Rooting for Baseball, Inc.

Posted by Matt Purdue

Huge company takes gigantic risks in an infamously volatile market. Huge company gets enormous help from the government in the form of tax breaks and other favors. In the face of all this, huge company is now making piles upon piles of cash.

Are you rooting for this company, which has obviously figured out how to work the capitalist system to full advantage, to succeed or fail?

It’s not Citi or Goldman Sachs. It’s Yankees Global Enterprises, or YGE. This holding company owns both the New York Yankees and the YES cable television network. And when the World Series ended last night, with millions of people screaming until purple in the face, did they know or care that everything in the lead paragraph is true about their beloved conglomerate?

No one can argue that in the midst of an otherwise crippling global recession, YGE has bought its way back to the World Series, spending money like a drunken sailor on shore leave. In the offseason, YGE committed more than $420 million alone to three free agents. Only YGE and Howard Rubenstein know how many millions they spent on PR to try to defuse the Alex Rodriguez steroids controversy that exploded before spring training.

Sure YGE is free to wheel and deal to its heart’s content. But let’s not forget all the corporate welfare the company has received to construct its new $1.5 billion stadium. YGE has been the beneficiary of hundreds of millions of dollars in tax breaks, public financing and infrastructure improvements. New York City will shell more than $190 million alone on creating new parks to replace parkland displaced by the new stadium.  

Meanwhile, money keeps flowing through the turnstiles, concession stands and YGE’s cash cow, the YES cable network. 

The lesson here? It’s pretty simple. In terms of public perception, a company can get away with a lot as long as it wins. With the YGE taking the World Series, everyone seems to have forgotten about the tax breaks, the steroids and all the other problems. But the trick is keeping that reputation afloat when that company inevitably starts losing.

Comments

[Julie Farin]

Thank you for reminding us all that Baseball is first and foremost a business -- Brooklyn Dodgers' fans learned that hard lesson back in the 1950s. For some reason, lovers of the game choose to ignore this fact when their team wins big; even though most folks can no longer afford even the bleacher seats of the new Yankee Stadium, let alone patronize the concessions that sell strip steaks and sushi.