Some MLB GMs don’t realize that spending money is good for business

Juan Soto smiles as he sits next to the president of Padres and baseball operations

Juan Soto smiles as he sits next to Padres baseball operations president and “big spendthrift” AJ Preller.
photo: AP

In a recent anonymous survey, The Athletic detailed how some MLB executives felt about the recent business deadline. Most of the answers were normal, everyday answers to basic questions.

“How big will the market be that Shohei Ohtani will bring in the off-season or next trade deadline?”

Random performer: “Really great”.

Oh! Thanks for this insight into an MLB front office. I absolutely failed to understand that the most exciting player in baseball who regularly performs feats that have not been done since Freddy McSchtickens before World War I would attract a large market. Thanks for making this clear. However, when asked about the deal with Juan Soto, the executives offered answers that really puzzled me.

The Athletic asked executives, “Does this make sense for finance or baseball?” While I can’t speak to the financial side as I don’t know everything it takes to run a baseball team financially, I can definitely tell you that it makes sense from a baseball point of view. If you think adding one of the biggest young bats in the game today doesn’t help in a baseball sense, then I’d like a reference to your local dealer, because you’re clearly smoking one of the best bullshit north of the equator. Financially, it’s a little more rough, but as any major will tell you, you have to spend money to make money, and with the product the Padres field every night, it’s hard to imagine a future where the San Diegans they are not interested in seeing their team cancel their competition night after night.

However, casual executives fail to understand why the Padres would have made such a move.

“I can’t understand the San Diego business model,” said one executive.

“I don’t know how they’re paying him,” said another.

Well let’s see. Soto doesn’t have a huge contract for his level of talent. That’s where much of his charm came from. He is under the control of the team with a very friendly contract for the next two and a half years. He would have aroused immense interest regardless of his contract, but that was just another factor that played into how much each team wanted to take him. 17 million dollars this year and will be submitted to arbitration in both 2023 and 2024. There is a possibility that arbitration could immediately push him into the $ 40 million range, but I find it much more likely that Soto will not break into the wage stratosphere until the expiration of the his current contract after 2024, or unless the Padres extend it before then.

Josh Hader doesn’t have a massive contract either. Sure, $ 11 million might be a lot for a tighter close, but the Padres are only paying half that, plus Hader will be subject to arbitration next year, and as he currently boasts a 4.11 ERA – the highest in the world. his career – the Padres could probably negotiate a lower salary in 2023. Even if Hader pops for the Padres and asks for a higher salary, he will only have one year left on his contract in 2023. They can afford to keep an expensive closer for a season.

Even if Soto and Hader were more expensive than they are, we have to keep in mind that this is baseball. Owners can pay what they want. There is no salary cap. Sure, there’s a luxury tax, but I’m sure the Dodgers, Yankees, Mets and others will keep their incredibly talented roster and pay the relatively miniscule fee without hesitation. Oh no! They have to pay less than a million in luxury taxes after spending $ 250 million on their list! How will they survive ?!

The fact is that any team can afford to buy players like Soto, Fernando Tatís Jr., Hader and Manny Machado; owners just have to be willing to open their pockets. Unfortunately, most owners are unwilling to do so, thinking they can win with a little luck and a lot of heart. (Editor’s Note: Either they’re just cheap). This is not a Disney Channel original movie though. Passion and friendship do not win championships, Juan Soto level players, although there are not many, yes.

Together, Machado, Tatís, Hader and Soto cost just over $ 82 million this year. It could be a lot for someone like Reds owner Robert Castellini (A net worth of $ 400 million), but for someone like Tigers owner Ilitch Holdings ($ 3.8 billion net worth) or Twins owner, the Pohlad family ($ 3.8 billion net worth), $ 82 million is like if you or me found the change in our sofa cushions.

It doesn’t matter that those players would bring your team increased revenue, but it’s not really that much for a team if they were willing to open their wallets. Sure, they may not bring in the revenue the owner was hoping for and that could lead to further financial losses, but you never know unless you try to guess a little, small market teams aren’t making as much money as they are. He might as well go for some big names and league aspirations and see if it works for your city. After all, the Padres pack their bags every night with their additional deadlines, and Tatís hasn’t returned yet.

Thankfully, an executive interviewed provided props to the Padres and owner AJ Preller to be willing to shoot big-name players.

“I give their ownership group a lot of credit. They are financially committed to building an incredible major league product. So obviously they are thinking that if you invest in building a strong brand, the money will work in the long run. … And I also think if I owned a team, I’d think it’s fun to win, so what’s the funniest thing we could do for me and our fans to watch? Let’s do it.”

This executive is absolutely right. Mark Cuban did this recently interview with GQ, and part of that interview is about how the Dallas Mavericks lost money for years before they started making him money, but by investing in the team and marketing the team, and by winning a championship, the money eventually started to come in. MLB may not have the same mass appeal as the NBA currently, but the business model remains the same. Put the money in the right areas and the money will spit back. The fact that owners of multiple MLB franchises cannot understand this is sad to say the least.