The old adage, “Be careful what you wish for,” should be a siren call to Major League Baseball owners and executives calling for a salary cap in the wake of the Yankees’ off-season spending spree.

Oakland A’s owner Lew Wolff, Milwaukee Brewers owner Mark Attanasio, Houston Astros owner Drayton McLane, and Pittsburgh Pirates President Frank Coonelly took turns lamenting baseball’s status as the only Major League team sport without a salary cap. All four suggested that a salary cap would be a panacea for both parity in MLB and preventing the Yankees from acquiring the best – and most expensive - free agent talent. As my father used to say every time I made a suggestion he was loath to embrace, “It sounds good.”

Indeed it does. After all, in leagues with a salary cap, there is no equivalent of the Yankees, a team that can purchase any free agent it chooses regardless of the price. And, so the theory goes, there is more parity in leagues with a salary cap, particularly the NFL which is the poster child for sharing revenues equitably. Except it’s just not true.

The NFL shares a higher percentage of revenue (approximately 70%) than the NBA, NHL and MLB. But the revenue discrepancy between the richest and poorest teams in the NFL exceeds $100 million. Because a salary cap in sports also includes a floor - a minimum amount each club must spend on payroll – the lower revenue clubs make significantly less money (they spend a higher percentage of their revenue on payroll) than the higher revenue clubs.

The NFL does have parity - how else to explain the Arizona Cardinals in the Super Bowl? Most teams, with the exception of Detroit and Cincinnati, begin each season with a reasonable chance of making the playoffs. But that’s as much a function of the nature of the sport and the limited number of games in a season as it is a salary cap.

The NBA’s salary cap would be laughable, except it’s no joke. The intricacies of the salary cap are known to only a handful of humans, living or dead. And the bottom line in constructing a team has nothing to do with talent and everything to do with the bottom line: Making sure each team stays within the parameters of the salary cap/floor.

As for parity, unless the Celtics decide to guard anyone other than LeBron James in their expected playoff matchup with the Cleveland Cavaliers, does anyone believe the two teams in the NBA finals will not be named the Lakers and the Celtics – again?

In the NHL, clubs such as Nashville and Columbus are hemorrhaging millions thanks to the minimum salary requirements, while Phoenix will reportedly lose $30 million this year and teeters on the brink of bankruptcy. The strongest teams in the salary cap era – Detroit, San Jose, New Jersey – were also dominant prior to the advent of a salary cap. Can you say good management?

A salary floor in MLB would require teams such as the Florida Marlins to increase payroll by as much as $50 million over last year’s figure.

The only realistic source for that money would be increased revenue sharing - taking more money from the Yankees to distribute to other clubs. Which is what all the crying and grandstanding is about. Clubs want to reduce the Yankees’ spending power; but owners can’t increase revenue sharing or implement a salary cap without the consent of the union. Peace will come to the Middle East before MLB negotiators convince the union to agree to a salary cap.

What the whiners fail to acknowledge is that parity in MLB doesn’t take a backseat to any league, including the NFL. In the last eight years, 13 different MLB teams have played in the World Series – the Yankees only twice and they lost both times - compared to 12 different NFL teams that played in the Super Bowl.

A salary cap in MLB is merely a pipe dream. It’s also a convenient crutch for incompetence on the part of team management. If the Pirates had drafted as well as Tampa Bay over the past 12 years, they - not the Phillies - would have played the Rays in last year’s World Series. Now that’s something for Coonelly to focus on.

Jordan Kobritz is a regular contributor to the Business of Sports Network. He is a former attorney, CPA, and Minor League Baseball team owner. He is an Assistant Professor of Sport Management at Eastern New Mexico University and teaches the Business of Sports at the University of Wyoming. Jordan can be reached at \n This e-mail address is being protected from spambots. You need JavaScript enabled to view it

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People like you......
written by emoneypitt, January 27, 2009

who write columns like these always convienently fail to mention what happens to these small market Cinderella stories a couple of years after their initial success, sometimes even sooner. When the core of good players on the Tampa Bay Rays become eligible for free agency, how many of them will be bought up by teams like the Yankees and how many will remain in Tampa Bay long term? I think you know the answer to that.

The current state of Major League Baseball is nothing more than glamorized version of the Minor Leagues. Small market teams are just a farm system for the big markets. Sure, the argument is there that 13 different teams have played in the last 8 World Series but the Yankees made the playoffs 12 straight years and the Atlanta Braves won 13 straight division titles until a couple years ago. Would either of these clubs have been able to pull this off without a) being able to sign their homegrown talent to big contracts with the time came, and b) buying big money talent from the outside when needed? I think you know the answer to that as well.

Milwaukee offers CC Sabathia $100 million to stay in Milwaukee, plenty of money to financially set a player for life on a team that should be a contender again this season. What do the Yankees do? Come along and simply ante up $180 million. This has happened in the past with Oakland, Minnesota and Cleveland, is happening now and will continue to happen in the future to teams like Tampa Bay until a fair system is put in place.

You cite the Phoenix market in the NHL as a victim of the salary cap. Perhaps Phoenix is just not a good market for hockey and have not drafted good enough talent to make that team a competitior. Before the NHL lockout, as many as three fourths of the franchises were losing money. The league, despite it's poor TV contract and ratings, is in much better shape now.

One last parting shot: Frank Coonelly is not responsible for the current despair of the Pirates. That "honor" belongs to Kevin McClatchy (although credit is due there for him having a big part of PNC park being built to ensure the Pirates remained in Pittsburgh), Dave Littlefield and Cam Bonifay before him.

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Unfettered Capitalism
written by Amarillo_Fats, January 27, 2009

...is great if you're in the private sector and for you to succeed at your finest, you need to crush your competitors. Coke's best dream scenario would be if Pepsi ceased to exist. But professional sports is different. For a league to succeed, there cannot be stagnation between the "haves" and "have nots". Everyone who shares your view points to the 1950s and calls it the "golden age of baseball"....yeah, for people who lived in New York! The Yankees, Giants and Dodgers were the only teams who ever did anything relevant...and fans of other cities took up knitting. Hence the rampant expansion and franchise relocation of the time. Get your mind out of the NY/Boston vacuum and get in touch with the rest of the country.

MLB is like playing Monopoly...you're playing the same game and the properties are the same, but some players get to start with $20,000, and some have to start with the standard $1500....even if the first player barely understands the game beyond the basics, who do you think has a better chance to win?

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Cherry Picked
written by Firsthand knowledge, January 27, 2009

It's obvious that the writer is a Yankees or Red Sox fan. I always enjoy how writers like this cherry pick statistics that supposedly demonstrate the "parity" of baseball: "In the last eight years, 13 different MLB teams have played in the World Series." What the writer doesn't mention is the painstaking process a small market team has to go through to even compete for the playoffs let alone win a World Series. For a team like the Marlins to be competitive they have to sign and trade for a large amount of young players and hope they can produce enough quality starters before those players reach their free agency years. If they are so lucky as to compete for, and win a World Series, they almost immediately have to trade all of their good players (to the Yankees, Red Sox, and Angels of course) for more good prospects so that they do not lose them all in free agency. Compare that painstaking process (which must be repeated every 5 years or so) to that of Yankees, which simply involves pulling a checkbook out of ones pocket and agreeing to the players asking price. This system virtually guarantees that teams like the Marlins, Rockies, and yes the Rays, will never have long term success. As emoneypitt stated in his posting above, small market teams can never be competitive long term with salary pressures.

In addition, if success depended solely on drafting and developing players then the nobody should be better than the Marlins. Where are all their good players? Playing for the Red Sox, the Tigers, and other teams that can afford to shell out triple digit millions contracts. Ultimately, baseball will never reach its full potential unless it learns this lesson: Having a wealthy few teams that compete every year for championships, while the other teams are glorified farm systems is not good for the sport as whole.

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Nothing Useful in this Story
written by Jesse, January 28, 2009

Nothing new here- no compelling points, no well-structures arguments - nothing.

You can't measure parity on who wins the World Series alone. While that is one meaningful measure, it doesn't account for sustainable success or the benefits of having your fans excited over the prospect of a good season. A Yankees "failure" is last year when the missed the playoffs, but still won 89 games. The Pirates haven't won that many games since 1992, and aren't likely to any time soon. Yes, Pittsburgh could be run better and get glimpses of success like the A's, Twins, Rays and Marlins have had. However, even those examples that anti-cap (aka Yankees fans) point out are teams who go through many re-building years. They are only good occasionally, and only the Marlins won the World Series - and immediately had to sell off all their players.

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