Thursday, February 5, 2015

6 comments Paul Hoynes Thinks MLB Should Have a Salary Cap to Create the Competitive Balance That Already Exists

Over the last 48 NBA Finals, 15 different NBA teams have won the NBA Title. 27 different teams have played in the Super Bowl with 18 teams winning a Super Bowl. Of the last 48 World Series, 27 different teams have been represented and 20 different teams have won the World Series. So obviously MLB has to do something about the competitive balance issue they have which has allowed a larger diversity of teams to win that major sport's title. Well, not really, but that's your view if you are Paul Hoynes of A salary cap fixes all of a sport's issues. Just ask the NBA, where only nine different teams have won the NBA Title since 1980. A salary cap will fix everything, because small market teams like the Cleveland Indians just can't compete in the current market.

There is never going to be competitive balance in baseball.

This is a trick statement. There is already some competitive balance. Small market teams like the A's and Rays are competing for division titles. You can't fool me!

In a game where the players have proven time and time again that they will strike to prevent it, perhaps it was never meant to be.

By the way, Hoynes will blame the players for MLB not having a salary cap. It's their fault. If Selig really felt a salary cap was so necessary, don't you think he would have pushed it harder during negotiations for the CBA? So it seems neither side wants a salary cap, but Hoynes still thinks it's a good idea to ensure the type of competitive balance the sport already has.

Bud Selig leaves the commissioner's office on Jan. 24. He has accomplished more than anyone who has held the office before him, but he couldn't wrestle this problem into submission.

I don't hate Bud Selig as much as it seems others do, but let's simmer down a bit.

Selig championed revenue sharing and it has kept many teams, the Indians included, afloat during troubled times.

Yeah, you are welcome Miami Marlins. While writers complain about a lack of parity, the revenue from high revenue teams is awarded to lower revenue teams who don't spend as much and are able to make a profit as a result. I still don't know how I feel about this system, but while Hoynes complains about a lack of salary cap, some of the excessive spending on free agents leads to asses in seats, which leads to revenue, which helps keep teams like the "non-competitive" Indians afloat.

But afloat and competitive are different things, especially when the use of revenue sharing funds can be siphoned to other areas besides player payroll.

Which is why it is the responsibility of the team receiving this revenue sharing to use these funds in the best possible manner to improve the team.

He instituted one wild-card team for each league in 1994 to the groans and wails of purists. It worked so well that he added another wild card to each league in 2013.

It's not a wild card, it's a one game playoff. I'm so frustrated with this set up I'm going to stop typing now.

But all that progress suffers when the Red Sox can simply open their wallet and pay free agent infielders Pablo Sandoval and Hanley Ramirez a reported $183 million in combined salaries.

Because when has it ever not worked out after a large market team opened up it's wallet and spent money on free agents? I can remember all the World Series won by the Rockies after signing Denny Neagle and Mike Hampton. Who can forget the Texas Rangers dynasty led by Alex Rodriguez and Chan Ho Park? More recently, the addition of Adrian Gonzalez (through trade) and Carl Crawford led to a World Series victory for the Red Sox...of course after they had traded both players. Not to mention the Dodgers recently had the highest payroll in the majors with Hanley Ramirez on that roster and it didn't even turn into an NLCS appearance this past season. But yeah, progress is suffering because the teams that spend the most money are always winning the World Series and are the only teams that can compete. Just don't pay attention to what's really happening and this statement may be true.

Two years ago the Red Sox won the World Series. This year they finished last in AL East at 71-91.

And of course, Ramirez and Sandoval are the two players that will make the only difference in the Red Sox winning 71 games again or winning the World Series. Over the last five years here is how many games that have been won by the Red Sox compared to Hoynes' hometown Cleveland Indians.

The Red Sox have won 416 games.
The Indians have won 394 games.

That's a difference of 22 wins over five seasons with a difference in payroll of $477 million (Going by Opening Day payroll of about $816 million for the Red Sox and $339 million for the Indians). The Red Sox paid $21.68 million for each additional win and the same number of playoff appearances (one each), but it's a huge problem when teams like the Red Sox spend money due to competitive parity being totally ruined.

During the course of the 2014 season, much was written about Boston rebuilding with young players such as Brock Holt, Xander BogaertsMookie Betts, Christian Vazquez and others...The rebuilding effort lasted about a half a season before Boston's owners waved their wallet at the problem.

Those writers like Dan Shaughnessy who claimed the Red Sox were rebuilding with young players were mistaken at the time and they are mistaken now. Ben Cherington made it clear that he was dumping payroll so that he could clear up the books and make a run at free agents or players through trade this offseason. The mistake was not listening to what Cherington said when he stated things like:

"We felt like what made the most sense for us was to try to focus on impact major league talent that is ready and we have a lot of good young players, we have strength in our farm system, so that is already a strength," Cherington said. "Although there were some prospect packages or prospects available to us that were very attractive, we wanted to add to the major league team and really give ourselves a head start on like I said building again and becoming as good as we can as quickly as possible. 

"...becoming as good as we can as quickly as possible." Sure sounds like they were going to be a player in the free agent market didn't it? Cherington was focusing on "impact major league talent that is ready..." which would lead one to believe they weren't just rebuilding around young players. But again, it's better to paint the Red Sox as going against their word of rebuilding slowly, even though that wasn't their word. 

The wealth of the Boston ownership and the loyalty of Red Sox Nation has allowed it to work the system. They're good at developing their own players and have been aggressive on the international free agent market. Plus they have more than enough money to correct mistakes and fill holes.

Because the money has helped them so much over two of the last three seasons when they essentially gave up on the season, sold off the expensive players Paul Hoynes is horrified they were able to sign and ended up being last place in the AL East. The list of teams who have thrown money at players to fix holes and correct mistakes which ultimately led to failure is quite long. What caused the Red Sox to go to such extremes in rebuilding is that they had expensive players who ended up being mistakes or had players they wanted to unload in order to temporarily lower payroll. The only reason the Red Sox have to sign Ramirez (to play left field it seems) is because Crawford didn't work out in left field and the Red Sox ended up trading him.

It is a tough combination to beat. Sandoval and Ramirez both received qualifying offers from their old clubs, the Giants and Dodgers, respectively. It means the Red Sox, if they sign both players, will forfeit two high draft picks in June, but not their first pick. That will be protected because of their last place finish this year.

The Red Sox also have a competitive balance pick from the A's. WHAT? A competitive balance pick went to a team who is the very reason competitive balance picks are necessary! What madness has baseball wrought without a salary cap?

There are 29 other teams in the big leagues and not all of them are as talented or as wealthy as the Red Sox.

And yet, 26 of them have appeared in one of the last 48 World Series and 19 of them have won the World Series over the last 48 seasons. This is better than two leagues with a salary cap, the NFL and the NBA, can claim. Anyway, despite the fact Paul hasn't even come close to pointing out why a salary cap would be beneficial, instead choosing to focus on why no salary cap is supposedly hurting the competitive balance in MLB, let's move on.

This is what happens when there is no salary cap. The teams that can afford to burn money do it whenever necessary.

While true, this doesn't mean these teams that burn money also have the most success. The Indians have a better record than the Red Sox over the last three seasons and the Kansas City Royals just made the World Series. The St. Louis Cardinals aren't a small market team, they also don't spend money on expensive free agents that often, and they have been one of the dominant National League teams over the past five years. The other dominant National League team over the past five years is the San Francisco Giants, another team not well-known for flashing cash around to acquire big name free agents. The Giants do have a high payroll but three of their six players making double-digit millions in 2014 were homegrown and five of these players were already on the Giants' team when they signed their contract to make $10 million or more per season.

Certain teams can spend money, that's well-known, but spending money isn't the same thing as having success and winning championships. Paul Hoynes should not get these two things confused with each other.

The teams that can't, have no choice but to stand and watch.

Except, not really. Again, the Kansas City Royals just appeared in the World Series, while the Rays and A's have both been very successful in the last decade without a large payroll. It can be done and teams that can't pay for expensive free agents can still compete.

It seems as if every team takes its shot now and then. The rich teams just have more ammunition.

The teams that have a larger margin of error also tend to spend bigger in great quantities than other teams who spend money on free agents only occasionally. The mistakes the rich teams make are bigger mistakes. This tends to even things out at times.

The Indians spent a combined $104 million on free agents Nick Swisher and Michael Bourn before the 2013 season. Halfway through their four-year deals it has not been money well spent.

And yet, the Indians have won 177 games over the last two years despite having Swisher and Bourn on the roster. Also, they have the reigning Cy Young Award winner and a starting rotation of under-25 guys like Trevor Bauer, Danny Salazar, T.J. House, along with a 27 year old Carlos Carrasco. But yeah, those two contracts haven't been good for the Indians, but they also haven't ruined the Indians team like Hoynes would like you to believe.

The Twins spent $84 million last off-season on free-agent pitchers Ricky Nolasco, Phil Hughes and Mike Pelfrey.

Hughes was pretty good last year and the Twins' problem wasn't simply that they spent $25.5 million on these three players last year. It's not like if they three pitchers had pitched well then the Twins would have won 90 games necessarily. Common sense shows that it's not just about spending money on free agents, but spending money on the right free agents and filling in the roster around these players. That's why the Red Sox signing Ramirez and Sandoval isn't the best example of why MLB needs a salary cap. These two players could just easily be two more Carl Crawford-type contracts for the Red Sox. They may not be, but that's the risk the Red Sox are taking. Even if it works, there is no guarantee of another World Series victory in Boston.

Giancarlo Stanton wasn't a free agent when the Marlins gave him a 13-year, $325 million extension earlier this month, but it certainly was a shot across the bow that carries no expectation of a repeat performance. Especially by Marlins fans, who have a firm grasp on what is here today is not necessarily here tomorrow.

By the way, a salary cap in MLB would do more to prevent the Marlins from building around Stanton because they couldn't necessarily afford to spend money on pitchers like Jose Fernandez or Henderson Alvarez. After giving Stanton the contract they did, the Marlins could conceivably not have the cap room to spend money to keep the rest of their young team together. The Marlins may not keep these players together anyway, but at least they have control over how much they spend if they did want to keep Fernandez and Alvarez.

Other than screaming, "IT'S BAD FOR THE GAME" and ignoring recent and long-term evidence this isn't true, Paul Hoynes hasn't given a good reason for why MLB needs a salary cap. Baseball has competitive balance, regardless of whether Hoynes wants to believe it or not.

The current bargaining agreement ends after the 2016 season.

Will that be the time the owners once again try to impose a cap on team payrolls? Will this generation of players, untouched by labor strife and under new union leadership, respond as steadfastly as their predecessors?

They probably will. A salary cap isn't the cure-all that Paul Hoynes presents it as. I think the players are smart enough to realize this. Baseball's economic structure isn't perfect by any means, but a salary cap wouldn't necessarily go a long way to ensuring competitive balance. It seems MLB is doing decently right now in ensuring there is competitive balance in the sport even without a salary cap. Again, rich teams spending money on free agents doesn't immediately lead to a World Series title.

Or will baseball simply continue to be a game where only the uber-rich can compete as owners?

If baseball is a game where only the uber-rich can compete as owners then what does that make the other sports like football and basketball where fewer teams have won titles over the last 48 years? Rich teams have the chance to acquire good, expensive players, but as is seen time and again, this doesn't mean that team won't regret signing those expensive players. All teams have to be smart in making personnel moves. It's just some teams have the money to acquire expensive free agents and other teams do not. In acquiring these expensive free agents comes risk for these rich teams.

Where teams like the Indians, owned by Paul Dolan and family, have no realistic chance at ending a World Series drought that will be entering its 67th year come opening day in 2015?

The Indians have no realistic chance at ending their World Series drought? Two years ago the Indians were in the one game Wild Card playoff, just like the Kansas City Royals and San Francisco Giants were in the one game Wild Card playoff this year. Don't give me this crap about the Indians not having a realistic chance to compete for a World Series. 


Chris said...

I don't particularly feel baseball needs a salary cap but I also feel this is always a roundabout argument. Yes the Red Sox can open their wallets whenever they want but it doesn't mean that it will actually work. A couple years ago they opened their wallets for Crawford and Adrian Gonzalez and how well did that work out?

Snarf said...

It's sort of odd that the examples provided for why a cap is needed are examples of smaller market teams spending big money and it NOT working...

Bengoodfella said...

Chris, I don't think MLB needs a salary cap for competitive balance reasons. Teams that spend a lot of money don't necessarily win titles. Part of the issue is they sign these guys to big deals and then they are stuck with them. Look at the Red Sox and other teams who sign expensive free agents. Sure, they get a good player, but they also get a big contract. I don't see the issue that Hoynes does. Obviously having money to spend on players you want is important, but it's more important to spend the money wisely and have a good farm system.

Snarf, that is true. It's kind of weird he used those examples of smaller market teams spending money and it didn't work out.

HH said...

In Hoynes's defense, a salary cap WOULD increase competitive balance with a slightly fairer playing field. I know that small market teams have succeeded and big market teams have spent money poorly, but that's hardly a reason to say that lack of a cap isn't affecting the competitive balance.

A team like the Yankees or Dodgers can spend like crazy, and, if the spending was a mistake, cut their losses and move on. A smaller team (think Cleveland with Bourn and Swisher) has to just ride it out. Small teams basically have to win by being smarter and luckier than big teams. Luck evens out, and someday big teams will be just as smart (see Epstein in Chicago). Then small teams will have much shorter windows to compete - two good drafts, two years to develop, three years to contend, and then sell off and rebuild. Bigger teams won't have to do that.

That said, baseball works fine now.

Snarf said...

One thing here...

So, I think we can agree that Baseball is largely becoming a regional sport. It's not hurting for revenue by any stretch, and the game is growing. "Regional sport" isn't an insult, rather, it's simply that I will watch 80+ Orioles games in a season, but I'm unlikely to tune in for a random Mets-Marlins weeknight (or even weekend) matchup. I think that's partially by virtue of the sheer number of games.

Anyway, one aspect of this regionality, coupled with the importance of a healthy farm system, etc. is that fans typically get excited for young guys coming through the system, key stars get locked down long-term, etc. I feel that imposing a salary cap would actually lead to more player movement in the long-run and hinder some of the things that make baseball attractive on a regional scale. Yes, there is a lot of movement in baseball as is, I just think the importance placed on cornerstone guys coming up through your own system would be largely diminished, especially since the only way the MLBPA would EVER agree to something resembling a cap would be to drastically change service time, arbitration, etc. rules.

Bengoodfella said...

HH, I think baseball works fine now personally. I guess it could become more competitively fair, but I also think I don't mind the current system. The current system sort of encourages dumb teams to be dumb and make bad signings (um, the Nationals with Scherzer), then try to get rid of those contracts. I sort of enjoy that in a weird way. I think if there was a cap then contracts couldn't be fully guaranteed or something like the NFL does. That may be a bad idea and the union would never go for it.

I do like the NFL structure, but that's not happening. I think teams can compete now by being smart. If there is a smart big market team then they succeed too. But they tend to like to throw money at players and I enjoy a good dumpster fire.

Snarf, it's very regional. I think a cap could encourage teams to have a good farm system to stay under the cap, but it could also end up like an NBA situation where a team gets stuck with a shitty player for a few years and this restricts what they are able to do.