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Outside the Lines:
Contraction - Is Less More?


Here's the transcript from Show 85 of weekly Outside The Lines - Contraction - Is Less More?

SUN., NOV. 11, 2001
Host: Bob Ley, ESPN.
Reported by:Bob Holtzman, ESPN.
Guests: Don Fehr, executive director MLBPA; Jeff Smulyan, former owner Seattle Mariners; Clark Griffith, son of former owner of Minnesota Twins; Andrew Zimbalist, sports economist.

Announcer - November 11, 2001.

Unidentified Announcer - Arizona Diamondbacks have overtaken the Yankees...

Bob Ley, host - And then less than 48 hours later:

Unidentified Male - Major League Baseball owners today voted overwhelmingly to authorize Baseball Commissioner Bud Selig to begin the process of contracting two teams prior to the start of next season.

Ley - One of those, the Minnesota Twins, a franchise that dates from Walter Johnson through Harmon Killebrew, Rod Carew and the championships of Kirby Puckett and Ken Herbeck, destined for extinction.

Unidentified Male - Drilled a hole in my heart.

Bud Selig, MLB commissioner - Is it a sad day after the World Series we just had and the things we've done? No, I don't think it's a sad day at all.

Ley - This morning, for the first time since the contraction vote, the head of the players union speaks to the issue.

Don Fehr, Executive Director, MLB Players Association - The fact that they want to do it and tell us about it afterwards is not a very strong step forward.

Ley - Today on Outside The Lines - Contraction: Is less really more?

Ley - Put aside the billions of dollars in revenue, the abstract economic concepts, even the anger and pain of the twin cities. See if they recall what Yogi Berra once observed, "It's deja vous all over again."

Major League owners and the players union in another steel cage match. This time, hanging in the balance are two major league franchises. Commissioner Bud Selig would remind us that no, the two teams to be contracted have not yet been chosen, that the union has no say whether this happens.

In a moment Don Fehr of the players union will address that, in an interview that I conducted back on Friday. But it is widely assumed the Minnesota Twins and the Montreal Expos are the targets, because baseball says they cannot carry their financial weight.

Selig - Whatever two franchises are contracted will be franchises that we have judged to be -- that don't generate enough revenue to be a competitive franchise. And that's a very significant problem. And if they can't do that and don't have the likelihood of it, we obviously have a problem.

Ley - Joining us now, Don Fehr, the executive director of the Major League Baseball Players Association. Don, Bud Selig said this is not a sad day, a sad time for baseball. I imagine your take is somewhat different?

Fehr - Well that's sort of a puzzling statement, because even if you believe it was absolutely necessary, it is still very unfortunate. It's still sad, it's going to cause a lot of heartache for a lot of people for a very long time. I mean, I've only been in New York 24 years, but in that period there isn't a week that goes by that I don't hear about the Brooklyn Dodgers.

Ley - Do you believe that -- any part of your soul believe you, or you are learning from all these negotiations you've been in that this is a ploy. Now Bud Selig, it took four direct questions the other day for him to say, flat out at his press conference this is non-negotiable, it is not a ploy. Do you think, though, it is a ploy?

Fehr - Well, I don't know whether it is or not. The good news is that our response to it is sort of the same either way. Whether or not it is ultimately determined that the clubs had an obligation to bargain everything with us, there is a fundamental question as to whether, if we're going to form a new relationship.

If we're going to get past all the difficulties we've had, if we're going to try and maximize and strengthen the kind of good feeling we've had for baseball up through last Sunday night, anyway, and before the owners meeting, this ought to be something that they ought to want to negotiate with us.

And the fact that they want to do it and tell us about it afterwards is not a very strong step forward.

Ley - So are you saying then that contraction has been in the conversations that you've been having over the last several months over financial data?

Fehr - After all the press reports about the possibility of contraction, we asked? And they said it was a possibility and, you know, they'd like to try and structure something that allowed for contraction or not. So what we said was, if this is something you seriously are interested in, make us a proposal, tell us what you think you're going to do.

Tell us what the differences are. We'll talk about it; we'll consider it. Instead, we never got the proposal. All of our revenue discussions were on the basis of 30 teams. All of the schedules we got which they are obligated to give us by contract, and are binding for the next year, are on the basis of 30 teams.

As late as late September, I was personally assured by a senior official in the commissioner's office that it was virtually impossible to consider contraction for next year, especially considering what happened on September 11.

Ley - So you had a personal assurance that nothing was going to happen?

Fehr - And that is why -- that is the basis upon which we proceeded. Now I was advised by the commissioner on Halloween that it was possible but not certain they would consider contraction on November 6. And I was told about two hours before the seventh game of the World Series that there would indeed be a vote on contraction on November 6. And without getting into the details of how I responded at the time, this is a very, very, very difficult way to proceed. Because, of course, as soon as the World Series ends, all kinds of things happened.

Players file for free agency. Reserve lists have to be filed by mid-November by the clubs. Clubs are looking for players. Players are looking for clubs. Clubs are trying to sell tickets. Schedules have to be redone. We still don't have any schedules, which contemplate for less than 30 teams. So the notion that somehow it was OK -- that we were just fine with the notion of considering contraction decisions, even without details on November 6, as if that would not cause in the best of circumstances incredible dislocation. And damage the players, and damage the clubs signing to sign players is just -- well it is just silly.

And that's what's so distressing about the way this developed.

Ley - Is there enough trust between your side of the table and the other side of the table, given what you've told me about this assurance you had in September to continue. Or are we returning to the bad old days?

Fehr - I hope we're not returning to the bad old days. I hope we're going to be able to find a way through this and work it out and reach a new basic agreement.

Ley - I don't think most folks would argue that Montreal may not be fit for the future as a major league franchise. But certainly relocation has been talked about there. But make the case, Don, for keeping the Twins as a viable franchise.

Fehr - There is this notion out there that you have markets that can't generate revenue, and you have markets that can, as if those were always the same ones. The problem is that it is not true. Until Jacobs Field, the Indians were considered to be the worst of all possible circumstances, hopeless. They made the movie "Major League" about the Indians because it was sort of a joke. Seattle was thought to be the same way. The success of a franchise does not necessarily remain static over time. It depends on what happens and it depends on how well it is run. And what we do know is that at times in the past, there has been very significant attendance in Minneapolis.

Ley - So it is fair to say that contraction has muddied the water, totally from your side of the table.

Fehr - Well you know, it's -- that's your phraseology, I'm not going to use that.

Ley - Would you argue with it?

Fehr - It's a difficult problem.

Ley - All right, Don Fear, thank you for joining us.

Fehr - Thank you.

Ley - Major League Baseball declined our invitation to address the issue of contraction.

Former commissioner Fay Vincent spoke with Outside The Lines, and criticized the owners for imposing contraction rather than negotiating it with the players union.

Fay Vincent, former MLB commissioner (1989-'93) - They have made a terrible mistake in trashing the union at the very outset. Why wouldn't you have gone to the union, talked to them about contraction before you announced the decision?

Obviously the union is in control of baseball, not the owners. You are going to need the union to make any progress on the ownership side. And this is like bombing someone and then asking him to come to the table and talk about a peace that you very much want.

Ley - When we continue, I'll speak with a man who has said he is willing to buy and save the Minnesota Twins, a former Major League owner who defends contraction, and a sports economist who says the idea makes no sense. And next we visit the Twin Cities where players and fans face the prospect their team will be no more.

Teddy Berg, Minneapolis bartender - Oh, they're mad; they're teed off. I mean, (Unintelligible) if they had a chance, they'd boot his can right out of town.

Unidentified Male - It's a sad day in baseball; the thing really stunk. I think he might want to take that back, because I think he hurt a lot of people with that thing.

Selig - Is it a sad day after the World Series we just had and the things we've done? No, I don't think it is a sad day at all.

Unidentified Male - I don't think Bud Selig would want to show up in Minneapolis right now, because he might be a wanted man.

Ley - Friday, Twins owner Carl Pohlad with tears in his eyes asked club employees to remain on the job. But he also said he would not sell the team. See Bud Selig if you want to buy it. Baseball has prepared to pay Pohlad anywhere from five to eight times what he paid for the Twins, to shut down a 100 year-old franchise.

It was, Bob Holtzman reports, a painful week in the Twin Cities.

Unidentified Announcer - For the first time ever, the Minnesota Twins are the world champions!

Unidentified Announcer - ... has his 3,000th hit!

Unidentified Announcer - ... Kirby Puckett!

Bob Holtzman, ESPN correspondent - In downtown Minneapolis, across the street from the Metrodome is Hubert's Bar and Grill. It's an old baseball hangout and home to a lot of old things. The oldest is Teddy Berg.

Berg - How you doing? Thank you.

Years ago, when I'd grown up with baseball, it was a kind of a sport people played because they loved the game. Today, it's how much money can I get?

This is what they call Pohlad Special.

Holtzman - This week, the 79-year-old bartender has been mixing drinks for a lot of mixed-up Twins fans.

Berg - Oh they're mad, they're teed off.

Deborah Lee, Twins fan - It's almost the American slogan here, you know, ice cream and baseball and hot dogs. You'll be taking away something from the people here.

Holtzman - Just 10 years ago, the Twins were on top of the baseball world.

Jack Kulseth, Twins fan - The kids here deserve, when they grow up, to have (Unintelligible) whoever comes out, you know, and it's not going to be here.

Berg - People don't want to lose this team. This is a sports-minded town. It always will be. Minneapolis, St. Paul both.

Tom Cody, Teacher, Cretin-Durham H.S. - Great insight.

Holtzman - Across the river in St. Paul is high school teacher Tom Cody.

Cody - Discipline, motivation, inspiration...

Holtzman - Cody learned to read by sounding out the names in the box scores, and his American car is plastered with baseball causes. Surprisingly, he says losing the hometown Twins is the right thing for the Twin Cities.

Cody - You know, I'm sort of proud to be from St. Paul-Minneapolis in kind of a weird way. We're the only ones -- we're always the last ones to figure anything out. We're just learning the high-five in the Midwest, you know, which originated, maybe, some years ago. But I think we might be the smartest of everybody.

I think we're going to be the people who are first to say, this is ridiculous. No, we're not going to build you a stadium; you're out of control. Go away.

We're not a baseball city, were a snowmobile, ice fishing city, you know. We love our baseball when it is here. I guarantee it, two years from now the Twins, nobody will be talking about it.

Frank Quilici, Minnesota Twins, tied World Series record with two hits in one inning - The people just don't know, that are talking that way, because this is a great baseball town.

Unidentified Announcer - Quilici singles to right for his second hit of the inning.

Holtzman - Frank Quilici should know. Quilici played six seasons for the Twins, managed the team for four, and helped broadcast the games for another seven. He still lives south of Minneapolis, and says the talk of contraction is surprising.

Quilici - I've always said, man has tried to destroy baseball for 140 years, but the game is bigger than man. But certainly this is manmade, and it is hard to believe that it's actually happening.

Jake Mauer, father of Joe Mauer, Twins prospect - I won't believe it until it actually happens. Maybe I'm naive, but I'm hanging in there.

Holtzman - Jake Mauer and his family may have as much interest in what happens to the Twins as anyone. They live eight miles from the Metrodome. They have three boys; all three play baseball.

And earlier this year their youngest, 18-year-old Joe, was the No. 1 pick in baseball's June draft, selected by the Minnesota Twins.

J. Mauer - What are the odds? I mean, a kid from northern -- even a kid from this far north being the No. 1 pick in the draft. It's great.

Teresa Mauer, mother of Joe Mauer - And then making his hometown...

J. Mauer - And then his hometown team picks him. It's a dream come true.

T. Mauer - I just know that it -- he would love to play baseball for Minnesota.

Holtzman - Joe Mauer grew up a Twins fan, after discovering baseball during the Twins first championship season of 1987.

Fourteen years later, Mauer was so excited about the possibility of playing here, he turned down a scholarship to play quarterback at Florida State. Now, his future is as up in the air as the Twins. Because of that, Mauer declined to talk with Outside The Lines. He did say he is still hoping the Twins will be saved; his parents remain hopeful as well.

J. Mauer - I can't imagine the feeling of what that would be, watching over at the Metrodome.

Berg - Four seventy-five, fellows.

Holtzman - At Hubert's, most are convinced this is all about money, and the timing couldn't be worse.

Quilici - Going out just when it looked like they might have turned the corner.

Holtzman - The sign across the street still says, "See you in 2002." But the signs from baseball aren't nearly as optimistic.

For Outside The Lines, I'm Bob Holtzman.

Ley - In that dome, the Twins and the season just concluded, posted baseball's second-highest percentage of attendance increase, nearly 70 percent without a new park, which the Brewers and the Pirates both debuted.

I'm joined this morning by Clark Griffith, whose family owned the Twins and the Washington Senators for 73 years. His father, Calvin, sold the club in 1984. Clark Griffith is in Minneapolis.

Clark Griffith, family owned Twins franchise for 73 years - Good morning, Bob.

Ley - Good morning.

Jeff Smulyan is Chairman of the Board of Emmis Communications. From 1989 through '93, he owned the Mariners in Seattle. He is in Indianapolis.

And Andrew Zimbalist, professor of economics at Smith College, and author; he joins us from Northampton, Massachusetts.

Good morning, all.

Clark, it's been reported you are willing -- you have a group willing to buy the Twins. You still willing to buy them? And do you think that Carl Pohlad is a little too anxious to be bought out?

Griffith - Well that's -- I think Carl would like to be bought out, if that would save the situation. I understand however, that he is saying right now, that he no longer has control over that situation. I'd like to put this in historical context thought for a second. Which is by saying, that in the 122 years of Major League Baseball, there has never been such a drastic act taken. And I simply don't understand it, because it makes absolutely no economic sense. Any economic gains that owners may think they are going to enjoy from this is ephemeral.

And what they've done here, unfortunately, is to destroy that bond of trust you have to have with the union at the beginning of negotiations.

Ley - You still willing to buy the team?

Griffith - Absolutely.

Ley - All right, Jeff Smulyan, do you think that deal could be worked out? You used to own the Mariners, you know how these things work.

Jeff Smulyan, former owner of the Seattle Mariners (1989-'93) - Well, I know, Carl has brought two world championships to Minnesota, and has tried to find a buyer for all these years. Clark, with all due respect, I think if you had had the ability to buy this team, it could have been bought at any time in the last at least 12 years -- absolutely, positively.

Griffith - Well I disagree with that, Jeff. Carl just simply couldn't pull the trigger when he had the opportunity to sell, and hopefully he'll be able to do that in the future.

Ley - Let's look at the bigger issue of contraction, for a second. Andy Zimbalist, why does it not make sense to you?

Andrew Zimbalist, has consulted the MLBPA about Collective Bargaining - Well first of all, as Clark was just saying, that baseball is going to take on an enormous tab to buy out these two franchises. Not only are they going to have to pay Mr. Loreal and Mr. Pohlad somewhere in the order of $250 million each -- because it is not simply a matter of what the team is worth in the current situation. But each could sell the team, if there is no contraction. They can sell the team and move it to a more lucrative sight.

So not only do they have to do that, but they have to buy out the commercial contracts of the team; they have to buy out the six minor league franchises. They have to buy out the stadium leases for the major and minor league teams and also the spring training site. It's enormously expensive. The bill for each team is going to be $300 million or more. So, there is not going to be any financial saving; and the real down-side here is litigation. You have baseball, which is an industry growing by leaps and bounds.

The revenue in baseball, between 1995 and 2001 has grown 17 percent per year. Revenue this year is over $3.6 billion; it was $1.4 billion in 1995. This is an industry that is growing very rapidly. In the context of that growth, they are not increasing output, they are not stabilizing output, they are reducing output.

Smulyan - But you're missing -- Andrew you're missing the point. The point is revenue is maybe growing by 17 percent a year, and expenses is growing by 40 percent a year. You've got an industry in dire straights.

Zimbalist - Well, that...

Smulyan - And your math is just wrong. It's not going to cost $300 million to release these teams. But the question is, do people have a constitutional obligation to continue losing millions of dollars a year? There has got to be some economic sanity.

Ley - Jeff would you...

Ley - ... Jeff would you buy back into the industry?

Smulyan - Absolutely not. And I love Bud, and I love the people in the game. But the economics of baseball are insane. You've got most of the teams losing money. The game is billions of dollars in debt. And it is a game Andrew that is absolutely at an economic crossroads, and it has to change. And keeping teams that can't make money, just because people demand that they lose money is insanity, and you know that.

Griffith - Jeff, I think...

Ley - Go ahead, Clark.

Griffith - Jeff, I think in what you are saying here you are making the greatest argument I've heard for a collective bargaining process that goes forward and at fairly amicable sense. By opening the negotiating, which requires the understanding and trust on the part of both sides, with a shot across the bow -- in fact this is a shot in midship at the waterline -- I think that you are going to have a very, very hard time achieving the revenue sharing, the salary control, the player contract matters that need to be negotiated in the coming labor negotiations. I think that issue has been destroyed.

Zimbalist - The Minnesota Twins made money this year and the Montreal Expos could re-locate to Northern Virginia, Washington D.C., it's the eighth largest media market. They would make lots of money in that market. They'll have a new stadium in a few years. In the short term, they can play in RFK. It's moving in a different league, so the Major League Baseball Constitution does not prohibit that team from going into Angelos' territory, the Baltimore Orioles. They ought to be relocating here; they should not be eliminating the gross number of teams.

Ley - Jeff, is it important for baseball to keep an empty city like that for bargaining position, if D.C. stays empty?

Smulyan - I think that notion of empty city has been wildly, wildly overstated. The economics of this game are such that you could put baseball today in Washington, D.C. or Charlotte, North Carolina or Indianapolis or Orlando, Florida and I can tell you, you can't make money with this game the way it is today.

You just built new ball parks in Pittsburgh, Detroit and Milwaukee. And the economics are so far out of hand; look at Detroit. They are drawing what 17,000 people in the second year of a brand new ball park. The game is out of hand, and the notion that you can all of a sudden make money moving to a new town is crazy.

Zimbalist - Do you think more people are going to go to Detroit next year if there are 28 teams in baseball? You're still going to have the problem that you're talking about. That's not going to go away. The solution to the problem is to restructure baseball's economic incentives, and to do it through the collective bargaining agreement, and not to undermine that process at the very beginning...

Ley - I'm going to step in right there guys. Let me step in for a second. We've got to step aside. Next, the question of the surviving teams, such as the Brewers with their new ballpark, a team in which Bud Selig has a blind trust interest, and how much these teams might profit from downsizing the Major Leagues. Next on the agenda, we'll be back, Outside The Lines.

Ley - We're back with Clark Griffith, Jeff Smulyan and Andy Zimbalist. Does anyone here think that Bud Selig is in a conflict situation?

Zimbalist - He's in a conflict situation; but I don't think it's the most important point here. He stands to have the franchise that's in his family's name and that he'll go back to have a larger share of the Midwest market, as a result of the -- if he succeeds in eliminating the Twins. And Selig has been in a conflicting situation on and off over the last ten years, simply inappropriate to have him in the commissioner's office.

Smulyan - I would say that anybody who knows Bud Selig, if there is anyone who cares passionately about making this game work for North America, it is Bud Selig. And I think, you know, the fact that his family owns the Brewers is secondary to his absolute zeal to try to figure out a way to make this game work.

Zimbalist - I'm prepared to believe that he has that zeal; but it doesn't matter.

Griffith - I agree with that. Bud Selig has prepared baseball masterfully for the coming labor negotiations. He has enormous skill; he's run the business as a great statesman. I admire everything he's done and I wish, and I hope, that he takes a look at the situation and jettisons these programs such as contraction which actually gets in his way for achieving the greater baseball community that he has been hoping for over the years.

Ley - But the fact is that anybody who owns a team came out of that meeting on Tuesday, with their franchise, if they get this plan to fruition, their franchise has increased in value. Has it not? There are fewer competitors.

Smulyan - I think that those franchises have had so much debt incurred that I think if you looked at those franchises, you would find that they are not exactly increasing in value no matter what they did. They have a long way to go to appreciate in value.

Griffith - Let's not incur an additional ten million dollars per team for contraction then.

Smulyan - Well I think they are trying to find a way to make the game work. I'm not saying contraction is the only answer. You have to have -- I don't dispute -- you have to have sane labor negotiations. But I will tell you the only way to have sane labor negotiations is to have a sane union.

And I'm someone who strongly believes in the notion of collective bargaining, but I think you will find, and when the history is written, that the history of this union has been one of ideologues who have no long lasting sense of improving the economic lot of most of their own constituents.

Ley - All right, the union -- guys, we're short on time, once around the horn. Clark, yes or no, 28 teams in April or not?

Griffith - I just want to put it this way -I think there is a slight chance to the better that there will be 30 teams next year. And the Minnesota Twins will be the champions of the Central Division.

Ley - All right, Jeff, go ahead.

Smulyan - I'm hopeful that, however many teams there are, we get baseball on a sane footing that finally works for all of America.

Ley - Andy, 28 or 30 teams?

Zimbalist - Thirty teams, there are too many hurdles.

Ley - Got to go; thanks guys. Clark Griffith, Jeff Smulyan and Andy Zimbalist, as we talk about contraction.

We'll be back in a moment.

Ley - "SportsCenter" -- I'll be back with Robin in 30 minutes. Now John Saunders is in for Dick Schaap - "The Sports Reporters" from the ESPN Zone in the heart of Times Square. See you next week.

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 Outside The Lines
ESPN's Bob Ley looks into the contraction issue in Major League Baseball.

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