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George Steinbrenner wouldn’t get the Yankees under $189 million? Really?

Oct 9, 2013, 11:03 AM EDT

George Steinbrenner AP

The Yankees are expected to get their payroll under $189 million for 2014. A decision borne of a desire to avoid the luxury tax, which could cost them some $100 million over the next two years.

Joel Sherman of the New York Post talks to Hal Steinbrenner about all of this. It’s a good interview, but I find the assumption Sherman has going into it — that Big George would never lower the payroll to avoid the luxury tax — to be something less than reasonable:

… no current issue brings out George-channeling psychics quite like the organizational plans to drop under the $189 million luxury tax threshold in 2014. No way The Boss would do that. He would do whatever was necessary to win a title — damn financial common sense.

I’m not so sure. George Steinbrenner was a lot of things, but a dumb businessman was not one of them. He turned a small investment — with a lot of other people’s money — into a franchise worth more than a billion dollars. During the years he was running the team actively he never had to face the severe luxury tax implications the Yankees face next year if they don’t get under $189 million. I don’t think it’s at all reasonable to say that George would act differently.

But we live in a world where everything is seen through George-colored glasses when it comes to the Yankees. So people will continue to say that, I suppose.

  1. yahmule - Oct 9, 2013 at 11:15 AM

    Everything about George’s legacy is an exercise in revisionism. Especially any parts that fail to depict him as a titanic asshole.

    • stoutfiles - Oct 9, 2013 at 12:28 PM

      GEORGE: It’s a calzone, sir.

      MR. STEINBRENNER: A calzone huh. Pass it down here. Let’s have a look at at it. I want a little taste. Come on, come on. Pass it down here. That’s a good boy. Okay. What’s in this thing?

      GEORGE: Uh. Cheese, pepperoni, eggplant.

      MR. STEINBRENNER: Eggplant. Yes. That’s a hell of a thing. Okay let’s get back to business. Okay here you go. Very good, very good. Excellent. excellent calzone you got there Costanza. Okay a little jealous now. Okay lets go. Ok last week……. You know that eggplant was very good. Everybody out. I got eggplant on my mind. Costanza get me couple of those calzones right now. Pronto. Move out. Pigstein what’s an eggplant calzone. Must have one. Everybody out. Out.

      • deathmonkey41 - Oct 9, 2013 at 12:31 PM

        Dude, I was just about to say everything is revisionist history except for his love for eggplant calzones from Paisano’s! You read my mind.

    • genericcommenter - Oct 9, 2013 at 5:03 PM

      I agree, and I’m a lifelong Yankees fan. It bothers me when people born in 1996 slobber all over the guy’s corpse.

  2. jfk69 - Oct 9, 2013 at 11:28 AM

    As soon as the Alex saga started and George deemed him a cancer to the brand. A Howie Spira clone would make sure Alex’s contract was voided. Presto….under 189 million
    Then he would tearfully apologize to the Yankee faithful and promise them another CHAMPIONSHIP soon

  3. hansob - Oct 9, 2013 at 11:31 AM

    Is the luxury tax “re-set” based on actual salaries? Could they game it for 2014 by giving Cano an 8 year/$220M contract that only pays him $10M for 2014, then $30M a year after that? Or maybe $10M in 2014, $10M in 2018, and $33.3M in the other 6 years so they could shoot for another re-set in 2018? Or do they calculate your payroll differently for purposes of the luxury tax?

    • scoutsaysweitersisabust - Oct 9, 2013 at 11:42 AM

      “Payrolls are for 40-man rosters and include averages of multiyear contracts; health and pension benefits; clubs medical costs; insurance; workman’s compensation, payroll, unemployment and Social Security taxes; spring training allowances; meal and tip money; All-Star game expenses; travel and moving expenses; postseason pay; and college scholarships.”
      Read more at http://www.philly.com/philly/blogs/phillies_zone/understanding-payroll-and-luxury-tax.html#QpXfFMSR1uDZuSWb.99

    • ezthinking - Oct 9, 2013 at 11:48 AM

      No. It’s AAV in baseball. Take the whole contract and divide it by years to get the AAV. It’s still $27.5 mil in your hypothetical ARod counts as $27.5 in 2014 even though he gets $26.

      With Pettite. Riviera, Granderson, Cano, Hughes, Kuroda, Youkilis, Reynolds, Hafner, Chamberlain, Overbay, Ryan and Logan all free agents, the Yankees have a huge roster turn over coming. The question is how they fill it.

      Those guys account for more than $100 mil last season. Cano will eat most of it. Granderson will likely come back. Then it’s free agent time and the pickings aren’t what they were a few years back.

      This will be an interesting offseason all the way around.

  4. gatorprof - Oct 9, 2013 at 1:48 PM

    George, unlike many owners, didn’t make his living being an owner. George realized that winning was profitable in the NY media market, so his passion for wining generated profit which he in turn put back into the team, which in turn generated more profit…

    His kids don’t have the same drive to win.

    Let face it, the Yankee empire will always be profitable…189M$ payroll or a 289M$ payroll.

  5. TheMorningStar - Oct 9, 2013 at 1:59 PM

    Hopefully A Rod is successful in his appeal and the collusion between MLB and the Yankees, using ARod’s suspended salary to get under the tax, is thwarted.

    Go ARod, go!

  6. chip56 - Oct 9, 2013 at 2:08 PM

    I don’t know if Craig read the entire article from Sherman or not, but it was an interview with Hal Steinbrenner and Hal himself said that his father wasn’t ever in the situation in which Hal currently finds himself. In addition to payroll the team has the following financial obligations:

    $75 million-$100 million in revenue sharing
    $20 million-plus in luxury tax
    about $75 million in debt service on the Stadium

    Take the payroll out of it and the Yankees are still paying for two major league teams and the Houston Astros just in their other monies owed.

  7. hitdog042 - Oct 10, 2013 at 8:21 PM

    Craig. Yankee fan and apologist.

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