Fay Vincent has a (severely flawed) idea about how to compensate players

6 Comments

Former baseball commissioner Fay Vincent has a column in today’s Wall Street Journal in which, after noting how businessmen and actors get an equity stake or points on the gross in their deals, why baseball players can’t do the same thing and take an ownership interest in the team:

Mr. Pujols will in all likelihood negotiate a salary of around $35 million annually in a four- or five-year agreement. He and his agent will surely notice the enormous bite the tax collectors will take of that income. Why not take some of the pay in the form of a piece of the Cardinals franchise? Who would argue the Cardinals are not more valuable if they can keep him?

First: $35 million? Really? I kind of figured it would be like $30 million, but let’s save that for another day.

Second: As Vincent himself notes, baseball prohibits players from owning a stake in their team unless they get approval from the commissioner and unless, pursuant to Major League Rule 20(e), they sell their stake in the team if they switch teams.  Specifically, that rule provides that the agreement “shall provide for the immediate sale (and the terms there of) of such stock or other proprietary interest or financial interest in the event of the [player’s] transfer to or joining another Club.”

I’m just a dumb litigator, but I don’t think I’m wrong when I say that a player-ownership scenario that is designed to provide tax savings and greater flexibility is a tad bit hampered by a rule that requires the stake be divested immediately if the player switches teams.  That, my friends, would lead to an immediate taxable event. It would also severely hamper the value of the ownership stake, which would piss off both the player and the team’s majority owners, who likely don’t want to have to force chunks of the team out into the market the moment the team’s GM comes up with a spiffy trade.

Sure, you could change the rules about immediate divestment upon being traded, but then you run into the uncomfortable scenario of someone playing for the Cardinals, for example, who owns a stake in the Cubs. Or a Dodgers player — Juan Uribe, for example — whose wealth depends on the Giants having a greater franchise value.  In an age where franchise values are dependent upon regional sports network ratings, and those ratings are dependent upon winning and losing, that’s a recipe for disaster, is it not?

In other news, for all of Fay Vincent’s virtues, the game is way healthier, financially speaking, today than it was when he was commissioner. If this article is evidence of his business acumen, there may be a reason for that.

Report: Twins sign Martín Pérez to one-year deal

Martin Perez
Getty Images
Leave a comment

Ken Rosenthal of The Athletic reports that the Twins have picked up free agent left-hander Martín Pérez on a one-year deal. Financial terms of the deal have yet to be announced, but it looks like a club option is included for the 2020 season. The Twins have not officially confirmed the signing.

Pérez, 27, missed 85 days of the Rangers’ 2018 campaign after undergoing elbow surgery on his non-throwing arm. He sustained the injury partway through the 2017 offseason; as the story goes, he was charged by a bull at his ranch in Venezuela and fell on his right arm as he was trying to get out of the animal’s path. (He later killed and ate said bull.) When he finally returned to the mound, he cobbled together a 2-7 record in 15 starts with a 6.22 ERA, 3.8 BB/9, 5.5 SO/9, and career-low -0.2 fWAR through 85 1/3 innings out of the rotation and bullpen.

As they approach the start of the 2019 season, the Twins will be looking for something a little more, well, bullish from Pérez. Prior to his injury, he turned in two solid seasons with the Rangers in 2016 and 2017, nearing the 200-inning threshold in both campaigns and providing a combined value of 4.2 fWAR at a time when Texas’ starters collectively ranked sixth-worst in the league.