McCourt, who is in the middle of a lengthy and heavily publicized divorce trial with ex-wife Jamie McCourt, had spent so much money on his lavish lifestyle and legal fees he didn’t have any left for the team.
It shouldn’t surprise anyone that McCourt ran the Dodgers into a ditch, with no feasible way of getting out of it. And it certainly shouldn’t surprise the owners, who should have sensed impending disaster in selling ownership to McCourt in the first place. They should have done everything they could to keep him out of the driver’s seat. Too little too late.
Last week, MLB commissioner Bud Selig made the decision to appoint former Texas Rangers President J. Thomas Schieffer to oversee the Dodgers’ financial operations, effectively pushing McCourt out of the picture in a move designed to make him sell a team he should have never been able to own in the first place.
The owners made a mistake allowing him to join their club in 2005 for the price of $430 million, because it was painfully obvious McCourt didn’t have any money to begin with. McCourt originally bought the Dodgers in a heavily leveraged deal, taking out loans and even putting up his Boston parking lots as collateral.
Their decision to ignore all signs of McCourt’s financial issues — among them, having no liquid capital to fund the franchise — has now led to a conflict of interest for MLB: Does it take the steps to improve the Dodgers by pouring money into the squad?
MLB might want to think twice before adding payroll to the Dodgers, because once it does show a vested interest in improving the team through financial assistance, who is to say other teams won’t ask for the same?
The details would confuse anyone who’s not a finance major. But any knowledgeable fan knows McCourt financed the franchise through nothing but personal debt.
McCourt never had the money to purchase the team, let alone operate it and make it a true contender.
NewsCorp, the media conglomerate headed by Rupert Murdoch that owns FOX and the Wall Street Journal, sold the Dodgers to the McCourts. FOX controls Saturday and Sunday programming for baseball, and naturally Selig and the owners want to appease Murdoch. These details indicate the owners share just as much blame as McCourt for the mess the Dodgers are in today, both financially and on the field.
Miraculously, the Dodgers found a way to make back-to-back National League Championship Series appearances, losing to the Phillies both times. During this run, however, payroll was slashed while ticket and concession prices were raised to cover costs. Naturally, these financial problems snowballed.
Just last week, McCourt took out a $30 million loan to meet the Dodgers’ payroll obligations. By the time the divorce trial came around in 2009, McCourt had earned himself a new, and accurate, nickname: McBankrupt.
The negligence of the owners while vetting McCourt as an owner has set the Dodgers back, disgracing one of the league’s premier clubs while shedding light on the shady way that he became the owner in the first place.
Now, the lack of foresight has created a precarious situation for Selig. If he chooses to pour league money into the Dodgers, it displays favoritism. He is giving them a competitive advantage they would not previously have if McCourt had been the director of financial operations. But if he doesn’t give the Dodgers the financial flexibility of other teams, they’re going to remain mediocre at best.
If MLB can collaborate with potential outside investors, the once proud Dodgers could be out of this mess within a few years, but the damage has been done. Somehow, it wasn’t all McCourt’s fault.
Cyrus Behzadi is a freshman majoring in communication. His column, “The Extra Point,” ran Wednesdays.