Major League Ready

Nick, you disproved one of Chief’s data points. However, you did not even consider the possibility he is still right. At least your post does not illustrate any consideration. Many sources have reported that in-stadium revenue are 40%. Let’s actually consider Chief’s point instead of taking one side or the other without any actual assessment of what a 40% drop in revenue means. If we look at various sources, player salaries (with taxes and benefits) are around 52%. Forbes and Statistica report that net income is around 13%. If these are correct, operating expense is 35% of revenue. If anyone does not want to believe operating expense is 35, that OK, we can still pursue Chief’s position that we don’t need a deep dive to understand full player salaries in the face of a 40% decrease in revenue is not viable. The one data point that is relatively easy to derive is player salaries. We know exactly how much they are paid and it’s not that tough to estimate payroll taxes paid by employers. It’s public record and it is generally reported to be 11.5%. If we assume full pay for players, based on a 40% decrease in revenue Player Salaries = 86.66% of revenue. This does not include MiLB players, coaches, or meals. In other words, Chief already understood the numbers well enough to know this model was not feasible without needing a financial audit. We really don’t need any additional information to understand full compensation is not viable. If you accept reported Operating Expense estimates, calculated at 60% of normal revenue, Operating Expense = 58% of Revenue. Therefore, even if you believe Statistica is getting paid to produce numbers that are of by a factor of 1/3 (which obviously is not the case because they are still in business) Operating Expense would still be 40% of revenue when revenue is 60% of normal. Of course, this little exercise is quite telling in terms of the viability of providing normal compensation with a 40% decline in revenue. If you are still not convinced, look at the proposals. Owners wanted less games. Why would this be the case if they were not losing money? The bottom line estimate based on projected revenue and stated percentages is as follows. Revenue 3,000,000,000 Operating expense $1,820,000 Players 2,240,000 Net loss = 1,060,000 It would appear the league made an offer where teams came close to breaking even in the 2nd half. In other words, the owners have made an offer where they will not recoup any of the losses from the 1st half. They are not asking for a third of what they normally make and asking the players to take a cut that supports them in getting back the massive first half losses. They are saying they will play for no financial gain, even take a loss. The players are saying sorry, we don’t care if there is a pandemic, we want 100% of normal compensation. I am with Chief. They have made an offer to play that is very reasonable. The players on the other hand are saying we don’t care how extreme the circumstance, we want every dime we would have got under normal conditions. The owners have taken care of their employees and MiLB players. Which side is demonstrating they don’t care about the game, the fans or the people who will be unemployed if the season is not resumed? Which side is showing no love for the fans.

Can anyone post a link that confirms the incident was racially motivated. If all this is based on unconfirmed assumption, any suggestion of a superior understanding or superior intellect is rather ironic. Taking such a hard position without full confirmation of fact and validation of assumptions is simply not consistent with advanced critical thinking skills or even an good understanding of problem solving practices. Sorry, it's just another example of people without any credentials thinking the problem is what other people don't understand.

Maybe Max’s parents encouraged him to pursue various forms of critical thinking, scientific method or business decision making. Perhaps he wanted to validate the assumption this was racially motivated before opening his mouth. Was there any evidence in the first couple days that this was racially motivated other than Chauvin was white? Intelligent or even reasonable people validate their assumptions and conclusions before taking a strong position. Reasonable people don't burn down innocent peoples homes no matter what. One could argue Max demonstrated better judgment than Sharpton, Jackson, and others who fanned the flames which resulted in massive violence. I am not hearing any criticism of their inability to rally peaceful demonstration. Perhaps Max was so wise as to understand the situation was already dangerous and he did not want to add fuel to the fire. I sure would not blame him if he decided to wait for reliable information and also wait to see if appropriate charges were levied against Chauvin and the other officers that were present. Running off in this type of emotionally fueled rampage and indictment of everyone that is not willing to universally condemn all police officers is much more harmful than Max Kepler refusing to take a political position. The masses don’t understand the problem nearly as well as they think they do. There are people that possess a long list of credentials on this and related issues. That’s who I want to hear from. I really don’t give a **** what Max Kepler has to say. Maybe that’s another problem we should address. That is people listening to people because they have name recognition instead of listening to people with expertise.

If I were to make a list of people who reacted poorly to this tragedy, Max Kepler’s actions are too far down that list to be given a second thought. My first disappointment is that the MPD did not review the video and make an arrest within a few hours. That just might have defused this, at least a little. I recognize that it takes time for the proper review. However, I just can’t imagine it too long to verify this was a criminal act. The explosiveness of this situation should have been recognized. Every hour that went by without an announcement to arrest / prosecute fueled the rage. In the grand scheme of things, Max Kepler’s unwillingness to take a stand is not even on the radar for me. I find it far more disconcerting that anyone could assess the actions of various people in this tragedy and conclude Max’s failure to take a stand worthy of concern. The actions of thousands of people were nothing short of criminal and barbaric. People were literally burning down the city and some of you want to defend singling out Max Kepler for not taking a stronger position. God help us! I have not spoken to a single person who did not find the actions of office Chauvin reprehensible. Of course, there are still plenty of people who hate based on some form of ethnocentrism. That’s a problem. The thinking that leads to singling out Max Kepler while ignoring thousands of people performing criminal acts is also a problem. I suggest we call out those who advocated violence and those who reacted with violence. Where is the outrage for not dealing with this tragedy in a civil manner? We should be much more concerned with a society that reacts this way than Max Kepler’s unwillingness to take a stance. We should also be concerned that there are those who find moral superiority in attacking Max Kepler while somehow ignoring the thousands of people whose actions were not consistent with a civil society.

This is my last comment on this subject. You keep throwing out a bunch of losely related concepts which have little relevance IMO as to if we have a season or not.. Once again, the choice is play or don't play. You seem to have a basic understanding of business drivers. Based on paying players full scale which increases loses over not playing at all it's likely the owners just cancel the season. What would your employer do? There is no question, they chose the scenario with a better financial outcome that is obviously better. This is not exactly complicated business theory. It's quite a different scenario for players. They have no exposure to loss. There choice is to make less or make nothing. Some of you just can't get off the premise the owners should just accept whatever loss is necessary to pay the players in full. This is a incredibly bias as well as a naive position. The average fan will not side with the players if they are unwilling to play 3 months of baseball for the equivalent to 33 years of wages for the average American, especially given the massive losses the owners are willing to accept under the scenario that pays the average player $1.66M for 3 months work. I actually doubt the majority of players have a Blake Snell attitude. At least I would hope their union would provide them with a report or video detailing the estimated financial income for both sides under the proposed scenario. I just find it difficult to believe most players are going to expect the owners to play this season under a scenario where playing means they lose substantially more than not playing. At that point I would hope they say a million seven on average is better than nothing. I would really by pleased if they thought about the fans that are responsible for their massive income potential.

Hopefully, it was obvious I meant MLB team. Player makes absolutely no sense. The context was loses associated with a team so it should be obvious I meant to say team. I should proof read and often I don't.

I agree completely that MilB players should be paid more or at least paid more consistently instead of unproven players getting multi-million dollar signing bonuses. However, I don't agree that poor pay during their development has any merit here. I went to college and grad school for 7 years and paid for that education. MiLB players are not paid enough but its a lot better than paying for developing the skills necessary at the next level. Once again you are still completely missing the decision scenario present here. The owners decision is to cancel the remainder of the season or play. At full scale they no doubt increase already enormous losses. They can just cancel the season or they can ask the players if they are interested in playing at less than full-scale. The net result is still likely a loss but apparently they are willing to accept the more palatable losses under this scenario. The players option is to accept less than full scale or opt to not play and get nothing. In other words, the net result of the season is the average team losing in excess of $100M regardless of if they play or not. Under the proposed split, assuming $3B in revenue, the average player receives $1.5M. (1.66 / 900 players). Those poor bastards having to work for an entire half season for a wage equivalent of 33 years income for the average American worker. How could they be accept this inequity?

I disagree. Getting paid less and taking a loss are two very different things. When the players have to pay out of their pocket to play that would be sharing in the losses. There is no doubt owners are going to pay well over $100M on average for the privilige of owning a MLB player. Players are not going to pay a dime which is very different from not profiting. Players also have guaranteed contracts. If they were willing to accept the risk associated with giving the owners the right to terminate that contract, I am quite sure teams would be willing to pay considerably more if the risk of non-performance was nullified.

Keep banging that drum but you cant see the forest for the trees. None of this is all that relevant to if we have baseball this year. It's real simple, if the owners losses are magnified by playing, we probably don't have baseball. I say probably because they might decide the best long-term solution is to cave right now and then hold out for terms that recapture those losses over the next several years when they renegotiate the CBA. In other words, we will likely miss another season. We might even have replacement players. So go ahead cheer for the players to cling to they want every dime in their contract but don't be surprised if we don't have baseball this year. To Chief's point ... take a look at an inflation calculator. Then, tell me how MLB players have done in terms of compensation increase. I can't think of another group in this country that has fared anywhere near as well as MLB players over the past 30 years. Compensation has increased by roughly 750%. To say they have not participated in profits requires an exceptionally blind view of the facts. What actually happened is player received steady huge increases in pay as revenue increased. Now that the revenue is not there you and some of the players are saying just pay us anyway, the players deserve to get paid as if revenue is as it has been.

That's fine but you are still missing the point. Socializing the losses is a designed to be a sound bite. The whole privatize the gain and socialize the losses makes no sense and it's misguided propaganda.

That's a Boris quote and he knew that he could get this past fans that would blindly follow a cute quote. A loss suggests a net result of less than zero. Making $5M instead of $10M is not a loss, it's less profit. Socializing losses is not an actual thing in a free market economy, it's a soundbite so Boris attempted to define something that does not actually exist. Players participating in actual losses would suggest the owners pay the players nothing and ask that they take money out of their pockets and contribute to mitigating their losses. Of course, his compensation is directly tied to player compensation so he just might be looking out for his own bottom line.

Let’s break this down based on the fact we know the 1st half of the season is cancelled. Players loss = 0 unless you don’t know the difference between a loss and break-even. Teams are going to lose $63M+ on average. Players break-even (don't get paid) Under the proposal for the 2nd half. Teams would lose another $63M best case scenario. Players would make less than their contract. Teams lose $126M on average. Players have a net gain smaller than normal. Please explain to me how the owners don’t absorb all the risk? BTW … I doubt I ever said owners make big money because they take on risk. My position has been that players have contracts that assure them 100% of their compensation regardless of their performance. That does not happen in the rest of the working world. Perhaps that precedent is why they feel they should receive full comp even if it's not economically feasible.

Right Ted. They have been the most successful business people in the country in spite of your assumed complete ineptitude. If only they had your exceptional financial acumen and business aptitude. So, as someone with business skills superior to that of ignorant MLB owners, tell us how you would resolve the present dillema. That dillema being cancelling the season costs on average $127M per team according to reports. Therefore, cancelling the second half costs roughly $63M. Playing at full wage for players costs $80+ billion. I would love to hear why they are the idiots you portray in your comment.

According to the CDC, there have been 459 deaths in the US of people 35 or less. While this is obviously not insignificant, it is most certainly not "of historic proportions, at least not for the age demographic of 99% of the players. The coaches and some of the training staff are actually the most at risk. https://data.cdc.gov/NCHS/Provisional-COVID-19-Death-Counts-by-Sex-Age-and-S/9bhg-hcku

I agree with the general sentiment that the players need the game more than the owners. However, I don’t believe fans are accurately assessing what each side will give up to play this season. Players will give up part of their salaries but they will be better off financially by playing. Obviously, they won’t get what they normally would have but $100K or $1M is better than $0. I don’t see a scenario where fans will be allowed to return soon enough or at levels that will allow the teams to break even. In other words, they have already agreed to a scenario where it costs them to have a season. That cost for the Twins is probably $20M+ over what they have already lost if the players we paid at full rate. The point at which I would blame this on the owners would be if they demanded a profit to resume the season. For example, if they wanted to recoup the losses they have already incurred. I would go so far as to say I even expect them to resume as long as the losses are modest. They have met that expectation. Some players are stomping their feet. Basically, they want every dime they would have got without a pandemic. However, I don’t think Blake Snell’s perspective is shared by all players. What I would like to see is the players given the option to play based on the 50 percent of revenue that has been offered. They should be given the option to sit out if they are so inclined. It should be noted that less than one half of one percent of Covid-19 deaths are people less than 35 years of age.

I have already said participation should be optional. However, to suggest the owners should just accept whatever additional loses result from playing the season while players receive full comp is not only extremely bias it's the kind of thinking that will assure we don't have a season. There are quite a few players who have already made far more than they can spend in their lifetime or their kids lifetime. I could see many of them opting to take no risk. However, anyone does not think this mostly about money, they are incredibly naive. If the owners would agree to pay full compensation, 90+ percent would play. I find prejudice in any form repugnant. The hatred some people demonstrate solely on the basis of someone being wealthy is no less distasteful than prejudice based in and other form. Judge the person by their actions not the size of their bank account. I bet their are plenty of owners who have no prejudice and treat people exceptionally well. We should all strive to do the same.

I guess I should not be surprised to see a fanatical response. Who is asking them to go back for "1% of what they earn". We get it ... your point of view is that players should not suffer at all as a result of a pandemic. Owner should just accept losses no matter how massive. The owners offer is perfectly reasonable. I don't expect the owners to incur even larger loses than they would by just cancelling the season. So, If rejected, I hope the league offers any player who wants to play the chance to play at the rate offered and then use replacement players to fill the roster. If you don't want to play, their are plenty of MiLB players who would love the shot.

I think you are right. Perhaps players should be allowed to opt out of this season if they don't want to assume the risk. Let MiLB players fill those spots. However, to say the owners should just eat whatever losses come from playing this season while players are guaranteed 100% of their normal compensation is an exceptionally prejudiced thought process. Just a thought ... There are a hole lot of people happy to go back to work for 1% of what the average MLB player earns.

Bravo! Finally someone looking at this logically rather than emotionally. I was listening to MLB radio yesterday and they were waxing on about how the players should not have to take anything less than full compensation. My first thought was along the same lines as your first sentence. Passing judgment without even knowing the numbers demonstrates a point of view developed from bias. Normally, we could estimate revenue pretty accurately. In this case, we don’t know when or if fans will be allowed to return. The Twins TV Revenue is roughly $40M/yr or roughly 15% of last year’s revenue. Of course, there are other sources outside of attendance but gate receipts have to be in the neighborhood of two-thirds of the team’s revenue. No fans equates to total revenue of less than $50M for the Twins. Am I missing something? Half of player salaries would be $70M plus whatever it costs for travel and other operating costs. There is no chance owners are going to accept an agreement that potentially increases what they have already lost this year. I don’t think the player’s hang-up is the 50% number. Best case scenario is fans return in limited number for what would be the last quarter of the season. Accepting a revenue split would mean players would very likely take a substantial pay cut. From an owner’s perspective, it is highly unlikely a 50% revenue share will produce any profit. I would assume their desire to play this year is motivated by long-term concerns starting with maintaining fan support.

I spent 25 years evaluating strategies for large companies. Never did one base their expectation or desire for profits on previous earnings, That concept gets batted around frequently by fans but it has no basis in reality in the real world. We could make the same type of statement about players. Their compensation is absurd relative to the rest of the world and we have no problem when they look to maximize their earnings. Somehow the same logic is not followed when assessing the actions of owners.

It does not sound to me like you see both sides at all. The Twins TV contract is under $40M/year. That won’t even cover costs for non-player employees, coaches, and other operating costs much less player costs. Most teams are going to lose a bundle without gate receipts if players demand full compensation. So, if you want to see baseball, you better hope players decide they are willing to get compensated based on this new reality.

Boston did not find a team willing to give more because 1 year of Betts is not worth more than they received. Also, consider Boston is not going to compete this year so how much value did Betts really hold for them? What they showed here is that they are not interested in being mediocre so they sacrificed in a year they won't compete to amke themselves better for several years yo come. Kind of like the Yankees did when they got Torres. They also reset the luxury tax which will position them nicely in pursuing free agents. They get 5 years of a guy who could be an all-star in Verdugo , a SS top 100 prospect, and a catching prospect that can play 2B/3B. He could be a very nice utility player. All of this for 1 year of Betts in a year they won’t compete. I guess it’s an F if you have a very short-term view and fail to consider Boston is not likely to compete this year. Long-term this deal was a solid B+ for Boston and an A- if Downs becomes an average regular. They get a solid A if he becomes an above average regular.

Analysts generally look at profitability as a percentage of various metrics. Revenue and Return on Capital being the most common. However, that has little to do with the point I was trying to make. Many people get upset without a solid basis for judgement. IMO, fans could save themselves some frustration if they were willing to make an objective comparison to other teams.

I think you may have missed the point. Including the level of profitability gives us a relative sense of spending capacity. It makes absolutely no sense for me to accuse you of being frugal if I don’t know your spending capacity. If we don’t know profitability, we can’t have a meaningful discussion on the Twins relative ability to spend. We also can’t have an informed discussion on the Twins relative willingness to spend.

Didn't they also say they used previous year's revenue back when they floated the 50% premise? BTW ... 2018 payroll was 51.% of 2017 revenue.