Lifting The Veil

The Padres Can't Have Their Cake and Eat It Too

Up until Friday, the deafening silence of the Padres offseason had been tempered by the hope that a master plan was coming to fruition. There was a cheat code this offseason: a superstar talent somehow making even less than Tyler Wade next season. And the Padres were, allegedly, one of the final three teams being considered by the prodigiously talented Roki Sasaki. The possibility of such a seismic infusion of value kept alive a tenuous path that could have satisfied all parties in the standoff between a fractured ownership group and a fan base suspicious that the rug was being pulled from the pursuit of excellence. But it was not to be. Roki Sasaki will not be playing for the Padres. And this means that the Padres ownership will not be able to have their cake and eat it too.

Losing out on Sasaki means that any significant talent acquisition this offseason will be coming at market rates, or not at all. And this has been a point of tension, as many feel that a willingness to pay those market rates was part of Peter Seidler’s vision, but perhaps not the vision of the current controlling entities.

No one can really know what Peter Seidler’s vision was. Certainly not Texas probate courts. When we tried to explore this we noted:

Something similar to the prisoner’s dilemma exists between a baseball team’s ownership and its fan base… the forces of geographic monopoly and the resultant captive fanbases ensures that even the teams with the most mediocre on-field product tend to be profitable…

Within this framework, a Nash equilibrium develops in which owners are encouraged to spend meagerly, because they make money either way, pushing fans to reign in their spending because the team is less likely to be good.

This is the equilibrium in which most MLB teams exist. The most destructive example of this can be seen with the Oakland A’s where years of chronic underinvesting led to fanbase attrition, and when dwindling revenues threatened the profitability of the team, rather than invest, the owners sought to move the team in search of a new geographic monopoly.

Despite being in a market of similar size, Peter Seidler seemed to have a very different vision. We said at the time:

Instead, (Seidler) tried to see if the Padres could enter a virtuous cycle in which high spending would produce a good team that would grow the fanbase and enable more spending. A perpetual motion machine… There are real world examples of teams shedding their geographic constraints to pursue such a virtuous cycle. They’re not common, but they’re possible. Manchester United (a team whose reach extends far beyond Manchester) and a handful of others come to mind.

As a result of a bold first step by Seidler, boosting team payroll, San Diego had firmly been moving away from the Nash equilibrium with both the team and the fanbase spending generously in a virtuous cycle. It was this process, breaking the Nash equilibrium, that we speculated was Seidler’s vision…

We’ll never know for sure. But what missing out on Roki Sasaki will show is the vision of the entities now in control of the team. The veil is going to be lifted sooner than it might have, had a cheat code permitted a deferral of commitment for another year.