Q and A - Who Is To Blame?

Question from Charles Thompson:

Mack, I've been forced to read other sites lately like Mets 360 and MMO because until recently, Mack's Mets just wasn't there. I've noticed (especially on MMO and its owner Joe D) that a lot of the blame for the Mets poor performance has been placed squarely on the shoulders of Sandy Alderson.  Joe seems to think Sandy should have done much more over the past two years to field a winner, but never mentions Sandy's payroll constraints.  He also never says Sandy should have traded top prospects in order to get better Major League ready players.  Everything is Sandy's fault, he doesn't know how to build a team.  I place all blame on the Wilpons and think that after 2011 when 50+ million came of the payroll, this big market team should have been able to reinvest at least 35 to 40 million back into the payroll.  However, the Wilpon's finances have turned this team into a mid-market competitor in terms of payroll.  Considering the bad contracts still on the books, and with only so much cash and very few precious trade commodities, who’s to blame for this squad?  Sandy or the Wilpons.  I, for one, just don't believe this team finishes fourth if this team’s payroll sits at 135 million in 2012.

Mack:

Hey Charles. Great to hear from you. Here's my spin.

Joe over at Metsmerized is as frustrated with Alderson as I am, and Wilpon ultimately is the person to blame because the money just isn't there right now to allow his General Manager to even make the wrong decisions.

In my opinion, there are two reasons we are all in this leaky boat.

One, the recession. Forget about the Madoff mess. The fact is all of Fred Wilpon's real estate investments have taken a big hit and the huge cost of building Ebbets Field v2.0 CitiField was highly leveraged at every level. That's how the big guys do it. That's how I did it. I owed three million dollars in the 80s on a group of radio stations in Ft. Walton Beach that I simply could not operate at a level to cover my debt. The economy tanked so bad that the the advertising dollars in the market were cut by over 35%. The money pie was too small for all the broadcasters to make their nut, and the cash flow multiples (value placed on your investment by the bank... example 10 means if your 12 month trailing cash flow was $200K, you times that my 10 and the value of your investment is $2mil) dropped from 10 to 4. Overnight, we went from millionaires to being heavily in debt.

The only solution... I know this sounds crazy... was to buy more radio stations in South Carolina, for $2mil more, and restructure the entire debt.

That's how this shit works is both the good times and the bad. It's just line a line of credit on the equity in your home.

The Wilpons wound up with less income, less paper value, but the same amount of debt... on all the tap dancing they did to keep buying up more real estate properties with additional money they would borrow. They knew as long as things stayed rosy, everything they owned would be worth more than they bought and they could keep on playing the same financial game. And, if for some reason their piggy bank felt light, they could sell a building for far more than they originally paid for it, pay down some debt, and get back in the purchasing game.

The other point... and I've been preaching this for two years... no, actually it goes back to when Barry Zito signed with the Giants. I asked why he didn't go with the Mets when everyone knew he wanted to be a Met, and I was told that the reason was simple... "no one who is 27-32, and is a free agent, and has never won the World Series, know that the road to that victory is not through Flushing."

Agents, scouts, team members, front office personnel of teams... all will tell you the same thing.

This is a bad team, owned by bad people, that could give a shit about their players. 

And, especially the agents. They do not try to sell this team to their clients.

Charles, the phone hasn't rung in the Mets General Manager's office for close to four years now. You can blame Alderson, but I honestly don't think he realized how little he would be able to do when he took this job.

You can blame the economy, but other owners have found a way to work around this. They also were sound businessmen who operated with some degree of sanity while leveraging their other investments.

No, the buck always ends with the owners, and, in this case, these are very bad people that leveraged their entire world while building a monument (CitiField) to themselves. Then the economy tanked followed by the Madoff mess. 

The bottom line is they "own" a lot of nice buildings (that the banks hold the lion share on) and simply do not bring in enough cash to operate this team even close to correctly.

Will the $50mil from the new TV deal help in 2014? Sure it will, but the Wilpons will never change. And Alderson will be long gone by then.

Will the addition of Wheeler in the 2014 rotation and the loss of the Santana/Bay contracts free up money to get back in the free agent market? Yes it will, but never will it return to the levels Omar enjoyed his first two years.

This is the team you root for because this is the team that the Wilpons own.