Cash Money Billionaires: The LA Dodgers and Opportunity Costs

(Photo courtesy of The Los Angeles Dodgers)

On May 1, 2012, The Los Angeles Dodgers, Guggenheim Baseball Management LLC (“GBM”) finalized a deal with Frank McCourt for the transfer via sale of the Los Angeles Dodgers franchise and associate assets for the sum of $2 billion.  While most of this windfall would find its way to the creditors involved in the previous year’s bankruptcy filing by Mr. McCourt, needless to say it was money well spent for a historic franchise with a track record of success (although not too recent) in the country’s second largest market.  And apparently Mark Walter and his Guggenheim money weren’t done redistributing wealth…

Fast forward to August 25, 2012.  The Boston Red Sox of the aughts are long gone (save for Big Papi) and even the Pink Hats money can’t save the team from the Scrooge McDuck sized contracts that Theo Epstein left on the organization’s balance sheets.  Meanwhile, the Los Angeles Guggenheims had already shown a willingness to take on high financial risk/high OPS reward contracts with the likes of Hanley Ramirez from Miami.  After having rolled out lineups with the likes of Elian Herrera and Juan Rivera around the middle of the order, the lineup was in need of some upgrade(s).  First base had been a offensive black hole ever since Eric Karros departed halfway through Dubya’s first term and with Joey Votto locked up by the Reds earlier in the year, there were slim pickings available via trade or free agency.  Enter the recently Bobby Valentine managed Red Sox.  The Los Angeles Dodgers leadership wanted to acquire a (statistically proven) franchise offensive player, hopefully one at a need position, and did so with Adrian Gonzalez and friends.  Chicken and beer, Tommy John surgeries, and decreased power numbers aside, the money involved in this deal was astronomical, not only in MLB history terms but for the North American sports landscape as a whole.  And as with everything at The 500 Section,  money is the root of all happiness and casino winnings/losings, so lets play with the numbers!

Starting in 2013, the total value of money committed to the 4 acquired contracts (and in case you were redecorating Bin Laden’s former cave over the weekend, those contracts were for Adrian Gonzalez (1B), Carl Crawford (OF), Josh Beckett (SP), Nick Punto (IF) aka The Centerpiece) is $274,428,562.00.  A majority of those funds will be thrown at Gonzalez and Crawford until 2018 and 2017, respectively.  Now, since we here at The 500 have, for the most part, never owned a major sports franchise in our lives (and god knows we are working towards that end), it may be a little difficult to rationalize how much money that actually amounts to.  So we have done the dirty work and used the AP Microeconomics concept of Opportunity Cost to equate what that $274m plus could buy us in terms that we could understand (unless one of us is actively attempting to purchase 4 baseball players for their personal use, then by all means stop reading now).  So, what could you do with $274,428,562.00???  I’m glad you listened to me ask…

# of each product you could procure with $274,428,562.00:

– Chipotle Burritos: 39,036,779

– Big Mac Burgers: 63,378,420

– Chick-Fil-A Chicken Sandwich: 99,792,204

– Papa John’s Pepperoni Pizza (Delivered w/o tip): 15,817,208

– Gallons of Milk: 80,008,327

– 18 Packs of Coors Light: 21,797,344

– Bottles (1.75L) of –

— Captain Morgan Tattoo: 7,708,667

— Grey Goose Vodka: 4,023,879

— Kentucky Gentleman Whiskey: 15,417,334

– 12 Packs of Mike’s Hard Lemonade: 17,435,105

– Packs of Kraft American Cheese singles: 65,496,076

– Packs of Trojan Condoms: 19,972,966

– Hyundai Accent’s: 18,986

– Ford Focus’s: 16,940

– Honda CR-V’s: 12,199

– Porsche 911 Carrera’s: 3,342

– Ferrari 458 Spider’s: 1,067

– M1A Abrams tanks: 31

– F35 Lightning jet fighter: 1.39

– Boeing 767 passenger plane: 1.71

– Cessna planes: 1,830

– 2013 Donzi 43rz speed boats: 458

– Kawasaki Jet Skis: 34,742

– Houses in Arlington, VA: 502

– Condos in Ballston, VA: 485

– Houses in Georgetown, DC: 275

– Houses in Great Falls, VA: 320

– Houses in Fredericksburg, VA: 1,193

– Houses in Los Angeles, CA: 822

– Houses in Miami Beach, FL: 962

– # of Harvard tuition payments (4 years): 1,782

– # of UMW in-state tuition payments (4 years): 7,420

– # of UMW out-of-state tuition payments (4 years): 3,182

– Xbox 360s: 1,045,481

– Madden 13’s: 4,356,700

– Dell Ultrabooks: 261,363

– iPod Touch’s (32GB): 718,042

– iPad’s (64GB): 373,377

– LeBron James contracts: 4

– Drew Brees contracts: 3

– Redskins Season Tickets: 105,549 (FedEx Field max capacity – 79,000)

– Mitt Romney’s: 0.98


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