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Red Sox owner John Henry was fined half a million bucks for slamming revenue sharing

Mar 1, 2011, 6:00 PM EDT

Liverpool Football club's co-owner, John Getty Images

Recently, when Hank Steinbrenner and Randy Levine starting slamming teams who took revenue sharing and referring to it as “welfare,” I suggested that Bud Selig may take issue with the comments.  John Henry — who has himself slammed revenue sharing — admitted today that, yes, Bud Selig does take issue. And does so quite expensively:

Red Sox principal owner John Henry, in an interview on The Big Show, said that he was fined $500,000 by Major League Baseball for comments that he made about the sport’s current financial system. In late-2009, Henry told the Boston Globe that “seven chronically uncompetitive teams, five of whom have had baseball’s highest operating profits,” had received over $1 billion in revenue sharing money.

Harsh? Sure. But Bud Selig’s job is to keep the labor peace and keep the PR machine running smoothly. And as it has been pointed out in the past, the biggest threats to labor peace tend not to come from the owners battling the players, but the big owners battling the small owners.  The last thing he needs or wants is for owners to do public battle over the system to which they agreed top be bound.

And while I’m guessing Selig’s fine doesn’t take this into account, part of that half million has to be the chutzpah tax. As in, it takes an awful lot of chutzpah for owners of the teams whose revenue and value have multiplied exponentially under this system to speak out as if the system were robbing them blind.

  1. noneofyourbusiness95 - Mar 1, 2011 at 6:23 PM

    With the collective bargaining agreement expiration in December it’s nice to know the owners are shooting one another and weakening their own position. Maybe this means the acrimony between the players and owners will be reduced?

    Nah.

  2. rapmusicmademedoit - Mar 1, 2011 at 6:26 PM

    “The system” ISN’T ROBBING THEM, THE OWNER’S WHO PUT THE MONEY IN THEIR POCKET IS ROBBING THEM, AND THEIR FANS TOO. I think any team who received revenue sharing money should be required to increase their payroll by that same amount, not write MASSIVE bonus checks to the owner like they do in Pittsburg, remember that story from last year Craig, that dirty little secret leaked out…………Craig, you are pretty quick with the keyboard but check your fact’s buddy boy.

    • noneofyourbusiness95 - Mar 1, 2011 at 6:30 PM

      Didn’t Craig say “as if the system were robbing them blind” from the point of view of the owners paying the tax?

      • cur68 - Mar 1, 2011 at 6:41 PM

        That’s how I read it. I think the rap music in question might be ODB. Someone’s a wee bit cranky today.

  3. elmaquino - Mar 1, 2011 at 6:48 PM

    COMMIES!

  4. PanchoHerreraFanClub - Mar 1, 2011 at 6:54 PM

    No one is robbing anyone. All the owners agreed to a CBA with the players union. I do not remember reading that any owner had a gun held to his head either by the union or another owner. Yankees and Red Sox need Tampa Bay and all the other low revenue teams because they need someone to play. The fact the some of the paying owners don’t like paying is natural. That the low revenue owners can do whatever they want with the money shouldn’t be an issue (I mean should my boss tell me what to do with my paycheck).

    If the high revenue owners thinks there should be some strings attached to the money given to the low revenue then CBA is the place to do that in conjection with all their business partners, the players and all the owners.

    • ditto65 - Mar 1, 2011 at 8:46 PM

      The revenue sharing was meant to make the small market teams more competitive, not line the pockets of the owners. I am sure they will push for the “strings attached” this time around.

      • clydeserra - Mar 1, 2011 at 9:33 PM

        What do you mean “line the pockets of.” The Royals owner shouldn’t make a profit? What incentive do they have to own a team then.

        I might agree with you if the A’s could pick up and move to Cambridge or Hoboken without the Yankees or Red Sox saying boo. But they can’t because o the agreement they entered into with MLB and the Red Sox and Yankees.

        Besides, the Pirates and Royals and Tampa spend more and make their teams better, the Yankees and Red Sox will lose more games that the rightfully deserve to win because they are so awesomely awesome at being awesome baseball teams with awesome owners and fans.

      • PanchoHerreraFanClub - Mar 2, 2011 at 8:24 AM

        You missed the point. Revenue sharing is simply an agreement between partner on how to split up the revenue pie. There could have been strings attached last time to certain parts of the revenue, but the partners decided not to. Perhaps, they will, perhaps they won’t, time will tell. But, I kind of think that owners complaining about what other owners to with their share of the pie is very self-serving to say the least. Now, of course, the fans of the low revenue teams have every right to complain, after all it is they buy the end product.

      • bigjeter - Mar 5, 2011 at 2:17 AM

        They won’t get it. You act like the big market owners are the masters and the small market owners are their servants. It is not anyone’s business how an owner spends his money. This is America. Are you going to insist that if the Yankees make more of a profit than the Royals, they be forced to spend it?
        You also act like the big market owners are doing the small market owners a favor with revenue sharing. They are not. It was a negotiated business deal.
        Unfortunately, we have this ridiculous system with no salary cap, which allows the Yankees to crush the small market teams by spending them to death. To whine about the injustice done to the poor big market owners is just stupid.

  5. markfrednubble - Mar 1, 2011 at 7:41 PM

    If the teams receiving all the revenue sharing money are among the most profitable, that is a disgrace. John Henry’s Red Sox are not just lucky beneficiaries of a big market. They have made many investments to improve the fan experience and raise revenue, from investing tens of millions in the ballpark and the areas around it, to good marketing with partners and other things that the so-called small market teams don’t even try. If the fans in the cities like Pittsburgh knew their owners were pocketing the revenue sharing dollars instead of investing in more talent on the field, they would and should be horrified. I don’t think it’s greed that causes Steinbrenner or Henry to complain about the system. It is their inherent bitterness toward working hard to make money and handing it over to owners who don’t invest it in being more competitive.

    • PanchoHerreraFanClub - Mar 1, 2011 at 7:55 PM

      And if the Pirates owner just worked a little harder, he could have the same kind of money that Boston and New York get for their cable rights. Yeah, sure.

      • ditto65 - Mar 1, 2011 at 8:47 PM

        The team would certainly be better if he spent the handout on talent.

      • clydeserra - Mar 1, 2011 at 9:35 PM

        So they should sign Bonderman for $10 Mil per year, would that make you happy or them better?

      • marinersnate - Mar 2, 2011 at 2:47 AM

        Exactly. It is amazing how Yankee & Red Sox fans think that all teams are playing equally.

        2010:

        Yankees 214M
        Red Sox 168M
        Philly 138M
        Pirates 39M

        If the Pittsburgh owners had DOUBLED their payroll, money that they absolutely do NOT have while attempting to pay down stadium debt, but if they had, gives them a 78M payroll against the rest? And that is competitive? Even doubling their payroll barely puts them at a third of the NYY payroll. And that would make all the difference? (Yes, Texas won at 68M, but you see my point).

        The “big market” fans have absolutely no idea what a competitive advantage they enjoy. Some years a really well run small market team may make it to the playoffs, and in a seven game series actually have a chance to win. But over a 162 game season, those big spending teams have far more of a chance to make the playoffs (year in and year out). NYY has been in the playoffs 15 of the last 16 years. And won five world series during that span. (And played in seven world series during that time. Nearly half). But if those “cheap” small market owners would just spend their “welfare” checks on players, they would be in the playoffs every year too? Yeah. Right. (It is easy to see why the Yankees are the most ‘loved” team in MLB. You can root for them from anywhere and be pretty certain that they will be in post-season every year. It is also very easy to understand why they are also, by far, the most hated team. And no. It is not envy.)

        Perhaps I have no room to complain. My team spent close to 100M last season (about the upper medium) and still lost over 100 games. They are not a well run team.

        But the bottom line is that small market owners should not be forced to spend more (they may make a profit but will never have “Yankee money” even if they spent every penny of their “profit”) but the big spenders should be forced to spend less. I wonder why the NFL, NBA, and NHL have done this? Go figure.

  6. Glenn - Mar 1, 2011 at 8:14 PM

    Will Henry be fined for saying that he was fined?

  7. Professor Longnose - Mar 1, 2011 at 8:23 PM

    Have the franchises increased exponentially since the revenue-sharing system was instigated in 2001? Offhand, I think they haven’t increased as much as they did in the 80s and 90s before the revenue-sharing system was implemented.

  8. nesuperfan - Mar 1, 2011 at 8:42 PM

    So why was he fined, but not the owners of the Yankees for doing the same exact thing?

    • ditto65 - Mar 1, 2011 at 8:48 PM

      Perhaps they were and haen’t said anything yet.

      • belichickrulz - Mar 2, 2011 at 9:52 AM

        Henry made that exact point when asked. He said “Did you know that I’d been fined?”. When the host said that he hadn’t, Henry then asked how they knew whether or not the Yankees had. It seems like MLB keeps such things in-house, so unless Hal or Hank talks, no one on the outside will know.

  9. xmatt0926x - Mar 1, 2011 at 8:57 PM

    I get Craig’s argument about the big market owners benefitting in general so why complain, but wrong is wrong. If you are taking revenue sharing funds then you should be forced to spend that money on the organization, not pocket it. It may seem logical to argue that the system has benefitted the complaining big market owners but there is also logic in making sure the money given to the Pirates owner is used somehow on his team. I just don’t understand why this hasn’t been worked out yet. Yeah, it will still end up being abused in some way but at least put some rules in. Why should teams like Pittsburgh have a high profit margin when they won’t spend on payroll and the stadium is 3/4′s empty for evey game? Cleveland, Pittsburgh, and Kansas City have drawn in the past when they had competitive teams. Force these owners to use that money to put a better product on the field and the people will come and the revenues will rise accordingly.

    • Craig Calcaterra - Mar 1, 2011 at 9:01 PM

      “but wrong is wrong. If you are taking revenue sharing funds then you should be forced to spend that money on the organization, not pocket it.”

      But the complaints coming from Steinbrenner and Levine at least — and a little from Henry — have not been the legitimate complaints of owners not using revenue sharing for its intended purpose. It’s been based on the very existence of the revenue sharing program. “It’s welfare,” they’ve charged. Fine, but it’s welfare you agreed to pay as part of the CBA. I

      It may be that their anger is really based on the pocketing-the-money thing. If so, I feel for them. But that hasn’t been what they’ve been moaning about. They’ve been moaning about simply cutting the checks. Not how it was spent.

      • Professor Longnose - Mar 2, 2011 at 9:14 AM

        As yo do, I doubt that they’re complaining about how the money is spent. Having to give the money, they probably happier that the teams they give it to don’t use it to be competitive.

        But I don’t understand why you keep saying they should be quiet. I can understand you saying they’re wrong, and sneering at them, but I don’t understand insisting on them shutting up. They probably are hurting the other owners by showing cracks in the owners’ facade vs labor. But Bud Selig’s job (literally) is to keep the owners unified (and he’s done it brilliantly). If the contracts he’s worked out are really so bad for a subgroup of owners that they are in serious doubt of causing real problems (I don’t think that’s the case here, but I’m just illustrating), then he needs to rethink the alliance and add some glue, either in the workings of the contract, or behind the scenes with some schmoozing. In the long run, fining owners isn’t really going to keep them together.

        In this case I just think John Henry and Hank Steinbrenner are loudmouths who aren’t really a serious problem. But in any case, whether it’s a problem for the owners or not, I don’t see why you think they should be forced to shut up. If nothing else, it gives you posts to write.

      • cur68 - Mar 2, 2011 at 11:20 AM

        I don’t see this a plea to ‘shut up’ so much as legitimately calling a whiner a whiner. We’ve all got that right.

  10. Lukehart80 - Mar 1, 2011 at 9:11 PM

    While the revenue sharing should be used to make the team better, forcing them to increase player payroll by the previous year’s figure is NOT the way to do it. Players and owners have already agreed that would not be a good system.

  11. thebrettman - Mar 1, 2011 at 10:21 PM

    Now that’s a fine. I think people start to listen when fines hit six digits.

    • cur68 - Mar 1, 2011 at 10:42 PM

      Gonna cut into his PI budget if that keeps happening though.

  12. Old Gator - Mar 1, 2011 at 10:57 PM

    Henry is the asshole whose abdication saddled us with Scrooge McLoria. You could make that an eight figure fine and it wouldn’t be enough for me.

  13. Kave Krew - Mar 2, 2011 at 8:15 AM

    The bottom line is that the Red Sox and Yankees are passionate about winning. They have all the advantages of a big market, have tremendous cash, are profitable franchises, but they pour money and passion back into the franchise and field a very competitive team.

    The Royals of the league have all the disadvantages, but they do not place the same percentage of passion into their franchises. They give the impression of ‘mailing it in’ every year and pocket the free revenue stream.

    I would bet that the Red Sox and Yanks ownership would love nothing more than have these low feeding teams field a respectably competitive team so they too can enjoy better gates when these teams coming slouching into their ballparks. Nobody wants to go to these games and if they do, it secondary to anything else going on their lives.

    A minimum salary cap is needed to at least force some teams to demonstrate minimum passion towards the sport.

  14. mrznyc - Mar 2, 2011 at 9:25 AM

    Minor league cities with major league teams.

  15. belichickrulz - Mar 2, 2011 at 9:55 AM

    Honestly, MLB needs to contract. What benefit does the league derive from the Padres or the Rays, for example? Their own “fans” don’t support them, so why should the Yankees and the Red Sox?

  16. 8man - Mar 2, 2011 at 10:44 AM

    I guess the real question for me is do those “seven” teams make the overall pie bigger. In other words, are television contracts larger because there are more teams? Or is this an issue of total subsidization and the leagues would be better off by contracting? I don’t care what you do, but if you are in business and something you are doing is costing you revenue as opposed to adding revenue and has little hope to improve, I think you have to stop doing it.

    • cur68 - Mar 2, 2011 at 11:24 AM

      Now that’s a legitimate argument. Does rev sharing increase profits? Should be easy to compare pre v post treatment. I believe we have a t-test here. Anyone have the numbers?

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