The monthly nut for the $700 million is $6,200,000, or $74 million annually; and for the $300 million portion, 2.6 million or $31 million annually for a total of $105 million. That's 1/3 the Yankee's annual revenue and you don't think that would put a damper on the size of salaries?
Well presumably revenue will be higher at the new stadiums (more luxury boxes, at least a modest increase in the already high ticket prices etc.). And revenue is already above $300mil and growing.
The $300mil portion they are going to have to pay anyway, so its only the $74 mil annually. That's under one fourth of their revenue, give it a couple of years and its one fifth, possibly even one sixth if the new stadium helps a lot, or they find new ways to squeeze out revenue to cover the costs (personal seat licenses for example, or maybe more from the YES network)
Yes that much money would have an effect even on the Yankees, but salaries would probably not decrease as much as that 1/3rd to 1/6th portion. For one thing the current contracts would still be valid and the team would be on the hook for them. I think A-Rods contract goes through 2011. Jeter also has years left on his contract. For another the supply of players wouldn't be any bigger and the Yankees would want to get the top players, and at times be willing to over pay for them.
As for other teams, well many of them would just live with the current stadiums for longer. Remove the subsidy for the stadiums and you reduce the amount spent on the subsidized item.
Also quite a few already have new stadiums or signed deals for them that include subsidies. Canceling future subsidies wouldn't eliminate those already spent or contracted for (well maybe the contract has an out clause, but there would be some penalty).
And there is no way the Yankees could increase revenues to cover the added $105 million cost per year needed to pay the stadium's financing.
Again the difference in your scenario is only $74mil a year.
They have been raising revenue and there are ways for them to raise more. Both the YES network and the Yankees are owned by Yankee Global Enterprises LLC. The YES network might have paid more for the Yankees rights but there is no need for them to do so. Paying more only increases the Yankees official revenue and causes the Yankees to have to pay more in revenue sharing. If need be the Yankees could be run at a loss with the YES network's profits causing the group as a whole to be profitable.
Searching a bit I see the stadium itself is supposed to cost $800 mil. (But that doesn't include some associated costs, like replacing the parkland where the new stadium is supposed to be built, or transportation improvements)
Your right that the Yankees won't pay property taxes, but the direct subsidies are much lower than $700mil. Between them the state and the city will pay $70 mil towards the parking garage, will handle the cost of replacing the parks, will not charge property taxes, and will issue tax exempt bonds for financing that will be paid back by the Yankees (but the tax exemption lowers the Yankees costs).
A lot of the money will in effect come from other teams as the Yankees can deduct stadium costs from their revenue sharing (and they have to share a lot of revenue)
en.wikipedia.org
You would need hundreds or thousands of professional caliber players, not just a few."
Per sport? That's nuts.
Yes per sport. Note I said "hundreds or thousands". It would be hundreds for most sports. Over 2000 for the NFL at training camp time, so even one NFL sized league would be thousands by itself. Also if you want multiple competing leagues its thousands for any sport.
A typical baseball team roster is around 35 guys. There are 30 teams in the MLB......so that makes up roughly 1050 players. Where's this need for thousands?
You suggested the possibility of multiple competing leagues. Also MLB teams have a farm system of A, AA, and AAA teams. Considering the farm system MLB would have more players than the NFL, but an NFL sized league also would reach the low thousands range during training camp.
Yeah, right. Just last season, a 100 games were cancelled due to a shortage of good players.
Of course games don't get cancelled. The teams just play with inadequate players at certain important positions. The point is that you don't have hundreds of additional starting quality pitchers, or dozens of additional starting quality QBs to go around. Which doesn't mean you can't have additional leagues, but it means either the new league will be satisfied with lower quality (in which case it won't provide serious competition), or it will compete for the limited number of top players in certain positions (bidding up their salaries, just like what happened when the AFL and NFL competed, or later when the NFL competed with the USFL)
Why is it you claim to believe in free markets but as soon as
I point out a major institution needing some free market treatment, you defend its near monopoly status?
I don't believe in government creation of, or defense of monopolies, except perhaps in limited cases (for example I accept copyrights and patents, even if there are some problems with those systems). But a company or organization being in a dominant position largely because of its own efforts isn't the same thing. I do oppose the subsidies going to the current teams/leagues, but I don't think they should be broken up, or penalized by the government, and I don't think it would be a good idea to massively subsidize new leagues so they can compete.
In any case pointing out the fact that increasing demand for players will increase their salaries is hardly defending the teams/leagues or any monopoly or near monopoly status. I don't oppose the idea of new leagues. If anyone tries to create them I have no problem with it. I'm just pointing out how they won't solve what you see as a problem, and in fact they will make it worse from your perspective.
Sure more teams would mean more people playing, and some of them would emerge as stars, but there is absolutely no good reason to think that doubling the demand (with two leagues) or even more (if you want multiple competing leagues) would result in an increase of supply even equal to, let alone beyond the increase in demand.
Damn! You are unwilling to even consider the prospects. Unbelieveable.
I'm quite willing to consider the idea, that doubling or tripling the number of leagues would do more than double or triple the number of top quality players, but there isn't an ounce of evidence to support the idea that it would. Presumably high schools and colleges, and little leagues etc. wouldn't double the number of players they have, so you wouldn't be doubling or tripling the development of players.
Maybe adding an additional league gets you 10% more top players, and 20% to 50% more capable players (capable meaning good enough to make MLB/NFL/NBA/NHL current rosters). I might be generous with those estimates, but lets make it even more generous. Suppose top players increase by 50% and capable players by 90%, your still increasing demand more than supply. And an increase of even that level seems very unlikely.
No professional team in this country has had trouble finding good players.
Every professional team in this country has occasional frequent trouble finding a sufficient number of good players, for most teams its frequent, not occasional. Even championship teams often have some mediocre (by top pro league standards) players.
If they can't get them here, they will get them from Japan, Korea or some other country.
They already do that (the NFL doesn't get a lot, because American Football isn't as big overseas but other leagues do), but its still not enough to fully meet what current teams want, let alone new leagues.
Your defense of the current sports status quo
Again I'm not really defending the status quo. You want a new league? Go ahead, have a new league. I don't oppose the idea at all. But adding new leagues is going to increase salaries.
If you want to get rid of the subsidies, then get rid of the subsidies. I'll support you all the way. If you want to add new leagues, I won't fight you. If you want to lower salaries, you need a different strategy. Adding new leagues works against you. Eliminating the subsidies will help, perhaps quite a lot, at least in terms of restraining future salary growth, but you'll still have a whole bunch of salaries that you apparently consider obscene and/or anti-social. |
