Selig Says Fail-Safe Point Approaching

As the baseball players’ union considers possible strike dates in response to the absence of progress in the labor negotiations and the possibility that owners could unilaterally implement new work rules after the World Series, Commissioner Bud Selig said Thursday that six to eight unnamed clubs could go out of business if the current economic system is not changed.

“I would say six to eight can’t exist another year, another year and a half. We’re talking about the immediate future,” Selig said during a luncheon meeting with editors and reporters of The Times. “There’s a lot of clubs that simply can’t survive the status quo.”

In continuing to paint a bleak economic picture if the competitive and revenue disparities are not addressed, Selig also said that the survival of those clubs hinges strictly on a change in the system because he is through trying to “prop them up” on his own with loans from baseball’s central fund or his own financial connections.

He described that as the one area in which he has received the most internal criticism--from owners of more stable clubs and his own staff.

“I’m out of that business,” he said. “The lines of credit those clubs have will still exist, but most are out of credit. They’re at the max.

“Baseball has $4 billion of debt, the bankers are nervous and the losses are very real. You know how serious the problem is when six to eight clubs are for sale, including the Angels.”

At Dodger Stadium Thursday night, union leader Don Fehr said he had never heard Selig claim six to eight clubs could go under if the system isn’t changed and refused to say whether he believed that or not.

“It seems to me the most important thing is negotiating [a collective bargaining] agreement so those things don’t have to be considered,” he said.

Fehr added he would be “willing to hire a neutral party to grade” whether the union or the owners have been more aggressive in pursuit of an agreement. He has said that the owners have been generally unresponsive to any union proposals and that it is hard to determine where they are headed or what their objective is.

In the continuation of a media campaign aimed at explaining and selling the owners’ need for a new economic system, Selig was accompanied Thursday by Rob Manfred and Sandy Alderson, his vice presidents of labor relations and baseball operations, respectively.

They said it is the union that has been unwilling to participate in meaningful negotiations and that the owners “remain committed to a moderate set of proposals” while avoiding “all this talk about a strike and interruption of play.”

The two key components of their “moderate set of proposals” call for a 50% tax on all payroll above $98 million and an increase in the sharing of local revenue from 20% to 50%.

The union considers the tax tantamount to a salary cap and privately believes that the high revenue clubs that drive the market would be restricted in the signing of top players if forced to share 50% of local revenue.

Union sources wonder if the owners are geared to make another attempt at breaking the union and are deluded into thinking fans will come back if the game is shut down for the ninth time.

“Our goal is to make a deal without having to worry about the fans coming back,” Manfred said. “Everything we have done during this go around has been calculated to get an agreement without an interruption.”

Similarly, said Selig, he can’t worry if his image and leadership take a public beating. He said he understands the “insanity” of a prolonged stoppage but hasn’t thought about it and can’t worry about it considering that the severity of the industry’s problems is increasing by the month.

Although baseball revenue has doubled to almost $3.5 billion since the work stoppage of 1994-95, Selig said there has been an increasing loss of faith and hope in too many cities and that baseball’s polling amid a season in which attendance is down 5% indicates that fans want it fixed.

He cited National Football League parity and the booming increase in NFL franchise values as indicative of what can happen in a “reasoned economic system.”

“Am I supposed to sit and watch our situation deteriorate just to preserve the status quo?” he asked. “Ten years from now people would ask, ‘Commissioner, what the hell were you thinking about?’ I can’t ignore it. It’s too stark. If we don’t address it now, the consequences will be even worse [than a possible shutdown].”

The owners have pledged not to initiate a lockout or to attempt a unilateral implementation during the season or postseason, but the off-season is another matter. A late-season strike would provide the union with a measure of leverage in the face of a possible implementation by the owners and could establish a deadline under which negotiations often improve.

“A little saber rattling can motivate people, but we’re not at the point yet,” Manfred said, “and this [talk of a strike date by the union] only raises the profile at a time where I don’t believe it was necessary.

“I mean, when people start talking about a strike you have to be concerned, but my experience over the years is that if someone is getting close to setting a strike date, you would expect them to be anxious about getting a lot of time in the negotiating room and I have not sensed that anxiousness in terms of the union’s scheduling.”