What should government do?

Posted on July 27, 2008 by Jorge Costales

Forcing fast-food restaurants to disclose calories seems like a safe ‘no’ by my way of thinking, but it’s not the clear cut answer I thought before I read the following from the Becker-Posner blog – this is Posner:

A law aimed at reducing obesity would be paternalistic if obesity did not produce external costs, but it does, because obese people consume a disproportionate amount of medical resources, and there is extensive public and private subsidization of medical expenses (private through insurance pools that are unable or forbidden to identify and reject high-risk insureds). However, the size of the externality is in question, because obese people die on average at a younger age than thin people, and so consume medical resources for fewer years on average than thin people do.

Here is Becker’s reply:

But the alleged “externality” with regard to obesity is due only to the government’s subsidy of medical expenditures, so that it is a case of one government intervention – justified or not – causing another intervention – control of eating. It is not a path of intervention causation that most people would be comfortable with in many situations. For example, since the government subsidizes the medical care of children of poorer parents, a mechanical application of this type of externality argument would say that this justifies governmental control over the number of children that poor parents can have. Additional children of these families create an “externality” by raising taxes on others to pay for the medical costs of these children. Many similar examples can be given where government regulations and other government programs cause certain types of behavior that raise taxes or subsidies and adversely affect taxpayers, even though there would be no externality from this behavior in the absence of the government programs.

I know what you’re thinking, ‘this stuff is awesome,’ I agree. See Posner’s entire post. See Becker’s entire post.

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Difference between Popularity and Leadership

Posted on July 26, 2008 by Jorge Costales

From a July 25 WSJ Editorial about Sen Obama’s remarks in Germany:

For our money, the best line in Barack Obama’s speech yesterday in Berlin came in the form of a quote from Ernst Reuter, the city’s mayor during the period of the Soviet blockade and the American airlift, in 1948:

“But in the darkest hour,” said Sen. Obama, “the people of Berlin kept the flame of hope burning. The people of Berlin refused to give up. And on one fall day, hundreds of thousands of Berliners came here, to the Tiergarten, and heard the city’s mayor implore the world not to give up on freedom. ‘There is only one possibility,’ he said. ‘For us to stand together united until this battle is won…. The people of Berlin have spoken. We have done our duty, and we will keep on doing our duty’.” This, from a U.S. Senator whose consistent message to the people of Baghdad, a similarly besieged city, also dependent on America’s protection, has been, in effect, to give up.

What Mr. Obama “knows now” is that the surge he opposed has saved Iraq, much as Harry Truman’s airlift saved Berlin and underlined America’s intention to defend Europe throughout the Cold War. The surge has also saved American lives in Iraq, with combat-related deaths (so far, there have been seven this month) at an all time low.

Mr. Obama also knows that Gen. Petraeus opposes setting a fixed timetable for withdrawing U.S. forces from Iraq. This military judgment ought to count for something, particularly since Congressional Democrats have long scolded President Bush for failing to pay sufficient heed to the advice of generals such as former Army Chief of Staff Eric Shinseki. Yet Mr. Obama, who has always been careful to cite the views of military commanders to justify his 16 month withdrawal schedule, now says that heeding less congenial military advice would mean an abdication of his responsibilities as a prospective commander in chief.

But the significant debate is not over whether and when the U.S. will withdraw. It’s over whether the U.S. will win. In his Berlin speech, Mr. Obama was at his most forceful when he insisted that “this is the moment when we must defeat terror,” adding that “the threat is real and we cannot shrink from our responsibility to combat it.” This is well-said and true. But it squares oddly with a political campaign whose central premise is that losing in Iraq — and whatever calamities may follow — is a matter of little consequence to U.S. or European interests. It squares oddly, too, with Mr. Obama’s broader promise to “stand for the human rights of the dissident in Burma, the blogger in Iran, the voter in Zimbabwe” and virtually every other global cause.

* * *

It is hard not to be moved by the sight during the speech of hundreds of American flags being waved, rather than burned. Then again, the last time a major American political figure delivered an open-air speech in Berlin, 10,000 riot police had to use tear gas and water cannons to repel violent demonstrators. It was June 1987, the speaker was Ronald Reagan, his message was: “Mr. Gorbachev, tear down this wall.” Press accounts characterized the line as “provocative”; the Soviets called it “war-mongering”; 100,000 protesters marched against Reagan in the old German capital of Bonn. Two years later, the Berlin Wall fell.

Reagan’s speech is a lesson in the difference between popularity and statesmanship. Watching Mr. Obama yesterday in Berlin, and throughout his foreign tour, was a reminder of how far the presumptive Democratic nominee has to go to reassure people he is capable of the latter — “people,” that is, who will actually get to cast a ballot in November.

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Marco Rubio on Cuba

Posted on July 25, 2008 by Jorge Costales

Please check out this video clip of Marco Rubio addressing the press at a luncheon attended by Sen Obama in May of 2008. The video was posted on the Babalu blog. Rubio is the Speaker of the Florida House of Representatives.

Rubio explains with great conviction why Cuba’s future freedoms should not be negotiated with the Castro dictatorship. He notes that their ability to maintain power should not be confused with the legitimacy which is earned by those who win free elections. They never have and therefore should not be treated as such. Very well said by Rubio and I wholeheartedly agree.

Speaking of even more local politics, check out the review of the Miami Herald’s new columnist, Myriam Marquez on the 26th Parallel blog. The post has numerous links to Marquez’s earlier columns in Orlando and quotes her opening column:

When your parents leave behind everything they hold dear, including their own parents, to save their children, you’re sure to grow up with lots of chutzpah. When you’re taught to ”duck and cover” in a Miami classroom during the Cold War, you learn to value freedom. When you spot a number tattooed on a tailor’s wrist at a fabric shop near Cielito Lindo, the old downtown Miami courthouse, you never forget the Holocaust survivor, for you have witnessed God’s perseverance over evil.

And the first time you have to translate for your mother that the white man with a Southern drawl is telling us to move up because we’re sitting in the ”colored” section of the bus, you learn to question authority.

And embrace empathy. When Haitians and Venezuelans flee their own despots, how can you not empathize?

Or feel grateful for this nation’s promise?

Had the U.S. government turned us away, I would have been forced to wear a red kerchief, shouting slogans about wanting to be like el Che. (A victory for this wife and mother of two sons: The boys know not to bring home a Che Guevara T-shirt from college.)

Now I have the privilege of sharing my perspective in this column three times a week, to try to explain what too often in South Florida seems inexplicable. I don’t take this assignment lightly.

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This is the Day, the Lord Has Made and …

Posted on July 24, 2008 by Jorge Costales

… here’s one way to rejoice and be glad in it – a bike ride through a beautiful part of my hometown of

Miami


1.1 miles into my bike ride – looking west on just past the toll booth to Key Biscayne.

2.5 miles in – Miami Seaquarium.

6.5 miles in – Crandon Park Tennis Center – During March, home to the Sony Ericsson.

9.5 miles in – Crandon Park Beach – across from the Tennis Center – turnaround point was at 8.0 miles

Still 9.5 miles in – A long view of the area before the beach – ABC’s Superstars competition once held here.

10.5 miles in – the view from Virginia Beach.


11.5 miles in – Miami Marine Stadium – boarded up for now.

Below in its heyday.

12.0 miles in – Rickenbaker Marina. Guess which is my pic.

12.5 miles in – Quick hellos to the former Ms Evert & Mr Norman.

13.0 out of the 16 mile round trip done – even the view from the gutters are …

… spectacular atop the Key Biscayne bridge.

The view atop the Key Biscayne Bridge.

Most pictures courtesy of the great Treo 755p.




But not these.

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MSNBC Dream Report

Posted on July 24, 2008 by Jorge Costales

Dateline: January 2, 2010 – Las Vegas, NV

[AP-BHO] President Obama addressed an adoring throng of approximately 1.5 million Americans yesterday in the outskirts of Las Vegas and urged them; to keep hope alive, to bring change to America, to realize that they were the change, but not to change [their voting patterns] since, ‘we are so close.’ The unusually large crowd was made even more conspicuous by the fact that they were sitting in the desert wearing cloth vestments [the Common Era look].

The spectacular event was almost marred when a San Diego accountant yelled out, “Brother we’re behind you, just do something already.” The president’s security team had to move in quickly as the crowd itself had turned on the man and began stoning him. The man was later asked that if by referring to the president as, ‘Brother,’ he meant to imply that he was black. He replied, ‘of course not, isn’t he though?’

When Obama realized that the man was being attacked, he raised his hands, which froze the throng immediately. Instantly grasping the parallels to the biblical story, he told the crowd, ‘as one who came before me once said, in granted what were less complicated and dangerous times, let he who is without sin …” Nothing further was heard as the crowd began chanting, ‘yes we can’ for the next 3 hours and 12 minutes. Some who stopped chanting after only one hour, were beaten [although not about the face] by the more enthusiastic members of the crowd.

It reminded all there of the political skill which earned Obama an unprecedented 49 state sweep in the general election. Alabama, you will recall, actually voted for McCain but it’s electoral voters refused to cast their ballots for McCain and boycotted the College. Instead the Alabama electors held a one-day symposium on the sins of slavery outside the home of former NBA great, Charles Barkley. In a scene reminiscent of the movie Babe: Pig in the City, persons suspected of past Republican voting were ‘asked’ to parade past union halls across Alabama and ask for forgiveness. One repentant McCain voter’s shame went so far as to cause him to attempt suicide by swallowing a print-out of the state’s voting tabulation report, but was saved by a nearby Obama precinct captain.

[Editor’s note: In the interest of full disclosure, the reporter who filed this story voted for Obama and donated 6% of her after-tax tax home pay to his campaign, but has assured us that it will not affect her reporting].

Post-post
I don’t think even my family would believe this one. I wrote the post above yesterday and then I found a similar kind [i.e. except funnier and well written etc] of satire about Obama linked on on one of my favorite local blogs, Babalu – July 25

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Opportunity Knocks

Posted on July 23, 2008 by Jorge Costales

If at first [pre-trial mediation] she doesn’t succeed, she’ll try [postpone her ruling so that Miami-Dade County’s megaplan will be dependent on a coming Florida Supreme Court ruling] again. Charles Rabin of the Herald described Tuesday’s ruling in his article:

Miami-Dade Circuit Court Judge Jeri Beth Cohen on Tuesday tossed a late, surprising wrinkle into Norman Braman’s attempt to derail a Florida Marlins stadium, declaring she won’t rule on a significant count for more than a month.

Cohen said she’ll wait to make a decision on a key remaining count until the Florida Supreme Court finishes work on a case involving the use of public money without a vote. The justices are on break until the end of August.

When Marlins attorney Sandy Bohrer told the judge she had an obligation to rule and city of Miami attorney Henry Hunnefeld said there was no guarantee the Supreme Court would rule anytime soon with three members set to retire by year’s end, Cohen said she resented the pressure.

”This is about me doing what is intellectually honest. They’re going to make this opinion before these justices leave. I have an obligation to wait,” she said. “I have a Supreme Court that is in flux.”

Cohen, also up for election in August, is stuck on Braman’s highest-profile count: That the funding plan for a $3 billion face-lift in downtown Miami is illegal because it uses millions of dollars of community redevelopment money without a public referendum.

Can a judge recuse themselves due to an upcoming election? I had an earlier post, which speculated that the judge would have to deal with the perception that the ruling from her courtroom was either an indictment or endorsement of the county’s megaplan. Clearly she wanted no part of either perception. I just didn’t realize that her election was right around the corner. In retrospect, it’s a miracle she didn’t flee the country when the first judge, Pedro Echarte Jr., bailed.

Judge Cohen began the trial by asking both sides to attempt to reach a settlement. Nothing seemed to come from that initial mediation attempt, but there was an indication as to the type of compromises which would placate Braman [South Florida’s version of Hillary before the final primaries]. Again, from the Herald’s Charles Rabin’s July 10th article:

Some close to the mediation said items being discussed included the possibility of building a community center near the planned ballpark, or awarding more public access to the facility. Such moves may help satisfy Braman’s quest for more public benefit from the megaplan.

Others said the standoff — being mediated by former judge Bruce Greer — hangs on whether the Marlins will give back some of the concessions the team received in December’s Baseball Stadium Agreement [BSA] engineered by Burgess.

Though the county would own the stadium, the Marlins would receive all monies from its naming rights, which is worth hundreds of millions of dollars to some Major League Baseball teams.

The Marlins & MLB likely felt that they had the upper hand and refused to compromise at that time. It is doubtful that they remain that confident today. I like what the judge has done. Even if the Marlins had won, everyone expects that Braman would proceed with appeals, guaranteeing further uncertainty. The best possible outcome for our community is one in which the Marlins and MLB go the extra mile and compromise. Bringing someone with Braman’s track record on-board would effectively eliminate any additional political hurdles.

In reading about various testimonies throughout the trial – see the Sun-Sentinel’s Sarah Talalay’s blog – it was amazing to see how every government witness proceeded to give ‘expert’ testimony that they were clueless as to the finances of their partners in the stadium venture. [If this blogger jumps up and down in cyberspace, does anyone … never mind, I’ve seen my Google analytics, the answer is no]. If there is a stadium, those guys deserve box seats for their performances. Hell, they should be in the dugout.

The Marlins & MLB are asking a lot of our community and compromising with Braman would constitute a much needed act of good faith. Their initial $158 million investment has grown in just 6 years to a self-acknowledged $250 million [see pg 11 of BSA] and would likely continue increasing with the additional revenue streams a new stadium would entail. This without probably even having to come out of pocket for their portion of the stadium construction costs [$120 million], thanks to their disciplined hoarding of revenue sharing monies.

The frustrating and fascinating aspect of this trial has been all the misdirections. Braman’s lawyers attack the Marlins financial viability because they realized that the Marlins couldn’t counter that assertion, given their own false claims of poverty recently. But in reality, the essence of their case is that the Marlins got too good a deal from the county. Why else grill the county’s brain trust about how they never saw the Marlins financials or inquired as to their solvency? But if, as they imply, the Marlins suckered the county, that would seem to address their supposed financial woes.

Let’s keep a watch on the areas of compromise discussed during the coming negotiations. If the Marlins are requested to put up additional guarantees or letters of credit, then perhaps the Braman team really believed that the Marlins are in financial distress. But if the issues addressed relate to additional dates for the county, community centers and naming rights etc., we’ll know their trial strategy was a bluff. After all, if the Marlins were really almost insolvent, that would bolster their argument that they are unable, not unwilling, to compromise on the initial Baseball Stadium Agreement [BSA] with the county. The Marlins are very profitable and they can afford to compromise.

From the county’s perspective, Braman and Judge Cohen may not appear to be their allies, but they are. County manager Burgess has been handed a big stick to go back in and get concessions which he likely previously left on the negotiating table.

Let’s be clear – what stands between the Marlins & MLB to have a new facility built and paid for with 75% public monies, in an area with more financial difficulties than typical, is some combination of the following:

  • Allowing local governments more than 16 days a year access to the facility
  • A Community Center
  • Sharing a portion of the naming rights to the facility

My suggestions for changes would be the following:

  • Concrete language in BSA regarding the Marlins responsibility for construction cost overruns.
  • Disclose how the county would pay those overruns, if the Marlins manage to sue and win to avoid paying for those costs – over/under on date Marlins would sue is now October 2009.

The bottom line is that the Marlins & MLB can afford to compromise, local politicians already have [it’s like breathing for them]. If the Marlins & MLB don’t compromise, they will have hung those politicians out to dry and would then deserve to have their fates decided by the Florida Supreme Court. A court which is danger of giving the term, ‘flaming lefties,’ a bad name.

Posted in Marlins Ballpark & Finances | Tagged , , | 6 Comments

Batman’s Secular Miracle at Local Mall

Posted on July 21, 2008 by Jorge Costales

The Dark Knight movie was great. I saw it in a packed movie house with downscale demographics [Mall of the Americas], and yet there were no detectable acts of rudeness in the audience during the movie. Perhaps not a Saint certifying-type miracle to you, but very surprising to this cheap theater aficionado. Granted they are ‘mi pipole’ and I’m just a mild-mannered accountant, but in a typical showing there, you can usually count on at least 3 acts of random rudeness. It’s why I keep the Minuteman Patrol on speed-dial.

Anyways, here’s my problem with the movie, the damage inflicted on the Gotham district attorney’s [Harvey Dent] face after his encounter with the Joker. The damage was extreme to the point of distraction, but not in a horrifying way. It made me conscious of the fact that someone was showing off their special effects on the audience. I kept wondering why some epidermis or saliva was not dripping out and if there was no saliva, how he was able to continue speaking with his regular voice. I would have been fine with either a dry raspy voice or a voice punctuated with a post-sentence slurp, like a kid with braces, but not a regular voice.

By the way, why I enjoy Roger Ebert as a reviewer so much is because he has written with passion about stuff like this. We don’t mind that certain characters are given special powers, but they need to be logical. Not even in science fiction, but especially in science fiction. For example, Superman can fly, but not teleport.

First, kudos to Anthony Michael Hall for carving out a supporting actor and producer’s career. A minor complaint was the scene where the hostages were disguised to appear as Joker soldiers. Early on in the scene, everyone knew what was about to happen, which was the exception, not the rule for this movie. How that long scene in a very long movie made the cut is a bigger mystery than why no homeless people were staking out Bruce Wayne’s inner-city hideout in the movie. Ya gotta figure he’s a huge tipper and those dirty windshields should have acted like a magnet on the downtrodden.

OK, now what I liked about the movie. As usual, great villains make for great movies. Heath Ledger’s Joker was so good, that his character managed to have the audience both scared and laughing. Also, I’m a big fan of Aaron Eckhart [Dent], since I believe he delivered one of the best opening lines in movie history in Thank You for Smoking, when he said:

You know the guy who can pick up any girl? I’m him. On crack.

The same movie had the following classic line from a tobacco company executive [J.K. Simmons] addressing his cowed sales team:

People, what is going on out there? I look down this table, all I see are white flags. Our numbers are down all across the board. Teen smoking, our bread and butter, is falling like a shit from heaven! We don’t sell Tic-Tacs for Christ’s sake. We sell cigarettes. And they’re cool and available and addictive. The job is almost done for us!

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The Dark Knight by Nicole Galego

Posted on July 20, 2008 by Jorge Costales

I recently went to the movies with my family to see The Dark Knight, the most recent Batman film starring Christian Bale. Though there were many things going on at once involving different parties, the plot was not too difficult to keep up with. I was very impressed by the special effects and action scenes. My favorite character was the Joker, played by the late Heath Ledger. I believe he did an excellent job staying in character and kept up a strong balance between comedy and fear towards the character.

In summary, I was very pleased with the second installment of Batman and I would definitely recommend it to anyone looking to be entertained by a film that keeps you on edge from start to finish.

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See no *EBIT, hear no EBIT, definitely speak no EBIT

Posted on July 17, 2008 by Jorge Costales

Why would local government officials testify in a trial [or deposition] under oath and say things which no one believes? An article by Sarah Talalay from the Sun-Sentinel, describes testimony in the Braman trial yesterday:

Miami-Dade County Manager George Burgess admitted in Miami-Dade Circuit Court on Wednesday he has never asked for or seen the Florida Marlins’ financial statements or any proof the team can meet its obligations to finance a $515 million ballpark. 


It follows a similar admission by Miami-Dade County Mayor Carlos Alvarez during an earlier deposition. An article by Paul Brinkman from the South Florida Business Journal, describes his testimony:

Alvarez’s taped statements said he never saw financial statements for the Marlins before approving public funding for the stadium, and that he had no guarantees the Marlins could pay for cost overruns, as required. Alvarez also said in the recording that he never asked why the county couldn’t keep naming rights for the stadium, which were assigned to the Marlins, or why the county couldn’t retain scheduling at the stadium when the Marlins’ season ends.

 
The questions and answers are designed to lead casual observers to conclude that the respondent is either lying or incompetent. How could they not inform themselves of such basic information?

Braman’s lawyers know that MLB’s veil of secrecy would prohibit the sharing of financial statements exactly for this reason – lawsuits against any one of their 30 franchises could open the door to reveal financial data which involves all of MLB. For example, if the Marlins financials were made public, the amount of Central revenues which is derived from external sources and distributed evenly among all the teams [currently estimated at $40 million annually] would be disclosed etc.

Now there are many other documents and testing which could satisfy the County’s concerns about the Marlins financial viability, not the least of which is the credibility of the MLB brand in wanting to avoid one of it’s franchises leaving a local community holding their debt. The ultimate guarantee in these cases is the potential sale of all or a part of the franchise to raise funds, as Huizinga did recently with the Dolphins.

Braman lawyers question the Marlins financial viability, but would oppose the stadium irrespective of the Marlins finances. In fact, a case can be made that their opposition would be even more strenuous if the Marlins admitted to their profitability. On the Marlins side, they have been very profitable in the past 3 yeras, but have pretended otherwise to solicit public funds for the stadium. Nothing is what it appears.

I recently saw the movie Disclosure, directed by the great Barry Levinson. I wonder if the County manger is getting anonymous emails late at night which say, ‘nothing is what it appears, solve the problem.’ The main problem with the stadium deal is the coming cost overruns in the construction, which the Marlins are supposed to pay, but with which there is much [earned] concern that the Marlins will avoid doing so at all costs – based on legalities, not financial solvency.

Braman and the local governments may be sitting at different tables at this trial, but their incentives – getting a better deal for taxpayers – are more aligned with each other than with the Marlins ownership & MLB. I hope the leverage this trial is granting them will allow the government to get stronger and more concrete language in the agreement regarding the likely construction costs overruns.

*EBIT = Earnings before interest and taxes. Also called operating profits.

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Braman, Petards and Hoisting

Posted on July 15, 2008 by Jorge Costales

Turns out a petard is a small bomb.

During Braman’s testimony in the trial yesterday, there was the following exchange as reported by Charles Rabin in the Miami Herald:

Auto dealer Norman Braman opened his lawsuit against Miami’s megaplan Monday by sparking a short, but fiery, debate over the financial well-being of one of the project’s prime recipients: the Florida Marlins.Braman lost the skirmish, but his opening salvo gave a glimpse of what will likely be a bitter fight over the plan that would bring a new stadium to the Marlins and reshape Miami’s urban core.

The judge had already ruled the ball club’s money issues had no bearing on whether the use of $395 million in public money to help build a stadium served the public good.

That didn’t stop Braman from going to the heart of his argument — which brought a string of objections and triggered something of a disjointed appearance by the wealthy businessman in the crowded, stately Miami courtroom.

”I know as a matter of fact that the Marlins do not have the financial capacity,” was all the 75-year-old former owner of the Philadelphia Eagles could utter before he was cut off by Marlins attorney Sandy Bohrer, who also represents The Miami Herald in unrelated matters.

”Has he seen their financials?” Bohrer asked Circuit Court Judge Jeri Beth Cohen.

Cohen sided with Bohrer, not allowing a document Braman said he received during a 2003 visit from Marlins President David Samson that he claims shows the team was more than $150 million in debt. Braman also said Marlins owner Jeffrey Loria tried to persuade him to take on partial ownership at the time.

In my dream movie version, when Braman was asked if he had seen their financials, he would have produced a copy of the 2008 Forbes Business of Baseball magazine and David Samson would have suddenly appeared, snatched it from him and thrown himself through the nearest window – invoking Law #11 of Cartoon Thermodynamics – no real injuries would have ensued.

I love this stuff. I can’t wait until Tom Wolfe or Carl Hiaasen writes about it. But for now, please note the following points:

  • Braman must know that the Marlins operating results have vastly improved since 2003 [see the Marlins P&L since 2002], given their salary cutbacks, the increase in revenue sharing monies and MLB Central revenues, but since the Marlins are always crying poverty in order to get the stadium, they are in no position to counter his argument. Hence, Braman is the ‘hoister’ and the Marlins brought the ‘petard’ to this relationship.
  • Whatever document Braman was presented to encourage his investment, it is extremely unlikely that the Florida Marlins debt would have been a significant factor.  Although Loria purchased the team for $158.5 million in 2002, $120 million of that price was the value ascribed to the Expos franchise which was exchanged for the Marlins.  So the maximum debt the Marlins could have incurred at time of purchase was $38.5 million owed to MLB.  However, we also know that $15 million of that loan from MLB would be forgiven if the team did not secure a stadium deal within 5 years.
  • According to Forbes, the Marlins had operating loses totaling $26 million for 2002 & 2003 – let’s say Forbes was off about 10% and round it off to $30 million in loses for those two years. So the Marlins would have had debt totaling approximately $68.5 million in 2003, $15 million of which was eventually forgiven by MLB.
  • According to Forbes, the Florida Marlins operating profits from 2003 to 2007 have totaled approximately $59 million. Goodbye debt. Hello stadium fund.

So how could a significant debt have arisen and survived the great salary dump of 2005?  Perhaps the document Braman saw also included monies which Loria had invested in the Montreal Expos franchise – estimated at $30 million. An excerpt from that article below documents how Loria got control of the Expos:

He then initiated capital calls on the other owners in 2000 and 2001 to fund rising operating expenses. When they chose not to meet those calls, Loria funded them himself with about $18 million. That triggered a clause in the partnership agreement that allowed him to dilute the interests of other owners down to 6%. Loria thus gained 94% of the Expos for roughly $30 million. He would soon sell the team for four times that amount [value given for Marlins – JC].

But even that $30 million, properly understood is not a debt to the Marlins, but rather represents Loria’s investment in the Montreal franchise which he subsequently sold for $120 million. The resulting difference represented a taxable capital gains to Mr Loria. But MLB ownership is the gift which never ceases giving to Mr Loria. There is a special IRS provision which allows sports franchise owners to amortize 50% of their purchase price over the first five years after the purchase. So Mr Loria was the beneficiary of about a $78 million tax write off which served to offset the capital gains tax from the estimated $90 million dollar profit related to the sale [or exchange] of the Montreal franchise.

His initial investment in the Marlins for $158.5 million is now acknowledged [see pg 11 of BSA] to have grown to $250 million. Further, any consideration of Loria’s or the Marlins financial viability, should really factor in that the owner was able to donate $20 million to Yale University as of 2007. If someone donates $20 million, what would be a reasonable estimation of their net worth?

Bottom line, the Marlins and Mr Loria’s investment in them are doing just fine. But in a reminder of Aesop’s [not Hee-Seop’s] boy who cried wolf classic, they cannot admit financial well being when they most need to.

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