Yankees Payroll At League Average (well, not really)

Here are the facts and figures (payroll numbers are as reported in the Biz of Baseball, revenues are from Forbes):

The average payroll in baseball equals 46.4% of average team revenues.  So in this sense, the Yankees have an average payroll.

Aren’t statistics fun?

Yes, I understand: the Yankees do not have a small payroll.  The truth is,  the Yankees have huge revenues.   If the Yankees spent revenue on payroll at the same percentage as the Tigers, the Yankees could add another $80 million in player salaries!   They could add Ryan Howard, John Lackey, Matt Holliday and Roy Halladay, with money left over.

Scary.  The Yankees are actually showing salary restraint? 

The numbers also show that the Red Sox have a large payroll.  Our neighbors to the north spend aggressively on their 25-man roster.

I’ll close with a statistic about the Red Sox payroll, to match the statistic from Mark Attansio about the cost of the Yankees infield:

  • The salaries for five part-time Red Sox players spend more on salaries for five part-time players (David Ortiz, Mike Lowell, Bill Hall, Jeremy Hermida and Jason Varitek) represent more total* money than the Padres spend for their entire team
(* Thanks Nick for pointing out that Theo is paying only a part of Bill Hall’s salary this year.)

47 thoughts on “Yankees Payroll At League Average (well, not really)

  1. Nick Smith

    Interesting piece. Is revenue sharing money accounted for in one of those numbers, either subtracted from revenues or added to payroll? If dollars spent on the payroll tax were factored in, it might bump the Yankees up a few spots on that list.

    Also, the Red Sox are only on the hook for $1.25M of Hall's 2010 salary, with the Brewers, by way of the Mariners, paying the other $7.15M.

  2. Larry@IIATMS

    Nick -

    Thanks for the info on Bill Hall. I'll make a subtle correction to my post.

    Yes, the Forbes revenue numbers include the effect of revenue sharing.  So, for example, the Yanks' revenue is probably in the neighborhood of $600 million before revenue sharing.  If you're trying to get a picture of the money teams have available to spend on payroll, I think that  the right number to examine is revenue after revenue sharing.  At some point soon, I'll post the payroll numbers for all 30 teams, including the teams that receive revenue sharing.  Since these "poor" teams use (or are supposed to use) revenue sharing to help meet payroll, we'll always want to use post-revenue sharing numbers when discussing payroll.

  3. jp

    I see that revenue sharing is accounted for, but do the payroll figures include luxury tax costs?  (For that matter do the figures include stuff like the Red Sox $51 million to talk to Matsuzaka?)

    I think the Yanks paid something in the neighborhood of $27 million last year.   That would be another 6 percentage points or so added to the salary/revenue ratio.

  4. Drew

    Truly, I'm not positive I would have ever thought that they Yankees payroll could be seen in an average light. Making the most money, much more probable.  As clearly as you've stated this, it would be interesting to look at some more statistics like: stadium size/attendance numbers, average income per capita/disposable income, and population density within a commuting distance. I supposed these are things you should consider when you're building/owning a baseball team, but also considerable when trying to justify huge numbers like these. Not having seen these numbers, I'm guessing there is more enlightening information out there to woo readers with.

  5. Nick Smith

    Thanks for the response Larry. The Yanks are paying more than $150M a year in revenue sharing? That's insane. Actually, after looking it up (http://www.mlb.com/news/press_releases/press_release.jsp?ymd=20061024&content_id=1722380&vkey=pr_mlb&fext=.jsp&c_id=mlb), it's probably even more than that. The high revenue clubs are taxed at 31% of local revenues, so using Forbes' numbers their pre-sharing revenue would have been $639M. Not sure if the rich teams get any of that 31% back — is the revenue sharing pot split evenly among the 30 teams or does it just go to low revenue clubs?

     

    Also, it doesn't look like CBT numbers are included on your list. 40% of payroll spent over $170M would add $14.4M to the Yankees effective payroll. Probably a little more actually, since the CBT is calculated off a different, larger number that includes everyone on the 40 man roster, benefits, and uses AAV. That would push the Yankees over 50% of revenues (that they get to keep) spent on players.

     

    Still there's evidence of some restraint there. If they spent like the Tigers, their payroll would be $288M.

  6. Nick Smith

    JP — A coke to you for the luxury tax point. And I second your call for Matsuzaka's posting fee to be included somehow. From the team's perspective, it's essentially a signing bonus (albeit one that avoids the CBT) and for accounting purposes should either be spread out over the course of the contract or added to their 2007 payroll. The one thing that doesn't make sense to do is ignore it completely.

  7. JT

    Why does anyone put credence in the Forbes revenue numbers?  Do they actually have data or great sources in MLB?  Or are they just a wild guess dressed up with a nice brand name?

  8. I'll try to get to everyone's questions (good questions!) later on.  But first, some general points:

    When it comes to baseball, we do NOT have great financial data available.  Baseball teams are private businesses, and as a general matter they're not required to disclose their finances to us.  Even the Forbes' numbers are educated guesses.  Nick, jp, Drew and the rest of you SHOULD question these numbers.  I can assure you, I do the same thing before I post these pieces.

    If you put aside my intentionally provocative lead that the Yankees spend an average amount on payroll (which was justified from a journalistic point of view, since I added that I was only kidding), I made two points about the Yankees.  First, the Yankees take in boatloads of cash.  Second, the Yankees could spend a lot more than they do on player salaries.  Then I showed you some numbers to back up these points.

    If I thought that the numbers were cooked and that these points were seriously off base, I would not have posted this piece. 

    I understand that it's possible to come up with different calculations for Yankees revenue and Yankees payroll.  If Forbes does not deduct the luxury tax from their reported revenues for the Yankees (I suspect that they do not make this deduction, but I don't know for certain), then we might fairly deduct this number ourselves from the Forbes' revenue figure.  We might also (or instead) add the luxury tax to the Yankees payroll figure.  We might add in Kei Igawa's salary, and his signing bonus.  If Roger Clemens was still with the club, we might add in the cost of flying him back and forth to Texas on private planes.  I could then come to the conclusion that the Yankees are really paying a lot more in payroll than is being reported, so that they're really spending revenue on payroll at a rate comparable to the Red Sox and the Tigers. 

    But when it comes to the Yankees, I'm reasonably confident that Forbes is understating revenues.  First, I know that Forbes has reported that the Yankees lose money nearly every year (2009 being an exception), and I doubt that this is really the case, so I suspect that the Yankees' revenues are higher than reported.  Actually, I KNOW that the Yankees make more money than shown in Forbes, because even Forbes admits that their numbers do not include Yankees profits from the YES regional sports network.    So, I understand that the Yankees may be spending more on payroll than I've shown, but I'm very confident that the Yankees are also making more money than I've shown, so I don't think that my 47% payroll/revenue figure for the Yankees is understated.

    I then ask, could it be that the Yankees have room to add to their payroll?  Again, the available evidence supports this conclusion.  The Yankees 2010 payroll is lower than it was in 2007, and about equal to what it was in 2008 (again, according to reports), while Yankees revenues have been rising (according to Forbes).  Does it make baseball sense that the Yankees might be holding some money in reserve for the next class of free agents (reported to be a strong class)?  Sure it does.

    It all adds up: the Yankees could be spending more money on payroll.

    Now we return to the numbers.  I will admit, the available financial numbers aren't great when it comes to baseball.  So I try to use numbers from the best available sources.  The two best sources, in my humble opinion, are Forbes and anything that Maury Brown publishes in his Biz of Baseball site.  I resist almost any temptation to adjust these numbers.

    I'll stand and fall by this methodology, which is the best I can come up with.  The alternative is to conclude that the numbers are so terrible that we cannot draw any conclusions from them, no matter how careful we might try to be.  In other words, the alternative is silence. 

    Silence is not in my repertoire.

    All this being said, you SHOULD question any baseball financial analysis. 

  9. Nick Smith

    Agreed that New York's real revenues are likely much higher and that they could support a much higher payroll. I'm not sure it would be a good idea for them to actually do it though. With CBA negotiations coming up, a $300M (or whatever) Yankee payroll could unite the other owners to adopt even more revenue sharing or even a hard cap. That would hurt the Yankees more in the long run than they would gain from juicing their payroll for a year or two.

  10. Jeff

    Great comments,  seems like most followers are CPA's… I love when folks dig into something beyond surface level. So sick of people saying Yankees buy championships.. Because they heard someone say that on TV that day. At the end of the day the Yankees are GOOD for baseball, if they were not World Series "favorites" every year; look at the effect that would have on Yankees road attendance revenue. Look at TV revenue from World Series with and without Yankees.

  11. Zach

    Interesting!  However, all of the other costs that go into a net income for each organization must be accounted for to show what management is really putting into the payroll.  Fenway park isn't being paid off anymore, but there are a couple of new stadiums in NYC.  It'd be more valuable to look at the net income of the organization compared to the payroll.  An interesting case would be Arsenal in the English Premiere League (Soccer).  That team spends quite little compared to their net incoe.

  12. Dan

    That's a load of BS, Jeff.  You think it's good for baseball that the Blue Jays, Orioles, and Rays combined make the playoffs once every ten years?  You think it's good for baseball that teams lose their stars to the Yankees because the Yankee offer them far more?  You think that the Yankees' road attendance numbers are greater than the increase in attendance that would occur if the other teams in the AL East (other than the Red Sox) actually had a chance?  While in the short run, the Yankees in the World Series may increase revenue because everyone watches to root against them, in the long run, a way to  diminish the Yankees' absurd payroll will be very good for baseball, as the Blue Jays will actually start getting more than 8,000 fans per game.

  13. Skeptic

    The article is deceptive.  The only thing it proves is that due to their huge revenue advantage, the Yankees can spend less on payroll as a percentage of revenues and still have the highest payroll in baseball.  This does not necessarily make them more efficient.  If their revenues were on par with the rest of the league and they were still winning pennants and World Series, then I'd be more impressed with them.  So what if the numbers say they could spend another $80MM on salaries?  The point is, they don't have to to maintain their payroll (and competitive) advantage on the rest of the league.

  14. 55

    "the Blue Jays will actually start getting more than 8,000 fans per game"

    No. Read "The Wages of Wins." Having marquee players only boosts road attendance, not home attendance.

    The Yankees are the most famous baseball team on the planet. They make a ton of money overseas, which boosts MLB revenue AND Yankee revenue, both of which get distributed (at least partly) among all MLB teams.

    The Blue Jays are a fun example. They were on the verge of a dynasty in the early 90's, but poor personnel decisions started costing them.

  15. 55

    "It all adds up: the Yankees could be spending more money on payroll"

    This is only player payroll. Running a global sports empire has many other operating costs. Not saying that they couldn't add payroll- they definitely could- but probably not as much as you're implying.

  16. Tomas

    I've never been able to figure out Yankee fans.  How can you follow a team that PAYS for its championships?  How is that being a fan?  They don't build their team via their minor league system.  Do they even HAVE a minor league system?  They just buy players.  We need a pitcher?  Don't bring one up.  Let's just go get CC!  Whoop-dee-do!  MLB needs a salary cap just like all other major sports leagues.  Then maybe you guys can feel real PRIDE when you win.

  17. Taber

    Tomas: Never heard of Jesus Montero have you? Please tell me your post was a joke.

  18. ummm

    @Thomas

    You  might want to do a little research (or just have some common baseball sense) before making those comments.  Sure we made some offseason adds with CC, Tex, and Burnett but to say the Yankees don't use or have a minor league system is wildly ignorant.  Four of the players the were key in the Yankees 2009 season came from the farm system (Jeter, Jorge, Pettitte, and Rivera) and this season marked the first time in ANY sports history that three players (Jeter, Jorge, and Rivera) stuck with the same team for 16 seasons.  Buy players???  In the age of free agency we not only developed these potentail HOF'ers but showed them what they meant to the Yankees by keeping them around (except the few years Pettitte left).  Add that to the likes of Cano, Huges, (I won't mention Joba but I could), and Melky thats a mass of the 2009 teams key contributers that have worn pinstripes since day one.  The additions at SP and A-Rod/Tex and company definitely helped to win the WS but that is hardly BUYING and ring.  I'd like you to name off the players on whatever "team" you are a "fan" of that are a product of your system that have been as successful as the Yankees…don't worry…I'll wait.

  19. Teddy D

    Tomas:  Jeter, Posada, Bernie, Pettitte, & Mariano were all developed from the minors.  As for current young players, so were Cano, Gardner, Hughes, & Joba.

  20. Let me try to respond to some individual comments, and I apologize if I don’t get to your particular comment.  I think all comments so far have been great.  Even Tomas, though I don't agree with Tomas.

    Jp, I don’t think that the payroll figures include luxury tax payments.  Reportedly, these figures do not include signing bonuses or “dead contracts”.  It would be great to have better payroll figures, but unless or until someone compiles better figures using the same methodology for each team, I’m reluctant to make team-by-team adjustments.

    Nick, you’re entering into a patch of, er, mud, that I’ve been stuck in for a long time.  The Yanks’ President Randy Levine says that the Yanks paid $150 in revenue sharing in 2009, see http://bit.ly/cKgeaq.  Yes, I agree, this calculation seems low.  However, the calculation of revenue for revenue sharing allows teams to deduct certain costs from their revenue, including the debt service on a new stadium.  The Yankees owe a lot of money on the new Stadium, and this debt DOES effectively reduce what the Yankees would otherwise pay in revenue sharing.  (For those out there looking for a fresh reason to hate the Yankees, I’ve just given you one.)  As for the CBA, if the Yankees appear to be cutting back on salary, that might cause friction with the player’s association.  It’s hard to know how to best enter into CBA negotiations.

    JT, people put credence in the Forbes numbers, since the people who compile these numbers do it every year and they’re widely read, and these people have good credentials.  Yes, you should read these numbers carefully and you should not take them as gospel.  The Forbes numbers are widely questioned, sometimes with good reason.  Maury Brown at Biz of Baseball has written more than once about the reliability of these numbers, and you can search his site to see what he has to say.  But the Forbes numbers are the best we have available.  I regard them as generally reliable rough estimates, and also as the highest quality numbers available to people like you and me.

    Skeptic, I said that the Yankees have the highest payroll and revenues that are off the chart.  I did not say that they were efficient.  I’m saying that they could spend more than they do.  As to what another $80 million in spending could buy?  You may not like the answer, and I hate to sound greedy, but more spending could buy more than two championships a decade. 

    To everyone here debating the question of whether the Yankees are good for baseball, debate away!

    55, I have not shown the numbers for all 30 teams, but the Forbes numbers show that the big revenue teams spend a larger percentage of revenues on payroll than do the smaller teams.  We’re not working from the best numbers in the world, but it appears that the larger teams can enjoy some economies of scale and may be able to afford to spend a larger percentage of revenues on salaries than the poorer teams. 

    Ummm, agreed.  A huge part of the Yankees payroll is the cost of retaining players as they enter their free agency years.  Yankee fans can be proud that these home-grown players are (arguably) still worth big bucks.

  21. CRM

     Huh?  So what if the salaries are not a larger percentage of total revenue?

      It's because of the huge reveuue that the Yankees can afford to buy players.  

       Some  teams get more for their money in terms of team success…but that's not the main point, is it?   The REAL success is the revenue.

  22. Dumbfounded

    Good job ummmm and Taber…it grates me that the ignorant prefer to spout what someone else says, rather than go with intelligent response.

    2009 Yankees

    Farm/Yankees as first team:  Robinson Cano, Derek Jeter, Jorge Posada, Melky Cabrera, Brett Gardner, Ramiro Pena, Francisco Cervelli, Dave Robertson, Phil Hughes, Phil Coke, Mariano Rivera, Andy Pettitte, Joba Chamberlain, Alfredo Aceves, Hideki Matsui.

    Trade:  Alex Rodriguez, Nick Swisher, Chad Gaudin, Jose Molina, Damaso Marte, Eric Hinske, Jerry Hairston, Xavier Nady

    Free Agent:  Mark Texeira, CC Sabathia, AJ Burnett, Johnny Damon

    So many people forget that the make-up of the 2009 World Champion New York Yankees was PRIMARILY home grown talent…a few strategic trades, a few needs filled by free agents.

    And the 2010 Yankees have the same look/feel.  Same infield as last year…new centerfielder acquired by trade…new leftfielder a home grown…new back-up catcher a home grown…new 4th starter a trade…new 5th starter a home grown…no major free agents added in the off season, a couple DH types and a couple RPs.

    If you knew what you were talking about, Tomas, you probably wouldn't be looking to make a fool of yourself in this manner…

  23. CRM, you mean that the Yankees are acting from a profit motive?  Great!  Then we truly ARE America's team!

    Be careful about arguing in the same post that the Yanks buy their championships, and that the Yanks should get more for their money.  How much more can you get than the World Championship? 

    If you're saying that a lot of Yankees spending is wasted money, then the portion of the money that was wasted did not go to buying a championship.  Ergo, the Yankees spent exactly what was necessary to buy a championship, and they wasted the rest of what they spent. 

    Teams can sometimes achieve great success on the cheap by doing so with players that are not yet eligible for free agency and can thus be hired at below-market rates.  It may be more difficult to achieve success following this model, and for certain it is more difficult to SUSTAIN success following this model, but outside of the difficulty factor, there's nothing in this model that is inherently admirable.  

  24. Dan

    "No. Read “The Wages of Wins.” Having marquee players only boosts road attendance, not home attendance."

    I'm certain adding Pujols to the Blue Jays is going to boost their attendance by more than 0%.  Regardless, my point was that the Blue Jays get such litte fan support because they never win, and I think it is very clear that the better the team is, the more fans that team gets.  In 1992-1993, the Jays sold out every game.  Now, the stadium is desolate.  Why?  Because they haven't made the playoffs in almost 20 years, and don't appear to be making them any time soon, considering that their payroll is dwarfed by that of the Red Sox and more so the Yankees. 

    The entire idea of a good minor league system that makes up for a smaller payroll is ludicrous.  The Yankees have a minor league system AND $200 million.  The Rays have a minor league system. The Yankees would new to screw up unbelievably badly for the Rays to ever finish ahead of them, which Cashman managed to do in 2008.  No one cares that Jeter, Mo, etc. are from the Yankees' system.  They would never, ever all still be on the Yankees if the Yankees didn't have so much money to resign them.  Almost every team develops good players, it's just that the Yankees can pay to keep them.

    Until a salary cap is instituted, MLB is a joke.  No matter how you slice it, it's not fair.  It may be more fun this for Yankees fans, but your fun comes at the xpense of the Orioles,' Pirates,' and Athletics' dying fan bases.  So have fun buying championships, you guys–I hope you're happy with he condition of MLB in 20 years.

  25. Dan, in response to your comment, see the Chicago Cubs.  They may be the exception that proves the rule, but they're a high attendance high revenue team that doesn't win.  The Dodgers are a less dramatic exception to the same rule, because the Dodgers win world championships, but if you look at the numbers you'll see that Dodger fans also show up to the ballpark in decent numbers even when the team is not contending.

    Of course, it helps to be located in a big market like Chicago or LA.

    Dan, I hope you keep posting here, but I'll push at you to take a more nuanced point of view.  Take the Pirates, whose value has about tripled since they were purchased by current management.  Much of that value is a result of the Pirates' perpetual entitlement to nearly $40 million in annual revenue sharing, much of it paid by the Yankees.  From this perspective, it's hard to shed tears for the Pirates.  (I DO feel for Pirates fans, one of whom married my sister.)  I can quote you numbers about merchandising (25% of MLB merchandise is Yankees merchandise; merchandising money is split evenly among all 30 teams) or national TV (even I am tired of how often the Yankees are shown on national TV, but evidently people will tune into nationally broadcast Yankees games). 

    Do the Yankees hurt baseball?  Yes.  Do the Yankees help baseball?  Yes.  It's NUANCED.  Look at both sides of the argument.

    I personally favor a salary cap.  Stay tuned.  A salary cap is not going to solve the problem faced by the Blue Jays, any more than the NBA salary cap allows the Trail Blazers to compete fairly with the Lakers.  A salary cap is a modest step in the right direction, in my humble opinion.  But if you want parity, you need to focus on more effective revenue sharing.  Stay tuned.

  26. Ummm

    This concept of buying a championship is more over stated than socialism and the Obama admin.  The closest thing do doing that is not the Yankees of last year…Dan, if you would like an example see the 1997 and 2003 Marlins and their ownerships refusal to keep the players around in exchange of profiting off the teams success and watching their team plummet to the worst record in their division the following year.  Now THAT's buying a ring.  I don't have enough time to go into how many wrongs the Orioles, Pirates, and A's have had over the last few years but one in recent memory is the Athletic's trading two years ago for Matt Holliday.  This is a player they knew they had NO shot of signing after with his alliance with Boras.  Yet, in an idodic move, they ship off Huston Street and Carlos Gonzales in exchange for Holliday's services for less than a half year.  Fast forward to 2009 and Holliday is with the Cards and a great closer in Street (when healthy) and one of the best young leadoff hitters (CarGo) are key pieces in a Rockies team that was picked by many to win their division.  Having deep pockets helps but that means nothing if you can't make great decisions regarding young players and free agents.  For more info on this please look into the New York Mets and Chicago Cubs.

  27. Tomas

    My goodness!  Such an outcry!  Me thinks these fans doth protest too much!  Let me see: just over the last few years — CC Sabathia, AJ Burnett, ARod, Abreu, Granderson, Teixeira, Matsui…  And don't forget Clemens, etc.  Yes, I agree that other teams make the occasional trade or buy the occasional free agent, but the Yankees and Red Sox are in a league of their own!  I mean, several high-priced free agents at a time???  C'mon.

  28. This comment falls under the category of shameless self promotion.

    If you like this discussion, or see any value in this discussion, come back!  We're going to have LOTS more discussions like this.  We're going to talk about salary caps.  I'm going to recommend a salary cap.  We're going to talk about more effective revenue sharing.  We're going to talk about how to make baseball fairer and better. 

    We're going to do this in a way that avoids the reflexive Yankee bashing that's endemic in the mainstream media.  This being said, I WELCOME Yankee bashers to participate in this discussion.  I like critics; the more you criticize me, the more you'll seem to me like a member of my own family.

    Bookmark this site.  Subscribe to us on Twitter.  This blog is as good as our readers and comment-ers, and I think the comments here have been excellent.  Stick around!

  29. More shameless promotion.  We have many good writers here.  I'm just a newbie.  There's Jason, our leader.  TCM, our Twinkee from the frozen north, bucking for a Pulitzer Prize in the first person.  Will, our fearless sabermatrician.  Tamar, our post-game correspondent (read Tamar first, the AP coverage second, you'll be better for it).  Mark, our voice of reason who asks the difficult questions and likes the Yankees less than Tomas does!  Brad, the webmaster who keeps me honest. 

    This is a really good site!  Stick around.

  30. dave c.

    Baseball doesn't need parity. Parity would be foolish, as it would hurt baseball's biggest draw: the Yankees.  I don't think baseball needs a salary cap, although one would be good for the players. A salary cap means a salary floor and a quicker path to free agency if we look at other leagues CBA's as an example. Sure the superstars would get payed less but the rank and file players would see their salaries go up. But I have no issue with the yanks making the playoffs almost every year. What I have issue with is the red sox dominating the wild card almost every year. Re-alignment would be a better way to solve baseball's red sox/yankees problem. Putting high revenue teams in different divisions gives baseball a way to allow the lower/mid revenue teams to battle it out for the wild card slots. Also maybe some teams need to think about moving/folding if they're unable to field a competitive payroll even after revenue sharing. I have more problems with the pirates 35 million dollar payroll(would never make the cap floor if there was a cap) then the yankees 200 million dollar payroll.

  31. Dan

    Don't get me wrong: the Yankees are playing by the rules.  I'm not calling them cheaters.  I'm also not saying what the Marlins did was right–that was just as bad.  However, without a salary cap, I think the Yankees are ruining baseball. 

    Yes, MLB gets a lot of money from random people in Texas buying Yankees caps, but I think if each team had a fairer chance to win, and therefore there was far more balance, the sales of each teams' merchandise would way more than cancel out te loss of Yankees merchandise sales.  The Cubs, Dodgers, and Mets, while not having won a world series recently, still atract many fans because they are competitive almost every year and because they are in massive markets.  Winning a world series is not the only kind of winning; yes, Cubs fans desperately want to win it all, but any team that is competitive is going to attract fans, especially in  place like Chicago.  Thus, these examples prove almost nothing.   

    People in New York and Boston love baseball.  People in Pittsburgh and Toronto don't care.  Steelers, Penguins, and Canadiens games are hugely popular, though, because those teams actually win. I firmly believe that if this continues, MLB is goin to slowly die.  The only thing keeping it afloat is the crapshoot that is the MLB playoffs, where the best team rarely actually wins, so people can't even see how ridiculous and advantage the Yankees have.

  32. Tomas

    Dave, I don't think anyone's looking for "parity."  What we want is a level playing field like in the NFL.  Those teams that have superior front office personnel will always be better than those that don't.  They'll get better players because they'll evaluate better, work out trades, etc.  I agree that it's not just the money, but it doesn't take a genius to plug a need with the best available free agent.  It's one thing to have a need at pitcher and look through your minor league system (and, yes, the Yankees do have a minor league system — I was just kidding!) or to work out a trade.  It's another to have an unlimited number of dollars and get the best pitcher available.  The Yanks and Red Sox have unlimited funds.  Most of the rest of the teams in the AL (and don't get me going on the stupid DH!) don't.

  33. Dan

    @dave c:

    Once again, I think it's hard to honestly believe that the Yankees' draw is greater than all the fans other teams would combine to get if they weren't awful every year.

  34. Tomas

    One last thing (unrelated, sorry) and I'll shut up.  Since Dave brings up the wild card team.  Why is it the wild card team in baseball is treated with the same respect as the teams that actually won their division?  Why not limit the wild card team to only two homes games during a best of seven?  The NFL's got it right on that.  The wild card teams are usually the visiting team.

  35. Evan

    Though I'm not sure that the author is suggesting otherwise, this is actually the strongest evidence in support of an "unfair" Yankees' advantage–much stronger than just looking at payroll without looking at revenue.  If revenue were more equal, at least the Yankees could say that they just want to win and are willing to spend more than other teams to do so (i.e., it's not that there is an inherent advantage, but rather that the Yankees just want it more).  But if the Yankees, as a percentage of revenue, actually aren't spending more than other teams, then that only highlights the advantage of the huge revenue–in fact, the Yankees aren't doing anything differently than other teams.  (I am, of course, ignoring revenue sharing  here.)

  36. DaveC, yours is a scary post.  You're anticipating much of what I plan to say about a salary cap, only I'm going to recommend one anyway.  I don't want to put any teams out of business, by the way. 

    Let's put re-alignment on our list of future discussion topics.  I personally like the idea of what I've called the "Mid-Major League" (hey, every March I root for the mid-majors after my Hoyas are eliminated), where small-market teams could compete in their own version of the Horizon League and still send a team or two to the Big Dance every October.  We'd have interleague play, so the Royals would not lose the benefits of having the Yanks show up once a year (and the Yanks would not miss out on the BBQ).  Could you imagine if the mid-major Pirates met the Yanks in the playoffs and won?  PEOPLE WOULD GO NUTS.  I can't find a way yet to make this idea practical, but I haven't given up on this idea either. 

    Tomas, the NFL model simply isn't going to work for major league baseball, at least not at this point.  The NFL splits revenues much more equally than does baseball.  2/3 of NFL revenues come from the national TV contract; NFL teams split gate receipts 60/40.  So, the NFL can institute a "hard" salary cap and "hard" salary floor requiring teams to pay nearly the same amounts in player salaries, and every team can afford to live within these limits.  But baseball is a game where most revenues are generated locally, and where the revenue split is not nearly this even.

    The NBA offers a better model for baseball, if only because the revenue gap between the Knicks and the Bucks is almost as wide as that between the Yankees and the Pirates.  

  37. dave c.

    dan, I think you underestimate the Yankees. I do think their draw is more than that of all the currently crappy teams. I don't think a salary cap would improve the draw of the crappy teams all that drastically, just hurt those of the yankees. Typically national draws revolve around superstars, so you could make the argument that if the superstars were more spread out to more teams would be more national draws, thus improving baseballs popularity and potential revenue from merchandise and national tv. But year to year consistency in a league; I think helps more. Remember this is not the absurdly popular NFL where different rules apply. This is baseball which is a much more local sport. I think ultimately people gravitate towards following the teams/players they know, and that is why its good for some teams to consistently make repeat appearances in the postseason. It's the same reason teams in the NBA can spend way above the cap to resign their own free agents.  Which is why I think realignment is the best way to both protect large market big spenders while allowing for mid to small market teams to compete at levels that won't doom them to obscurity.  Although an NBA style cap(although not so needlessly complicated and with more room open for exciting trades) would be acceptable.

  38. dan williams

    The Yankees only advantage is they play in new york… We love our teams. if your a ball player would you rather play in new york or tampa bay… get real its not even close…. nba has a cap. you dont think lebron james is gonna be in a knicks or a nets uniform next year… everyone that complains about the yankees most likely live in a city where they have nothing to do on a friday night…. The Yankees R BASEBALL…  if everyone had to spend the same amount of money, the best players are still comming to NY cause its NY … Why is that so hard 4 people to understand… who wants to be in pittsburgh or kansas city

  39. Dan

    @ dumbfounded: how can u give the yankees credit for "trades" when these trades are just salary dumps for some garbage in return (vazquez though maybe the braves weren't ripped off, arod, nady/marte, granderson) and your so proud of your great homegrown romero pena's – please. the yankees also get to spend more money on scouting, signing prospects/picks, etc.  yet they still manage to mess up so much '08 comes to mind. what a joke 

  40. Leon Holloway

    First, if ONE OUT OF EVERY FOUR merchandise items sold by MLB is that of the Yankees, then isn't it fair that they get to spend more than the rest of the league?

    Second, I think people lose the fact that New York City is a very expensive place. (those who've spent $3.50 for a slice of pizza understand). A one bedroom apartment costs an average of $1000. And thats probably a low guess.  New York  is #1 Forbes list of most expensive American cities. EVERYTHING costs more here, and it only makes sense that people who work/play here be compensated to show that.

  41. JetsYanksDevilsFan

    LOL, $1000 for a 1br apartment in NYC???  Yeah, I'd say that's an understatement.   More like $2500.

  42. James

    Dan,

    The Arod trade involved someone named Alfonso Soriano, you may know him, he's currently making around 18 million dollars a year to play bad left field for the cubs, at the time he was highly touted to be the next 40/40 man.  Hardly a salary dump.

     

    The Granderson trade involved Ian Kennedy, who was linked to rumors when Santana was being traded.   As well as the Yankees top prospect, Austin Jackson who is currently hitting over 300 as the starting center fielder in Detroit.  Again, not a salary dump.  Simply the Yankees wanting a proven center fielder, that they can afford, instead of taking a chance on Austin Jackson and Ian Kennedy (though they had no place for Kennedy anyway).  In fact, many analyst thought that the Yankees got the worst part of that deal.

     

    Vazquez was a horrible trade, but for the Yankees.  Although maybe since Mekly Cabrera is hitting under 200, it was equally bad for both teams.

     

    Nady/Marte were just the Pirates being the Pirates, and weren't the only players given away by them, they also gave away Jason Bay for very little to the Red Sox (Manny Ramirez who refused to play for them, well, he was on the field, just wouldn't run or anything else and occasionally went into the score board to go to the bathroom).

     

    For people talking about the CC Sabitha signing, what they fail to realize is the Yankees lost a 20 game winner to retirement that year in Mike Mussina.   Mike had played for them for 7 years, 30 wins away from being a 300 game winner and had literally just won 20 games in 2008.  Any team in the league would have replaced him with someone of equal production if they could.

     

    Baseballs system is set up so much better than any league with a salary cap, because you have your player for a certain amount of time, usually till they're 30 because of the way their CBA is set up.   And usually for much cheaper than what you would normally pay for them (unless you're the Phillies signing Ryan Howard).  This has allowed teams like Tampa Bay to keep Carl Crawford and actually be a contender for the last three years.

     

    More parity exists in MLB than any other sport.  Last time I checked no team has gone 0-162.   Or even 10-152 or 20-132 (the equivalent of 1-15 or 2-14).  Nor has any team ever gone 162-0.  Baseball is just a longer season, so people tend not to care about it early on, by late in the season their team is out of it so they don't watch.  Toronto was actually the top team in the AL East for over a week, it did not increase ticket sales, because it's early in the season and nobody cared.  It'd be like the Lions winning their first game of the season, nobody would care.

  43. Andy

    I'm not sure I get why spending a high percentage of one's revenues is not the most admirable thing an owner could do (especially for smaller-market teams).  It doesn't mean that the team is a "big spender", because it is relative to what they bring in.  Total expenditure is what people care about when talking about parity, because that determines (roughly)  what kind of talent can be amassed on one team.  I'd say that the only non-regulatory (that is, without a salary cap) "solution" to the parity issue is in fact for lower-grossing teams to spend a higher percentage of their limited revenues on player salaries.  You have to be a pretty strong Yankee apologist to try to criticize that.

    Framing this in terms of percentage of revenue spent to evidence Yankee "restraint" and excess on the part of other teams is extraordinarily deceptive.  Smaller-revenue teams are merely trying to compete with far more limited resources.  Just looking at the list of total revenues by team tells the whole story of how uneven the playing field is.  The Yankees have just about double the financial resources of any of their nearest competitors.  They blow the smallest market teams (not even listed here, because it would be embarrassingly lop-sided) out of the water in that regard.  Unless you think baseball is a competition to test corporate might, these facts have a terrible impact on the game.

  44. Rob in CT

    Salary dump = the Abreu trade.

    The Swisher trade != salary dump.  The White Sox thought he sucked and wanted him gone.

    The Granderson trade != salary dump.  That deal required Ian Kennedy and Austin Jackson, and Granderson just doesn't make that much money.  The Tigers promptly went out and signed Johnny Damon (damn them for buying players!).

    Vazguez for Melky & Vizcaino… that one is in a gray area for me.  Clearly the Braves had 6 pitchers and wanted to clear some payroll.  They figured nobody would give them anything useful for Lowe, so they traded Javy.  They got back a 4th OFer/borderline starter and a lottery ticket A-ball pitcher.  If Vizcaino turns out to be really good, I bet the "salary dump!" whining turns into "hahaha Yankees r dumb" gloating.  Also, Melky's not THIS bad.

  45. Rob in CT

    This basically just highlights the massive revenue advantage that our favorite team has.

    Tomas clearly doesn’t know very much about the Yankees, but knows enough to be a hater.  Eh, that just makes him like most non-Yankees fans.  Nothing new there.  All trades are “salary dumps,” stars who came up through the system are ignored, etc.  It’s all about CC, Tex and Burnett.  Jeter, Posada, Pettitte (admittedly he left and came back as a FA), Mo, Cano, Melky, Gardner, Joba, Hughes, Aceves, Robertson… those guys were just hangers on!

    The Yankees farm system, while certainly not great, has been solid.  Of course, they don’t get high picks in the draft (one of the things baseball already does to create more parity).  Just like the Red Sox, they pick late, going for guys who fall b/c of injury or conditioning issues (Joba, fer instance) , “character” issues (laptop theft, for example), or high bonus demands.  They also spend aggressively in the international FA market (Cano & Wang are good examples of that, as is Aceves).

    I think more revenue sharing would be a good thing for baseball, and I’d be fine if the next CBA enacted that.  I do not, however, think that it’s bad for baseball if the Yankees continue to be rich and successful, given where they play and how many fans they have.  It’s a matter of how much is too much.

  46. mattmugg

    This argument is espoused by so many Yankee fans eager to share the experience of being a sports fan:  the Yankees don't win just because of their free agents but really because they are a team of "home grown" players. The argument is a fallacy. The Yanks can afford to risk overpaying and holding on to players, e.g. Posada.  There's no difference between being the only team that can afford the big ticket free agents as well as the only team that can keep on paying Derek Jeter. 20 million per is 20 million per. Just admit it Yankee fans: it's not a level playing field. I don't envy you.

  47. Eric Fortin

    this sucks! >:(

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