By Jake McCormick
Just for a second, imagine you’re the bread winner in your family of four; the damn paterfamilias, if you will. You, your neighbor, and your best friend all receive $500 from the government in tax returns (I know the average return is much higher, but just bare with me). You spend the $500 on getting your kids new shoes, your neighbor spends his money on repairing his roof, and your best friend blows his $500 on a private escort. Who looks like the bad guy here?
If you’re anyone other than someone in a JG Wentworth commercial, the answer would be option C, or in the MLB, you’d be the Florida Marlins or Tampa Bay Rays. That’s basically the process that is allowed to occur with the current setup of baseball’s revenue sharing program, which transfers money each year from large to small market teams to help them stay competitive.
This flaw in the concept came to my attention when I noticed the Marlins, at times, have been more profitable as a team than the Yankees. You read that sentence right. In 2008, Florida, supposedly a team that needs to annually cut salary because they’re seeing red, made $35 million in profit while the Yankees posted a $47.3 million loss.
Being the only major sport without a salary cap, the teams at the top will dominate the market in a capitalist fashion while the Mom & Pop Florida Marlins are supposedly forced to tiptoe through financial landmines in their quest for October glory. What “they” don’t tell you is that revenue sharing between teams has helped the cheap Marlins net millions of dollars that their owners would much rather pocket than spend on team improvements.
Imagine if the current progressive tax system in the United States allowed the people on Capitol Hill to pocket the money that pays for Medicare, Social Security, unemployment, business/environmental regulations, and subsidies. Most people wouldn’t be happy to see their benefits and tax money going towards their personal expenses.
Baseball runs on a very similar structure. They redistribute wealth under a very vague set of rules without any fear of regulation for fairness and accountability. The Kansas City Royals, Marlins, and Tampa Bay Rays are turning profits while still claiming to lack the funding necessary to keep a successful team. Do they have the guys from AIG and GM running these teams? Clearly Barack Obama needs to rent out his Change Bus to Bud Selig so he can ride around the country like William Jennings Bryan declaring the flaws in professional baseball’s operations. But like WJB, Selig doesn’t like admitting he is wrong.
A seemingly unlikely candidate has recently become a vocal proponent of change: Boston Red Sox principal owner John Henry, who outlined his personal preference in an e-mail:
“It’s a very simple approach in which payroll tax dollars replace revenue sharing dollars and go directly to the clubs that need revenues in order to meet minimum payrolls that should be imposed on each club receiving revenue. Further, players would have to be protected with a guaranteed minimum percentage of overall revenues. This would be a very simple and effective method in reducing top payrolls and increasing bottom payrolls with no tax on revenues.”
Henry is in favor of taxing teams that spend over a certain dollar amount on payroll and giving that money to smaller clubs to spend on their own team’s payroll. Sounds like the progressive tax system. He’s on the right track in attempting to level the competitive playing field without a salary cap, so it’s just a matter of whether the president and legislature (both Bud Selig) come to their senses and realize that new challenges require new solutions. It’s a much better idea than keeping small market owners on the honor system with revenue sharing.
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