Tuesday, November 25, 2008

Life is Good?

Life is Good?
You've seen the t shirts, caps, sweats and other swag with this slogan. Even if life is good, why do you have to brag about it? I wonder if the CEO's from AIG were wearing this stuff around the resort while planning the company's post government bail out restructuring. In this economic downturn life is not that good for a lot of people in this country. That being said I prefer a more realistic approach to a clothing line like: Life is not good; depecting the negative but all too real aspects of life. Like those funny warning signs you see showing you what could happen to you if you use a tool improperly or bring a telephone into the bathtub.

So the question I pose is: Will life be good for Scott Boras and baseball's free agents? I guess life is already good for anyone making over a million dollars a year and additionally those playing professional sports for a living, but in this economic environment why should Manny Ramirez expect a pay raise? I understand supply and demand, but what kind of economic conditions would have to be in place to make MLB teams balk at an expected salary by one of Scott Boras' clients? The answer is that I don’t think we will see it in this lifetime. Barring a great depression, baseball salaries will continue to rise. The popularity of Major League Baseball is at an all time high. As long as teams are winning, they can expect to be profitable. The Red Sox have become the blue print for this type of success. As long as team management has a commitment to winning and running the franchise as a business by making shrewd and thorough business decisions, success can be had. This formula along with the many improvements to Fenway Park, have led the red sox to two world series championships and to a MLB attendance record.
Teams that can afford to spend do spend. They have to spend in order to be competitive, but success is had by spending wisely. The Mets and Yankees have spent quite a bit in recent years but it has not led to playoff success. Major League Baseball has seen some pretty terrible free agent signings over the years from: Albert Belle with the Orioles, Mo Vaughn and Pedro Martinez with the Mets, Barry Zito with the Giants, and Carl Pavano and Kevin Brown with the Yankees to name some of the worst. Granted it is a crap shoot in determing a players success, but the best predictor of future behavior is past behavior. Teams should spend the most on the players with the best consistent track record, young guys like Texiera, and not give in to Boras' demands for sub par players past their prime like Jason Varitek.

Ultimately, demand for the player is the most important factor in salary negotiations. Scott Boras creates fictious demand for clients like Jason Varitek, claiming that there are suitors for a sub par catcher who can miraculously help you "win you 60 percent of your baseball games". During Varitek's last free agency bid, Boras made the claim that there were a number of other teams that were interested in Varitek's services, yet these teams never seemed to materialize. This time around, Theo Epstein is not afraid to call Boras's bluff in this game of high stakes chicken.

Players should be rewarded based on their performance, not by some contrived scheme by a super agent to maximize player revenue. Factors like behavior must also beconsidered. Teams are willing to turn a blind eye to players who have behavioral issues if that player can be productive like Manny Ramirez or John Rocker. Personally, I dont think Ramirez deserves a big contract based on his behavior in Boston. You would think that a free spirit like Manny Ramirez or Pedro Martinez would not mind leaving that last buck on the table and opting for comfort over money. Yet, the mentality is that a player feels disrespected if they dont collect every last drop of money coming to them. Then the super agent enters from stage right playing on these emotions. Despite an increased tax for the super rich under the Obama plan, MLB players will not feel the pinch that the rest of the country is feeling. Even given Varitek's declining statistics, I seriously doubt that Varitek and Boras will leave that last buck on the table.

I happen to like Jason Varitek. I even shook his hand the night he put a catcher's mitt to AROD's face. However, from a business standpoint, you have to assign a value to each player based on their performance. Given Varitek's age and declining ability, I dont think he should be granted a long term high dollar contract.

Mr. Varitek, despite the divorce, despite the economy, despite your swiss cheese bat, life is still good, even if you only get a one year contract worth $10 million dollars or less.

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