Horizon, Host: Ted Simons

April 1, 2014


Host: Ted Simons

Arizona Diamondbacks

  |   Video
  • The Arizona Diamondbacks started their season in Australia, and are in full swing now. Diamondbacks president and CEO Derrick Hall will discuss the Diamondbacks new season.
Guests:
  • Derrick Hall - President and CEO, Arizona Diamondbacks
Category: Sports   |   Keywords: sports, arizona, diamondbacks, baseball, season, new, australia,

View Transcript
Ted Simons: It is the first day of April and the Arizona Diamondbacks have already had a very curious season. The team played its home opener in Australia, and last night it played its home opener at Chase Field. Joining us now is Derrick Hall, President and CEO.

Derrick Hall: We had our two games in Sydney, they went very well. They were our home games, this is odd. We don't like to lose two home games like that. Then coming back with a traditional home opener last night with the celebration and the bunting hanging around the ballpark. It looked as beautiful as ever. The festivities were wonderful.

Ted Simons: Australia, why open the season there? Looking back, I'm sure it was lot of fun for a lot of folks and eye-opening. Was it worth it?

Derrick Hall: We would have hoped the outcome of the two games would have been different but for us to plant our flag in the sand and expand our brand and help promote baseball as good will ambassadors. There’s been 12 teams that have opened up six different times abroad. I think it was good for us to have that opportunity. It's an emerging market. The participation, the interest and intrigue in baseball is really on the climb in Australia. For us to go over there and introduce ourselves to the fans, let them know who we are, it's help us when it comes to scouting in the future.

Ted Simons: Can you quantify that at a later date, as opposed to now?

Derrick Hall: It felt like home games, they embraced us. They were all wearing D-backs gear; they were rallying behind us at the end. In the future it could equate into talent that we could sign. They know who we are, they want to wear the D-backs jersey one day.

Ted Simons: As far as Spring Training in general, how was attendance at talking stick?

Derrick Hall: Really strong, as a complex, there's been no other one that's had 300,000 in attendance. We’ve now done it four times in a row. Different spring for us, we had to start early when it was colder. We missed the best week of Spring break because we were in Sydney. We did very well and that place continues to click and provide a great experience to our fans.

Ted Simons: Mr. Critic here, but how long can it be a good experience? I remember walking in at the fifth inning, you walk in free and you have a whole row to yourself. It is a whole different beast. Is there a threat now that you could lose a little bit of that homespun, the affordability for folks to go out and catch a game?

Derrick Hall: I don't think so. You have to challenge yourself to remain affordable. Chase Field is now more affordable than Salt River Fields. I'm not sure about the Grapefruit League as much as the Cactus League, but this is a baseball market. They like to watch ASU, the Diamondbacks, and the Cactus League and the fall league play baseball. The interactivity, with the fans and players, before the games start in the backfields, it's important for us. I think we'll see the demand there for a long time.

Ted Simons: Now, can you get the demand over to Chase? You've got Diamondbacks fans spending money in spring as opposed to regular. How do you change it?

Derrick Hall: We have to make sure they don't get enough of their baseball fix through spring training. It's knowing who the players are, getting involved and interested in the product so they want to come over to Chase Field and watch that team. We get that feedback. A lot of people saw their first Major League Baseball game at Salt River Fields. They loved the interaction, they got autographs and liked the experience. They want to see if the experience is the same and it is.

Ted Simons: NFL is just so huge right now, TV, video games, so huge. Baseball seems like it's from another era. Can baseball attract that modern mindset? Or does baseball hurt itself by trying?

Derrick Hall: We really are America's pastime. It's the one game you pass it down, tradition to tradition. We're as healthy and popular as we've ever been. We're an $8 billion industry when it comes to revenues. We're at an all-time high. Our attendance is at an all-time high. What were the three most popular sports 50 years ago and in no particular order Major League Baseball, horse racing and boxing. Today it's Major League Baseball, football and whatever.

Ted Simons: Is there concern that the audience is graying?

Derrick Hall: We're worried about the competition and options and lack of attention span. We have to introduce new technology and make sure the experience at the ballpark is unlike anything you could get at home or with any other sport, and we’re advancing. The network is doing great. MLB advanced media, our online version is doing fantastic. People are watching games online, the subscriptions are up. That's the younger audience we have to appeal to. We have to make sure the older audience are still there. We have to make sure we connect with the younger audience and carry that on into the years.

Ted Simons: Some of that broadcasting success especially is translating to a team in your division that is spending money like there is no tomorrow. I want to take this from a Diamondbacks fan's perspective. How does a fan from the Diamondbacks think we got a chance, when they’re spending some 230-odd million dollars-?

Derrick Hall: $241 million, on opening day, the Dodgers are. We're at our all-time high. And we’re at about $115. That’s a big disparity. I think that makes the fans want us to beat the Dodgers or the Giants even more. We can't worry about what they are spending, we have to worry about doing business the right way. A team like that can afford to make a mistake. We can't recover from that mistake. If you're the dodgers, you write a check for another player and turn the page, we can't do that. We have to still scout properly, draft properly, develop and contain them, control them through arbitration through their early free agency years and build around that.

Ted Simons: It seems you really don't have a choice. If you're playing numbers games, goodness, gracious, they can buy everything and we're lucky if we get -- however, when we do have young talent like the Tyler Skaggs, Trevor Bowers, what's going on? They are gone. What happened to Adam Eaton?

Derrick Hall: He's going to be a terrific player again. We do have so much talent and top prospect which means you have a surplus and an abundance. We have two center fielders, A.J. Pollock and Adam Eaton, and also Cody Ross in the wings, you're able to go get Addison reed. We go out and get a closer with 40 saves. Last night same old story but 40 saves for a team that wasn't very good last year.

Ted Simons: What are the Astros, are they even at $100 million?

Derrick Hall: No, not even close. It would be nice to bring the parity down, the competitive balance needs to be much more evenly balanced. We really need to figure that out through collective bargaining, we really need to. When opening day comes all 30 teams think they have a chance. We know there's really only a handful of teams that have a chance to win. We think we are one of them, but we've gotten off to a slow start.

Ted Simons: Steroid testing, are the new rules in place?

Derrick Hall: Even stricter penalties in place now. It was 50 games for your first offense, 100 games for your second, lifetime after that. You’ve got 81, 162 and a lifetime ban. I've got give credit to the players, too. Because both sides realize it's a problem, we want to have a very clean sport. I think we police ourselves and we're always held to a higher standard, more than the other sports, I'm proud of it.

Ted Simons: There are some that until contracts are voided over something like this, you're still going to get problems. Is it even realistic to think about voiding contracts for offenders?

Derrick Hall: We have to bargain for that with the union, which is a very strong union. The players association is tough, they have been through a lot already to get to where we are. I know they want to do all they can to get to where both sides are happy one day. We are much different today than we were five, 10 years ago.

Ted Simons: Injuries, spring training, early part of the year. The Diamondbacks have been hit with serious injuries that are going to affect the team. A lot of teams are getting hammered. What's going on out there?

Derrick Hall: They really are, it's an odd year. Should we go back to the old ways? I think we're more cautious today than we've ever been. I look at pitch counts and days of rest that we have, technology and medical attention, I think we're better than we've ever been. I just think it's a really strange year. We have four guys that have undergone Tommy John surgery in our club house. There’s years where we don’t even have one.
Ted Simons: Could it be the new normal? The way kids are brought up?
Derrick Hall: Maybe there were more innings when kids were younger and they are just now feeling the effects. I hope that's not the case. The way medicine is today. Tommy John is so advanced so that often times they come back better than they were before in some cases. You look at a young pitcher like Patrick Corbin, it broke my heart to see him go down but hopefully he comes back even stronger, still the ace of our staff.

Ted Simons: We've got about second. You mentioned last night, how do you sell a team? When the bullpen fails it's just horrendous. How do you sell the team?

Derrick Hall: Our bullpen is really one of our strengths. That's why it was odd, what happened last night. I look at that team and the team in the past has struggled to have offense and scoring runs. We’re not going to have a tough time scoring runs. If we can get a year out of our starters like we think we can, remember Patrick Corbin last year, he wasn't even in the rotation yet. So we're going to be just fine.

Ted Simons: I'm going to hold you to that.

Derrick Hall: Good!

Ted Simons: It's good to see you again.

Derrick Hall: Appreciate it.

Economic Update

  |   Video
  • Some economists are predicting a three-percent growth rate for the American economy this year. That would be the best expansion since 2005. Economist Dennis Hoffman of Arizona State University’s W.P. Carey School of Business will give us an economic update.
Guests:
  • Dennis Hoffman - Economist, W.P. Carey School of Business at Arizona State University
Category: Business/Economy   |   Keywords: business, economy, update, growth, rate, america,

View Transcript
Ted Simons: Is the U.S. economy on the verge of a major growth spurt? Some analysts are saying yes. Some are saying later this year the country could see the strongest growth in nearly a decade. Joining us now to offer his thoughts is Dennis Hoffman of ASU's W.P. Carey School of Business.

Ted Simons: Good to have you.

Dennis Hoffman: Great to be back here, Ted.

Ted Simons: The U.S. economy heading for a breakout. Are you buying this?

Dennis Hoffman: You brought PollyAnna Hoffman in here to endorse this.

Right. I was a bit more optimistic about this last year. I had talked about a distinct possibility of breakout to the up side. It really kind of looked that way to me last year, and then we faced a lot of headwinds. Some was self-inflicted with Congress. Some was attributed to the fact that the housing sector clearly cooled. Maybe that was higher interest rates with respect to the fed. Now fast-forward to this year, I guess as a forecaster, when you get a little burned it's kind of hard for me to embrace that particular outlook again. Although, I understand where those guys are coming from. Because there are pent-up demands in this economy, pent-up opportunities for a breakout to the up side. If we could kind of put some of these headwinds aside, I think it could happen.

Ted Simons: Seemed like at the end of last year, the fourth quarter, there was some pretty good growth. Things were pretty strong ending the year, you were kind of right.

Dennis Hoffman: It was -- it was okay, especially given that Congress essentially tried to shut down the federal government for the first part of the quarter there, but you know, we finished on a higher note. I think there was some optimism that we've gotten beyond this debt ceiling debate and shut down the government debate. As of today, the Obamacare debate. Who knows? Any of these could resurface at any time.

Ted Simons: And tax deductible Affordable Care Act debate, Obamacare today. There were a lot of concerns regarding job loss. Are we, A, seeing job loss in general? Sounds to me like we're seeing job growth out there.

Dennis Hoffman: Jobs are coming back, we face headwinds. What's the ACA going to do for job creation? That's been debated all along. The biggest problem with small businesses, frankly they may be concerned about taxes and regulation. But I truly believe if there were a few more folks coming in the front door or placing orders those concerns would kind of fall by the wayside. It's really lack of demand for products, lack of confidence on the part of businesses to hire and invest and put capital and people in place. Because there's just not enough buying out there.

Ted Simons: You mentioned pent-up demand. I keep mentioning weather. Throughout the U.S. the weather was just horrible this winter. I'm guessing people just can't wait to go out and buy something.

Dennis Hoffman: I was there the first week in January in western Wisconsin for the minus and miles per hour winds. Why I was there, let's not go there, but at any rate, yes. And those folks, there's just an awakening feeling. You know, it's new life, a rebirth kind of thing. And yes, they will be ready to buy some goods.

Ted Simons: We mentioned kind of finishing on a relatively strong note last year, winter kind of messing some things up this year. Does that kind of momentum from last year, along with pent-up demand, from what I've been reading some analysts are saying put those two things together. You're looking at twos and threes percentages of economic growth.

Dennis Hoffman: If we could get north of three, then I think you've got an opportunity to get inflation closer to two than it is one. I think that's just a nominal issue, but an important issue. We could use a dose of inflation in this economy. It would provide people the psychological boost, even if it's just a raise that keeps pace with inflation. My goodness, it's a raise finally. Many people have just gone without anything extra for a long time. Last year they actually felt like their wages were being caught because the FICA, the Social Security increment was put back into its normal level. That was dampening on people. So no, we have some opportunities. We really do. There could be fewer headwinds. You know, with an immigration reform policy in place, I think with corporate tax reform, those kinds of things would unfetter the economy. That would be very, very helpful. But confidence and buying is really what we need. I think people don't really understand how important it was to take on debt, to leverage up. We did it as a government and we did it as individuals. You know, from the better part of the 1970s, the 80s, the 90s, the early 2000s. This notion that all we have to do is rid ourselves of debt and things will be great, I'm sorry, the arithmetic doesn't square with that particular argument. We saw that very clear in the last years.

Ted Simons: That argument has been used over in Europe, the austerity movement to, try to get those countries back on some footing. I don't know if it's because of those measures or not, again, some of the research is showing Europe is ready for a rebound. A, is that true? And B, why?

Dennis Hoffman: Right on the precipice of collapse, you had the Irish economy and in Spain and in Italy and of course Greece, and any kind of resolution, kind of a stability there in Southern Europe, really helped improve conditions throughout the entire continent. And Germany's always been strong. I was concerned a bit this spring and remained somewhat concerned over the Ukrainian issue. Because, you know, we argue politically, what we need to put sanctions on. Sanctions are bad for the economy, they are bad for the Russian economy, which is their intent, but they are bad for both economies. Trade is what enables economies to prosper. You know, I mean, it's not just one side of this coin. You can't benefit from it.

Ted Simons: Talking about what's happening in Ukraine and Europe, it does affect America, which does affect Arizona.

Dennis Hoffman: Absolutely, absolutely. I think we're talking a lot and very progressively about opening trade and Borders with respect to Arizona and Sonora, the U.S. and Mexico. Those are very, very good moves, I think, and will help this economy prosper.

Ted Simons: I've heard the jobless rate went to 6.6, to 6.7 and more than one analyst said that's a good thing, it shows that people who might have been on the sidelines in the past think it's time to get back in the market and aren't finding things immediately.

Dennis Hoffman: The labor force is so tough to deal with, in terms of trying to measure it and what the correct measurement of the labor force is. Part of this is 10,000 a day baby boomers, people of my generation, are crossing the 65 and over line. They are leaving the labor force, some of them happily, some of them not so happy. And in dealing with this and unemployment statistics is really tough. Trying to understand what this means for the economy I think is very tough. Think about what we baby boomers did to boost this economy in the s and s. We're leaving. In the 60s we burned our draft cards. We're not going to burn our Social Security cards, Ted. We were very additive to the economy in the 70s, 80s, and 90s. Now we're going to be part of the takers.

Ted Simons: And part of the takers, Arizona, we have more than our share of folks crossing that 65-year-old line.

Dennis Hoffman: We do.

Ted Simons: We talked about trade a little bit, but other aspects of what we discussed. could Arizona be poised for one of those big growth years?

Dennis Hoffman: Yes -- you know, real estate has certainly hesitated. We saw acceleration in housing price appreciation through about the middle of last year and then it kind of flat-lined. This spring will be very important to kind of watch that. Perhaps it's a good thing we're not getting frothy in terms of real estate. Our investment segment has backed off a little bit but certainly not collapsed. Arizona is still a great place to invest in real estate. We're just changing. Part of it is the change in demographics that's taking place. It's difficult to estimate how many people want to own homes going forward. Do they want to rent versus owning homes?

Ted Simons: The milliennials. They’re not all that interested in owning anymore because they see what happens when you do own.

Dennis Hoffman: My generation wanted to own, but we're fading away.

Ted Simons: You wanted a car, too. Last question before you go here I'm reading the economy progressively faster as the year goes on is likely. Do you agree?

Dennis Hoffman: Yes, I think that is likely. The question is how fast will it progress. Will we, you know, meet some of these headwinds again? But I think it can certainly progress, and it's certainly fourth quarter, as good as you described it, I think it could have been much better had we not gone down the path that we did at the federal level at the end of the year last year. We'll have that as comparable this year. I completely agree.

Ted Simons: Good stuff, Dennis, good to have you here.

Dennis Hoffman: Great to be here, Ted.

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