Thread: Article: MLB Payroll By The Numbers

Originally Posted by Boom Boom

It wouldn't surprise me a bit if every single number in that USA Today article was fudged.

The Twins saw the fans start to leave Target Field late last year, and the decrease in payroll reflects an expectation of fewer tickets sold. If the Twins expected to have packed houses for every game in 2012, the payroll would have stayed close to where it was in 2011.

This is certainly true, but doesn't cutting the payroll mean you'll probably stay the same or get worse, and in that situation lose even more fans? Based upon this hypothesis we'll eventually see a payroll back around 60 million and only have about 10,000 fans a game. It's the late nineties all over again! Which comes first the chicken or the egg?

One other point, I know the Pohlads have and will always manage this like a business, but let's not forget they are one of the richest owners in all of sports. They certainly "could" spend enough to lose money without any real impact on their personal wealth or long term goals. Heck I'd be happy if they just put all of their revenue back into the organization, but they don't even do that. When you consider the ROI they already have banked from the teams increase in value, they are simply taking advantage of a willing fan base.

Originally Posted by mike wants wins

Does anyone really think they will make a bigger signing next year? Why would you think that?

I could see them signing a free agent pitcher this offseason, depending on who all is available and what the market is like. I don't think they'll sign any bats. This past offseason was the stopgap year for position players (Willingham, Carroll, Doumit).

One other thing, I know a lot of you feel it's a "business" and they need to run it like a business. Let's not forget that many, many big businesses do NOT pay dividends to their owners each year. Despite Apple's huge incomes, it's only this year that they are paying the owners. Lots of owners have made lots of money on Apple stock by buying and selling it without every taking any income out of the organization. Sports franchises are unique in that they receive anti-trust exemptions, subsidized stadiums, etc. They almost always greatly appreciate in value regardless of what the owner does, or the economy...see the LA Dodgers as an example. There is no reasonable "business" reason for them to budget to make money, they are making a great ROI just on the teams increased value.

Originally Posted by whydidnt

There is no reasonable "business" reason for them to budget to make money, they are making a great ROI just on the teams increased value.

That long term ROI doesn't pay the daily bills, the salaries, etc. The short term ROI is what does that, and it certainly is reasonable to budget for a profit in order to do so. Although I'm sure we'd have to agree on what "reasonable" means for this aspect of the conversation to go anywhere. Who gets to decide what reasonable means?

Originally Posted by scottz

That long term ROI doesn't pay the daily bills, the salaries, etc. The short term ROI is what does that, and it certainly is reasonable to budget for a profit in order to do so. Although I'm sure we'd have to agree on what "reasonable" means for this aspect of the conversation to go anywhere. Who gets to decide what reasonable means?

I disagree, the profit is what they take out of the organization AFTER paying the bills. That's the definition of profit. They don't "need" to budget to make money to pay the owners as the owner will get paid when they sell the organization. Like I said if you think MLB franchises should be run like a regular business, then I think we need to take away their anti-trust exemption and tax-payer funded stadiums. The Pohlads are rich enough to lose 25 million a year for Ten years and they would still be Billionaires (yes with a B), and if they sold the team they would get that $250 million back in a heart beat.

All the apologists here will tell us last year the Twins suffered 99 losses due to injuries, and injuries only. Those same apologists will then turn around and tell us cutting payroll is justified because the Twins can't hope to compete in 2012, and probably not for several years. You can't have it both ways.

There is NO logical reason to claim both.

And there is NO logical reason that cutting payroll helps this team now or somewhere down the road.

Originally Posted by whydidnt

I disagree, the profit is what they take out of the organization AFTER paying the bills. That's the definition of profit. They don't "need" to budget to make money to pay the owners as the owner will get paid when they sell the organization. Like I said if you think MLB franchises should be run like a regular business, then I think we need to take away their anti-trust exemption and tax-payer funded stadiums. The Pohlads are rich enough to lose 25 million a year for Ten years and they would still be Billionaires (yes with a B), and if they sold the team they would get that $250 million back in a heart beat.

It isn't like the end of the year comes, they balance the books and say "we made $20 million dollars! Here's yours, here's yours, here's mine. Now, let's start at zero again." Any business plays by the rules allowed to it and tries to come out ahead (and rules are different for different businesses - i.e., exemptions and public subsidies in baseball but not for shoe store companies). They need cash on hand to pay people and they need cash in the bank for future plans. If they can sign player A (Willingham) for less than player B (Cuddyer) and get similar production, they'll do it. If that means the payroll gets lower, that improves the business because then they can put more money into signing draft picks or increasing a scouting budget or whatever other things they decide on. It's not a regular business, but it absolutely is business.

The new CBA and the Twins' multitude of top-75 picks basically locks them into spending 8 figures on the draft this summer. If you combine that spending with the $100M-ish figure (which accurately includes the money going to Nishi and Marquis) and compare it to 2011's total spending on the MLB payroll and the draft, the cut for this year looks a lot more modest. If they manage the middle-of-the-pack finish this year that a lot of us are expecting, their 2013 draft spending will be considerably less. Just maintaining the total MLB/draft spending for 2013 at the same level as 2011-2012 should see the payroll climb to around $110M.

Assuming they're prudent enough to decline their options on Baker and Capps, that would give them $35M+ to spend on free agents. They'll need 3 starters and a couple of relievers, but the projected crop at those positions looks very favorable. I doubt they'll bid on Cole Hamels, but a couple of solid 2nd-tier options (Brandon McCarthy, Shaun Marcum, Colby Lewis, etc.) should be well within their means.

Originally Posted by whydidnt

This is certainly true, but doesn't cutting the payroll mean you'll probably stay the same or get worse, and in that situation lose even more fans? Based upon this hypothesis we'll eventually see a payroll back around 60 million and only have about 10,000 fans a game. It's the late nineties all over again! Which comes first the chicken or the egg?

One other point, I know the Pohlads have and will always manage this like a business, but let's not forget they are one of the richest owners in all of sports. They certainly "could" spend enough to lose money without any real impact on their personal wealth or long term goals. Heck I'd be happy if they just put all of their revenue back into the organization, but they don't even do that. When you consider the ROI they already have banked from the teams increase in value, they are simply taking advantage of a willing fan base.

This of course assumes that no players improve, all the players in the minor league system fail to become competent big-leaguers, and the Twins draft absolutely no one of consequence. Just one of the three happening is a long shot, but all three at the same time? Virtually impossible.

As for your sans-cullotes-esque salvo about owners taking advantage of a willing fan base, welcome to professional sports in the 21st century, you must be new here.

Originally Posted by USAFChief

All the apologists here will tell us last year the Twins suffered 99 losses due to injuries, and injuries only. Those same apologists will then turn around and tell us cutting payroll is justified because the Twins can't hope to compete in 2012, and probably not for several years. You can't have it both ways.

There is NO logical reason to claim both.

And there is NO logical reason that cutting payroll helps this team now or somewhere down the road.

I don't think the only reason the Twins lost 99 games last year was due to injuries, though it certainly factored in. I think the 2011 Twins limiting factors were (in no particular order):
1) injuries
2) the bad scouting/signing of Nishioka
3) career dips for a number of healthy players (pretty much everyone but Cuddyer)
4) glaringly thin reserves pool, made apparent by #1
5) substandard starting pitching

So this year:
1) a) they made some orgizational changes in the medical department, b) hope they stay healthy
2) cut their ML losses on Nishioka, signed Carroll as a stopgap, and plan on Dozier being here this year or next
3) made the decision to cut loose Cuddyer, Kubel, Young (sell-low trade), and Nathan. stopgaps in Willingham, Plouffe, and now Clete Thomas in the OF.
4) this takes time to remedy.
5) this takes time to remedy (4 of the 5 starters from last year are starters this year).

because of 3, payroll goes down. because of 4 and 5, it will stay down next year, likely, while they build for the future. 2014 or 2015 has to be the plan, and to be the best they can be then, it doesn't make any sense to overspend now. who were we going to sign? Buerhle? would that have helped? it's not being an apologist to think they are thinking longer term as a business decision.

Originally Posted by USAFChief

All the apologists here will tell us last year the Twins suffered 99 losses due to injuries, and injuries only. Those same apologists will then turn around and tell us cutting payroll is justified because the Twins can't hope to compete in 2012, and probably not for several years. You can't have it both ways.

There is NO logical reason to claim both.

And there is NO logical reason that cutting payroll helps this team now or somewhere down the road.

Some logical people can hold more than one thought in their head at once. Some can understand that injuries to your best two offensive players and possibly top three and almost certainly four of your top five would have a huge effect...without also believing that it's the only reason. Some might understand that there are actually other teams in the leauge that get better and worse around the team they follow closest and so a contending team one year could be a middle of the pack team the next without having changed all that much. Claiming things are not logical simply because they are not how you see them seems fairly egocentric and small-minded.

How does the Bullpen look? Terry Ryan stated on Kfan, that it scared him. That was before the first pitch was even thrown.

Upgrading the leagues worst Bullpen would have cost just a few million dollars more.

There were a lot of games ruined by the Bullpen last year.

My general feelings about payroll conversations are a bit ambivalent. Often it seems like a waste of time to worry so much about something one has zero control over. But at the same time, it can be fun to think about how to try to maximize value within contraints and "play along" so to speak. It seems strange to me, though, when people start wanting or expecting or in their minds directing "their" team to expand those constraints. There is some discrepancy about how much is available, so I get that. But when people start presuming to tell other people how to spend their own private money, it always feels a little...icky. So I always bristle at, "They're rich, so they should do 'x' with their money."

Keep in mind that a lot of the big free agents would not come to Minnesota to play anyway. Don't forget the other end of the equation--players have to want to come to the Twin Cities.

Originally Posted by mike wants wins

Does anyone really think they will make a bigger signing next year? Why would you think that?

I think the answer is definately NO.

Willingham's deal was the largest free agent signing the Twins have ever had....roughly 3 years 21 mill.

Both sides have a valid point of view.

Either way, the Pohlad's will make their money

Originally Posted by scottz

I could see them signing a free agent pitcher this offseason, depending on who all is available and what the market is like. I don't think they'll sign any bats. This past offseason was the stopgap year for position players (Willingham, Carroll, Doumit).

Next year they will have Pavano, Maquis off the books for sure and if this season keeps up like this they will not re-up Baker or Liriano either. That is $25+ million off the books for next year. They should be able to get a couple decent arms for the rotation for $10-12 mill each.

Originally Posted by Highabove

After reading most of the comments, I have changed my view on Payroll.
I now believe that the Pohlad''s did the wise move by slashing Payroll.
The Fan Base is very supportive of this. The Pohlad,s should and will continue to slash the payroll. We should see a 65-70 million dollar payroll soon. I'm sure the Fan base will welcome this with open arms. Even with lower attendance, the Twins will continue to make big money. Their Big market ticket prices will insure them of that. The Revenue will be a lot lower too. They will never have to touch 100 million Dollars again!

Don't be all butt-hurt.

If the Twins sign Nate & Cuddyer they would of had a much better team and someone to trade come August.

Willingham is their largest FA contract ever. They have never traded for or signed a big time, legit player, in his prime earning years to a bigger contract than that, and that's the only 1 I can even think of. Why would you expect them to sign a legit MLB starter for big money next year, given over 40 years of history suggesting otherwise? Does anyone think that is Terry Ryan's approach?

I have zero issue with the cut in OF salaries, as Willingam is better than Cuddeyer and cost less, and Kubel is somewhat replacable. It's the lack of spending on the INF and the pitching that convinces me nothing has changed in Ryan's approach from his previous tenure.

And, there was plenty of money to sign better pitchers than Marquis this year, they just didn't. There was money to have a better bullpen, and they didn't.