Baseball numbers merit study--in economic way Players, owners turn to committee

THE BALTIMORE SUN

When the Boston Red Sox rewarded Roger Clemens with baseball's first $5 million a year contract this month, the message was clear.

Clear to the 26 baseball owners. Equally clear to the players. But as you'd expect when dealing with two sides that don't agree on anything except the greed of the other, the conclusions they drew were vastly different.

To most owners, the Clemens signing proved again that baseball has lost touch with financial reality and is headed for disaster. Without a correction soon, many predict that a few teams, the ones that play in big cities and reap huge sums from their local TV contracts, will sign all the players and win all the pennants.

From the players' perspective, the message of Clemens' signing was precisely the opposite. They saw the owners' willingness to pay higher and higher salaries as proof that the game is healthier -- and that the owners are pocketing bigger profits -- than ever.

Which is it?

In search of truth, and an alternative to another knockdown confrontation at the bargaining table, the owners and players have turned to a six-member committee whose job is to think profoundly about baseball's economic future.

Last month, members of baseball's new Economic Study Committee threw out their first insights around a conference table in New York. In the coming months, they are expected to pore over reams of material, to meet one or two days a month and maybe to interview informally players and owners as they put together a comprehensive study of baseball's financial present and future.

Neither the players nor the owners know what the results will be, but they all have dreams.

"In the best-case scenario, I suppose someone has a revelation and we all sit around the table saying, 'Gee, that is so comprehensive we never have to bargain about anything again,' " said Donald Fehr, executive director of the Major League Players Association and a co-chairman of the study group.

"Some people expect an entire package to come out of this -- these are the problems, this is the [common] language and these are the solutions," said Chuck O'Connor, general counsel to the owners' Player Relations Committee and one its lead negotiators during last year's contract talks.

"The first two would be marvelous. The third would be unexpected, unintended and, quite frankly, impossible."

There's agreement that it would be a good thing if the committee drew a picture of baseball's financial condition that both sides can accept.

"At the stage I came to baseball,there was no common ground on any factual matter whatsoever," commissioner Fay Vincent said last week. "Baseball has to develop a common dictionary."

Strangely, the Economic Study Committee rose from the ashes of one of baseball's least-amicable negotiations. Last year, owners and players set deadlines, blew deadlines, set new deadlines and blew those, too. With spring training half gone and the 162-game regular season in jeopardy, they agreed on a new Basic Agreement after owners removed the largest obstacle -- a proposal to tie players' salaries to the owners' revenues, a change from the current system that permits star players to shop their services to the highest bidder.

Although the owners moved off "revenue participation," they pushed through the study committee, which will report on "the overall economic condition of the industry."

Fehr and Milwaukee Brewers owner Bud Selig are the committee's co-chairmen. The other four members, though nominated by the players and owners, in theory, have allegiances to neither side. They are: Paul Volcker, the former Federal Reserve chairman; Peter Goldmark Jr., president of the Rockefeller Foundation; David Feller, an emeritus law professor at University of California Berkeley, and Henry Aaron, a former University of Maryland economics professor who never played for the Milwaukee or Atlanta Braves.

Volcker and Goldmark were chosen by the owners, Feller and Aaron by the players' union.

It's doubtful that baseball ever has been studied by more IQ points. But will the committee be able to think away a generation of disputes?

History says no. Baseball's attempts at problem-solving by committee have had paltry results. During the first collective bargaining talks in 1968, the players' union persuaded the owners to study two areas of concern to the union -- the reserve clause and the length of the season.

From the union's perspective, they failed miserably.

"The owners didn't have the slightest intention of moving on either subject," said Marvin Miller, who guided the players' union from its beginnings until he handed the reins to Fehr in 1983. "In the case of the reserve-rule study, it was so blatant as to be laughable. They never came in with an idea for the study. And every single proposal that came from the players' association . . . the other side would say, 'Well, we really like it the way it is.' "

This time, however, there appear to be key differences. The owners, Miller pointed out, are the "moving party" behind this study committee. And the panel apparently will get the information it needs.

That is no small point. For years, representatives of the players pointed out that, while the owners talked of impending financial doom, they refused to open their books.

That changed somewhat in 1985, when, at the urging of former commissioner Peter Ueberroth, the 26 owners shared financial data with the players union. The study committee will be able to delve still deeper into the owners' pockets because they may request any information "the committee believes is necessary."

That could have far-reaching effects. The Baltimore Orioles are a fraction of principal owner Eli S. Jacobs' holdings. As recently as last year, he owned a controlling interest in companies with annual revenues exceeding $5 billion. Braves owner Ted Turner, whose broadcast empire includes Cable News Network, is worth an estimated $1.3 billion.

Braves president Stan Kasten anticipated no objections from his boss. "We have wide reporting obligations as it is," he said, citing Turner Broadcasting's status as a publicly held company.

The Orioles have placed tight restraints on information they disclose in connection with their "partnership" lease, which ties the team's rent payment at Memorial Stadium to its profits. Until last year, the city of Baltimore released a list of the team's revenues and expenses. The Orioles persuaded city officials to stop, citing concerns that they could be put at a competitive disadvantage.

"This is a private business; certain things are confidential," said Orioles president Larry Lucchino. But he said the team would "cooperate fully" with the committee.

One thing is clear. Almost before the committee has rolled up its sleeves, it's tempting to expect good things.

O'Connor, for one, isn't trying to discourage that. "Our history in baseball hasn't been one of peaceful accommodation," he said. "It's important that we show the fans we're trying to set the stage for something better."

Salaries committee

The chairmen

Donald Fehr: Executive director and general counsel of Major League Players Association, which he has led since 1983. He has resisted all efforts by the owners to alter the current salary system, which includes arbitration and, for veteran players, free agency.

Bud Selig: Milwaukee Brewers owner, and one of management's negotiators during talks with the players' union last year. Among owners, Selig is one of the most staunch defenders of revenue participation, a proposal to pay players a fixed percentage of what owners earn.

Owners' appointees

Paul Volcker: Federal Reserve chairman in the Carter and Reagan administrations. In all, Volcker worked in government for almost 30 years, serving five presidents. Volcker now is chairman of James D. Wolfensohn Inc., a New York investment bank, and a professor at Princeton University, his alma mater.

Peter Goldmark Jr.: President of the Rockefeller Foundation since 1988. Prior to that, Goldmark was senior vice president for the Times Mirror Company and executive director of the Port Authority of New York and New Jersey.

Players' appointees

David Feller: Law professor emeritus at the University of California Berkeley. While in private practice in Washington, Feller was counsel to, among other labor unions, the United Steelworkers and the Industrial Union department of the AFL-CIO.

Henry Aaron: Director of Economics Studies Program at the Brookings Institution, and formerly a member of the economics department at the University of Maryland. He is no relation to baseball's all-time slugger of the same name.

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