The Rundown Lite: Bryant Brainstorms ‘Step Brothers’ Deal with Rizzo, Cubs Biz Side Moves Financial Goalposts, Vaccine Hesitancy Still a Thing
The bad news for Rundown fans is that Mr. Canter is still laid up and I decided to follow some rabbit trails here. The bad news for me is the Cubs just played two late games, my son’s rec playoff game went into extras, and I need sleep. The good news is that the Cubs play earlier on Wednesday and are then off Thursday, so I can catch up on both sleep and some TV shows.
Regardless of how they’re playing on the field, the Cubs have been surrounded by the same drama for at least the last year. Maybe even two or three years. The pandemic has changed the calculus, literally, but it all boils down to money and whether and how ownership chooses to spend it.
While we’ll never know exactly what figures are being moved around on the Ricketts family’s ledgers, we can be certain that the Cubs have been reducing their payroll for a few years now. The big numbers the team and many fans continue to cite stem from signing big deals prior to 2018. Those long-term contracts continued to run, keeping payroll relatively high, but the lack of new money and the expiration of those deals will soon see payroll plummet precipitously.
That means the Cubs a) can afford to pay players, and b) must add several players to account for all the deals that will end after this season. Wouldn’t it be cool if they could keep some really good players who’ve been part of the team for years and who are also good dudes in general?
Kris Bryant has a plan for that.
“Just joking in the cage,” Bryant told Patrick Mooney of The Athletic. “Anthony will be on the tee, ‘I can’t go anywhere without you. I need you.’ Stuff like that. We got our pitch. It’s like ‘Step Brothers.’ We got to go in and get the job.”
But, Kris, what about all the money the Cubs keep telling us they’re losing?
“I don’t know their financial situation,” Bryant said. “But the Chicago Cubs are doing well. So theoretically, yes, you could sign whoever you want. It’s just a matter of if they want to continue with us or if they want to go a different way. They got some money.”
About those losses…
Cubs president of business operations Crane Kenney is a cagey fella, which I think is a kinder descriptor than some of you might use. In any case, he’s responsible for making sure the books are in order and the printing presses keep running, product on the field aside. He’s also responsible for maintaining the narrative that the Cubs are essentially a non-profit being run by the beneficent Ricketts family.
In any case, Kenney told 670 The Score’s Mully & Haugh back in March that Wrigley Field could operate at a break-even from an operational standpoint at 20% capacity. He went on to say that getting more fans in the door would allow them to “scale up” in terms of potential acquisitions. As you may recall, the Cubs initially got approval for that figure and then had it bumped to 25% prior to the start of the season. Capacity then went to 60% in late May and will be up to 100% when the Cardinals come to town on June 11.
So what do you do when the financial projections improve ahead of schedule, something Jed Hoyer noted publicly in May? Why, you muddy the waters. Speaking to the very same show on 670 The Score earlier this week, Kenney said the Cubs will still lose money this year because the budget is set to break even in a normal year.
Crane Kenney says #Cubs will still lose money on the bottom line this year because Ricketts family allows them to run business at "break even level" in a typical season.
That said, Kenney adds performance will dictate whether the Cubs add or sell at the trade deadline.
— 670 The Score (@670TheScore) June 7, 2021
Not since Illinois and Northwestern were forced to use one end zone have the goalposts at Wrigley been moved so quickly and obviously.
But moving words and money around is exactly what the wealthy and their handlers are best at, a fact that was reinforced for the bajillionth time earlier in the week. That’s when ProPublica used tax returns from a group including Jeff Bezos, Warren Buffett, Bill Gates, Rupert Murdoch, Elon Musk and Mark Zuckerberg to inform a piece piece about how America’s richest people avoid income taxes.
The New York Times laid out the “buy, borrow, die” strategy of these various individuals or families, something that feels somewhat familiar in terms of the Wrigleyville empire.
A central reason that very wealthy people can avoid taxes is that the U.S. system taxes only so-called realized gains — like wages or stock sales. But the wealthy often live off unrealized gains — in the form of stocks and other assets that grow more valuable over time [emphasis mine]. The wealthy borrow against these assets to pay for houses, islands and private planes and then use a variety of strategies to avoid paying taxes on the debt repayment.
I emphasized that part because Tom Ricketts himself will tell you that the real value in owning a professional sports team is not in the revenue it generates annually for owners, but in the appreciation of the overall asset. That’s why you see so few holdovers from baseball’s last strike, with just nine owners remaining from the 1994 season. Some teams have been sold multiple times in that stretch.
The real gain comes when you sell, and the Cubs are one of the most valuable professional sports teams in the world. Even with robust cash positivity, they’re not matching the growth from $900 million to $3.36 billion in 12 years.
Whether or not you believe Ricketts about the irrelevance of revenue isn’t really important here. What is important is that operating at either a surplus or a deficit in any given year isn’t — or shouldn’t be — a factor in player payroll. This isn’t a great analogy, but it’s sort of like looking at your 401(k) when the market takes a dive. You didn’t really lose any actual money you need for living expenses, so a decrease in value should not alter your day-to-day habits.
So the upshot is that the Cubs are either lying about losing money or the people in charge are not fit to run anything more complicated than a lemonade stand.
Cubs still very unlikely to reach 85% vaccine threshold
There’s really not much new I can add to the discourse on this topic, but it’s salient again as Wrigley Field moves to full capacity and the Cubs are still not at the 85% vaccination threshold. Nor are they likely to join the ranks of the 20 other MLB teams to have reached that level.
“I don’t have an exact reason,” Ian Happ, the Cubs’ union rep, told The Athletic. “But I do know that where we stand right now is probably where we’ll be at the end of the year.”
Jed Hoyer has called reaching the threshold a competitive advantage, David Ross has advocated for vaccinations from the start, Javier Báez and Willson Contreras are involved in public campaigns, and Bryant has spoken about the peace of mind he got from his shot(s). And while the total Tier 1 personnel pool numbers roughly 100, Mooney writes that a “vast majority” of that group has been vaccinated.
So we’re not just talking about two or three holdout players here, nor are the Cubs the only team to remain short of the goal. That said, you have to wonder whether and how vaccination status could factor in personnel decisions for a team that will have more players than roster spots before long. The union would certainly object to a GM making moves just to get closer to 85%, but a player having a -0.2 fWAR and a redundant positional set is grounds enough for dismissal on its own and would easily cover any other impetus.
If the Cubs are truly intent on winning, they’ll need to leverage every possible advantage they can find. Vaccination status alone won’t necessarily create or remove enough of an advantage to trigger a move, but it certainly could serve as a tiebreaker when it comes time to DFA a member of the roster.