Team That Spends the Most Money Wins. Thrilled I Am.
by Tom Dakers on Nov 5, 2009 10:41 AM EST
in Toronto Blue Jays Analysis
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PrintI guess they could call it a win for capitalism. I don't know how even a Yankee fan could get excited about winning when you win because you spend $67 Million more than the team that spends the second most on payroll. It would be a tough thing to get excited about. The Yankees spent $206,811,689 on players (Cotts). The next highest, the hopeless Mets at $139,102,235. When you spend 50% more than anyone else, shouldn't you win?
So have we hit the end of competitive balance? The Moneyball idea was to find what skills other teams undervalued. Team paid the big money for power, batting average and even speed but players with high on base percentages didn't get the big bucks. But now team realize that getting on base is worth paying for, especially the Yankees. So is there any ability that is under valued enough now that a team can make up the huge differences in payroll?
I really don't think so anymore. I think all teams use enough statistical tools that no skills will be undervalued enough to make up for the huge inequity in payrolls sizes. The only real hope, to me, is that the Yankees have hit the ceiling of what even they are prepared to play. We could hope that, as the players with the long huge contracts age, the Yankees won't be able to buy every good free agent that comes along to make up for the aging players. And I doubt that's true. They would pay $300 million if that is what it took.
Will there ever be a salary cap? I doubt it. The only way that would happen is if people started to stay away from game in hordes. But my understand is that TV ratings were great for the playoffs. And if people stopped coming to games it would effect small markets first and baseball would laugh off the Royals or Marlins dying off. I think we are stuck with the system as is.
Anyway congratulations Yankees, you were able to buy a championship.
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Please post this over at Pinstripe Alley
Very well stated!
Johnnie Morton: The Man. The Myth. The Legend.
by craig in calgary on Nov 5, 2009 12:03 PM EST reply actions
Don't blame the Yankees
They played within the current system, and were rewarded for it. Blame Selig for the unfair divisional alignment, unbalanced schedule and outdated playoff structure.
How did the Yankees benefit from divisional alignment or an unbalanced schedule?
There needs to be some sort of salary cap though, or this will continue to happen, and get worse. I also think the playoffs are rediculous and doesn’t reward team depth when a team can win the WS using a 3 man rotation.
Johnnie Morton: The Man. The Myth. The Legend.
by craig in calgary on Nov 5, 2009 12:20 PM EST up reply actions
A salary cap would penalize players at the advantage of the owners. I have no problems with players receiving fair compense for the earning that they generate as the product on the field.
I think what needs to happen is an established min-max payroll disparity, where the teams at the high end of the payroll subsidize those at the low end, and franchise requirements for a min. level of expendature in order to remain an MLB ball club. So lets say that you say that the max disparity is allowed to be, say, $70mil. For your max-min to start, you discard outliers on either end and find an average payroll (drop the Yankees off the high end, and the Marlins off the low end, say). So let’s say the average is $80mil. So the minimum a club can spend on its payroll is $45mil. The max is $115mil. If a club wants to spend above that, they are responsible for subsidizing the clubs at the minimum to increase payoll. So, if the Yankees spend, say, $150mil in payroll, and that number changes the average to $85mil, they are responsible for subsidizing the teams at the bottom to reach the new minimum as well. So a $1550mil payroll ends up with a true cost of an extra, say, $50mil. Max and min can only be spent on payroll, and each year, there is an audit of payroll versus total revenue with the players union having the right to demand an arbitrition process are payrolls are not maintain a consistant ratio against the total market revenue.
I think it balances out the ability of big market teams to use others as farm systems. It also lets smaller markets compete on a more viable level, and really guards against expansion sprawl. If you want a team, you have a specific yearly financial commitment, without exception. Stops a lot of the smaller market teams that actually do have the financial resources to be compete and choose to pocket the cash instead from doing so.
The concept of one team paying for another seems a little misguided., I think.
Salary caps seem to work well. It works great in the NFL. It is not working well in NHL cause they have allowed loopholes which have led to these unusual long-contracts that are very front-end waited and extend beyond, for all practical purposes, the professional life of an athlete.
The trick is to re-engineer the revenue model so that most of it (tv contracts etc) goes through the league versus the team. If MLB can achieve that, than we can have salary caps to the benefit of all teams. However, as Tom says, that is not likely to happen.
I agree
NFL should be the model league for others to follow.
This is a very interesting year in the NFL as there is a Salary Cap and a Salary floor where all teams need to follow and yet there is very little parity…only good teams, and shitty teams. This shows me that a well run organization can win Year-over-year with good personel desicions, not just throw money after highpriced free agents (Daniel Snider, I’m looking at you)
Unfortunately with teams like the Yankees, Mets, Cubs, Marlins, Padres and Pirates, this can never be achieved because there is such a disparity right now. If they were to impliment a floor/ceiling of $75-$105, less than 1/2 the teams would fall in to it.
Johnnie Morton: The Man. The Myth. The Legend.
by craig in calgary on Nov 5, 2009 1:01 PM EST up reply actions
The Yankees didn't benefit from the divisional alignment or unbalanced schedule...
…but the Jays, Rays and O’s all took it on the chin by having to play 38 games a piece against the Yankees and Red Sox, and only 7 or 8 against the Royals, Indians, A’s, etc.
It works great in the NFL.
For the owners, absolutely. Look at the revenues of the NFL versus the payrolls. It’s one of the least equitable professional sports in terms of compensation relative to revenues.
That needs to be fixed definetly...and soon
I’m afraid that point is going to cause a Strike in 2011 :(
Johnnie Morton: The Man. The Myth. The Legend.
by craig in calgary on Nov 5, 2009 1:02 PM EST up reply actions
Offhand, no. I was reading an article I think last year that talked about salaries in baseball, and had a graph that showed payroll versus revenue for the NHL, MLB, NFL, NBA and MLS, and football had the greatest differential. I’d imagine you can google it or at least find total revenue and payroll expendatures for each professional league online somewhere.
I think it might have been in SI, but I don’t remember. The artcile was about agents, especially Scott Borias, and the relative power and influence they have in baseball in relation to other sports, if that helps.
Let me talk this out for a second.
NFL players beef with the owners is that they get the lowest percentage of revenues?
What are they arguing, that they are underpaid based on the product that they put on the field?
NFL salaries have escalated to rediculous levels the last couple of years to the point whereas guys who haven’t taken a single snap are recieving $41MM in guaranteed money. And now they want a bigger piece of the pie?
Isn’t there something that can be done to make the game more accessable to the consumer? I can’t afford to go to NFL games and I have to pay $49/month just to have access to every game on cable…and the players want more money?
I know I’m oversimplifying it, but I have a hard time feeling sorry for these poor fellows.
Johnnie Morton: The Man. The Myth. The Legend.
by craig in calgary on Nov 5, 2009 1:52 PM EST up reply actions
In all fairness, the $41MM contracts to unproven rookies will probably disappear or significantly dimish once the next CBA goes through. It really sounds like the veterans and the PA even are wanting to see more of that money shifting from rookies just cracking the league to the guys who have been in the league for a couple years and are making pittances compared to the kid who’ll probably wash out in a year.
Though the rest of your argument is sound in my eyes.
I don't want to play golf. When I hit a ball, I want someone else to go chase it. ~Rogers Hornsby
I don’t know that much about the specific issues that are threatening to strike about for 2011. What I know is that there have been stories over the last five years or so about the fact that sports salaries have been increasing in relation to revenue except in football, so it sounds to me like the concern is coming from the players.
But, if you want to talk it out, the basic player position in any sport is that the players are the product on the field, and the compensation that they receive should be relative to the revenue that they generate. So as MLB revenues have grown over the past ten years, to grab an example, the players union and agents have been very forceful in making sure that the league minimums and player salaries have grown in a roughly equivilent fashion. While in the NFL, revenues have also grown, but the overall pay hasn’t grown in relation to the increased revenues. So yeah, some guys have gotten a lot of money, but overall, the profit percentage of the owners is what has increased, in part because I’m told the NFLPA is pretty weak.
I think that’s a fair position. If I sell ten books and get a dollar a book, I make the same percentage if I sell ten thousand books. Where as in the NFL, to use the analogy further, the more books they are selling, the smaller the overall percentage is getting. So they are making more money, but in relative terms, are receiving less compensation for their value. Does that make a little more sense?
Cavaet: I am not a throrough NFL follower of any type, so my information is based on what I’ve seen, read, and remembered. If anyone who pay attention or has hard numbers to refute any of this, I will stand very corrected.
the NFL cap is a percentage of total revenue
In the NFL, the salary cap is set as a percentage of total revenue and until the last CBA, it was set as a percentage of shared revenue (which pretty much includes everything except for luxury box sales and concession/parking type stuff).
The NFL salary cap is 57.5% of the average team revenue, and the minimum cap is set at 50% (I think) of the average team revenue.
If revenue in the NFL goes up, then so does player salaries and in fact, there is a clause there that the salary cap can’t be less than the year before so even if revenue decreases, the salary cap stays the same from year to year.
Dexfarkin made an interesting point/comment about the differential between Revenue and Payroll and that the NFL had the greatest differential. Revenue is interesting but it is meaningless unless it is taken in context of Profit. I can run a company that has a revenue of $100M but constantly loose money or I can have a revenue of $1M but at consistent 15% profit ($150K) and that is a nice business. The cost to run a football team (NFL) compared to MLB, or NHL must be considered and salary is only one factor.
NFL and NBA does not have a minor league system to run, such as the NHL or MLB. This likely, either directly or indirectly, affects the cost to run the parent club. The typical lease agreement on the stadium will be another major expense and likely varies between the leagues.
"Baseball statistics are like a girl in a bikini. They show a lot, but not everything." ~ Toby Harrah
A salary cap is really a necessary “evil”. It is in the player and owner’s best interests. If 1/3 of the teams fold because they are not making money, this makes it harder to have a viable league. A maximum per player salary and rules outlawing back-ended contracts (i.e. paying a player well after they retire – like Mario Lemieux) will likely be necessary to make it work.
Revenue sharing is also a necessity. If the Yankees are making money off of TV and gate from playing the A’s or other lower payroll team, the lower payroll team helped the Yankees make that money. The “all for one and one for all” approach will make a stronger league and that will result in higher overall revenues.
I really get tired of the argument that the players are the product and therefore deserve a higher cut, or any number of arguments that the staff deserve more than the owners. Golf is the only major sport that I know of where the athlete has no guarantee of payment (tennis is a bit different) – in other words golfers get paid only if they perform. Performance bonuses are there in MLB, NHL, NBA, etc. but rarely (i.e never) is it the majority of the compensation package. If the team owner is loosing money he can’t go back to the players and ask of some of their salary back. The Owners take all the risk and deservedly should get the majority of profits. The various unions in pro sports will never agree to a pay for performance standard, but it would be a great way to level the playing field.
"Baseball statistics are like a girl in a bikini. They show a lot, but not everything." ~ Toby Harrah
grumble grumble grumble
I am disgusted that there is already a 2009 Championship Yankees Monopoly board game for sale
Do you want another strike?
If your answer to wanting a salary cap in the MLB is yes then your answer is yes to the question above. Bud Selig would probably want to avoid that PR disaster.
The truth is that the Yankees can’t be blamed. They have the gall to spend the cash, Rogers despite being a multibillion organization doesn’t. It really goes back to the the “put up or shut up” saying. (Not referring to the fans on this one of course).
I wouldn’t really compare any system to the NFL’s be it the NHL’s system (which I believe is great in theory, just the health of the game as a whole is lacking) or MLB’s. The NFL has non-guaranteed contracts which no union in their right mind would ever agree to so a salary cap for the MLB would probably mirror the NHL (but with much greater profits and less teams in the red).
Generally the point of a salary cap is to prevent the owners/management that are stupid from making moves. It does make it a need to be smarter. The truth is that the higher spending teams have smartened up by pooling resources into the right places (player development and scouting).
The REAL solution is in player development/scouting/drafting which the higher payroll teams have taken over. You need to be able to allow smarter teams to exploit this but really it ends up being the team with the most dough gets the best player.
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http://twitter.com/awmusicblog
Can you elaborate on this for me
The truth is that the higher spending teams have smartened up by pooling resources into the right places (player development and scouting).
The Yankees bid $26M to negotiate with Kei Igawa, then agreed to pay him $20 M over a 5-year period. $9 M/yr over a 5 year period and the Yankees don’t even bat an eyelash. If there were a salary cap it would punish the large-market teams for making moves like that.
"Look at me! I'm Tomokazu Ohka of the Montreal Expos!"
Well if there was a salary cap wouldn’t only the 20M count as “salary”?
I should say for the “most part”. That was just plain stupid and a reactionary move so I can’t defend that.
Teams have smartened up bridging the gap between the smart small market teams and the stupid overpayers. It’s true that teams like the Yankees have a serious advantage but I think my point was that a salary cap doesn’t solve this.
I’m not for punishing the large market teams because a salary cap just lets them pool finances into other areas to exploit. So what if there’s a salary cap. That will be 20-25 million more or so for prospects….either way the small market teams are exploited.
Sure the salary cap is one way to solve it but I think it’s a measure that’s not worth having compared to changing the system from a drafting/scouting level.
AWmusic - mp3 blog.
http://twitter.com/awmusicblog
Players would be on board with a cap
if it was at $135m and there was a floor at $55-60m. It would probably be a net gain for the players.
they wouldn't be on board unless there was something from the owner's end too.
there would have to be some real way of sharing revenue.
a salary floor is from the owner's end
I actually like the MLB system. It’s just one team that needs to be controlled. We shouldn’t need too much collective bargaining to resolve it.
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