August 31, 2010

New documents show how Major League Baseball owners systematically defrauded the public out of billions to fund their stadiums--even as they raked in big profits.

LET'S LOOK at what we have before us: leaked documents that by all accounts should be part of the public record; an alarming snapshot of corruption, waste and fraud that connects the seamiest worlds of politics and big business; calls to prosecute whoever might be responsible for daring to drag truth into the light of day.

No, this isn't a summary of the "WikiLeaks scandal" that exposed the brutal facts that surround the U.S. quagmire in Afghanistan. It's Major League Baseball and the leaked private financial statements that show how some teams claiming poverty, demanded tax dollars for new stadiums while pulling in record profits.

Like with the war in Afghanistan, it's a reminder that for people in power, words like "democracy" and "transparency" aren't sacred values. They're punch lines.

The leaked Major League Baseball documents show the national pastime to be an unaccountable, highly secretive legal monopoly that demands and receives billions in tax money for publicly financed stadiums while willfully misrepresenting their bottom line.

They show that despite team protestations of perpetual poverty, the Pittsburgh Pirates have made a fortune while not fielding a winning team in 18 years. Pirates owner Robert Nutting pulled $30 million in profit in 2007 and 2008 despite fielding losing teams with a $23 million payroll, the lowest in the game.

As long as he receives revenue from big market clubs via the luxury tax and extorts millions in revenue from their publicly funded home at PNC Park, he could care less. If the old Willie Stargell Pirates of 1979 won a World Series to the tune of "We Are Family," the Nutting Pirates dance to the beat of "Gangsta Gangsta."

But the worst story to emerge from the documents is that of the Florida Marlins, owned by multimillionaire art dealer Jeffrey Loria. The Marlins have secured funding for a new $400 million publicly funded stadium, all while lying about their bottom line to max out their corporate welfare potential. As Yahoo sportswriter Jeff Passan wrote:

The team fought to conceal the $48.9 million in profits over the last two years because the revelation would have prompted county commissioners to insist the team provide more funding. Loria, an art dealer with a net worth of hundreds of millions, wouldn't stand for that. He wanted as much public funding as possible - money that could've gone toward education or to save some of the 1,200 jobs the county is cutting this year.

AS POLITICIANS begin to rev up their shock and outrage, it's worth asking why this is a story at all. As with Afghanistan, where for years independent, unembedded media has been raising critical questions about the U.S. military intervention, it should hardly shock us that public funding of stadiums is a sham and the owners of teams simply lie their way to the bank.

Neil deMause, editor of www.fieldofschemes.org, wrote to me:

The remarkable thing to me about the leaked MLB documents is how much of this we already knew: Forbes has been reporting for years that franchises like the Marlins and Pirates were turning profits despite dismal teams, and the leaked documents show that their estimates were generally right on target. It shouldn't come as any surprise that if you're eligible for a cut of league revenue and don't spend anything on payroll, you're going to make money--does anyone really think it costs that much to paint in the batter's box every day?

He's absolutely correct. The numbers have been there for years but politicians simply took owners at their word that Forbes was simply wrong. Politicians now either look incredibly naïve or utterly complicit. They were dupes or participants in what has been a Ponzi scheme of lies and organized theft.

Passan was absolutely correct in writing, "The swindlers who run the Florida Marlins got exposed Monday. They are as bad as anyone on Wall Street, scheming, misleading and ultimately sticking taxpayers with a multibillion-dollar tab. Corporate fraud is alive and well in Major League Baseball."

The question now is about the appropriate response--and this question far transcends the world of sports. It's about approaching our political leaders with the now indisputable truth: stadium construction deals are corporate welfare hotels that don't return on their promised investment and most city officials are either too cowardly or too compromised to stop them. The idea that we are giving tax money to owners who are then under no obligation to tell the truth to the public about the general state of their finances is appalling.

Let's make it clear to the billionaire owners of baseball teams: pay for your own damn stadiums. If you do take public money from us, then we the people should have a public ownership stake in the teams. Major League Baseball's owners have been playing dirty for far too long. It's time to send them to the showers and for fans to get off the bench.

First published at TheNation.com.