If this were an ideal world, the Cardinals would be playing baseball today. I would have a fun postseason “best of” article in this Saturday spot. (Look for a season-long “best of” deep dive on Thursday.) We would kick any talk of offseason budgeting until after the Cardinals’ World Series win.
This is not ideal.
Nothing about 2020 is ideal.
Instead, the entire financial landscape of major league baseball, including the Cardinals, has been rocked to its core. Revenue has collapsed. Teams are laying off personnel. Entire minor league franchises are getting the axe.
To make it worse, just because 2020 will soon end, it doesn’t mean that any of these realities will end with them.
Cardinal fans are already making offseason plans, with starry-eyed suggestions of signing this superstar or that. “Ideally, the Cardinals will sign (insert pricey free agent here).”
It’s Saturday and while I hate being “that guy” on the weekend, reality is waiting and ready to give our ideal offseason a swift kick in the pants.
Today, that’s what we’re going to do. We’ll acknowledge the ideal. Then we’ll destroy it with the real. Fun, right? No? Sorry! But I won’t leave you too depressed, I promise.
2021 Budget: Ideal
What’s an ideal Cardinals’ budget for 2021? In an ideal world, the 2020 Cardinals would have played 162 games of winning baseball, drawing over 3.5 million fans across 81 home games. They would have progressed into the postseason, perhaps duplicating their 2019 NLCS appearance. Mozeliak could Scrooge McDuck in all that postseason income.
Ideally, the Cardinals would enter the 2021 offseason ready to spend.
John LaRue did a great job of laying out the Cardinals payroll commitments for 2021 and beyond. (That’s right, I’m stealing all of his work for my own benefit.) Let’s consider the Cardinals payroll under “ideal” circumstances, looking back over the last five years (using Cot’s Contracts), and looking forward to 2021 using JL’s current estimates.
2017 – $148.1M
2018 – $159.7M; +7.8%
2019 – $162.6M, +1.8%
2020 – $168.9M (69.4M actual), +3.9%
2021 – $156.6M estimated, (includes options, arbitration, and assigned salaries for current 40-man players.)
A vocal contingent of Cardinals fans don’t like to hear it, but the club’s payroll has been trending upward, if only slightly. In an ideal world, the Cardinals’ budget would be looking at a 4-8% increase in 2021. That would be adding between $7-14M in payroll above last year’s.
2021 “ideal” – $175 – $183M
That would leave the Cardinals a minimum of $21M to spend in the offseason to improve their roster. Not bad!
Except, it kind of is bad.
Molina and Wainwright alone could easily eat up $21M. If the Cardinals choose to let those two go, that money could be redirected to other areas. However, with impact players making $25M or more in an ideal market, even the ideal budget doesn’t allow much space to acquire significant talent.
We’re talking ideals, though. There are trade options and ways to shift expenses around if the club decides to be creative. That’s their preferred route. Ideally, though, this club was designed to win with its current parts plus or minus a few low-to-mid dollar tweaks.
2021 Budget: Reality
Fair warning: if you don’t want to ruin your weekend, look away now. Almost nothing about the “ideal” presented above is going to prove true.
Instead of playing 81 home games with 3.5 million fans in the stands buying hot dogs and beers, the Cardinals played only 58 games and the fans were made of corrugated plastic. Regardless of what you think you know about the Cardinals’ revenue, the club undeniably made less money in 2020 than they do under “ideal” circumstances. The Cardinals did make the playoffs and they’ll get a share of the TV money. But their actual postseason revenue will fall far short of what they hoped to receive.
2020 was a financial disaster for MLB, including the Cardinals. We know that. That alone is enough to significantly revise those ideal budget projections above.
We still haven’t even got to 2021 yet.
The Cardinals are setting their budget expectations for 2021 right now. That means DeWitt and Mozeliak are building their spending plan based around current realities.
Right now, a few college and pro football teams have opened their venues to very a limited capacity of fans. The Kansas City Chiefs, for example, are limiting ticket sales to just over 22% capacity. Ticket prices are up but not nearly enough to make up the loss of 78% of apx. 70,000 fans.
Surely this will improve, right? COVID is not slowing down in many regions of the country, including Missouri. Reports indicate that progress is being made on a vaccine, but there are realistic doubts about when it will be ready, how quickly it will be widely distributed, and how effective it will be. The economy is still struggling. Unemployment is still very high.
Can the Cardinals realistically project 100% fan capacity in Busch stadium in 2021? Based on the information available today, there’s no way they can.
The Cardinals suffered a huge loss of revenue in 2020. Now the current financial and health crisis is forcing them to assume another significant shortfall in 2021. This is a huge problem for the Cardinals’ budget.
In an ideal offseason, we would be asking how much the Cardinals are willing to raise payroll.
If we stick with reality, we should be asking how much the Cardinals are willing to cut payroll.
Back to JL’s article. How much margin do the Cardinals have?
Realistically, the Cardinals are on the hook for around $145M for their current 40-man roster in 2021. That’s about a 14% cut in payroll from 2020 expected. This would require the club to let all their current free agents walk and to buy out Wong’s option year. If circumstances got truly desperate, the front office could also non-tender arbitration-eligible players. The team has nine such players. Most of them are arb 1’s, however, so the cost savings vs. pick-your-minor-leaguer is not great. Still, that’s the “push the red button” scenario.
I do not believe the club will go take that path, regardless of projected income.
Instead, if the club just allows its free agents to walk while keeping Wong and their arb-eligibles, payroll would sit around the $156.6M that JL projected. In total, that’s about a 7% cut in payroll over 2020s expected budget.
That brings up the $21 million dollar question. Right now, as the Cardinals are setting their budget and making their offseason plans, can they realistically expect 2021 revenues to be within 7% of 2020’s expected revenues (pre-COVID)?
Sorry, folks, I’m not seeing it. Not based on where the virus, the economy, and the sports world are right now.
Baseball fans need to prepare for a dark winter.
That’s where I can give you a small sliver of hope. It’s Saturday, after all. I’m never going to leave you in the dumps on a weekend.
While the Cardinals have to plan and budget now, they don’t have to field a team and settle their roster until April.
When you’re stuck between ideals and realities, the best approach is patience.
The smart play is for Mozeliak and Girsch to delay as many of their roster decisions as they can. Yes, they’ll have to let their free agents walk, but by February, the situation with the virus might improve and they could start projecting more normal revenue levels. That would be the time to spend. By then, the free agent market will have a some remaining discounted talent as impatient players grow desperate to find a roster spot.
Simply put, if you want the Cardinals to spend this offseason, be willing to let them wait! That’s the only way our “ideal” becomes our “real”.