Minnesota and Big Contracts

[old nurse]

 

No one has ever said that it guaranteed anything. That is a straw man.

How well do teams that avoid big contacts do in the playoffs?

What Twins team in the last 10 seasons was one or two players away from being championship quality? Which team was projected to be a 9o win team that one more player could push it to the top?

 

Tampa Bay made it to the World Series

The Royals won one and lost one.

Cain was about the only one the Brewers have signed. They made it to a championship series.

[old nurse]

By Forbes data on revenue per fan and the baseball revenue sharing system for a 20 million dollar a year player to "pay" for themselves they would have to bring in 900000 new fans.  Last year's winning team brought in 300000 more in attendance.

 

The other side is by Forbes numbers, is that it costs about 100-110 million to  pay for everything that is not a mlb contract' for the Twins. That is pretty much similar to some other clubs. Although I think it is just an educated estimate it is the best guess they have. By Forbes estimates the payroll could be around 160 million without costing the Pohlads money.

 

There is a valuation on paper of the team. It is not really money that the team can use. If you borrow against the value of your team you become the Wilpons. Sell the team you say. The new owners become like the Miami Marlins. Revenue goes to debt service.

 

 

[ewen21]

I'm asking billionaire owners to make less profit.....not (likely underpaid) workers to give up wages that they need to pay their bills. I'm not sure how those two things are comparable at all. Not even a little.

 

And, again, I'm a fan....I'm speaking for what I want as a fan. Not an owner. Not an employee. Not a player. A fan.

 

As for Disney, if they stopped investing in good movies, and put out bad movies, I'd stop watching them. Since the TWins have failed at drafting and developing or trading for starting pitchers, and since they are in contention, I'm asking them to sign some FA pitchers, a stance you agree with. If they won't pay what other teams pay, then the product probably won't be good.

 

This isn't the movie business, or food business....there are only a few hundred human beings that can play baseball at an elite level. If you want an elite team, you have to have some of those elite players.

Yeah well the owner create the structure the players get to play in and they are the risk takers, not the players.

 

The players get guaranteed money and make millions of dollars. They can sign a contract, get guaranteed millions and be a dog like Chris Davis. You advocate for the players way too much, Mike. In what other world do employees get the kinds of pay increases they have enjoyed over the last 25 years? They have the strongest union in America and you (a fan) is going to advocate for them? Ridiculous.

 

The players make enough. If anything should be done about sports franchises a larger percentage of revenue should be taken off the top and be given public works projects. There is no legitimate explanation for where salaries have gone AND the way middle class families have been priced out of games ...

[goulik]

Yeah well the owner create the structure the players get to play in and they are the risk takers, not the players.

The players get guaranteed money and make millions of dollars. They can sign a contract, get guaranteed millions and be a dog like Chris Davis. You advocate for the players way too much, Mike. In what other world do employees get the kinds of pay increases they have enjoyed over the last 25 years? They have the strongest union in America and you (a fan) is going to advocate for them? Ridiculous.

The players make enough. If anything should be done about sports franchises a larger percentage of revenue should be taken off the top and be given public works projects. There is no legitimate explanation for where salaries have gone AND the way middle class families have been priced out of games ...

This goes down a whole new rabbit hole but I wish the MiLB players were included in that union and got some of that increase...

[rv78]

 

This is why I think they actually spent big on Puckett and Mauer. Both times it would have been REALLY bad for business to let them get away. Even worse than letting Hunter and so many others leave. It could be fairly argued that the only reason they spent big on those two contracts was for business reasons and not to try and win.

Not exactly.

Puckett could have went to Boston for more money. HE chose to stay in Minnesota. 

[goulik]

Not exactly.

Puckett could have went to Boston for more money. HE chose to stay in Minnesota.

 

And Mauer could have gotten more on the open market from the Yankees also. Doesn’t change anything about why they spent that much.

[Major League Ready]

 

By Forbes data on revenue per fan and the baseball revenue sharing system for a 20 million dollar a year player to "pay" for themselves they would have to bring in 900000 new fans.  Last year's winning team brought in 300000 more in attendance.

 

The other side is by Forbes numbers, is that it costs about 100-110 million to  pay for everything that is not a mlb contract' for the Twins. That is pretty much similar to some other clubs. Although I think it is just an educated estimate it is the best guess they have. By Forbes estimates the payroll could be around 160 million without costing the Pohlads money.

 

There is a valuation on paper of the team. It is not really money that the team can use. If you borrow against the value of your team you become the Wilpons. Sell the team you say. The new owners become like the Miami Marlins. Revenue goes to debt service.

 

Have you accounted for payroll taxes in this calculation? I read somewhere it's around 11.5% for MLB teams.

[ewen21]

 

This goes down a whole new rabbit hole but I wish the MiLB players were included in that union and got some of that increase...

AMEN to that.  Can't the players accept 5% less in order to give minor league players a living wage?  The average player salary has increased by seven and a half times over the last twenty years.  They can't afford to give a small pece of the pie to their bretheren?  It is actually shameful that the player's union does nothing about this.

[big dog]

 

This is why I think they actually spent big on Puckett and Mauer. Both times it would have been REALLY bad for business to let them get away. Even worse than letting Hunter and so many others leave. It could be fairly argued that the only reason they spent big on those two contracts was for business reasons and not to try and win.

Not long after Puckett, who was in fact a free agent, signed for 3 yrs, $9 million and became the first $3 million player (for about 48 hours iirc), the team then re-signed Hrbek, who was also a free agent.  Herbie got $14 million for 5 years, and he also turned down better offers from Detroit and Seattle (12/7/89).  I'm sure this was for business reasons, but let's not forget those two players were pretty darn crucial in winning the WS in '91. I think "trying to win" might just have been part of the equation.

[big dog]

Reports are the Mets might soon be sold for $2.5 billion or so.  Winning doesn't seem to matter all that much for overall profits, when the big payday is selling the team.

 

A lot of us were happy when Cal Griffith sold the team- he had no other source of income than the Twins, so he had to make it profitable every year and had little to spend on extras, like umm players.  When he sold to the ultra-rich Pohlads fans were thrilled that someone with some of their own money to spend was now in charge.  I think it's fair to say that didn't work out the way that we naively hoped.

 

 

[old nurse]

 

Have you accounted for payroll taxes in this calculation? I read somewhere it's around 11.5% for MLB teams.

I have no doubt that Forbes would not have overlooked payroll taxes in their operational expenses

[tony&rodney]

The Pohlads are not opposed to spending money if they are going to make even more money. The Twins team as currently constructed is on the cusp; they are competitive to a point but need a boost. Signing a player or players to supplement the core will necessitate a payroll in the $140-150M territory. This works for 2020. A big contract cannot be mulled over as reasonable, especially because it fits into a budget of less than $150M. Of course these numbers are ridiculous. That is totally irrelevant. Cole or Bumgarner plus others are very doable this winter. A big contract can be signed now, and no it will not have future deleterious effects on the team's ability to compete. The time is now.

[Major League Ready]

 

I have no doubt that Forbes would not have overlooked payroll taxes in their operational expenses

 

I looked through all of the old profit projections I am guessing are the same reports you used to estimate operating cost and came up with the same rough estimate as you.  

[Major League Ready]

 

The Pohlads are not opposed to spending money if they are going to make even more money. The Twins team as currently constructed is on the cusp; they are competitive to a point but need a boost. Signing a player or players to supplement the core will necessitate a payroll in the $140-150M territory. This works for 2020. A big contract cannot be mulled over as reasonable, especially because it fits into a budget of less than $150M. Of course these numbers are ridiculous. That is totally irrelevant. Cole or Bumgarner plus others are very doable this winter. A big contract can be signed now, and no it will not have future deleterious effects on the team's ability to compete. The time is now.

 

I am going to keep asking the same question until someone answers ... If Cole is so "doable" why is there only one instance where a pitcher of this status was signed by a team with equal or less revenue and that team just happened to sign a billion dollar TV deal. Opinions here are not consistent with history.

 

BTW ... we should also note the Dbacks were 1 game above 500 for the 4 years with Greinke. There is literally not an example of a team in the bottom half of revenue building a dominant team with this strategy in the past 30 years.

[Major League Ready]

 

Again, asking workers who aren't billionaires to give up wages is very different than asking owners to take less profit. And, I'm a fan asking owners to do this, not an owner asking employees to do something. And, in the NFL, there are instances of players taking less money so other players can be signed.... So it does actually happen. But that's a decision an individual gets to make, just as the owner can decide to make more or less profit.

I've never once said the owners shouldn't make money. ..

 

 

You keep banging this drum because you think it's reasonable. Did Chris Davis or Jacoby Ellsbury or any of the long list of players who tanked after signing a big contract offer to give back some of their pay when they produced so poorly? Business owners don't accept less profit because they are already wealthy. If they were willing, I agree with Birdwatcher that hopefully they would contribute to something more meaningful than a couple extra wins.

 

You keep pressing this presumption that owners accepting less would somehow enable teams to acquire more talent and that premise is fundamentally flawed. The Twins relative financial capacity does not change in a world where owners give up profits even if they only did it in years they hope to contend. There are probably 25 of the 30 teams that are hopeful of competing this year. The only net difference would be that players would get payed even more. I have pointed this out to you twice in the past but you elect to ignore the facts that don't sync with your annual focus that all would be well if the Twins would just sign a giant contract. This debate between you and I started way back when you insisted signing Ellsbury was a great idea.  

 

[Major League Ready]

 

Of course, they could occasionally choose to make less profit. They aren't obligated to, but fans aren't obligated to buy tickets to teams that value profit over winning either. It's a balance, that I think the owners have rarely sided on the side of spending more when the team was great. That's their right, of course, but they chose this business. If you judge success by winning playoff games, they are not so successful lately. If you judge it by profits, I'm sure they are plenty successful.

 

2019 estimates are not out yet but they were 25th in profit in 2018. They did elect to be aggressive with spending just 2 years ago.

[old nurse]

The World Series has been dominated by teams that have the ability to spend money. KC won without big name free agents. The Giants won with pretty much home grown talent The Cards had Holiday. Houston traded for Verlander. They got theirs without signing a big name free agent. The key is to have a solid core of homegrown talent, preferably an excess. Maybe the Twins are getting to that point. Houston by producing talent allowed them to trade players that they did not miss.  Being able to add the pieces  has been a big part of success. It seems like the other teams then value your prospects more. Cole brought back nothing for the Pirates.

 

[Richie the Rally Goat]

Mod Note:

 

Keep it about the OP and not each other. goulik put good research and writing into the thread starter and deserves good debate about the Twins willingness to increase total payroll.

[ewen21]

To anyone who feels we need to sign a guy to a monster contract you don’t distinguish between what the Twins are and what the Dodgers and Yankees are. The Yankees and Dodgers make so much money they can afford to pay the luxury tax. They can sign guys to horrible contracts like Ellsbury and Stanton and not miss a beat. The Twins do not operate on the same plane.

 

Also, to use the argument that franchises sell at a profit ALL THE TIME in no way erases the fact that owners are the ones taking the risk.  We never know what can happen.  Furthermore, the average player salary has increased over seven times the amount it was in 1999.  How long is this supposed to go on?  At what point is there saturation?  To act as if this will last forever and ever ignores logic.  The owners take the risks and players have monstrous guaranteed contracts.  They don't need advocates.  They have their own union and it is the most powerful union in baseball.

 

The structure currently existing in baseball is extremely favorable to players making all the money they want.  The richest teams will do the best in this structure because midmarket teams and small market teams cannot absorb a $240 million dollar mistake. 

[Mike Sixel]

The owners are not taking any real risk. They could lose the team, and still be rich beyond belief. All they are risking is making less profit.

 

Players are not making all the money they want. Not even close. Revenue is rising faster than pay, league wide. The money either goes to the players, or the owners. Why anyone wants it to go to the owners more than the people doing the work is incomprehensible to me.

[strumdatjaguar]

State and Municipal Taxes are paid proportionally by visiting players (I believe).   I don't want the Twins to be saddled with too many long term contracts for aging players that block our system's future superstars as they enter their prime. 

[tony&rodney]

"The owners takes risks ..."

I'm just wondering when was the last time that an MLB team owner lost their team to bankruptcy court action or something akin to that? Yes, the players make huge money, like other entertainers - the public likes to spend their money on entertainment. I was thinking that only the San Francisco Giants among the four large professional sports organizations paid for their own stadium. Whatever, most arenas and stadiums are paid for by citizens and then the league/team agrees to play in that place. Not a shred of expertise in my experience about this, but just wondering .... what is the risk to owners?

So, if the budget is $40M+ more than current expenses, then there is room for a big contract in theory.

[Mike Sixel]

State and Municipal Taxes are paid proportionally by visiting players (I believe). I don't want the Twins to be saddled with too many long term contracts for aging players that block our system's future superstars as they enter their prime.

They are thirty million under last year. They lose Cruz after this year. They likely lose Rosario. They won't sign Garver to a long term deal, he can't be a free agent until he is 31. That leaves Sano, Buxton and Berrios to sign. They have plenty of money to add a great player, and sign those players, and stay under last year's budget.

[tony&rodney]

 

They are thirty million under last year. They lose Cruz after this year. They likely lose Rosario. They won't sign Garver to a long term deal, he can't be a free agent until he is 31. That leaves Sano, Buxton and Berrios to sign. They have plenty of money to add a great player, and sign those players, and stay under last year's budget.

 

... and Gonzalez, Avila, and Odorizzi - $31M plus the others - the money is there. Falvine are working hard to find someone (pitcher) who has a working pen.

[Richie the Rally Goat]

"The owners takes risks ..."

I'm just wondering when was the last time that an MLB team owner lost their team to bankruptcy court action or something akin to that? Yes, the players make huge money, like other entertainers - the public likes to spend their money on entertainment. I was thinking that only the San Francisco Giants among the four large professional sports organizations paid for their own stadium. Whatever, most arenas and stadiums are paid for by citizens and then the league/team agrees to play in that place. Not a shred of expertise in my experience about this, but just wondering .... what is the risk to owners?

So, if the budget is $40M+ more than current expenses, then there is room for a big contract in theory.

I would think if margins were actually as thin as some of the article/estimations show, we’d see a lot more of the private equity leveraged buyouts like we saw in retail during the mid-aughts.

 

That would be a nightmare scenario for fans, owners and players alike, but with ownership already private, those details are rather opaque. I guess we saw a version of that 17 years ago with the Expos being purchased by the league and resold and moved.

 

Since then team valuations have only increased.

[Mike Sixel]