Tomorrow will be a big day in the international sports world as one of soccer’s all-time greats, Lionel Messi, will be unveiled as the newest player for Paris St. Germain. He has spent his entire career playing with FC Barcelona. His tearful exit from the only club he has ever known leads me to think about how different baseball would be if it had some of the business rules which exist in soccer.
- The first one which would be interesting to me is if baseball had the two part talent acquisition process with teams having to agree to terms with one another, followed closely thereafter with the club being forced to come to personal terms with the player changing teams. This would mean no more trades where the club is in having a down season and then trades a bunch of their players in an attempt to rebuild. The 2021 Chicago Cubs would be a prime example. This would mean the players would not be forced to pay the price for the mistakes of the front office. Under the soccer model, the Cubs would have needed to convince Rizzo, Bryant, Baez, et al to leave town. Now playing for a World Series is quite a carrot, but it is no sure thing. If the players decide they want to just play out their contracts on the Cubs then there is little the team could do, except wait for their contracts to run their course.
This brings me to the second part of the deal, which is negotiating with the player on what he will be paid upon his changing teams. In this part of the deal the players now have a lot of agency. In Major League Baseball the contracts go with the player, with some exceptions. The Nolan Arenado deal is an example of this where the Colorado Rockies are paying roughly $50M of the remaining $199M on Arenado’s deal, and this includes paying all $35M for this season. So essentially the St. Louis Cardinals acquired an all-star for free for 2021. Imagine if the Cardinals had to come to terms with Nolan Arenado directly on a new deal in order for him to change teams. This would place a lot of onus on the club acquiring the player to deal with him, and likely others before him, fairly or else the deal won’t happen. Cheap clubs, well let’s say they are parsimonious in order to make it sound more elegant, would have problems attracting top tier talent. All players would have effective no trade clauses. This will not stop the talent from moving as players want to play and will always be on the lookout for the best opportunity to showcase their talents. While this may sound selfish (it is), but it is no different than any other walk of life. A talented plumber will change companies if a competitor treats their employees better and paying them better can’t hurt either.
- A version of Financial Fair Play would be good for baseball. The idea of Financial Fair Play was introduced in 2010. What it is to put it simply meant European soccer cubs could not spend more money than they earned from soccer related revenue. The purpose was to increase financial viability of clubs by limiting their debt and emphasizing long-term planning. I liked the Spanish version of the rule which limited clubs to spend a percentage of their income for their players. The amount changes from year-to-year to match revenues for each club. This is why FC Barcelona could not afford to retain Messi no matter what they tried; he simply earned too much money (And no, playing for free or for some unrealistic reduction wasn’t going to happen. He agreed to a 50% wage cut and it still wouldn’t work). Now to move this to baseball, a team like the Los Angeles Dodgers would hypothetically have more to spend for their players than the Kansas City Royals because the Dodgers revenues are higher. This places pressure on the Royals to get better or the owner won’t make any money owning the team. Baseball has local television deals which drives a lot of the disparity between the large market clubs and the small market ones. Currently in baseball an owner can turn a nice profit by coming in last and having a low payroll each year. This is due to the clubs with less revenue receiving money from the pool paid by the teams who exceeded the competitive balance tax threshold. in 2019, the last full season, the Dodgers had the largest tax bill of about $90M, and the Miami Marlins received about $70M for their payout from competitive balance tax pool. The pandemic caused some changes to the revenue sharing payouts this year, but the idea holds true. Having teams out of contention before the season starts is not good for the game of baseball. However, the smaller teams can compete with the teams from larger cities by being better on the field. Manchester and Liverpool are each about 1/15th the size of London, but Manchester United and Liverpool FC are the two most successful clubs in England’s soccer history.
What diehard fans of their team would not want to be an actual owner of their favorite baseball team? Well, in the soccer universe it is possible are there clubs which are publicly owned. The current FC Barcelona president is Joan Laporta, who was elected club president in March 2021. He is the 42nd club president. Let’s just say the Messi exit better work out for the club or he won’t last too long. The voting club members have a say in all major decisions. Dodgers fans with votes would have been able to have their say about the fate of manager, Dave Roberts, following the 2019 playoff exit. Almost all major player acquisitions have to be run by the board of directors, who are shareholders by extension. The controversial Trevor Bauer acquisition would have to have been vetted by that board, who answer to the larger voting body. There isn’t a baseball fan alive who hasn’t wanted to pull their hair out after seeing their club doing something they don’t agree with, so why not give them a mechanism to affect change? Under this model, owners have been forced to sell the club once the fans and board members turn on them, making their continued ownership untenable. I do have to say I wonder how the fans in Houston would have behaved once the cheating scandal come to light, since it is on the heels of winning a championship.
This was in interesting thought exercise. I know Steve Cohen is the wealthiest owner in Major League Baseball, so he is not going to be giving up any of his control of his plaything. Having said that, it would be nice if baseball players and fans had a lot more to say about how things are run with their favorite or current team.