Game Time: George Steinbrenner's Death Raises Anxiety of Billionaires
|You may be rich, but your heirs may be dangerous come December|
In a sense, 2010 has evolved into one big "cheat day" for billionaires in sports and, perhaps, their families. We all know about the NFL financial structure this year -- because the league is approaching the end of the collective bargaining agreement, 2010 is a year without a salary cap. It doesn't mean it's completely bereft of salary structure rules, but it does give a loophole and a freedom to owners who are willing to spend freely and treat the NFL like a blackjack table with three open seats. "I'm just gonna go ahead and play three hands."
The NFL salary cap "cheat day" is fun for billionaires. There's one other sports "cheat day", and unfortunately it's not nearly as much fun for the owners. Not at all.
As you all know by now, Yankees owner George Steinbrenner passed away earlier this week. Certainly, a sad day for Yankees fans and the end of a distinct era in baseball. It goes without saying that George's family was deeply saddened as well. However, there was a silver lining to Steinbrenner's body choosing now to fail him.
At the end of 2009, our federal estate tax law lapsed, and apparently whoever's job it was to get a new one scribbled together was busy downloading shit off of iTunes or playing "Words with Friends" or filling out his March Madness bracket. Whatever the case, the federal government was forced to make 2010 an estate tax-free year. To say this makes 2010 the ultimate "cheat day" for families of deceased billionaires is a multimillion dollar understatement.
Along those lines, to say that billionaires everywhere shouldn't be completely skeptical of every move their family members now make for the rest of the calendar year is an even bigger understatement.
In 2009, the federal estate tax rate for the Big Rich was 45 percent; starting in 2011, it will be 55 percent. So using the Steinbrenner death as an example, with his total net worth valued at around $1.1 billion, The Boss' passing away in 2010 saved his family anywhere from $500 million to $600 million in estate taxes, and just as importantly for them (and potentially for Yankees fans) kept them from having to sell the team to cover a large estate-tax nut.
Basically, as shrewd as the old man was in life, he was a thousand times more shrewd in death.
Not that the Steinbrenners would all of a sudden be eating cat food if George were to have waited until 2011 to pass on. After all, as the old saying goes "When you have to fork over 55 percent of $1.1 billion in estate taxes, the good news is you still have 45 percent left over." (I don't know for sure if that's an "old saying" but it should be.) But still, there's part of me that thinks....well, I think one of my listeners (Charles in Cypress) put it best by mixing in some gambling speak -- "-600 that Hank Steinbrenner was sitting next to the bed saying 'go to sleep, old man'."
And therein lies the formerly underrated but now fully highlighted subplot of 2010 -- families of billionaire sports owners subtly rooting for their demises, or in some cases, perhaps even taking steps to improve the odds of grim death actually occurring. I mean, let's face it -- paying $500 million (or more) sucks, no matter which way you slice it.
So for the rest of 2010, even things like subtle requests to take family vacations to do things like bungee-jumping off cliffs or rock-climbing in the Himalayas can be construed by the Drayton McLanes of the world as "Hey Tal...I think my family might be telling me somethin'!" The good news for Drayton? Astros games are about as safe as it gets right now. With only a few dozen people in the stands, you should be able to easily pick out anyone who may look like a possible paid assailant.
The city of Dallas, on the other hand, all of a sudden has the makings for potential Godfather baptism scene bloodshed. Are you telling me that the Jones' kids and whomever Mark Cuban has scrawled into his last will and testament aren't pulling out a calculator and multiplying everything by "0.55" this very instant? Somewhere, Rangers owner Tom Hicks is actually thankful that his company is in bankruptcy.
If mob-style whackings are the general concern for these owners, then The Sopranos has taught me that there are at least two NBA owners I don't need to worry about: Mikhael Prokhorov of the New Jersey Nets, because Russians in New Jersey are immune to bullets and can escape any near death situation.
And Jerry Buss of the Los Angeles Lakers, because if ever there were an A.J. Soprano in the NBA who would somehow fumble the knife when going in for the stab, it's the simple-minded, mildly overwhelmed heir to the owner of the Showtime Lakers, Joey Buss....
Speaking of mob-style hits, since it was the failure of the federal government to enact a law that would prevent this kind of behavior by billionaire family members, what is their responsibility in all of this? Can they not create some sort of Billionaire Protection Program for the balance of 2010 where the Donald Sterlings of the world can go work at a local feed store in Idaho under the name "Slappy McRacist" until this whole "estate-tax free" zone blows over?
The paradox in all of this is that ironically 2010 has become a year where Bud Adams' existence just became infinitely safer as the number of people rooting for him to go to that big oil derrick in the sky has shrunk from four million (roughly the population of the city of Houston) to a couple dozen of his closest family members. So I guess not every billionaire's life is worse.
Let's face it, even players should probably be a little bit worried, especially players whose families can plainly see that their earning years are about over and "what you see is what you get" when it comes to whatever estate they've amassed. So Carlos Lee, I can't believe I'm doing this, but a word of warning for you -- if your family is all of sudden encouraging you to eat that tenth chalupa, or you find that they're feeding you a whole lot more grease and cholesterol than in weeks and months past, just know that they realize this contract is your last one. Until December 31, 2010, your existence is a tax bill for 55 percent of whatever you have right now. Stick to the salad bar, Caballo. (Actually, that's advice that applies after 2010 is over, too. Just sayin'.)
Damn, it's times like this that I'm really happy I live in the borderline poverty of sports-talk radio. Honestly, I don't think my kids will be making phone calls to any hit men just so they can circumvent the 55 percent tax on my big screen television and stack of Wrestling Observer newsletters (dating back to 1997, by the way). Good rule of thumb for the next six months or so -- if your family can pretty much liquidate all of your shit on eBay, you probably don't have anything to worry about.
So yeah, it's pretty good to be me right about now.
Listen to Sean Pendergast on 1560 The Game from 3-7 p.m. weekdays on the "Sean & John Show" and follow him on Twitter at http://twitter.com/SeanCablinasian.