittsburgh Pirates cut the 401k benefits for their baseball operations employees and some teams were even discouraging minor league players from applying for unemployment benefits, as this would affect the league if enough players received them. 

These financial issues bled into the regular season and also the offseason. Not only did many teams avoid major spending, but a lot of them unloaded talent for financial reasons. This may be seen as a result of COVID-19, but an in-depth look shows that it has been a long time coming for a lot of these teams, and recent losses are not a valid excuse.

The Cleveland Indians unloaded franchise superstar Francisco Lindor and starting pitcher Carlos Carrasco to the New York Mets in early January. Lindor is set to be a free agent after this upcoming season and is in line to get over $200 million for a long term deal. Even after making the World Series in 2016, Cleveland has been a fire sale since, determined to keep spending low, leading to subpar seasons. Although their owners’ valued net worth is over $4 billion and the team worth about $1.15 billion, the team will have a payroll of under $35 million this upcoming season, the lowest in the majors.

Speaking of low payrolls and subpar seasons, the Pittsburgh Pirates are on the same boat, as their lackluster past couple of years can be attributed to their unwillingness to spend. Valued at $1.26 billion, the Pirates have surpassed the .500 mark just four times since current owner Bob Nutting took over in 2007. Nutting, worth $1.1 billion, has long been known in the baseball world as an owner who complains about the finances of the game. The Pirates are not one of the richest franchises but their spending is not a result of lack of talent, since they have had some in the past. But, as many of these teams do, they preferred to trade or let them go rather than to pay them.

Another team that has fallen under the scope of penny-pinching is the Oakland Athletics. The Athletics’ money ways have been well-documented, and with an analytics-driven mentality, the team has found a way to field playoff teams without spending a lot of money. While they have been appreciated for finding ways to do so, they have hid behind their small success and found a way to avoid criticism of how cost-cutting they really are. The A’s mask as a small market team, but are a part of the sixth-largest media market in the U.S. Their owner, John Fisher, is the eighth richest owner in MLB, but his team constantly ranks near the bottom in payroll. Overshadowed by the image of Brad Pitt in the film Moneyball, the Athletics have long been seen as a feel-good, underdog-type team but in reality, it is more upsetting and frustrating for the fans than feel-good.

There are many more examples of teams like this in baseball, from the Kansas City Royals to the Baltimore Orioles and now recently, the Boston Red Sox, among many others. The common reasoning and excuse is that these teams do not have the same amount of money to pour in as the big market teams do. That, however, is untrue, as shown this same offseason with the San Diego Padres. Ranked 29th in biggest media market and being in the bottom half of the most valuable teams, the Padres have not been shy about spending to compete, giving Manny Machado $300 million and rising star Fernando Tatis Jr. $340 million as well as adding many more pieces like Yu Darvish and Eric Hosmer. Always known as one of the lower valued teams, their recent surge to try to compete has been evident by their willingness to spend, once again proving that a MLB team does not need to be in a big media market to compete. In contrast to public belief, the Padres have shown that spending to field a competitive team is more about the leaders in charge rather than the location. 

“We all lost money in the pandemic, but they’re all reading from the same script,’’ an anonymous West Coast-based agent told USA Today back in January in regards to this past offseason. “They say, ‘I have no idea what my budget is.’ Every single GM is telling me that. It’s all B.S. They don’t know what the budget is until they sign the player they want. They’re trying to manufacture a depressed market.”

All teams don’t make the same amount of money. Of course, there are some that bring in more than others, but there seems to be cost-cutting owners across all net worths Even with many using this pandemic as an excuse, the fact of the matter is teams rake in massive amounts of money every year, and hiding behind the pandemic losses does not erase the amount they’ve gained in previous years. 

Sports teams are supposed to exist to represent a community, not just to make their owners rich. Being that MLB is in a constant battle to try and garner the attention of younger viewers, the reluctance to spend may cause many younger viewers to turn away if their team is performing badly. Whether it is implementing a salary floor to at least set a minimum payroll or changing the luxury tax system, the MLB office has options as to how they can go about solving this issue, as its ramifications may not be evident until it’s too late. 

Written by: Omar Navarro — sports@theaggie.org


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