Blog Entry

The Daily Shoutout

Posted on: May 16, 2011 7:38 am
 
THE POLITICS OF WEALTH: Michael Strahan, the former New York Giant, recently raised an interesting point on Twitter. This is what he wrote:

"Why is it that athletes can be overpaid but owners aren't? Is there a basic logic behind that?"

I've always considered Strahan one of the smartest athletes I've ever covered and also mostly fearless. As happened several times during Strahan's career, something he said ignited a passionate debate. After re-tweeting Strahan, my own Twitter exploded, turning a sleepy and rainy Saturday afternoon in the east into a fiery one.

The 200-300 tweets sent to me seemed equally divided. Half said owners created their own wealth and deserved every penny while the other half said players were a rare resource who did things few on the planet can and deserved to be paid well for it. I think Strahan's overall point is a viable one. There does seem to be far more resentment over players making millions from football than owners making millions from football (if not a lot more). Perhaps the biggest reason is that we see and read about the players daily. They're closer to us. They're ubiquitous. Owners, with the exception of Jerry Jones, are mostly invisible.

Some fans also feel that they're just a heartbeat away from being a pro athlete which is, of course, laughable.

We also don't seem to have dislike for actors who make $15 million a movie but we have disdain for players who make a great deal of cash. Ben Stiller earned $53 million one year. Ben Stiller? Have you seen him act? Ben Stiller and myself have something in common. Neither of us will ever win an Academy Award for best actor.

Strahan's tweet was an interesting jumping off point in this lockout battle for hearts and minds and I don't expect this debate to end any time soon.

MEDIATION RETURNS: Yippeeee!

PLEASE. STOP IT: Donovan McNabb's career isn't over. Not yet.

See you Tuesday.

Category: NFL
Comments

Since: Sep 28, 2006
Posted on: May 16, 2011 5:47 pm
 

The Daily Shoutout

Is there a source I can see the percentage of recent players who were living paycheck to paycheck? Is there a report from state dmv's on the percentage of highly paid athletes who forget to pay their car registrations? And exactly how many are broke soon after leaving the NFL? And what exactly is 'soon?'

Try using Google. It is a search engine used to find information on the Internet.  I Googled "nfl players broke after retirement" and got many hits that state around 75 to 80 percent of NFL players are bankrupt or in severe financial distress within 2 years. It took like 10 seconds to do.  Here is a quote from one article:

"Within two years of retirement, 78 percent of NFL players are bankrupt or in severe financial distress."
 

The numbers may not be exact but it is safe to safe that "most" (that's more than 50%) are in severe financial distress.


There were articles recently about the number of players applying for extremely high interest loans and they estimated that it could go up to 60% of the players needing these loans (you can Google it yourself).  Please realize that none of the players have missed a pay check yet. Some players may have missed out on a workout bonus or some type of bonus payment but they have not missed a pay check and they have been receiving payments from the fund they setup with the former Union which should help them but they still need the loans.

This means these players would have needed these high interest loans even with no lockout or CBA issues going on because they have not missed a pay check yet.  This is why I stated that most are living pay check to pay check.  I will admit maybe it is not most of them but my point is many are not financially adept.

I will retract my statement about them not paying their car registration but we have seen many news stories where NFL players are pulled over for something and their car is not legally registered.

I may have exaggerated a little but my point is if you think the players can manage pooling their money (this would never happen) so they could put on entertaining and profession games in high school and college stadiums I feel you are delusional.

I call your "ignorant blowhard" and raise you "your to lazy-minded to do a little research".




Since: May 16, 2011
Posted on: May 16, 2011 4:56 pm
 

The Daily Shoutout

 Why should 32 business men make a $900 million dollar investment for so little return?
Because they get to sit in luxury boxes on Sunday afternoons in the fall and rub elbows every day with the people who make the game they love actually HAPPEN. If you buy an NFL team and are comparing your profit margins to your buddy at the golf club who makes semi-conductors or garbage disposals or paper clips- you got in the wrong business.



Since: Aug 25, 2006
Posted on: May 16, 2011 4:52 pm
 

The Daily Shoutout

I agree there are some discrepancies in comparing NFL salaries to wages at McDonalds. For one, there are a LOT more people capable of performing the tasks required at a hamburger joint.
Many of today's players including NFL players are well under paid based on the worth of their team. The labor market determines salary of atheletes as well as the average joe. Each collective bargaining season is a new collective bargain. That is why they call it bargain. The owners felt in their mind, they gave to much during their previous bargaining and they need to recoup that. That is their right to do, aren't they allowed to negotiate?? Dont we all negotiate till we drop when we go out to a flea market or buy a car from a private person.That is what they are doing.Market conditions changes, and labor laws, contracts have to be change when the market changes. In a real world, if a company feels like they are over paying their employees and have lived up to their usefulness they fired him, and closed the vacant position or bring in someone who is willing to work at the same productivity and take less money (that is what essentially happening in this econmy) people taking less money and being underemployed. The owners have the right to fight for the labor dispute and the players as well but you cannot fault the owners for their fight



Since: May 16, 2011
Posted on: May 16, 2011 4:48 pm
 

The Daily Shoutout

 I must say I'm really good at what I do and I think I'm compensated fairly, but if I requested a raise to $3,000,000 per year, they'd laugh me out of the company.
If only we could ALL be grossly overpaid football players.

 If one team doesn't pay them enough, they jump ship as soon as they can. their loyalty goes as far as the contract dictates. 
And  if the team can get a younger player at a lower salary, you get cut. Where's the loyalty in that?

They take all the financial risks (buying the team, paying the bills) so they deserve whatever profits they can get from running the team properly. It's their (financially speaking) blood, so they deserve any and all profits they generate.

Againandagainandagain- risks fundamentally minimized by League revenue sharing. These 'Owners' are as much franchise owners as anything. They are greatly limited in individual actions they are allowed to take and greatly limited in their actual financial exposure. In fact, their chief financial gamble is a long term one: that the value of the franchise will continue to escalate at the same rate it has over the last 30-40 years. 






Since: Feb 16, 2007
Posted on: May 16, 2011 4:37 pm
 

The Daily Shoutout

This whole thing is soo stupid.. how about this for a solution.. give the billion dollars extra to making it easier for the common person to attend a freaking game.. you know the persons who the the teams figure they're barely getting by in a recession but so what...lets get some taxes from them to build a stadium and then price them right out of attending a game in the stadium their tax dollars built.   Then complain that we aren't getting enough of their money on top of that?!    Seriously??!!   The owners and players better wake up and realize who they are alienating with this crap...  How great would it be if a competitor was around that brought it back to more simpler times..  where is the XFL when we need it?   Wish all the fans could go on strike if they came back and put them on the ropes of backruptcy to wake them up to why they are in the position they are.. because of the enjoyment that it gives ordinary people.. or DID shall I say before you started pissing all over their collective backs.



Since: Apr 8, 2009
Posted on: May 16, 2011 4:11 pm
 

The Daily Shoutout

Strahan makes a good point but who says owners can't be overpaid?   Norman Brahman the former owner of the Eagles was overpaid and Philly ran him out of town.  Every year there are published reports of teams with the lowest payrolls and fans regularly don't show up to support those teams because they don't like where there money is going.  So YES owners can be paid too much, but NO they most definitely don't get a free pass.  Of course Strahan opens a can of worms now because the flip side is can an owner be underpaid just like a player and want to renegotiate a deal?  That answer is most definitely yes as well.  When these 32 guys compare their 9 billion dollar industry to their friends 9 billion dollar industries they know exactly how underpaid they are.  In most companies Payroll makes up 50-60% of costs, and while the players' salaries fall in that range, they fail to realize that they are not the only employees!  What about the coaches?  The doctors?  The trainers?  The scouts?  The front office people?  The marketers?  If you look at the real payroll of the league I bet its closer to 90%!  Why should 32 business men make a $900 million dollar investment for so little return?  The last 20 years the only way an owner can make serious cash in the NFL is by selling their team.  Except now the price for franchises are topping out and they don't even have that option.

In the end Strahan doesn't make a good point, he makes a very short-sighted incomplete point.  Which isn't surprising since it came from twitter and you only get 140 characters to say something.




Since: May 16, 2011
Posted on: May 16, 2011 3:49 pm
 

The Daily Shoutout

Nope. The egg is chicken, involved much earlier than the pig, and like all greedy players, they get cur eventually.
Unless you make a point of buying fertilized eggs, there is no chicken on the plate.

And like all meat in the labor market, players get chewed up and shat out.

Nice try, though.





Since: May 16, 2011
Posted on: May 16, 2011 3:40 pm
 

The Daily Shoutout

Hey Soopafly- Thanks for a level-headed response. I found a great discussion thread regarding the NFL labor issues which includes some relevant economic theory I dimly recall from 25-years-past econ classes. 

http://www.advancednflstats.com/201

0/07/player-salaries-and-economic-r

ent.html

I agree there are some discrepancies in comparing NFL salaries to wages at McDonalds. For one, there are a LOT more people capable of performing the tasks required at a hamburger joint.

On another level, it seems most people are missing the fact that in THIS round of NFL labor unrest, the players are not arguing for a bigger slice of pie, they are just unwilling to give up what they won last time. It's the owners who want back something they gave up.  



Since: Sep 11, 2006
Posted on: May 16, 2011 3:39 pm
 

The Daily Shoutout

When I saw the headline for this article, I was sure Mike Freeman was going to totally lambast Michael Strahan for making such a stupid comment. Alas, he almost sounds like he agrees with Mr. Strahan. Ugh....

Owners don't get paid. The NFL doesn't allow corporate ownership so the owners actually own the club. Anything left over after all the bills are paid is theirs. If there is no profit, they don't get make anything. If the team loses money, the owner has to make up the difference. They take all the financial risks (buying the team, paying the bills) so they deserve whatever profits they can get from running the team properly. It's their (financially speaking) blood, so they deserve any and all profits they generate.

Players, on the other hand, look out for themselves. If one team doesn't pay them enough, they jump ship as soon as they can. their loyalty goes as far as the contract dictates. If the team loses money, they still get paid. The players are entertainers who put on a show each Sunday. Everyone wants to win, but the owners also have to deal with being profitable.

I work for a company that earns a net profit of around $245 million a year from revenue of about $4 billion. We have about 800 employees, so each employee generates about $5 million in revenue and $306,250 in profits. It's a very good company and I'm happy to be working here. However, If I felt I should be compensated based on 60% of the revenue, they'd have to pay me $3,000,000 per year( $4b / 800 * .60). I must say I'm really good at what I do and I think I'm compensated fairly, but if I requested a raise to $3,000,000 per year, they'd laugh me out of the company.



Since: Apr 14, 2007
Posted on: May 16, 2011 3:35 pm
 

The Daily Shoutout

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