December 06, 2004

One, Two, Many Jason Giambis

Additional thoughts on the baseball/steroids scandal:

- He probably was truthful enough on the witness stand that he has “plausible deniability” and was thus able to avoid perjuring himself, but I don’t believe Barry Bonds. You think he just woke up one day, realized he was twice as large as he used to be, and didn’t think something was up?

- Bud Selig, realizing that the steroid thing will indeed be his primary legacy and will cement him conclusively as the worst commissioner in the history of organized sports, has acquiesced to renegotiation of baseball’s steroid testing rules, in the face of government interference in the steroid matter. Then again, we’ve got John McCain threatening legislation- though he threatened hearings aimed at regulating boxing a few years ago, and nothing ever came of that.

- I honestly couldn’t tell you what the endgame will be for the Yankees/Giambi thing. I can’t see them getting permission to void his contract, just because the union will never stand for it, especially not with the government in control of the 2003 drug-testing results and fifty more Jason Giambis possibly waiting in the wings. But will the team just end up paying Giambi to not play? Will there be a settlement? Would that mean the Yanks will just write him a check for $50 million? That’d make for a hell of a luxury tax bill.

- After all that, I’m about ready for the hot stove to begin, how about you?

Posted by Stephen Silver at December 6, 2004 10:02 PM

"Will there be a settlement? Would that mean the Yanks will just write him a check for $50 million?"

I would assume there's some kind of liquidated damages clause in the contract addressing what happens if he can't play, i.e., it wouldn't provide for the full amount. Moreover, I would also assume the club's general liability insurers would be on the hook for at least some of this, i.e., Steinbrenner wouldn't have to eat the whole loss (although he might prefer to fight Giambi in court than the insurance companies).

"That’d make for a hell of a luxury tax bill."

Luxury taxes are sales taxes, so I don't see how they're involved here. Of course, yes, Uncle Sam would take a deeper cut in income taxes out of a one-time payment than out of Giambi's salary had it been paid over multiple years.

Posted by: Dave J at December 7, 2004 10:37 AM
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