The notion of a salary cap is also nonsense because unlike the NFL, MLB revenues are driven by local efforts. With a national TV contract comprising the lionshare of its revenue, there is no need for local markets to have the incentive to create new revenue. In baseball, however, massive revenue sharing would essentially place the risk burden on local teams, while the league reaps the reward. Why would any team invest millions into local revenue effort when they’d have to split the reward 30 ways?

The NFL has designed its sport to be appealing TV programming. It’s high ratings are the result of scarcity and casual interest, the latter stemming from gambling concerns. With a revenue base that is posied to leap past the NFL, baseball would be wise to throw the NFL blueprint into the fire.

Finally, a salary cap creates an inefficient allocation of league resources, which is why NFL owners are no considering abandoning it. It makes no sense to have a salary floor because it mandates spending…even when such an action would be unwise. As a result, players in the NFL and NBA make a larger percentage of league revenue than in MLB. Deep down, I don’t believe any MLB owner wants an NFL style system because it would require most to raise salaries and then hope the Yankees and Red Sox are willing to continue to grow revenue to add to the bottom line.

The bottom line is that outside of the Rays, every team has a very fair chance to make the playoffs (the Yankees can’t win the other divisions). If the Royals, for example, are unwilling to spend money to make money, well, that’s their problem. Furthermore, if the KC market still wouldn’t support a winner, then they don’t deserve a franchise. Having the Yankees curtail their operations for such teams is the definition of unfair.

“Wah! Wah! I want cost certainty.”

“Wah! Wah! I want built-in profit–even if I field a shitty product.”

Of course, for example, in 3 years when Sabathia is recovering from his labrum surgery, AJ Burnett is struggling, and Teixeira is good but not great, ARod and Jeter are scuffling, no one will be complaining about the Yankees high payroll. And despite the acquisitions, the Yankees are no lock to win the Serious (Sure, to win 85-95 games, I’d definitely take that bet), but there’re holes that could have this team scuffling (e.g., Posada, Cano, CF, and possibilities for decline in Matsui, Jeter, Damon).

As usual, yawn.

Love

Steve

[16] You may be right, but I suspect that a team in, say NJ, would have its own following. Also, there may be initial passive “anti-support” for a third team: in other words, if another NY team were placed in the AL, would mets fans support it against the Yankees? Would Boston or Baltimore fans attend games because tix are relatively easy to get, to see their own team or root against other teams? A reasonable TV deal is a more difficult obstacle, but not insurmountable.

I just figure that in a metro market of 20+ million, and an even larger extra-metro market, it should not be impossible to find a couple of million fans.

I’d also add that Sabathia and Teixeira are replacements for their 2008 ace and 2008 first baseman/slugger. Teixeira and Burnett had comparable offers from other teams and didn’t take them. Does anyone really think Teixeira was holding out for the extra 1.5 million a year he got from the Yanks over the Sox? I really think only Sabathia qualifies as a signing only the Yankees could have pulled off, and it was an important one, at least to them.

[14] Yes, it is unfair. It’s not prohibitive – it still doesn’t wrap things up in April, and there’s a dumb-luck factor that overrides just about anything else in October. It still allows the Yankees to operate on different terms from any other team.

The competitiveness is also a little bit of a sham. A lot of different teams have found themselves as winners over the last 10 years or so. One reason is that virtually none of them are able to sustain that winning team for very long. The Yankees and Red Sox are exceptions; so were the Braves, when Turner was playing Steinbrenner.

There are a couple of other teams that should be able to build that same kind of advantage: the Red Sox, Mets, Cards, Cubs, Dodgers. That doesn’t come close to a level playing field.

Here’s what we know: The best players individually don’t necessarily comprise the best team. That’s how the Yankees have been beaten. FACT: Five of the eight playoff teams in ’08 were in the top 10 in payroll. FACT: The team with the 13th-highest payroll played the team with the second-lowest payroll in the WS. It was the second straight year a team in the top 15 in payroll played a team in the bottom 10. FACT: 17 of 30 MLB teams finished at .500 or better, and outside of Tampa Bay, three teams in the bottom third (Arizona, Minnesota, and Florida), all had realistic playoff chances through September. … [11] [12] The NFL model, of the national television contracts, the salary cap and revenue sharing, gives more teams a chance on a year-to-year basis. But they don’t treat their players as well in terms of guaranteed money, pensions, etc., because of the NFLPA’s weak position. The NFL won’t allow any player or league to be bigger than it. MLB, from what I’ve experienced, researched and observed, is not as hard-line.

Apologies for the long post. For more words, my column will be posted today.

[13] [14] I’d have no problems with a third MLB team in the NY metro area, but practically, I don’t think it works. Where do the fans come from? What drives the interest? Are there really 2-3 million non-Yankee and Met baseball fans in NYC who’d happily attach themselves to a brand new team? Without big interest – and thus the ability to negotiate a large cable/radio deal, and generate lots of merchandise and ticket sales – I don’t see how a 3rd NY team cuts down on the Yanks and Mets huge revenue advantages.

To me, the only way a third NY team could work at cutting down Yankee/Met revenue is if the Dodgers or Giants moved back east. But that’s not happening.

[7], [9] There already is a de facto salary floor, since the players have negotiated a fixed minimum salary. But the general point is well taken: a salary floor that is closer to the salary maximum (if one were imposed) would be necessary.

[10] The Yankees have advantages, but are they “unfair”? That is a philosophical/ideological question. However, depending on the way one measures it, MLB is more competitive now than it has ever been (except for maybe the mid 80s). The system does not seem to be broken, despite the hand wringing, so why fix it?

If he kept say the $30 million a year saved from payroll during the 80s and 90s, and instead fielded a team of Hensley Muelens and .500 teams, would the franchise have a money-tree in the YES Network and be worth a billion and half or so? I’m not sure.

It’d also be interesting to throw another franchise in the Tri-State area. The market could certainly support them, but they would lack the historic cachet (similar to the Mets). What would the NY market look like if the Giants and Dodgers still played in NYC and never left? Would the Yankees have such a financial advantage?

As long as the system stinks as much as it does, I’m glad (as a Yankee fan) to be a beneficiary of it. It still stinks.

It’s damn good to be a baseball owner and it’s certainly not bad to be be an all-star performer or a #3 or better starting pitcher.

Pro-sports economics suck.

It also distorts the salary structure, making it more difficult for those other teams to make the good decisions you’re talking about.

There still needs to be a salary floor, some assurance that the revenue-sharing $$ won’t go into Kevin McClatchy’s failing newspapers, or Carl Pohlad’s pocket.

It seems to me that the players, overall, would also benefit. There might not be as much money for the tippy-top free agents, but more teams would be able to spend more money on more players.

More teams will lock up their outstanding young players at reasonable prices with pre-arbitration contracts (Reyes and Wright with the Mets, Longoria with the Rays, Hanley with the Marlins, etc.), and on the rare occasion when a true superstar hits the open market (CC), he’ll get paid big time.

But as teams get smarter, those mid-level stars aren’t going to see huge, big money contracts, because teams aren’t going to value them as highly. That there are fewer foolish GMs in the game than ever before helps a lot too. (My count is Ed Wade, Jim
Bowden, maybe Brian Sabean, and because I really don’t understand what he’s doing at the MLB level, Drayton Moore. YMMV.)