Best of BP: The Moon and the Stars

The baseball season ended a couple weeks ago, fittingly, in the ballpark once known as Enron Field. That structure still stands, and looks—with the notable exception of Tal’s Hill—largely the same as it did under its old name. Resilient institutions, like Major League Baseball, are strong enough to withstand the shockwaves of bubble economies—inflated by nothing but the hot breath of the latest huckster smooth enough to sell unbridled hope, whether it be called mark-to-market accounting or, and I’m just spitballing here, cryptocurrency.

If it seems silly that baseball keeps finding itself tied up in deals with these kinds of businesses, it’s worth remembering a couple points. First, baseball’s credibility bar for its sponsors has historically been exactly as low as it has needed to be for the check to clear it. And second, while grown men wearing matching pajamas swinging a stick at a wound piece of cowhide is an absurd activity, it is an incredibly sound and proven entertainment product, which has existed professionally in America for roughly 60% of the country’s existence. That baseball’s institutional stability stands in contrast to some of its recent sponsors is notable, but it’s also disconcerting. If, as the social science goes, we’re the average of the people we spend the most time with, perhaps it’s time for MLB to forge some better relationships.

As inconsequential as the action of a baseball game certainly is beyond the lines of play, it can only take place within the structures that define it. The rules might seem arbitrary, but everyone agrees to their framework. They must, in order for the action to proceed. Pitches are balls or strikes. Batted balls are fair or foul. Fly balls are caught, or land. For each of these outcomes, the on-field decision (now backed by even-more-definitive replay), is adjudicated by an impartial enforcer of order, a neutral arbiter whose word reigns supreme—the umpire, the man wearing the FTX patch.

What better signifier—at least to the kind of brain that has built a multi-billion dollar empire on nothing but speculation, mind melding with the kind of brain that has milked the multi-billion dollar empire over which he reigns for every last dollar—of stability and trust. Officiousness as a shared value. What a world.

While the exact terms of FTX’s deal with MLB were not disclosed, it was reported to be a five-year deal, the same length as that of the Washington Nationals’ pact with Terra, though in that instance the team took the entire $38 million bag of cash up front. A patch on an umpire’s uniform is no stadium naming rights compact, so there’s no reason to think the value approaches anything close to what FTX agreed to pay the Miami Heat ($135 million over 19 years) to sponsor its arena, or the 10-year, $210 million deal it doled out to esports organization TSM. Only the owner of this house, the Commissioner’s Office and, presumably soon, the Federal Trade Commission, know the precise value of X as defined by the yearly allotment of their agreement, and whether or not there is now an X-sized hole in MLB’s budget for the remaining three years of the deal.

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Since we’re now beyond the sixth paragraph of this blog post, I guess it’s a safe time to mention that Moneyball and The Big Short author Michael Lewis has been embedded with FTX founder/fugitive/tweeter-through-it Sam Bankman-Fried for the last six months. That Lewis keeps finding himself in the middle of both baseball’s and our economy’s revolutions feels neither accidental nor disconnected. While some writers have attributed our culture’s flatness to the Moneyballization of everything—which might more correctly be called the McKinseyfication of everything, from baseball to private equity—it’s notable that the crypto boom-and-bust very specifically does not fit into those parameters.

Baseball has been optimized and scrutinized at every touchpoint, all the fun and improvisation squeezed from it to within an inch of its life. Crypto has been the exact opposite. Its rise has been fast and furious, its fandom not well-won through generations, but an overnight success that never really established its own credibility and always seemed too good to be true. But, at least at first, it was making money.

The cult of capitalism insists on the mantra that, by becoming rich, you’ve done something smart and correct. The ends necessarily justify any means to get there, as the only ends of capitalism are more wealth accumulation. It’s one thing, though, for some Forbes Magazine centerfold’s siren song to convince the investor class to throw ungodly sums into, say, an unproven blood testing company; at least, there, one is betting on an actual product, something that serves real utility in the world—or would if it actually worked.

With crypto, investors are betting on an idea. Becoming rich off that idea alone—even as it is based in no tangible product, with no institutional or government backing (indeed, that it flaunts those very bedrocks as its raison d’être), with nothing but the agreed upon buying-of-hype to fuel it—stretches capitalism’s current corollary. If you’ve gotten rich off a concept, and your ability to sell confidence in that concept to others, you must have done something smart and correct. As long as you’re not the one left holding the (virtual) bag when the Feds arrive.

Crypto’s bubble seems to tap into the larger societal rush to capitalize on ANY GOOD THING, which has never been faster or more furious. When I first wrote about Pickleball, a little less than seven years ago, it was very much just a recreational sport and a curiosity. Now, everyone from LeBron James and Kevin Durant to Drew Brees to (extremely divorced) crypto enthusiast himself Tom Brady have bought professional teams. It’s hard to look at Pickleball’s arc and not see the parallels to Baseketball, the sports film that sees a backyard revolution against the corporatization of professional sports ultimately get swallowed by the very forces that it was invented to spite. Frankly, it’s hard not to see everything these days, whether legitimate or a scam, as something for someone to squeeze as hard as possible for whatever personal gain might drip out.

When it comes to baseball, it’s this drive, this need to speed up the game and its financial growth to meet the unquenchable hunger of capitalism, that worries me far more than the efficiency quants tinkering with the margins on the field. When those same private equity firms stripping and strangling newspapers and the American housing market are allowed to buy into 15% shares of MLB franchises, the eventual downstream effects on profit margins cannot possibly benefit the fans, or the product on the field.

To be clear, this is not about the inherent morality of revenue streams. It may strike you as quaint, but it should not, that every MLB team had its own cigarette sponsor a century ago; we haven’t evolved all that far from the image of a cancer stick protruding from Joe DiMaggio’s prominent teeth on the cover of The Sporting News in 1948. Baseball has always been willing to lend its image to disreputable businesses to launder, in return for additional revenue streams.

Disreputable doesn’t mean unreliable, though. Trading the vice-based advertising market of tobacco from yesteryear for the hyper-segmented alcohol or sports gambling industries of today is one thing. It’s growing revenue streams built on nothing but optimism—crypto, sure, but also bloated RSN contracts that cannot possibly bridge the shortfall caused by cord-cutters without ludicrous carriage fees—that should give even the most contemptuous of the “baseball isn’t dying” crowd pause.

It’s well understood that a product is worth what someone is willing to pay for it. But we can all be pretty clear that Twitter wasn’t worth $44 billion when it was bought, much less now, and that whatever anyone paid for FTT tokens was too much. Someone may well soon pay $2.4 billion for a Washington Nationals franchise that was bought for just $450 million in 2006 ($665 million in today’s dollars). Baseball’s is a much wider, slower orbit, but it still circles the same sun.

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This is quite the moment for discovering that the grand technologies of the future, and those who have gotten unfathomably rich selling their possibilities to us, may not be all they’ve promised. For every trip to the moon—figuratively, or aptronymically—there is an inevitable boomerang back to earth.

We see it in the way people whose “companies don’t buy advertising” are suddenly buying advertising at one of their companies for their other company, the latter of which receives government funding. So long as the bedrock institutions remain, anything new and shiny will still be tethered to them, no matter how much they project otherwise.

Where does this all leave baseball now? Are we really, seriously, still calling the luxury club seating at Nationals Park the Terra Club? Does the fact that the team got all its money up front mean it is, somehow, contractually obligated to wear its name like a branded polo shirt at a Monday afternoon pro-am for the remainder of the contract? Will this farce continue for four more years, for a sponsor who has now been bankrupt for longer than it was solvent (to the degree that it ever was) during the deal?

The boom and bust cycles are happening so quickly now that it’s nearly impossible not to feel like we’re spiraling toward the singularity. Perhaps baseball’s orbit has just brought it into proximity with these other gravitational forces for now. But even if it swings out, seemingly unscathed, as its sponsors crash and burn, it’s worth remembering—retrograde motion is just an optical illusion. Every celestial body creates its own gravity, pushing and pulling each other towards an eventual convergence at the middle. The revolution comes for us all.