Big Money Ball

Josh Hamilton signed with the Angels for a big payday, yet hasn't found his stroke. Photo Courtesy: Darryl Briggs
Josh Hamilton signed with the Angels for a big payday. Photo Courtesy: Darryl Briggs

Can Money Still Buy Wins in Major League Baseball?

By Rodney Fisher

For decades, Major League Baseball has been divided between the “haves” and the “have nots”. Teams in major markets with large revenue potential have had the upper hand in putting together winning rosters, so much so that many baseball fans conceded their team’s season before opening pitch.

Enter revenue sharing among all teams, good and bad. A move that Major League Baseball thought would level the playing field. Unfortunately, the low salary teams saw this as a way to make a profit with a bad team, versus increasing their spending on free agents. The larger revenue teams still benefited with wins and championships, i.e. the New York Yankees and Boston Red Sox.

Enter the current MLB collective bargaining agreement that runs until 2016. Small-market and low-revenue teams will have the ability to obtain additional supplemental-round Draft Picks through an annual competitive balance lottery. The 15 teams in the largest markets will be disqualified from receiving revenue sharing by 2016.

The result was lower teams being able to build with cheap new talent rather than spend more money. Notice the new agreement states that the 15 teams in the largest markets stop getting revenue sharing by 2016. Regional broadcasters like Fox Sports saw an opportunity to secure long term broadcasting deals with those franchises, which gave them all a huge influx of cash. Cash that they spent immediately overpaying for every top free agent that hit the market.

The New York Yankees, with the benefit of their YES network, have been able to operate around the $200 million mark since Derek Jeter was a rookie. The result of which has been five world championships, the last was 2009. The YES network has a 30-year broadcasting deal with the franchise, and last year sold 49% to Fox Sports for a whopping $3 billion. The Yankees have the luxury of trial and error on their side. Spending money is business as usual.

What about the newbies at the big boy table? The 2012 Miami Marlins started their first season in a brand new stadium built with tax money and a payroll just north of $118 million, more than double from the previous year. The end result was a disastrous mid-season fire sale and finishing last in the NL East at 69-93. In 2013, they have the second lowest payroll in league, but the newest stadium.

The Los Angeles Angels shocked most people at the 2011 winter meetings by signing both C.J. Wilson and Albert Pujols for a combined $331.5 million total. Days later, owner Arte Moreno announced a new television deal with Fox Sports worth $150 million per year for 20 years. That season the Angels finished 3rd in the AL West, 89-73 and out of the postseason. With more money to spend, the Angels again went after the big free agent Josh Hamilton this offseason. Currently, they are second to last in the American League with a 14-22 record.

The other LA team, the Dodgers, may be the biggest example that big money may not equate to big wins. After starting the season with the second highest payroll of $216,302,909, the Dodgers find themselves 15-21. The owners however have a $7 billion dollar 25 year deal with Time Warner to rely on.

In contrast to big spenders, teams that have used the collective bargaining agreement to stockpile young talent have been the big surprise winners. Take the Oakland A’s of 2012 for example. They had the lowest payroll in MLB, $52.9 million, yet won the AL West. In 2011, the Arizona Diamondbacks with a $53.6 million payroll won the NL West.

Over the last two years, MLB teams in the postseason have been split evenly 8-8 in regards to payrolls above or under the $100 million mark. If you combine the payrolls of the World Series champions from both seasons it would be under what the Dodgers or the Yankees are spending for 2013. Teams have got to realize that in today’s baseball money does not buy wins.