Leverage For Dummies

I need to vent.

I’m stupid, I freely admit it; guilty as charged … if brains were dynamite, I wouldn’t have enough to blow my nose. I called my blog “Synaptic Flatulence,” and when I was writing for TOTK Sports, my column was entitled “The Village Idiot.”

You get the idea.

But I’m not so dense that I cannot understand the concept of leverage. If a guy holds a loaded gun to my head and demands my wallet, I understand that he has leverage. If my wife asks me to do something and threatens me by withholding something (you figure it out) if I don’t do it, that’s leverage.

I get it.

The reason that I’m coming out of the closet with my mental deficiencies is that it has lost all social stigma. After all, this orientation hasn’t stopped folks from becoming CEO’s of national pastimes, or more importantly elected officials. If I had the spare time and the motivation, I might well organize an “Idiot Pride Day Parade” with colorful participants, such as kids running with scissors, multiple DUI offenders riding in bumper cars, a float with teenagers playing “the choking game,” and Paris Hilton.

I’m sure even some of my fellow parade participants would understand the basic concept of leverage—I mean, Paris Hilton realizes that if she has sexual relations and folks can’t watch it on the Internet, people will forget about her. She understands leverage. The public could care less about what Paris Hilton thinks (insert air quotes here), so to get their attention she, well, does pretty much anything to keep you focused on whatever it is she’s doing.

But I digress.

So if your garden variety dumb-as-a-bag-of-rocks baseball writer understands leverage, why is it so many politicos are oblivious to the concept? What does that say about their level of intelligence (or lack thereof).

My point?

Item one: Twins not bound to play in Metrodome beyond ’06. Now some folks think that this gives Carl Pohlad a lot of leverage in his negotiations extortion attempts against the state of Minnesota.

Does it?

If they don’t sign a new lease with the Metrodome, where are they gonna play? Is there any other major league ready stadium in the US. available to play in? What are they going to do? Not play? Go on a 162-game road trip? Move to Montreal? What are the Twins going to do if the city/region/state says no to a new stadium?

I’m going to let you in on a little secret. It’s hard to move a major league franchise. One reason for this is simple: let’s assume Washington D.C. was still available and the Expos were owned by Jeffrey Loria and David Samson. Now suppose you’re Carl Pohlad, or David Glass, or Lewis Wolff. Do you vote for their being allowed to relocate? If you do, then you can’t threaten to move there. A big reason why the Expos relocation finally went through is simple: all major league clubs have a stake in the franchise. It was in their financial interests to do so. If Jeffrey Loria moves the Expos to D.C., Carl Pohlad doesn’t see much financial benefit, but he sees a potential financial problem: He loses a viable relocation threat to extort a stadium from his community. However when Carl Pohlad owns a chunk of the Expos … well that’s a whole different situation isn’t it?

It would seem to me that the decision regarding the Twins’ lease gives the region as much leverage as it does Pohlad, because where are they going to play? The Minneapolis-St. Paul metro area ranks 14th in the U.S. as a television market; any place they move is going to be lower, which in turn reduces the overall value of MLB television rights—which, by the way, are currently being negotiated. Do you think the other 29 clubs are going to tell Carl Pohlad he can reduce their potential income? Is there currently a major league ready stadium anywhere? Right now the Twins have two viable options: the Metrodome and Olympic Stadium in Montreal.

These same obstacles face the Marlins and the A’s.

There have been overtures by the Marlins to Las Vegas (MLB put a stop to that), Portland, Ore., to which the mayor said “My concern is that Portland is facing a crisis is education … that’s my top priority, to find funding for that. And I expressed that today… publicly financed baseball [will] not be coming to Portland on my watch. And that was not a point of discussion today … I do not want the city of Portland taking out any mortgage on our children’s future,” and Charlotte, NC, which would automatically make it the smallest market in MLB—and there‘s no facility to play in.

In short, South Florida is holding the cards. They put over $160 million on the table, which Loria and Samson felt was a little short of what they wanted, but is still over $160 million more than any other region has offered. Best of all they have an interim stadium to play in (the Marlins current home).

What about D.C.? Amazingly, the city offered up a $611 million dollar corporate welfare package, and inexplicably MLB didn’t take the money and run. Even if baseball were to take D.C. to arbitration and win, they would not be awarded over $611 million, and it would leave the stadium question unresolved.

For some teams searching for a new stadium, any new location is going to be a step down in market size (including TV) and the number of corporations available to lease luxury suites and club seating (the real motivation in wanting new stadiums). On top of that, we have a lot more entertainment options than there were even 30 years ago, and a team moving into a new market has to deal with that [once the initial novelty wears off], whereas in their current locales, major league baseball teams are already a part of the local entertainment scene.

In short, it would take a lot of work to build up a new market. They would need to succeed there. Just look at how things have fallen off in baseball-mad Colorado due to the team’s ineptitude.

Put simply—most team’s looking for a new stadium are probably in their ideal location right now.

In other words, there’s no reason for regions to give in to their team’s blackmail attempts. A new stadium has no discernible positive impact on a region’s economy and their team’s really don’t have realistic options either in the short term or the long term.

Bottom line: they have leverage.

So if they want a new stadium, tell ‘em to build it themselves and if they’re nice maybe they‘ll chip in some infrastructure costs and maybe a tax break or two.

So if David Samson comes calling, just …

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