From the Windup is FanHouse's extended look at a particular portion of America's pastime.
Salary Cap. There's not a more controversial phrase in baseball economics. The prospect of one hung over the strike of 1994 and 1995 before the owners and players managed to settle without implementing a true cap. Since then, baseball has instituted a luxury tax that acts as a sort of soft cap, but it's set high enough that it only really affects the Yankees annually, and they regard it in the same manner that a rhinoceros regards a mosquito.
For the most part, a salary cap hasn't been part of the conversation in baseball for several years. The Yankees ridiculous spending spree this winter, however, has changed things. In the days and weeks since their signings of CC Sabathia and Mark Teixeira, Brewers owner Mark Attanasio and Astros owner Drayton McLane have once again begun to call for a salary cap. They're the only two owners to have spoken directly on this issue, but it's hard to think they're alone.
A salary cap in baseball is not a simple thing. In most sports, there's only one line in labor negotiations: the line between the players and the owners. In baseball, there's actually a three-way divide between the players, the "big-market" owners (for lack of a better term), and the "small-market" owners. The MLBPA isn't the only thing that stands in the way of a cap. Some of the owners (think John Henry, the Steinbrenners, naturally, the Wilpons, Frank McCourt, Arte Moreno) would likely be opposed to one as well. After the jump, we'll look at all the obstacles and problems with implementing a cap.
I'll start this by being entirely up front. I'm a Pirate fan. Obviously, I think a salary cap would be a nice thing. But I don't think it is absolutely necessary, I don't think it's a cure-all, and I don't think it's something that's going to happen anytime soon. With that out of the way, here we go.
Money does not equal success
First things first, let's look at the Yankees. This winter they've lost Mike Mussina, Jason Giambi, Bobby Abreu, and probably Andy Pettitte. They've added Sabathia, Teixeira and A.J. Burnett. It's an upgrade, yes, but it's not as dramatic as the huge salaries attached to it would seem to indicate. As we stand today, I'm not really convinced they're the favorites in the AL East and I'm not convinced they're better than either of the teams that finished ahead of them in the standings last year. Rebuilding through free agency is always going to result in sinking huge sums of money into players that are in or past their prime. It's just not the best method to build a team.
It's certainly true that teams in smaller markets are at a disadvantage, but the teams that haven't had success in recent years can't blame that on the lack of a cap. The Rays and Brewers were awful for decades, but lately they have embraced true rebuilding plans and stocked their minor league systems with talent. In 2008, both clubs made the postseason. The Pirates, on the other hand, let Dave Littlefield run their team for seven years and they're still losing. The same can be said for the Royals and Allard Baird.
Money is clearly a big part of success in baseball, but the past few years have shown that being well-run is more important than how much you spend.
A salary cap is not a cure-all
Where, exactly, do you set a salary cap in baseball? Do you set it at $100 million? Because 13 teams were more than $25 million under that threshold and six were more than $40 million under that number. Setting a salary cap in baseball won't mean that the Pirates or Marlins or even the Rays will meet that cap. It might rein-in the highest spenders, but it won't necessarily level the playing field.
Many baseball fans point to the NFL as the paradigm of the parity that they would like to see in baseball. This year's Atlanta Falcons are a great example of how quickly a team can turn around in the NFL. Last year, their franchise player got sent to jail, they hired a bad coach and things looked generally hopeless. A year later, a new coach and some shrewd personnel decisions helped them reach the playoffs. My question is this: Would they be in the position they're in now if they were still saddled with Mike Vick's contract? Because baseball contracts are not easily voided and the player's union would be fighting something like what the Falcons did with Vick every step of the way.
A salary cap is a useful thing. Every other major sport in America uses one and reaps the benefits from it. The problem that baseball has at the moment is that the environment that it operates in is so extremely different from every other sport, that a salary cap probably wouldn't even start to chip away at the competitive imbalance that exists. The well-run teams would continue to have success and the poorly-run teams would continue to fail.
The majority of the involved parties don't want a cap
The obvious problem with actually implementing a cap is that there are three sides to all labor negotiations (the MLBPA, the ulta-rich owners, and the much less rich owners) and only one of those groups (the less rich owners) really desire a cap. The players would oppose a cap on all fronts like they did in '9. Hank Steinbrenner isn't going to care what Bob Nutting or David Samson wants when it comes to a new labor pact because what benefits them certainly won't benefit him. The small-market owners don't have anything to hold over the larger-market owners as leverage because most of the money the league brings in from things like TV contracts etc. is generated by the large-market clubs. The small-market owners in turn pocket an even share of that money.
Even if a salary cap is somehow agreed upon, we just loop back up to the second problem listed above. It's unlikely to be set at a level which will help the clubs that most need it. And if the MLBPA somehow were to acquiesce to a salary cap, it's unfathomable that they'll make any other allowances (say, a system that limits contract ceilings like in the NHL and NBA, or non-guaranteed contracts like in the NFL) to help encourage parity.
The bottom line is this: People are upset by the Yankees spending spree, but that's going to subside. For now, having a good front office is generally enough for small-market clubs to compete with the outrageous spending of the Yankees. Unless the Red Sox win eight of 10 World Series because they both have money and knowhow to spend it (unlike their divisional counterparts in New York), that's not going to change. It's not necessarily a fair system, but it's not as unfair as people think. Implementing a salary cap wouldn't be nearly as effective in creating greater competitive balance as people think it would be.
Comments (Page 1 of 2)
I think the player's union would be ok with a cap as long as a ceiling was put in place. If you are gonna cap the Yankees, you make the Royals spend $60 million on payroll. In this case, sure, the mega-stars are limited in their gargantuan income opportunities, but the majority of the players would benefit.
The Royals were 24th in payroll last year. Just an FYI. The biggest problem with requiring spending is television contracts and markets, correct? How are the Royals supposed to generate enough revenue to always spend money without more support from the HUGE market clubs? I have read somewhere (can't find it now, but if I do I will post it) that the Royals spent a much larger percentage of their overall worth than the Yankees on payroll. Either the luxury tax needs to be lowered or MLB needs to insure more revenue sharing.
However, I agree with Lackey's assessment that great management will find a way to compete. I have to hold on that hope with GMDM.
If the smaller market teams outnumber the large-market teams and call for a cap, that's fine, but it should come at the cost of revenue sharing.
You sir are an idiot. Instead of thinking about how to lower the spending of the "super teams" how about you tell the cheap owners who are pocketing the majority of the revenue sharing money to SPEND SOME... if the MLB was run like the NFL and 58% of the revenue went towards the players then the salary cap would be in the range of 120$. You want to do that? You want the royals and the brewers and the other smaller market teams to come out of their pocket? Pat Lackey another no nothing journalist who doesn't do the proper research for his articles.
It's convenient to say that, inconvenient to explain it. How are the small market teams supposed to come up with that money? In the NFL, they all get the same money from TV deals. That doesn't happen in MLB. Once you realize that, you will realize your last comment is retarded.
a salary cap is simply another word for 'communism' : the control of the few for the good of all . besides , just HOW MANY world series have the yankees BOUGHT this decade ???
that being said , the nba model [where a team can keep its own talent regardless of cost] is vastly preferable to the nfl model where a team is penalized for its success .
the biggest problem with baseball [and ALL professional sports] is there are too many teams for the number of professional quality players . baseball resembles a AAA+ league rather than the major leagues .
I challenge ANYONE to find out how many World Series the Yankees have won with the highest payroll since free agency was implemented. I do know the answer. Since we all know that this whole debate is based on what the Yankees spend. The author of this blog is absolutely correct with his 1st point. Money doesn't mean success. The Yanks have certainly proven that. I'd also like to point out again that the Yankees payroll is still lower than last years. And if my math is correct, IF they sign Manny it will be equal to what it was last season.
The cap doesnt really work in the NFL because there are 2 ways around it. (perhaps more) I just know of 2. Signing bonuses and stretching out the length of pay vs the lenght of contract. Randy Johnson has even done this. Im sure more have.
The Yankees are living proof that spending a lot doesn't guarantee anything! With all the fuss about the spending recently the yankees still only have a three man pitching roster and only a handful of players with heart. Texeira was a great signing but does he really replace the offensive numbers put up by Abreau and Giambi? We're still stuck with A-Rod, Cano, Matsui, and which Damon will show up next year? The yankees haven't made much of an improvement other than Sabathia.
If there is no correlation between payroll and success in baseball, when wouldn't teams spend as little as possible?
Sounds like a tired excuse to me.
Ugh... it is so easy to throw in one-liners and not back them up.
There ARE teams that spend as little as possible! But it's not so they can win.
Living in Pittsburgh, I see how the owners/managers of the Pirates have converted their team into the AAA team of the majors. "Sending their quality players up to the majors" (trading their talent), halfway through the year, while collecting luxury tax money in the process.... making no real attempts to build a winning team. The only thing this franchise has going for it is a nice ballpark.... which the city taxes paid for because the owners are too cheap. It would have been great to see a person like Mark Cuban buy the team... or at least someone that cares about winning. Someone willing to make the right moves by keeping the core talent of a team while also spending money on scouting to build a reservoir of talent.... with the ultimate goal of assembling a team that can compete. I don't think a salary cap will fix this ownership problem.
I thought this was an interesting stat comparing the leagues:
- 20 MLB teams have won a WS in the past 30 yrs.
- 14 NFL teams have won a SB in the past 30 yrs.
- 13 NHL teams have won the Stanley Cup in the past 30 yrs.
- 9 NBA teams have won an NBA title in the past 30 yrs.
- 14 different men have won Wimbledon in the past 30 yrs.
....hmmmm, I wonder if a salary cap would make a real difference when it comes to the "competitive balance"... I highly doubt it, especially in places like Pittsburgh where the owners and general managers have run the team into the ground. I don't blame the Yankees, Mets or Boston (or any team that make an attempt to win through buying free agents) for this, I put my blame where it really belongs. If your team hasn't made it to the WS in the past 30 years, maybe you should do the same. It's probably because your team's owners and general managers lack the smarts or desire to win.
Talent alone does not lead to championships. It takes chemistry and patience to win... something you can't buy... but if you are a smart Owner/GM you can assemble a winning team through time, regardless of a salary cap. Look at the A's, Twins, Rays of '08, Marlins, Arizona... in the past they've had success by building teams from several avenues: scouting/building a talent pool, trading players, and spending on free agents that fill in the holes. They are also willing to give up players in order to get players.
Personally, I feel a salary cap may reward crappy owners who really haven't worked hard enough for their profit.... or for their team's fans.
If there's no correlation betwee payroll and success in baseball, then why have small markets Baltimore, Cincinnati, Cleveland, Kansas City, Milwaukee, Minnesota, Oakland, Pittsburgh, San Diego, Seattle, Tampa Bay and Washington combined to win zero World Series since the current economic system was put in place?
Just a coincidence, right?
What would the average athlete earn today if he wasn't in sports.I am a die hard Yankee fan for over fifty + years and what those a-holes are doing to the game is nausiating.I for one feel the max any player should earn is 1-2 million and i'm being real generous.Remember they only work 8 mos on average we work 12.And thats all i gotta say......
Its odd how in those fifty years you still haven't learned a thing or two about how business works. First to Wade... The small market teams have a smaller fan base and thus have far less responsibilities to their teams such as the big market teams. Second what should the big market teams do? Pocket the money they earn off of their fans? Should they simply be curtailed even though they owe it more to their fan base? A majority of the revenue IS being shared, merchandising for example although the red sox and yankees make up more then 50% of all sales its shared equally. A salary cap is BAD for baseball... and finally to the old man... if the players will make 1-2 million do you think your ticket prices will drop? If not then where is all that money going? Into to the pocket of the owners.... is that what you would prefer? Simply idiotic.
I don't even think the yankee are concern about winning championship' it seem like they more interesting in competing with Boston of who can sign the best players in the market, or can bid the most money on a player.. They are acting more like "show off" and showing there wealth.. A salary cap is not going to fix the problem!!
no matter how much talent they want to buy is not going to work all those players and there is no team player..
the majority are more concern to be a star more than a team player and winning
when you have a big contract with millions players tend to work less harder vs the new up and coming star that are working hard for a big million $$ contract.. Almost Every player with multi million contract have a better record before they acquire a mega contract
If the small mkt teams M.U.S.T. have to spend at least ---$$$ 75 Million per year $$$--- on *** THE TEAM OR BALL-PLAYERS*** THEN THIS ISNT GOING TO W.O.R.K.....AND YES IM A YANNKEE FAN. We all hv to understand here , the fans in all the citys what to win. Some more than others. Money is getting hard to find here at the N.J. Shore. and to go to see the YANKEES OR EVEN " the lonely mets " , this is becoming big bucks for tolls, gas , seats, parking , a hot-dog ( ONLY 1 HOT-DOG I DONT THINK SO ) ,drink , and of cause cracker-jacks. the fans ---didnt cry out--- for a NEW YANKEE STADIUM , WE ARE GOING TO HV TO PAY FOR IT. LESS GAMES TO GO TO , AND PAY MORE MONEY ???..... PUT THE CAP IN " I SAY ".....
There's such a fuss over all this, and honestly, it doesn't make much sense other than the fact that it's the Yankees doing this. Let's say that you are a successful business owner. Let's say you take your healthy profits and put them back into your business, making your business better, and in turn, paying your employees more than the other guys which, of course, makes your business more desirable than others. Honestly, think hard about this now.........If this was anyone besides the Steinbrenners (and their considerable egos), we'd be calling these business owners "American heroes".
Perhaps what is needed is not a salary cap but a length of contract cap. T
First off, you all got it wrong! The perfect salary cap is one that works both ways; A maximum & a minimum! Teams like the Yankees, Redsox, Mets & Angels are the highest spenders. Revenue is always split even with the lower salaried teams and the luxury tax also goes to the smaller market teams. However, they don't always spend it on players. Lets use two teams for example, lets say the Yankees pay out 25 million in luxury taxes, & for arguments sack the Pirates & Royals split it 12.5 million each, shouldn't be mandatory for the to spend it on players! Forget about the luxury tax and go this way; assuming all teams combined salary was 3,000,000,000 dollars and it was divided by 30 teams; that would be an average of 100,000,000 per team. The players union should be fine because the same amount is being paid towards player’s salary. But the lower teams don't have the cash that the upper teams have! The minimum salary cap for a team should be set at 50,000,000 & the maximum set at 150,000,000. Now you implement a luxury tax. If the lower teams do not meat their 50,000,000 minimum salary tax obligation; they don't get the get the salary tax money.
Roughly 7 years ago Jason Giambi signed with the Yankees for an obscene amount of money. Was it something like $140M for 7 years? Point is, did he really pan out? The Yankees couldnt wait for his contract to end. $20mil for a DH is ridiculous. Same can be said for Carl Pavano. The Yanks are the only team to be able to afford bad signings. Sad but true.
Are fans that hate the Yankees really going to care about CC or AJ 2-3 years from now? No one will care about what they are being paid then BUT the Yankees.
You pay athletes a base pay with insane incentives to reach.
The players will have motivation and it would be better baseball.
You're RIGHT Maurice!! Everyone else's opinion is wrong.
You got it! You're the first person that has said this. I vote Mo for the next MLB commish.