Friday, January 2, 2009

The Yankees Are Bad For Baseball (yeah, right)

Here it comes. The annual "The Yankees are bad for spending money...competitive imbalance...blah blah blah" arguments that come up this time of year. For those not familiar with this annual rite, the gist is this: The Yankees spend too much money; they are just buying championships; they are killing small market teams, etc. Conveniently ignoring the fact that there have been 8 different winners in the last 9 World Series, and the Yankees haven't won since 2000, or that 18 of 30 franchises have made the playoffs at least once the last three years or that the National League has had 10 different franchises win a pennant the last 11 years, sportswriters decided this winter "Just declare the Yankees the champions. Why have a World Series?" "The Yankees are bad for baseball." And my favorite, from Phil Sheridan of the Philadelphia Inquirer,"The New York Yankees represent the very worst of America."

Oh, please. The Yankees are the best thing to happen to baseball. There is a reason that when the Yankees visit a city, they break attendance records. (In 2004, when the Yankees visited Los Angeles, the Dodgers recorded over 55, 000 fans in attendance, or the highest recorded attendance in 31 years...including World Series games.) There is a reason that when the Yankees play an away game on a getaway day, the game is scheduled at night, even though most teams play day games on getaway days. Why? Because the local television want to broadcast the games at night when people are home from work, because they know they will get the highest ratings of almost any game that year.

Why do people come to see them? Simply put...they are the Yankees. They will invest money in their product to give themselves in the best chance. They will do whatever it takes to win, including spending money and the fans respond. Not only in New York, but everywhere. It's good business, not just for the Yankees, but for baseball. Fans want the best product and the Yankees deliver.

And as a result, the Yankees earn a lot of money—which certainly makes other fans mad. But the point is they spend it, while a team like the Houston Astros, home to the fifth biggest market, cry poverty and pretend they are small market and spend next to no money on their own team. As a result, they are mediocre.

Example #1 of the crying poverty nonsense; Milwaukee Brewers owner Mark Attanasio. “At the rate the Yankees are going, I’m not sure anyone can compete with them,” Milwaukee Brewers owner told Bloomberg News in an e-mail after the Yankees signed Texeira. “Frankly, the sport might need a salary cap.” This coming from an owner who made almost $40 million over the 2006 and 2007 seasons and is set to make more money after the Brewers ranked 9th in attendance this year, up from 17th just two years ago.

However the internet and newspapers have been riddled with complaints of Yankee malfeasance; articles unaware of their own wrongheaded logic. Here's an except from an article from bleacherreport.com

In a span of a week, the Yankees have signed the top pitchers in the market, C.C. Sabathia (17-10, 2.70 ERA in 2008) and A.J. Burnett (18-10, 4.07 ERA in 2008). It seems to be the way the Yankees function. Spend the big bucks and make it impossible for the weaker guy to win.

In recent years, the Yankees have been disappointing. Last year was a good example of that. The Yankees finish third in the AL East, much due to the emergence of the Tampa Bay Rays. The Bronx Bombers finished 89-73.

So the article's principle argument states "Spend the big bucks and make it impossible for the weaker guy to win and in the very next sentence states that the Yankees came in third behind the Tampa Rays. The article then goes on to write, "It seems baseball is now a game of money, not talent. The spenders are usually the ones who succeed," conveniently ignoring the fact that the World Series played three months ago was played by two teams ranked 13th and 29th in team salaries and who beat the 1st, 3rd and 4th teams in salaries.

Let's go back to Mr. Sheridan and his circuitous logic.

What's wrong here is obvious. It's also not really new. Unlike the NFL, NBA and NHL, baseball has no salary cap.....Those leagues have them as part of an effort to maintain some kind of competitive balance among teams from different-size markets in disparate parts of the country. The Yankees have proved for the last five years that buying the highest-priced players does not guarantee you a title. Teams, not necessarily all-star teams, win championships.....The bully franchises make good foils for everyone else. It was a nice, fun story when the Tampa Bay Rays played their way into the World Series to face the Phillies (who in turn beat out the New York Mets and their bloated payroll).....When the bullies win, well, they're supposed to. When they lose, well, they give everyone something to laugh at....."

OK, let's get this straight. The Yankees are bad for baseball because they destroy competitive balance, but they haven't won the Series in 9 years and didn't even make the playoffs this year and got beat by the Rays. How does that follow? Let's read on.

In fairness, MLB did create a luxury tax system that punishes overspenders such as the Yankees and Red Sox and adds revenue to the coffers of teams such as Florida and Kansas City. Of course, that system also gives some of the small-market teams a disincentive to spend money to win. They can pocket their free money from New York and Boston and continue to flounder on the field.
Nonsense. The Yankees and revenue sharing don't cause a "disincentive to spend money and win." A reluctance to spend is the reason teams don't spend. As James Lincoln Ray wrote in his essay, "Baseball's Revenue Sharing Problem", some teams use the money they receive in revenue sharing to improve their ballclub. "The Rockies used all of the $16 million they received in 2006 revenue sharing dollars to increase their payroll in 2007, and that certainly helped the team win this year's National League pennant." He goes on to write that the Detroit Tigers in 2006 used the money they received to attract Magglio Ordonez and Ivan Rodriguez and win the pennant the next year.

There's no "disincentive" to not spend money on free agents and lose. Teams just do it to be cheap. It's easier to pocket your revenue sharing earnings, smile, then publicly blame the Yankees for trying to win than to actually go out and sign a free agent.

Ray continues in his essay:

The Marlins won the World Series title in 2003 with a team that had...Josh Beckett, Brad Penny, Mike Lowell and Ivan Rodriguez. That year, the team had a respectable $54 million payroll. Rather than retain those players, however, the Marlins traded away Penny and Beckett for much cheaper players, and lost Mike Lowell and Pudge Rodriguez to free agency.

By shedding these stars, Florida was able to cut its payroll down to $14.9 million in 2006, which is less than 20% of the Major League average of $78 million. It was also less than half of the $31 million in revenue sharing dollars the team received that year. So, rather than using the money to retain or attract on-field talent, the owners took it as part of the team's MLB best $43 million profit in 2006.

The Rays might be worse than the Marlins. From 2002 through 2006, Tampa Bay took in an average of $32 million per year in revenue sharing money. During that same period, the Rays had an average payroll of just $27 million, which was the lowest in baseball. They also had the worst five year record on the field, winning an average of just 70 games per season. Yet the team turned an average profit of more than $20 million during those years.


It's interesting to note that since Ray wrote this, the Tampa Rays increased their payroll to $43,820,598 last year and with the players they spent money on, made it to the World Series. That exemplifies that young talent mixed in with some money spent on free agency is the best method. Crying poverty and doing nothing, however, does not.

A high-ranking MLB official once said anonymously to Richard Justice of the Houston Chronicle, ''There are owners that would like to see the Yankees win every year. They believe it raises the water level for everyone.'' See,TV ratings when the Red Sox and Cubs are on are decent. The Dodgers still do well. The Giants, Tigers and Cardinals still hold their own. But nothing is as good for baseball—financially speaking—as having the Yankees playing deep into October. When they're on, more people tend to watch. And when more watch, there are more earnings. So let your team lose, have the Yankees win the Series and pocket the revenue.

To sum up a response to Mr. Sheridan's silly "The Yankees are bad for America" spiel, I'll quote from soxandpinstripes.com:

"Now what seems un-American or bad for economic times? Spending money on an internal product? Drawing fans into the American economy? Boosting revenue and paying higher taxes as a result?"

And to that, I'll add the thought. Is trying to win, anti-American, Mr. Sheridan? I'll bet in your heart of hearts, you know the answer to that one.

3 comments:

Anonymous said...

"The Marlins won the World Series title in 2003 with a team that had...Josh Beckett, Brad Penny, Mike Lowell and Ivan Rodriguez. That year, the team had a respectable $54 million payroll. Rather than retain those players, however, the Marlins traded away Penny and Beckett for much cheaper players, and lost Mike Lowell and Pudge Rodriguez to free agency."

THE TRUTH. Marlins payroll increased after winning the World Series in 2003, spending $135 million over the next two seasons. Only when the deal for a new stadium fell apart because of local politics and the revenue stream they were counting on evaporated did they slash payroll.

Of the four players mentioned, only Pudge left through free agency for what then was thought a ridiculously high $40 million contract engineered by Scott Boras to the then laughingstock Tigers who needed Rodriguez as much for PR as for his ability on the field.

Rodriguez only signed for the 2003 season with the Marlins after no one else wanted him and Japan looked like his only recourse, with the understanding he was there to showcase his talents and prove he could still play. And boy did he!

Penny stayed a Marlin until half way through 2005 when he was traded in a very unpopular trade (on the Dodgers side) for Paul LoDuca.

Lowell was not lost to free agency, where this guy you quoted got that I have no idea, he was traded with Beckett in the winter of 2005, two full seasons after winning the World Series", for four "cheaper players" as the author put it, among them one of the most exciting young players and all-star, Hanley Ramirez, and Anibal Sanchez who threw a no-hitter in 2006, his first season with the Marlins. The Red Sox are still dispirited they let Hanley get away, are now trying to dump Lowell but can't find any takers, and Beckett after one marvelous season has been a good, but very iffy pitcher.

The rest of the article you quote is a fable as well. Just ask yourself if you think with the worst lease in professional sports, a fan base that stays home because they hate the stadium so much, no concessions or parking revenue, no skybox or club seat revenue, no advertising revenue, I don't think I need to go on, that the Marlins, without a YES Network, without international marketing clout and dollars to match, without any of the revenue sources every other team in professional sports takes for granted, were the most profitable team in baseball?

Only Forbes with their cock-eyed accounting and the lunatic fringe really believe that.

You depended on someone who is either a fool or a liar or both to build your post around and he got virtually every fact you quoted wrong.

Now, you either knew that and decided to use it anyways because it furthered your agenda which I doubt, or you were duped and didn't fact check the piece you quoted and now wish you had, but either way the falsity of that piece undermined the validity of any of your argument.

And oh btw, the Marlins had a winning season last year, something fourteen out of thiry major league teams didn't and were in contention until the last two weeks of the season, something twenty out of 30 couldn't say either. So for all their sins, the Fish must be doing something right.

The Marlins are a convenient whipping boy for anyone who wants one because the mythology surrounding the team is pervasive throughout the media and fandom.

But like most myths most of it isn't true. Half the teams in major league baseball wish they could be the Florida Marlins and the other half are afraid of what happens if they do.

P-Cat said...

Actually, we're both correct. The Marlin payroll decreased the year after they won the Series, increased moderately the following year, then decreased the next two years.

The Lowell thing was a sort of mistake. He was traded away, not let go as a free agent, but only after it was made clear he wanted to leave; in effect he was leaving anyway, so they got Hanley Ramirez for him. However, to say the Sox are dispirited about the Beckett trade is a bit much. The Red Sox love Beckett; he's their ace. Lowell, too isn't a disappointment, the Red Sox resigned him just last winter, so saying the Red Sox want to dump him is a a bit of a stretch.

And look. The Marlin fan base is moribund yes. But the way the franchise has been run has contributed to that. They won two World Series, then got rid of the teams that won them shortly afterwards. I understand they don't have the resources of some other franchises, but in this chicken/egg scenario, perhaps they don't have a strong fan base because they are seemed as a bit mercenary, and not rewarding their fans by trying to keep some of their players.

And yes, the Marlins did have a winning record last year, which is sort of my point. A high team salary doesn't necessarily mean a winning record was exactly my point, so we agree on that. Thanks for writing in.

Ray said...

Wahh! Wahh! Waaaah! Yankees bad for baseball? Damn stupid if you ask me. I grew up as a White Sox fan and always feared when the "Damn Yankees" (as a once English-speaking Harry Caray referred to them) came to town and crushed our hopes. But we certainly did not miss a White Sox-Yankees series. The big show is in town! People hate winners because they wish their team could be as successful. People love losers. Why does "everybody" love the Cubs? Because they are lovable losers. It is sickening. Don't get me wrong though, I usually go for the underdog, but always pull for the Yankees once the Sox are out of it. They can always be depended on to squash the "Nominal League." So I say Boo-Hoo to the jealous Yankee haters. Billy Martin should have been elected president, with Thurman Munson as his V.P. As a Chicagoan, I have to hate New York, but Go Yankees and Go Mets!