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The Village Idiot
by John Brattain
Senior Columnist
E-mail

John Brattain is a 36-year-old baseball writer from Campbellford, Ontario, Canada. After graduating from high school, he worked in a number of jobs, got married, and is the proud father of two beautiful daughters--who thankfully got more of their mother's and not their father's DNA. Following a lengthy recovery from a truck accident in November 1991, John came to the decision that he wanted to work covering sports. He is a longtime (and long suffering) fan of the Toronto Maple Leafs. He also hasn't forgiven Roger Staubach for his 90-second rally over the San Francisco 49ers in the NFC title game back in the 1970s.

John's greatest sports love is baseball. He describes himself more of a Field Of Dreams than Bull Durham kind of fan. He's done extensive research into the history of baseball including nineteenth century baseball, the Federal League, and the Negro Leagues. He fell in love with the Montreal Expos and remains a frustrated fan of Les Expos--still cursing Jim Fanning to this day for having Steve Rogers pitch the ninth inning in the final game of the 1981 NLCS when they had a rested Jeff Reardon waiting in the bullpen.

John is also an increasingly rare phenomenon: a fan of both the Expos and the Toronto Blue Jays. He is also considered an authority on the "inside game" of baseball, having studied baseball economics, labor law, and collective bargaining.

John began writing about baseball in 1995, and initially struck out more often than the early 1990s Detroit Tigers. After getting a small number of freelance articles published in some small (and we mean small) town papers, he was hired on as a baseball history guide for The Mining Company (now About.com). He was later picked up by MLBtalk.com and published well over 100 columns and features--some of which went into syndication. He also enjoyed a stint with the New York Yankees official web site doing over 30 historical features for Yankees Xtreme. He was cut loose when MLB took over all teams' official web sites.

When MLBtalk went belly up, SABR and former TOTK columnist Lee Sinins, fearing the consequences of John not having anything to do, considered it his civic duty to suggest TOTK.com Sports.

He will most likely live to regret it. :-)

Archives in progress:

From P.U. To F.U.
Sports Bytes 11/19/01
Going From Desert Heat To Nuclear Winter
Sports Bytes 11/9/01
To Err Is Human, To Really Screw Things Up Requires A Commissioner
Sports Bytes 11/1/01
Here We Go Again
Sports Bytes 10/26/01
God Bless The Yankees
Sports Bytes 10/22/01
Hakuna Matata Oakland
Sports Bytes 10/19/01
Treating ALDS
Sports Bytes 10/17/01
You're Not Getting Older, You're Getting Better
Sports Bytes 10/12/01
Thinking The Unthinkable
TOTK Today 10/9/01
A Tribute To 2001
Sports Bytes 10/8/01
Labour
Sports Bytes 10/5/01
I Don't Like To Nit-Pick... Well, Maybe a Little
Sports Bytes 10/1/01
Flood Said No
World Wide Church of Baseball 9/27/01
GREAT SCOTT!
Sports Bytes 9/21/01
Like It Or Not....
Sports Bytes 9/17/01
Wile E. Quixote
Sports Bytes 9/10/01
The Hatfehr�s and the McSelig�s
Sports Bytes 9/7/01
Oh No(ah)!
Sports Bytes 9/3/01
Guess Who?
Sports Bytes 8/31/01
Coulda/ Woulda/ Shoulda II
Sports Bytes 8/27/01
Hodge Podge VI
Sports Bytes 8/20/01
Where Do We Go From Here?
Sports Bytes 8/17/01
For What It's Worth
TOTK Today 8/13/01
Barefoot Through The Rose Garden
Sports Bytes 8/10/01
Hodge Podge V
Sports Bytes 8/6/01
The Talented Mr. Griffey
Sports Bytes 8/3/01
Coulda/ Woulda/ Shoulda
Sports Bytes 7/30/01
It's Easy To Criticize....
Sports Bytes 7/27/01
Hodge Podge IV
Sports Bytes 7/23/01
They Need The Money For A Liver Transplant
Sports Bytes 7/20/01
Hodge Podge III
Sports Bytes 7/16/01
Smile When You Say That
Sports Bytes 7/13/01
Hodge Podge II
Sports Bytes 7/9/01
Hodge Podge
Sports Bytes 7/6/01
Ground Chuck
Sports Bytes 7/2/01
Where Labrums Go To Die
Sports Bytes 6/29/01
If I Had A Hammer
Sports Bytes 6/25/01
Here Are A Few Of My Favorite Things
Sports Bytes 6/22/01
Gigantic Loophole
TOTK Today 6/21/01
If A-Rod's Head Split Open, Would Scott Boras Jump Out?
TOTK Today 6/19/01
Countdown To Armageddon, Part Two: Predictions and Outlook
Sports Bytes 6/18/01
Countdown to Armageddon, Part One
Sports Bytes 6/16/01
Manny Ramirez�s Paychecks Don�t Bounce and John Harrington Doesn�t Eat Alpo
Sports Bytes 6/11/01
My Dinner With Bess
Sports Bytes 6/8/01
Crimes And Misdemeanors
Sports Bytes 6/4/01
The Killer B's
Sports Bytes 6/1/01
Revolution
Sports Bytes 5/29/01
Hmmmm
TOTK Today 5/29/01
Putting The Fun Back Into Funeral
Sports Bytes 5/25/01
The First Black Yankee
World Wide Church of Baseball 5/23/01
There Is Nothing To Fear But Fehr Itself
Sports Bytes 5/21/01
Not An A-riginal
Sports Bytes 5/18/01
Don't Be Stupid
TOTK Today 5/15/01
There�s No Free Enterprise in Baseball
Sports Bytes 5/14/01
Expos-ing Myself
Sports Bytes 5/11/01
Orioles Go Belly Up
Sports Bytes 5/7/01
Pedro Martinez Suffers Career Ending Injury
Sports Bytes 5/5/01
Rough and Tough and Hard To Diaper
Top of the Key 5/1/01
Memo to the Baseball Gods: Hasn't Junior Suffered Enough?
Top of the Key 4/25/01
Contract Crisis
Sports Bytes 4/20/01
It's Not About the Money, Honest
Top of the Key 4/17/01
The Federal League
Top of the Key 4/11/01
Cheeky 19th Century Baseball Essay
Top of the Key 4/11/01
The Negro Leagues
Top of the Key 4/11/01


From P.U. To F.U.

11/19/01 by John Brattain

No, I�m not talking about Princeton and Fordham University. P.U. is the quickest way to spell the reaction to a rancid stink and F.U. means just that. Both are good indicators of what�s happening in MLB at the moment. Something stinks and it�s pretty obvious that baseball is flipping us the bird and I ain�t talkin� about Cardinals, Blue Jays, and Orioles either.

So, baseball is planning on aborting the Twins and putting the �ex� into Expos.

Now we know the drill: major league teams are losing moolah hand over fist. Jeffrey Loria and Carl Pohlad were recently spotted in a rusted out 1972 Ford Pinto eating Alpo out of the can with plastic forks because between them, they didn�t have enough cash to scrape together to pay for a small fries at Mickey D�s.

Of course we also know that the owners and players are doing their usual trial by [collective bargaining] ordeal.

Now, wouldn�t this be the perfect time for the Twins and Expos to open their books to independent scrutiny in front of the MLBPA? If these two franchises need to be deep-sixed, isn�t this the ideal time to prove that small markets are losing more green than an elephant with a bad cold? (Think about it).

Aren�t you also the teensiest bit curious why MLB is willing to pay more to dissolve the Expos and Twins than could be fetched in the open market?

So, let�s try a little convoluted math: two franchises that can�t afford to function plus two franchises who *still* won�t open their books, divided by MLB willing to pay more for the franchises than they�re probably worth?

Hmmmmm.

Could it be that the large payout is due to the fact that the Expos and Twins are still fairly profitable businesses?

Time for a quick tutorial on baseball economics:

MLB, as you�ve no doubt surmised, can write off the everyday cost of running a team including such things as minor league expenses, scouting, and signing bonuses on top of player contracts, stadium rents, and the like. Well, back in the 1950�s Bill Veeck managed to convince the IRS to assign a portion of the purchase price of a club as residing in player contracts; then allowing a team owner to depreciate the cost of the contracts over the first five years of ownership. What this allows team owners to do is to double-count the player expenses. One, they could deduct the cost of the players� contracts as an expense but also to amortize those same contracts over the first five years of club ownership. Since the depreciation is a non-cash cost--a simple bookkeeping entry--it allows the team owner to convert a pre-tax loss into an after-tax profit.

To put it simply, let�s use the Cleveland Indians as an example. The Tribe was recently sold for $320M. That would allow Mr. Dolan to place $160M as residing in player contracts (which he could write-off at the rate of $32M/year for the first five years of his ownership). Let�s assume (strictly hypothetical to make the math easier for me to do) they enjoyed $120M in revenue [in 2001] and had $90M in expenses (excluding the player depreciation that they�d still have since the club changed hands less than five years ago). So, here�s what the books will look like:

Revenue......................$120 million
Less costs......................$90 million
Less depreciation.........$32 million
---------------------------------------------------
Pretax profits................-$2 million

As mentioned, the $32M in depreciation is simply an entry in the books, no actual cash has been spent. So the club that actually had a [substantially] positive cash flow in 2001, but can report a loss of $2M. Suppose Mr. Dolan decided to give himself a salary of $8M/year (above and beyond what was mentioned in the above equation--re: costs), then the book loss becomes $10M:

Revenue......................$120 million
Less costs......................$98 million (including owner�s salary)
Less depreciation.........$32 million
---------------------------------------------------
Pretax profits..............-$10 million

To keep things rolling, suppose Mr. Dolan is in the 30% tax bracket and has other sources of income besides the Cleveland Indians (which he does). Since his operating income [from his ownership of the Cleveland Indians] is negative, Mr. Dolan can use his $10M [pre-tax] �loss� to reduce his total taxable income from his other sources (such as his cable TV enterprise) by $10M thereby saving him $3M on his tax bill.

Presto, his $10M dollar �loss� that the Indians inflicted on him was actually a gain to the tune of $33M ($22M operating income minus depreciation, plus $8M salary, plus $3M in tax savings)

If these are his revenue totals for the first five years of running his club. Mr. Dolan can say the Indians lost $50M even though he is $165M richer for his troubles.

I may be a tad off here or there (I�m not an accountant and I don�t play one on TV) but the bottom line is the same--you can bleed a sea of red and swim in an ocean of green.

And that�s just one of the little perks that come with club ownership and I haven�t even discussed the explosive increases in franchise values.

That�s how team owners can lose tens of millions of dollars but you never see them dressed in rags driving a rusted out 1972 Ford Pinto.

So it appears that MLB is buying out profitable franchises to feed their tawdry little war with the MLBPA. They are screwing the fans in Montreal and Minnesota (again) in hopes of getting (1) getting several hundred millions in corporate welfare from the cities and (2) getting the players to submit to a salary cap.

One thing I�ve learned is to *never* ask how low, or how stupid, or how dishonest MLB can be, because when I do, they say in effect:

�You ain�t seen nuthin� yet.�

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