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Does MMII Equal Collusion IV?
2003-01-06 00:20
by Mike Carminati

Does MMII Equal Collusion IV? II

Major League Baseball posted this article on its site in response to the collusion theories circulating. Basically, their stance is that all is normal and the rumors are the result of some skylarking cospiracy theories on a few agents' parts.

They cite both MLB president and COO Bob Dupuy, who termed it "both disappointing and farfetched", and union executive Gene Orza on the matter:

"Asking agents to keep good notes of negotiating meetings is nothing new," said Orza, the union's No. 2 official. "We've been doing it the last 15 years. It's the way we monitor the market. The operation of the free-agency market is always a concern for us."

Dupuy added that:

"The market is behaving as it always does, reacting to economic stimuli and the quality of the players in the marketplace," DuPuy said. "There have been numerous free agents who have attracted attention from any number of clubs. I can state unequivocally that there has been nothing done in contravention of the Basic Agreement."

I can believe that there is no collusion afoot, but when Dupuy starts talking about ecomonic stimuli, I check for my wallet. What stimuli? Revenues have flattened somewhat but we're talking about an industry that has trebled its revenue growth in the past six years. Also, there have been a number of ticket-price increases throughout the offseason.

The economic stimuli must be the fact that there was no provision in the CBA that teams that are paid money in the luxury tax measure actually spend that money on the team. There are two effects: 1) teams that have high payrolls are reluctant to take on more even if it means weakening the team (witness the Mets' reluctance to sign anything but a bargin at third base) and 2) the potential windfall for small-salaried teams induces them to forego any and all payroll even if it means non-tendoring some of the team's most talented players (for example, Robert Fick in Detroit). The Yankees are still spending because they know that they will have enough revenue to take care of themsleves. The Phils are spending because they have neglected the team for decades and are now realizing the profits that they will make when they move to a new stadium if they just invest a little now.

Dupuy, as remarkable as it sounds, isn't lying. The fact is that the CBA just obviated the need for collusion. Too much liability. Even a salary cup is too messy as teams well below the cap have no incentive not to sepnd. Why not just institute measures that stimulates payroll cuts?

Even a team with a meager payroll like the Royals have incentive to cut payroll. Look at their moves this offseason. They let some high-priced free agents go: Roberto Hernandez ($6M in 2002), Chuck Knoblauch ($2M), Jeff Suppan ($4.14 M--non-tendored), Blake Stein ($1.35--waived), and Neifi Perez ($4.1 M--waived). They also lost ace Paul Byrd ($850 K in 2002) to the Braves at $5 M a year and are extensively shopping Joe Randa ($4 M, plus an extar mil if traded). The Royals went from a team with eleven players making over one million dollars to a team with five or six, depending if tehy can trade Randa. I guess If you going to suck, you may as well really suck and make as big a profit as possible.

Anyone who believes that the major-league teams are really losing money should note how much Ruppert Murdoch sells the Dodgers for in six months. If he doesn't make a huge profit on the deal, something on the order of $100-200 M, I will be officially shocked.

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