Come To Think of It: Why We Don’t Need a Salary Cap in Baseball
August 4, 2009 · Bob Warja · Jump to comments
Article Source: Bleacher Report - New York Yankees
During a recent chat by ESPN’s Keith Law, the following Q&A transpired:
Q: Keith, do you think that the MLB will ever implement a salary cap, like the rest of the major sports or will it take someone like Bill Gates or Donald Trump to purchase a franchise and build their own all-star team before this flawed system is exposed?
A: The only flaw is in the minds of people who think baseball needs a salary cap or that a salary cap is going to do anything for baseball but line owners’ pockets.
I mention this for two reasons.
One, it indicates that this is on the minds of baseball fans; and, two, I completely agree with Law’s response.
Yes, there has been much hand wringing over the money that the so-called ‘big market’ clubs spend. The target of angst, in most cases, is the New York Yankees, of course.
The Yanks spend, by far, the most money of any MLB team on its payroll. Yet, instead of lamenting this fact, fans should appreciate owners who are willing to pour some of their profits back into their ball club.
No matter what your personal feelings are toward the Bronx Bombers, what fan doesn’t want to see their team do that?
Yes, the Yanks have the most revenue of any big league club. That’s why they can afford the highest payroll.
However, profit in MLB certainly is not restricted to just the bigger market teams.
While we are in a major recession, smaller market teams can be profitable because MLB has adopted a system whereby revenue is shared, and teams that go too far over the payroll ‘threshold’ (mainly the Yankees) are penalized and this money is placed into a pool that the smaller market clubs dive into, head-first.
Now, the idea behind this arrangement, at least in theory, is that it is done to help clubs become more competitive by providing them with additional revenue that is supposed to be put back into the baseball team, and not the owners’ pocket.
The monies could be used for personnel, scouting and development and on player salaries.
Yet, in practice, often times a smaller market team, like the Pirates, simply does not put this money back into the club.
Why does this matter?
Well, it shows a pattern of abuse that exists. Abuse that would likely only increase if a salary cap were introduced.
If an owner isn’t ‘in it to win it’, then it is simply a business. And we all know that the goal of a business is to maximize profits.
Recognizing that, why in the hell would anyone expect the addition of a hard cap in MLB to be a good thing, unless you are an owner?
As Klaw implied, it would simply make the rich richer.
But the argument in favor of a cap is flawed anyway.
I say that for two reasons.
First, spending a lot of money never guarantees you anything. Just look at the Yankees, who haven’t won a title since 2000.
If baseball’s economic system was as flawed as some make it out to be, then all you would have to do is outspend your opposition and you would automatically win.
But we know that it doesn’t work like that. The Mets, as another example (not to pick on the Big Apple), routinely spend more than $100 million on payroll, yet seldom win.
And while the Cubs have captured consecutive division titles, they are no closer to winning the World Series since they became one of the ‘big boys’.
Second, there is much parity in baseball these days. Low budget teams like the Florida Marlins and Tampa Bay Rays have had winning years despite being outspent by their rivals.
So why haven’t the Pirates won, you ask?
Well, it isn’t because they have the wrong strategy in place. If you aren’t in position to win now, it makes sense to try and turn some of your more established players into even more talent.
No, it is because they have the wrong people making decisions. Look, I don’t care if you have unlimited finds, if you make bad choices you are not likely to won. Period.
Some of the draft picks and prospects the Pirates have acquired over the years simply haven’t panned out. But that isn’t a knock against the strategy; it is a mark against the decision making being done.
Meanwhile, the Rays have turned years of losing into some fine young players that helped them to win in 2008, despite a payroll lower than $44 million.
Now, admittedly, the system isn’t perfect. Teams that spend in the upper third tend to win more often than teams that do not spend as much.
But again, there is no guaranteed correlation between spending a lot of money and winning. If there were, the Yankees would be winning the World Series every year.
Further, just as a salary cap isn’t the answer, neither is a salary floor.
A floor would unfairly penalize a team that is going through a rebuilding process, and would artificially inflate the salaries of mediocre players.
All things considered, we do not need a salary cap in baseball. The competitive balance in baseball isn’t perfect, but a salary cap would only enrich owners who already bathe in green, come to think of it.
Yankee Tickets
Shop Yankee
