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Tuesday, March 24, 2015

How MLB Profits from Players with Addiction

Intentional or not, MLB’s steroid policy has been a massive money-saver for owners. In the Biogenesis case alone, $31 million in salaries were saved by teams. MLB even went so far as to threaten Alex Rodriguez with a lifetime suspension from the game, which would have saved the Yankees at least another $60 million on top of the $22 million the club retained in 2014—all before potential eight-figure luxury tax savings are accounted for. While suspensions without pay are far easier to justify for performance-enhancing drugs than they are for drugs of abuse, MLB and the Yankees attempted to go above and beyond the joint drug agreement in an attempt to bilk Rodriguez out of money he’s contractually-owed.

MLB needs to fix its incentives. It shouldn’t be hard. Just look at what the rest of the major sports leagues do with their suspension and fine money. Section 6 of Article VI of the NBA’s collective bargaining agreement lays out a policy in which all fines and pay lost through suspensions are channeled to charity, with one half going to charities selected by the NBA Players Association and the other half going to charities selected by the league. The NHL directs its player fines to the Players’ Emergency Assistance Fund, with a mission to help former NHL players who have fallen into poor health or dire financial straits. Similarly, all NFL on-field fines go to the NFL Player Care Foundation.

As for how things work in baseball? After 60 days in the drug program—according to the Los Angeles Times, it’s unclear if Hamilton exhausted these 60 days during his time with the Devil Rays in the early 2000s or not—a player is no longer entitled to salary retention even if he is in treatment. As such, a year-long suspension for Hamilton would save the Angels anywhere from just under $17 million to the full $23 million if MLB determines his treatment days have already been used up.


 

 

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