Months ago, there was an MLB lockout where the owners would not agree
to the requests from the players, and it was this ongoing feud and
the owners decided to lock the players out.
Meaning they couldn't even use facilities to do their training and all of that.
Well, they finally came up with an agreement.
I don't know every part of that agreement, but one thing that really stood out,
it was a sticking point in this ongoing labor dispute was the revenue sharing.
And so luckily, I have a husband who follows this stuff closely.
He used to be a professional baseball player and
he told me about how revenue sharing works.
And it sounded so curious to me because it was something that owners
seemed to love and remember owners think of these teams as an investment,
as a way of maximizing profit, right?
So this is what revenue sharing is in the MLB, as it stands today.
Along with TV deals,
MLB teams also receive extra money through revenue sharing.
Each team pools 48% of the revenue they earn and
the total amount is then evenly split 3.3% of the total and given to each team.
Teams receive more than $110 million through revenue sharing.
And so That sounds like a redistribution of wealth.
That sounds like something these rich owners are not in favor of generally
speaking, when it comes to, let's say paying their fair share of taxes.
Pulling this money into social programs that benefit the less fortunate.
But when it comes to this context,
where let's say they've invested in a team that maybe is not drawing big crowds.
Maybe they're not investing enough revenue to make their teams better,
to make their teams more competitive.
Maybe they're not recruiting players that would require more pay because they happen
to be better performance, whatever it is.
This is a way of kind of ensuring that you bring in money for yourself as an owner
without really having to do the necessary investment to make your team competitive.
Am I understanding that correctly?
>> Yeah, and there's so much that goes into it too.
In baseball, they enacted this artificial tax on spending.
So, the theory being so that very rich teams like the Yankees.
The playing field will be leveled against small market,
poorer teams like the Milwaukee Brewers say, right, or
name any other small market team in baseball.
But what happens when you put that artificial cap on
revenue on the Yankees without enacting a spending floor,
meaning you have to reach this certain level of spending.
So just to say if the Yankees get to 110 million in payroll,
there's nothing obligating the Brewers to get to past 20, right?
They didn't even do that.
So they're artificially decreasing players wages that way, of course.
And then they had this other thing where as a player in baseball,
you don't really get to make your big bucks until you reach free agency and
you can't reach free agency until I think seven years of service.
However, what they would do when they had guys in the minor leagues,
they would wait until the exact date that they could get them,
I forget what the cut off was for the counters a year.
I think it was, let's say it was 83 games or something like that.
They would only bring these guys up at 82 to ensure that they didn't
reach that full year of service which brought back their ability to go get
the big bucks by year, thereby depressing their earning potential.
All these cheap ass ways, right,
to artificially suppress wages of the players.
And then, the biggest part of how owners are just disgusting and
how they colluded with each other was just that basically.
I think Alex Rodriguez, the deal that he signed with the Texas Rangers for
$250 million was in the year 2000, I believe.
About three years ago, the best players in baseball were getting deals for
basically $300 million as well.
The same deal A-Rod was getting 20 years ago,
superstars are getting today while revenues are still breaking all
kinds of records in revenues and profits on the owners side.
There's that, and
then of course every single sports league does the revenue split right?
In the NBA, for example, they do the most basic one,
the owners get 50% of basketball related revenue, the players get 50%.
So that's the TV deals, the concessions,
the sponsorships, all of the stuff that teams franchises generate.
Fine, they split that with the players.
However, if you buy a franchise for say 100 million and
you sell it for 500 million, that 400 million in profit,
you don't share that revenue with the players, right?
When staples center or whoever has, Jay Z, Beyonce and
Eminem and all these people coming in for
concerts and that revenue generated by the team's stadium.
You don't share that with the players.
There's all this value, extra value and also the players have,
basically every athlete at max has 20 years to play professional sports.
That's the time that they get to earn.
Owners, they pass these things down to their spout tines, and
it keeps going and it keeps going.
They don't ever stop extracting value from this thing.
And so they're already in an advantageous position, right?
The idea that they're fighting tooth and nail with these guys
over money is just laughable, but that shouldn't surprise anybody.
And most of these new owners, of course,
they come from hedge funds, freaking venture capital.
The worst greediest people on the planet who see teams as not just a social
utility, something that's supposed to be a little bit bigger than just money.
They just see it as another investment that they do and they treat it as such.
>> Yeah, it's interesting,
I know a few of the details about what they finally came to an agreement on.
And aside from the revenue sharing stuff, there was this one thing,
I get that it's not that big of a deal, but
it really shows you just how greedy [LAUGH] these owners really are.
Because despite all the advantages they get in these agreements,
they wanted to ensure that there could be advertising on the player's uniforms.
>> Of course.
>> That's another thing that they agreed on in this contract.
And it's just, how much more money do you need?
It's insane.
>> They're sick.
And they were doing crazy [INAUDIBLE] again, the owners are supposed to view
what they're doing with the players as a partnership.
You guys are capital, we're labor, the fans come to see us,
you put up the money for the stadium, blah blah and
our exploits attract a certain amount of money.
We're partners in this thing.
However, in baseball there's this thing called arbitration where,
basically a third party, you both parties present their cases management and
the player to this arbitrator.
And the arbitrator is, all right, this is how much that player should get.
Major League Baseball was giving out trophies to the ownership groups
that were able to stiff their players in arbitration the best.
And this news got out and unsurprisingly and
disgalvanized these guys these people.
If we thought we were gonna, all right, you know what,
it's not that big of a deal that we gotta take these to the wood shed and
get every single thing that we want cuz these people are disgusting.
And not only that they don't respect what we do,
they don't respect what we bring to the table and they think we're idiots.
>> You mentioned how the lifespan of their career lifespan
is short relative to how people and other jobs work.
So 20 years max, but keep in mind if they have a serious injury,
they could be out after the first year.
Yeah, exactly.
>> That's 1% of professional athletes play 20 years.
>> And I remember writing a segment about this whole labor dispute
after the lockdown happened or lockout happened.
And I wanted to make a point about how this isn't just too greedy parties
fighting amongst each other, right?
Because when you hear about those hundreds of millions of dollars in contracts,
you have to keep in mind that that's just like a handful of players.
A lot of those players are not making even a million dollars a year, right?
Right, so, and yeah, even the lowest paid professional baseball player in
the majors, minor league players, they get paid almost nothing, right?
It's terrible.
But we're talking about the major leagues, even the lowest paid major league players
seems to be making a lot of money relative to an ordinary worker.
However, they're not gonna be making that money over 30, 40 years.
They're gonna be making that money for a limited amount of time.
They got a limited amount of time to build that nest egg and
that's assuming they don't get injured.
And when you look at that pay relative to the amount of revenue that comes in,
you get a better understanding of how unfair it is.
It's very similar to what you experience in other corporations or workplaces.
>> And also just understand when I talk about let's just say baseball,
I don't know what their revenue share split is.
I know the NBA is 50% I'm not sure what baseball's is, but
let's just say it was 50.
There's 25 men on every single major league roster, there's 30 teams,
you can extrapolate the map.
So it's that many players 25 times 30 splitting 50% of
that revenue on the ownership side, on the ownership group at
max there's six people part of some ownership collective.
Most of the time this one guy or two guys for 30 teams.
So you can compare that, hundreds and hundreds of players sharing that 50%
whereas the owners are sharing it with 30, 40, 50 total people.
>> That's crazy.
>> You understand?
So just think about the value they're extracting all the time from this stuff.
And again, this is not even to talk about Anna when they can use the franchise as
leverage or collateral to go get this other money and do these other deals.
And the amount of value the owners are able to extract from these franchises.
And again, the values of the teams are always going up up up.
So even if you crying poor, you're gonna make way more than you paid for
it if you decide to sell, say, I can't afford it no more.
It's too expensive.
All right, go ahead, go sell it.
You're gonna make billions more than what you paid for that franchise.
And the nerve of these cats that say we demand concessions from the players.
It's just greed at just the most ridiculous and base level and
luckily they got called out for it and they fucking folded and caved.
>> I love it.
I love that it ended that way.