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"It's the (baseball) economy, stupid"

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Baseball trades, rumors and blog coverage - SB Nation MLB Hot Stove

The news that Adam Dunn was not offered arbitration caused something of a furore among Arizona fandom, though it seems clear the franchise simply couldn't afford to take the risk of him accepting a hearing, with the $15m salary which would inevitably result. It's also true Dunn was far from the only established player in the same boat. While the raw numbers were around the same [24 free-agents got the offer from their teams, compared to 17 and 25 in the previous two years], the quality of the talent that got skipped - or perhaps more importantly, the cost - seems pretty high. While it certainly wouldn't be cheap, you could put together a pretty good roster of players, picking solely from those not offered arbitration by their current team:

C. Ivan Rodriguez
1B Adam Dunn
2B Jeff Kent
SS Edgar Renteria
3B Mark Loretta
LF Pat Burrell
CF Ken Griffey Jr.
RF Bobby Abreu

SP Andy Pettitte
SP Randy Johnson
SP Jamie Moyer
SP Greg Maddux
SP Brad Penny
RP Kerry Wood

In particular, the Yankees offered arbitration to none of their free agents, and it's obvious why. They wanted to avoid any nasty surprises, and who can really blame them for that in the current, uncertain financial climate? Said GM Brian Cashman:  "The determination that we made today was to make sure that we control what amount we'd be spending, at least in the event that we're fortunate enough to bring those players back." The Yankees are obviously looking to exercise restraint - at least until they sign the two front-line starting pitchers they need. For even as GM teeters on the edge of bankruptcy, CC Sabathia can still look forward to a very nice payday.

However, in USA Today, Jeff Curry notes that "There has been only one major trade and one marquee free-agent signing in the five weeks since...the World Series." Things have apparently been so slow that K-Rod's agent, Paul Kinzer is closing up shop on negotiations for his client, until the winter meetings in Las Vegas next week. An un-named major-league executive concurs: "The slowness of the free-agent market is totally due to the economy. We can't be sure what our revenue will be this year. You're always going to have the big-market teams that will sign guys for tremendous amounts of money. But teams right below them are being a lot more cautious this winter."

Not everyone is buying it, with our sibling by the bay, McCovey Chronicles, notably less impressed:  "I'm wondering if the economic hullabaloo hasn't given the owners an excuse to say, gee, we just can't spend right now." He agrees with Scott Boras, who points out that the game enjoyed record revenues this year, and that previous recessions largely left baseball untouched. J.C. Bradbury, an economist and university professor who runs the site Sabernomics, is similarly optimistic: "it's going to be another healthy offseason in which we're going to be dropping our jaws every time someone signs a contract." When the first big free agent - Ryan Dempster - signs a deal giving him $53 million over four years, it hardly seems like an apocalypse is imminent. 

However, even Donald Fehr, the players' union chief, admits, "We're in an atmosphere right now I haven't seen in my lifetime," and Bud Selig agrees:  "This is different clearly... To think that all of this won't have some kind of impact on the sport is probably unrealistic." It already seems to be happening. Just yesterday, the Toronto Blue Jays followed suit with the Diamondbacks recent layoffs, and cut 24 front-office jobs. Said  their spokesperson, Suneel Khanna, "Every area of our business was affected. (The cuts) are largely viewed as a one-time cost-control measure. We certainly aren't the first and I suspect we won't be the last. It's an uncertain future."

Their CEO Paul Beeston reckons there'll be less revenue going forward, whether "the result of people not going to as many games, whether it's going to be people not buying as many suites, whether it's going to be sponsorship dollars drying up, whether it's going to be, for that matter, television ad revenues drying up." On the last point, the financial and automotive industries have been major buyers of adverts over the past few years - that seems less likely going forward. According to MPG North America Chief Operating Officer Steve Lanzano, "If you just look at the numbers, straight at the numbers, on the broadcast side in sports...between 6 percent to 8 percent of their revenue is automotive and then you take out the financial picture there and now maybe you’re up to 9 percent or 10 percent."

If no-one expects that to dry up entirely, there will certainly be tightening of the purse-strings - just ask Tiger Woods. We've already seen Riviera Pools get sunk as the sponsor of the Chase Field bathing experience: how many more might decide to forgo the suite deals and sponsorship opportunities, especially if they are requesting handouts from the federal government? It would be a brave business who decided now was the time to increase their public profile, when many consumers are wondering if they'll have a job this time next year.

And that brings us to the final, and perhaps most important question: how the current economic situation will affect baseball fans? Personally. we have already opted to pass on our share of the 118 season tickets for next year: a combination of the economic uncertainty and too many irritating and/or visiting fans in that section, have seen to that. Actually attending games is a pleasure, yet it's a luxury, which can be dispensed with, to no great loss in our lives; in 2009, this will be done on an ad-hoc basis, as and when the opportunity arises and can be taken. Similarly, it seems unlikely we'll be stocking up on much additional D-backsmabilia during the off-season. Indeed, if the projected house-move comes to fruition, the closet might end up getting a good bit emptier!

How do you see things unfolding in the coming year? Are you planning to rein in your baseball [and other leisure-related] spending? Or are those dollar inviolate, and a necessary escape from the pressures of everyday life?