It Drives Me Crazy

I know I’ve written about this before, and once the post-season games get under way, I will leave this to the side. But, like fingernails on a chalkboard, so too does it drive me to distraction to hear the endlessly repeated trope that parity in baseball today is a consequence of the changes in the economic structure brought about by the 2002 collective bargaining agreement. The commissioner, of course, goes around saying this endlessly, which is bad enough. Bud has been known to have difficulty at times in speaking honestly and forthrightly, and is also inclined to pat himself on the back, even when he doesn’t actually deserve credit. But, that media types have bought, without a second thought, Bud’s explanation for that parity is too much. So, I have to get this out of my system every few months.

It’s now widely accepted that baseball has, in fact, achieved parity. One piece of evidence for this new parity, repeated often the past couple of days, is that of the eight playoff teams this season, only one is a repeat entrant from last year – the Yankees. And, of course, the Yankees were unceremoniously dumped in the first round by the Tigers in their 2006 division series. So, we are guaranteed an all new pair of LCS match-ups this season. In fact, the American League hasn’t seen a team make the LCS two years in a row since the epic 2003 and 2004 match-ups between the Yankees and the Red Sox. Furthermore, as the commissioner trumpeted to Mike and the Dog yesterday, no team won 100 games in baseball this year, and no team lost a hundred games.

Whether we’ve achieved unprecedented parity (at least in the post-strike era) is itself questionable. Bill James’ calculations, using standard deviations, asserted that the decade of the 1990s had more competitive balance than any decade in baseball history. But, the conventional wisdom is that, by the late 1990s, with baseball in the midst of the most recent Yankee dynasty, there was little “hope and faith” for the vast majority of major league teams, and no way for small-market, low payroll teams to be competitive. These were the issues that, according to Selig in 2000-2001 needed to be solved lest the game be destroyed.

So, while we may debate whether baseball has achieved unusual relative parity in 2007, what is most of interest to me, as noted above, is the assertion that the cause of the parity effect, is the change in baseball’s finances, notably the increased revenue sharing that was part of the 2002 collective bargaining agreement. This morning, for example, Greenie argued that baseball’s wonderful new parity was “entirely” a function of the new economic system, compared to the one that existed “seven-eight” years ago. Greenie’s often said that he wants to be the next commissioner of baseball (he’s joking, one presumes). And, perhaps he’s decided that one way to accomplish this is by parroting the present commissioner’s untruths. But, Greenie’s not alone. The new competitive balance and its causes have become conventional wisdom.

That conventional wisdom is, however, wrong. On one level, it doesn’t matter that people in the media have a hard time with cause and effect. But, its bothersome that such thoughtless repetition of poor logic and outright error encourages and enables baseball’s dishonest commissioner to continue to reiterate simple falsehoods without accountability. This is, of course, a much larger problem in our public discourse than the commissioner of baseball.

OK, some basic facts. Back before 2002, the commissioner repeatedly argued that the game was in trouble because of a lack of competitive balance. Of course, baseball was doing very well, revenue-wise and in terms of attendance when Selig was saying this. But, the commissioner had bigger fish to fry – namely to try to push a redistribution of revenue from players to owners, andfrom bigger revenue generating teams, esepcially the Yankees, to smaller ones, like the team Bud formerly owned, the Brewers. The Trojan Horse for accomplishing this and to bludgeon both the players and the Yankees in the court of public opinion was to talk about out-of-control payrolls which, Selig argued, were so disparate as to allow only a small fraction of teams to compete.

Many of you have heard the phrase “correlation does not equal causation” but what Selig had going for him in the late 1990s and early 2000s was the coincidence of his constant complaining about the game’s financial state with a Yankee dynasty. This made it appear that Selig’s analysis was on the money.

But, what’s happened since 2001? As I have said before, the Yankees’ payroll was consistently one of the two or three highest in the game between 1996 and 2001 (all payroll data is from USA Today’s awesome payroll database). However, during that time, it was not out of line with other high payroll teams. To take one example, in 1998, the year the Yankees blew the sport apart and won 114 games on the way to a world championship, their opening day payroll was $63 million, about seven million lower than that of the Orioles. In 2001, the year the Yankees run of championships ended, the Yankees’ payroll was 112 million, while the Dodgers and Red Sox checked in at about 109 million. In other years during the 1996-2001 period, during the competitive balance “crisis” the Yankees payroll was typically 2-4 million more per season than that of the next highest payroll team, and somewhere between 40-70 million dollars more than than the lowest payroll team in baseball. Beginning in 2002, the Yankees payroll started to leave other teams in the dust. And, in 2003, the first year of the new collective bargaining agreement, the one that Bud has always argued saved baseball, the Yankees payroll had swelled to 150 million, about 35 million more than the second highest spending club, and 135 million more than the lowest payroll team.

These trends have only worsened since then. The Yankees now outspend even the profligate Red Sox by 50-70 million dollars a year and, in 2005 and 2006, outspent by an incredible 180 million dollars the lowest spending team in baseball.

Yes, there is more revenue sharing now. But, it’s not clear that beneficiaries of that revenue sharing are using it to become more competitive. The Pirates aren’t. Neither are the Royals. Looking more closely at some of this year’s playoff teams, the Diamondbacks payroll this year is 52 million, 26th in baseball and less than half of what their division rival, the Dodgers spent. The Rockies are 25th in payroll at 54 million. Each team, in fact, spends far less than it did in 2001, the year before Bud saved baseball. Likewise, the Cleveland Indians, which tied for the best record in baseball were far more frugal this year, when its payroll was 23rd in baseball, than they had been in 2001. In 2001, between 15 and 40 million dollars separated the baseball-destroying Yankees from these three teams. In 2007, between 125 million and 140 million separates them. (and, by the way, in 2000, during the dark ages of competitive imbalance, no team won 100 games, and no team lost a hundred games)

Problem solved.

You can believe that baseball has achieved parity. You can also believe that parity is essential for the health of the sport. You can even believe, if you like, that the sport would be healthier if there was more revenue and payroll balance between franchises. But, you cannot, if you have any claim on logic at all, believe that payroll disparities were destroying competitive balance in 2000-2001, and that the post-2002 system, under which payroll disparities have dramatically increased, is the cause of the new competitive balance.

Bud could spend his time lauding the obvious increase in intelligent management in the game over the past few years, which happens to have coincided with the new economic system. More organizations are being smart about drafting, scouting and avoiding wasting money on mediocre veteran free agents. The Brewers, Diamondbacks, Twins and Indians have joined the Oakland A’s in being smart, young and frugal. But, this is not a function of revenue sharing, or Bud Selig’s genius and great concern for the health of the sport. It’s a function of more organizations knowing how to be competitive without spending a king’s ransom on overpriced talent.

We live in a world where our President and other political leaders regularly lie or mislead about things like WMD, the cost of funding health insurance for children and the supposed “crisis” of social security. And, in that world, our media repeatedly fails to point out the obvious flaws in logic and gaps in evidence that might prevent those claims from achieving such an insidious place in our national debate. That Bud does this about baseball’s economic structure is of far less consequence than all of that. But, that he gets away with it is a function of the same laziness that afflicts much of our press more generally.

And it drives me nuts.


6 Responses to “It Drives Me Crazy”

  1. One thing….

    Is this the best sports journalism on the web? I mean, who else does what you do? Outside of just the race stuff who else writes articles like this? Who writes the kind of stuff that you guys pen about PEDs and concussions and salaries, etc.?

    And better yet….why aren’t YOU GUYS the mainstream? Any reasonably intelligent person would crave something like this.

  2. “But, that he gets away with it is a function of the same laziness that afflicts much of our press more generally.”

    Karl Rove taught these people very well.

  3. thanks, i didn’t know payroll disparities kept increasing. But a more important question. If you are giving credit to the new young GM minds in baseball does it follow that there will soon come a time where parity in baseball GM “Moneyball intelligence” will even out and then possibly bring back the significance of payroll?

  4. Ap

    Thanks for the compliment.


    Ever since Moneyball came out, in 2003, this has been the fear – that the big money teams would “catch up” on the knowledge front, and then bury the small revenue teams. Time will tell, but I suspect that smart management will keep smaller revenue teams competitive for a long time – though if I were a non-Yankee, non-Red Sox fan, the infusion of young talent in both those organizations would concern me.

    There’s another thing going on, though, almost never pointed out, which is that the divisions are largely (and coincidentally) organized in a (fairly) equitable way from a revenue standpoint. The Brewers aren’t competing with the Yankees and the Sox – they’re competing with the Reds, and Pirates, and Cards. The Cubs are a bigger revenue team, but if you look at the divisions – like the AL Central, or the NL West, you’ll see something similar. It does neutralize the financial discrepancies to some degree.

    I do feel badly for the Devil Rays.

  5. This is just a spectacular piece of writing, interweaving as it does the local annoyance – Bud’s un-called-out nontruths – and the distressing larger picture. So, so great.

    Keep it coming.

  6. great stuff

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