By Michael Musto
By Capt. James Van Thach told to Jonathan Wei
By Kera Bolonik
By Michael Musto
By Nick Pinto
By Steve Weinstein
By Michael Musto
By Michael Musto
THE DEVIL'S IN THE DETAILS
There's a joke baseball owners like to tell: "How do you make a small fortune owning a baseball team? Start with a large fortune!" We're sure that gets big laughs at whatever Hilton the horsehide tycoons hole up in these days. But then, these are the same people who kept a straight face last week when Bud Selig announced that baseball lost $500 million in 2001.
Half a billion schoendiensts sure sounds like a lot of cash to the casual observer, which is no doubt what Beelzebud hopes to impress upon Congress in his testimony this week. But as sports economist Rod Fort notes, while he has no doubt that Selig "will be reporting dutifully what all of those owners told the IRS, that's not the gauge of the value of owning a baseball team." Among the fiscal tricks Selig can use to transmute gold into red ink:
The IRS allows teams to depreciate their players, even while simultaneously deducting player-development expenses. "If I try that, people in shiny shoes come to my door," says Fort, noting that a recent exam of the San Antonio Spurs' books revealed that losses of $10-14 million turned into real profits of $2-3 million once depreciation was discounted.
Corporate-owned clubs can easily hide income by, say, charging their broadcast outlets next to nothing for TV rights. (The Atlanta Braves and TBS are prime suspects here.) More direct approaches are available as well: George Steinbrenner once carried a $25 million charge on the Yankees' expense sheet for a cable-contract consultantby the name of George Steinbrenner.
Appreciation of team values invariably wipes out any losses once the team is sold, a fact that seems recession-proof, if recent reports are true of a $500 million offer for the Mets (purchased in 1980 for $21 million) and $390 million for 50 percent of the Red Sox.
So as the numbers trickle out from Selig's testimony this weekand oh, will they trickleremember the words of Paul Beeston when he was Blue Jays veep: "Anyone who quotes profits of a baseball club is missing the point. Under generally accepted accounting principles, I can turn a $4 million profit into a $2 million loss, and I can get every national accounting firm to agree with me." Beeston is now baseball's chief operating officer. Draw your own conclusions.
THE MEDIA OWN THE MESSAGE
Heavens to Sal Maglie! Sure, The New York Times's corporate empire counts The Boston Globe among its 18 newspaper properties, but still and all, we felt a frisson of weirdness at the news (broken by the Globe, natch) that the Gray Lady was bidding to become part-owner of the Boston Red Sox. If successful, Arthur Sulzberger would join one of the most unlikely ownership groups ever assembled: Tom Werner, who as Padres owner oversaw both their 1994 fire sale and Roseanne's National Anthem performance; John Henry, who presently owns both the Marlins and a vestigial sliver of the Yankees, and was recently foiled in attempts to buy the Angels from the disembodied head of Walt Disney; Larry Lucchino, late of the Padres' and Orioles' front offices; George Mitchell, late of the U.S. Senate; and some guy named Les Otten, who is invariably described as a "ski mogul." (We will forgo the obvious joke about the Sox going downhill fast.)
Cognitive dissonance aside, though, we're more concerned at what Red Sox ownership would mean for the Times's sports coverageand we don't just mean whether it would start referring to a certain former Yankee as Mr. Fucking Dent. As St. Louis's weekly Riverfront Times reported last month, the St. Louis Post-Dispatch editorial page went from arguing that a publicly funded Cardinals stadium "will not revitalize downtown" to insisting that a "strong economic case can be made for the ballpark"shortly after the paper's owner bought a 4 percent share of the team.
Post-Dispatch editors immediately insisted they'd already done their stadium flip-flop before becoming ball barons, but that hasn't removed conflict-of-interest concerns for the growing number of sports-media mergers. "The principle of owning a little piece of everything is what media companies operate on these days," says Peter Hart of the media watch group FAIR. The real prize for the Times, he notes: the Red Sox cable outlet, NESN, which would allow a wall-of-ad-sales spanning TV, print, and Web. Repeat after me, Nomar: "I think the only thing I enjoy more than doing the crossword puzzle is actually finishing it!"
OUT AT FIRST
Last Friday night former Mott The Hoople frontman Ian Hunter played a monster gig at the Village Underground. During consecutive choruses of "Cleveland Rocks" he did an impromptu poll by substituting "New York," "the Yankees" and "the Mets" for "Cleveland." Then, "Jason Jombi [sic] rocks!" and got a lot of boos. So he stopped mid-verse and asked, "What? Does Tinostill rock?" and got a huge cheer. Looks like even a middle-aged, nimbus-haired Brit rocker has more sense than Steinbrenner.
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