The Table Setter, Dec 12, 2023: Dodger Deferrals and Royal Paydays

I'm not mad at the Dodgers, I'm just jealous. Makes me like Ohtani a whole lot more too, clearly his time wasted in Anaheim caused him to do everything he can to get a ring.

Good for the Royals too. For about 30 years, they've almost always been a bottom feeder in terms of signing free agents. Still, ain't a pitcher listed that they're interested in that I want.

2 hours ago, USAFChief said:

This is ridiculous.

MLB needs to bust the union, and institute a hard salary cap.

It did wonders for the NFL. It would do wonders for MLB as well.

And MLB better do it quickly, while it still properly claims to be a "major" sport.

Agree that there needs to be a hard salary cap along with a hard salary floor.

But the owners need to step up and make it in the players best interest too, I'm in no mood for them to bust a union. I'm sure the players would at least come to the table if the offer was a 200-220M floor. The billionaires should be making a far greater sacrifice than the millionaires; that being across the board revenue sharing.

And if the big shot owners are not willing, there are way more 'have-nots' than 'haves'. The have-nots can go right ahead and kick the Yankees and Dodgers out of the league if they're not willing to make the game equitable.

2 hours ago, Rod Carews Birthday said:

I understand that the idea came from Ohtani and that it's within the rules.  However, that set of rules is severely skewed toward teams that have a ready (nearly) unending stream of cash coming in.  For the Dodgers to commit to that kind of money in the future at worst may make it a little uncomfortable for them, but I doubt it.  In essence, they're getting their player, paying him a pittance now in order to artificially deflate their payroll, add more, and avoid some luxury tax hit, while deferring costs to later, when there may be no luxury tax to pay.  For a mid or lower market team to do this requires a scary leap of faith that the money will be there in the future, which as we've seen this year, it may not.  It's why Bill Gates buying a new Mercedes (or the company) isn't a big deal, but if I buy one, I am concerned about the payments and that may make me buy a car that sells for less money.  In my case, it doesn't hurt me, because I'm not competing with Bill Gates in anything, but in the Dodgers/Twins case, it interferes with fair competition and makes an even more uneven playing field.

If the Twins showed a larger investment in winning maybe they'd have players like Ohtani wanting to come to their team on creative deals within the rules which would also raise their revenue they could produce through advertising and thus be able to afford more good players and continue the cycle.

Of course the Twins are never going to be able to spend like the Dodgers, but I'm told nearly everyday on TD that "payroll doesn't matter" and "you can't buy championships" so why do we care? The Dodgers have a big advantage in their market, but they also run their business significantly better than the Twins. I just don't understand why people are upset with players and teams trying to win. Is it a bummer for us that we're in a smaller market than LA and we have owners who don't really care to invest in winning? Absolutely. But I don't know why that makes people upset with the teams that are actually trying invest in winning within the rules that the players and owners both agree to. But to each their own.

1 hour ago, Steve Lein said:

If he really wanted to do this he would have signed 10-year $300 MIL contract.

Why? Would that make a significant difference? The only way to truly show he wants to win is to take less than half of what he could get? Seems dramatic. There's also the push from the MLBPA to maximize your value so the guys who come after you can maximize theirs. He's getting paid, helping future players, and still setting himself to be on the best team in baseball while allowing them more flexibility to improve their team.

1 hour ago, Major League Ready said:

I agree we should applaud the team and the player.  However, how many players do you suppose would be willing to accept this type of "creative approach".  Ohtani makes $45M/ year in endorsements.  Plus, the Twins also are never going to be against the luxury tax threshold so it seems unrealistic to ask why the Twins are not getting deals like this done.

We will have to wait and see what they do this year but they did quite well in modest costs deals like MAT, Solano, Pagan, and Stewart.  The big deals most people here were adamant about being needed (Correa & Mahle) have not been so good.  They also got criticized for Pagan and Paddack and that deal is looking pretty good.  

Almost 0 players would do that, but isn't that all the more reason to praise Ohtani instead of being mad that him and the Dodgers are doing this? The CBT break is definitely nice, but taking only 2 mil in actual payments while providing your team with reportedly 50-100 mil in extra revenue makes it much easier for that team to manage their finances, no? It wouldn't be helpful for the Twins to be able to pay Correa 2 mil now while putting aside extra revenue he produces that they can earn interest on or invest or whatever they do to increase that stash to be able to then pay him 30 mil down the road when their revenue would be expected to have grown anyways? They couldn't use that extra 30 mil this season because they aren't in the luxury tax? I'd think saving the literal cash is just as important as the CBT implications. Not sure why not being in the luxury tax makes it unrealistic for the Twins to do creative contracts that manipulate their spending.

If the modest cost moves are just as good why do we care about the Dodgers spending or not spending on Ohtani? If you don't need to make big deals why do we care that other teams do? Shouldn't we be happy they are if the big deals aren't really helpful?

14 minutes ago, Rod Carews Birthday said:

Oh, payroll most certainly does matter.  The way it matters most is the ability to make mistakes and then recover from them.  If Ohtani tanks or gets hurt, the Dodgers have the kind of cash flow that enables them to pay him off, ignore it, and move on.  If Correa tanks (for a lot less money), it’s a much greater drag on the Twins ability to continue to invest and compete.  A contract like the Dodgers/Ohtani contract, which would still be too risky for a smaller market team, just exacerbates an already apparent issue.  

I am also a fan of spending other people’s money, so I wish that the Twins would support a higher payroll, but I don’t think it’s entirely fair to say that ownership doesn’t care to invest in winning.  The inherent combination of much greater population base and nationalization of the fan base gives a team like the Dodgers a huge built in advantage.  It essentially makes their cash flow bulletproof — so much so that they would have to try to screw it up, no matter how much money they defer into the future.  The players and owners have agreed to the current system, but that doesn’t make it right or fair for everyone, as there is less interest in competitiveness than in just maximizing the league’s dollars to reinvest.  Unfortunately, this makes those dollars even more concentrated in a few areas.  

I agree payroll matters. But, honestly, I'm not sure why I should care about "right or fair" when some owners are clearly not interested in winning, but instead are just happy to take their revenue sharing dollars, put it in their pockets, and watch their franchise appreciate year over year. If every owner were actually interested in winning I'd have a different stance. But they aren't.

So at that point I'm all for the big guys going out and flexing their muscle in an attempt to win. I hate the Yankees. Always have, always will. But Steinbrenner wanted to win, played within the rules, and did everything he could to achieve that goal. I'll never be mad at that. Jealous? Absolutely. But not mad. Owners who take their fan's money, their publicly subsidized stadiums, and their revenue sharing and make no attempt to actually invest in winning are what make me mad. The Dodgers are the ones showing an interest in competitiveness. Cohen showed an interest in competitiveness. The Padres have shown an interest in competitiveness. I'll never be mad at them. I want them to lose because they aren't the Twins, not because they're actually trying to win and are using every tool at their disposal to do it. The reason the rules are how they are despite there being more have nots than haves is because the teams are just businesses to most of the have nots. I don't know why I'd want them to have a fair playing field when they're not even really trying to compete in the field in the first place.

14 minutes ago, Major League Ready said:

Let's use your mid-point of $210M in Payroll.  Benefits and taxes are at least another $20M so $230M.  Plus, $15M in draft bonuses (Domestic & International)  That's $245M and the bottom teams generate around $240M.  Of course, they also have to pay for hundreds of employees and all the operating costs associated with a MLB team.  Therefore, a $210M floor is not even remotely feasible.  

I hate the disparity but it's simply not financially to set the floor high enough to offset the ceiling in terms of overall dollars paid to players.  The top revenue teams produce 250% of the revenue of top teams.  You can't raise the floor enough to reduce that gap.  That's why the players were focused on increasing the luxury tax threshold.  Had the owners insisted on the modest increase in the tax threshold, the players likely would have gone on strike and the owners would have been crucified by MLB fans.

The disparity is not on the owners.  They would gladly reduce the Luxury tax threshold and increase penalties.  However, that would take a lot of money out of players pockets,  That's why it won't happen without a work stoppage.

We have next to no idea how much the top revenue teams are making, but based on their willingness for the big contracts and their willingness to build their own stadiums, we can be assured it is exponentially higher than the bottom clubs. 

You can reduce the gap if you average the revenue of all the clubs, legitimately, not what they claim, find the mid point and set the floor and ceiling 10-15M or so on each side. Or to make it more fair to the players, set the floor at the midpoint and allow teams to spend 30-40M more. I have no idea if that's 210M, It's probably much, much higher.

If the Dallas Cowboys and Buffalo Bills can do it, and the LA Lakers and OK City Thunder can do it, the Yankees and Pirates can do it too.

29 minutes ago, Major League Ready said:

Let's use your mid-point of $210M in Payroll.  Benefits and taxes are at least another $20M so $230M.  Plus, $15M in draft bonuses (Domestic & International)  That's $245M and the bottom teams generate around $240M.  Of course, they also have to pay for hundreds of employees and all the operating costs associated with a MLB team.  Therefore, a $210M floor is not even remotely feasible.  

I hate the disparity but it's simply not financially to set the floor high enough to offset the ceiling in terms of overall dollars paid to players.  The top revenue teams produce 250% of the revenue of top teams.  You can't raise the floor enough to reduce that gap.  That's why the players were focused on increasing the luxury tax threshold.  Had the owners insisted on the modest increase in the tax threshold they originally proposed, the players likely would have gone on strike and the owners would have been crucified by MLB fans.

The disparity is not on the owners.  They would gladly reduce the Luxury tax threshold and increase penalties.  However, that would take a lot of money out of players pockets,  That's why it won't happen without a work stoppage.

In a "salary floor/salary cap" world the revenues are all (mostly) shared. That's how the NFL does it. It's not about what each individual team can make in revenue, it's about what the entire league makes. The NFL rule (I believe still after the new CBA) is that 51% of total football revenue has to go to the players. That sets the floor for the salary cap. The Jags and Cowboys don't make the same revenue, but because the league shares revenue they're both able to, and forced to, spend to at least the floor. A floor wouldn't come in without a drastic change to revenue sharing.

20 minutes ago, nicksaviking said:

We have next to no idea how much the top revenue teams are making, but based on their willingness for the big contracts and their willingness to build their own stadiums, we can be assured it is exponentially higher than the bottom clubs. 

You can reduce the gap if you average the revenue of all the clubs, legitimately, not what they claim, find the mid point and set the floor and ceiling 10-15M or so on each side. Or to make it more fair to the players, set the floor at the midpoint and allow teams to spend 30-40M more. I have no idea if that's 210M, It's probably much, much higher.

If the Dallas Cowboys and Buffalo Bills can do it, and the LA Lakers and OK City Thunder can do it, the Yankees and Pirates can do it too.

I believe the league does between 10 and 11 billion in revenue each year. If the MLB were to follow the NFL situation it'd be about 51% that has to go to players, which sets the floor. Let's call it 10.5 bil in revenue. 51% of that is 5.355 bil. Divided amongst 30 teams the floor would be 178.5 mil.

10 minutes ago, TwinsDr2021 said:

Interesting nobody has mentioned the amount he is going to save in Taxes by doing this. He will not be living in California when his contract is done thus reducing his state tax by 13%. He will either be in Japan or a state that doesn't pay income tax. Not sure what Japan will tax him, but if he moved to Florida that would save him around 100 million.

 

I'm confused on how all that works. It doesn't make sense to me that he'd be able to dodge any taxes this way since he signed the contract for work in California, and is being paid for work done for a California company. Somebody much smarter than me is going to have to explain to me exactly how this all works.