Contraction: Another Stupid Selig Idea

Now that Governor Swift has given birth, Bud Selig leads the world in use of the word “contraction.” For weeks national baseball writers have solemnly reported that Selig and other unnamed “baseball insiders” want to eliminate at least two of MLB’s weakest teams.

Contraction makes no sense. It would be an economic and public relations disaster. It would solve none of MLB’s perceived problems, and none of its actual problems. No wonder Selig likes it.

In theory, contraction is simply the opposite of expansion. To remove a team, Major League Baseball need only buy out the owner and cancel the franchise. The national TV contracts and other shared revenues would be split fewer ways, giving each survivor a larger share of the pot. But in practice, MLB will find it much harder to contract than to expand.

The first problem is finding two owners willing to sell back their franchises. Montreal’s considered a leading candidate for extinction, but owner Jeffrey Loria doesn’t want to sell. And in the ego-driven world of pro sports ownership, who wants to be remembered as the man who mismanaged his team out of existence?

Assuming this problem is overcome, the next big issue is the sale price. Even if the Expos can’t survive in Montreal, the club would be worth $100 million more if moved to Washington, D.C. To persuade Loria to fold the Expos rather than move them, MLB would have to offer him more than D.C. interests are willing to pay for the team, which could be double the fair market value of the Expos in Montreal.

Tampa Bay, the other team at the top of MLB’s hit list, presents another problem: the Devil Rays have 26 years remaining on what city officials describe as an ironclad stadium lease. Tampa Bay, which was burned twice when the White Sox and Giants backed out of deals to move there, has made clear it will sue over any attempt to move or fold the club – and in a suit over the Giants’ aborted move, a local judge has already ruled that MLB’s antitrust exemption doesn’t apply to franchise location issues. MLB settled that case rather than risk an appeal, but a case involving the permanent loss of a team would be much harder to resolve out of court. Indeed, a local judge might well enjoin MLB from eliminating the local team pending a full trial on the merits.

Then there’s the little matter of what to do with the players. MLB would immediately become responsible for paying off all long-term guaranteed contracts -- a significant expense where the Devil Rays are concerned -- and would acquire the rights to every player in the affected teams’ organizations. Although the collective bargaining agreement doesn’t specifically forbid contraction, the MLBPA would challenge any action which adversely affected even one of its members.

Finally, contraction would infuriate elected officials not only in the affected markets, but in every market looking for a team. With Washington, DC at the top of the list, Selig & Co. could expect several rounds of Congressional hearings...including hostile grilling from Sen. Jim Bunning of Kentucky, the Hall of Fame pitcher instrumental in hiring Marvin Miller to run the MLBPA. Any threat to the Marlins or Devil Rays would cause Gov. Jeb Bush to burn up the phone lines to his brother, asking the Rangers’ former managing general partner to persuade his ex-colleagues to reconsider.

And what would contraction solve? Certainly not the “competitive balance” problem, which if it exists at all, is a function of the difference between large-market and. small-market revenues. Increasing everyone’s revenue by the same amount leaves this difference intact..

Indeed, the argument for contraction is based on two false premises. To the extent any team “can’t afford to compete,” this competitive disadvantage results from MLB’s own revenue sharing formulas, which the owners could change at any time. By arguing instead for contraction, they’re saying, “Sure, we could help you, but we’d rather kill you.”

Even more fundamentally, “can’t afford to compete” and “can’t survive” are very different concepts. Thanks to their low payrolls, the Expos and Twins actually make money despite low revenues, and this year’s Twins are showing that “inexpensive” doesn’t always mean “bad.” (Think of them as the anti-Orioles.) Since the free agent era began, no club has come close to the pathetic, decades-long performance of such chronically underfunded teams as the St. Louis Browns or Philadelphia Phillies – but for all their problems, no one seriously proposed contracting the Browns or Phillies out of existence.

Commissioner Selig’s talk of contraction may just be an attempt to frighten the Players’ Association on the eve of labor negotiations. If not, it’s a loaded gun pointed at his own head.

Copyright © 2001 Doug Pappas. All rights reserved.
Originally published in the June 2001 issue of Boston Baseball.

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