Monday, April 1, 2013

MLB Team Salaries: How Can They Compete?

Baseball fans love this time of year. The start of a new MLB season. Fans are excited to see the team they have viewed on paper finally take the field. All fans feel that it might be the year for their team to have success.

Can this hope really become reality? Has the payroll disparity between teams become so great that it is impossible to compete? Let take a look.

The opening day payrolls, which is a projected number, have a huge disparity for the 2013 season. The number one team nearly has a payroll 10 times that of the lowest payroll team. Take a look below at the teams with the top 5 and bottom 5 payrolls.

1. New York Yankees ($228,995,945)
2. Los Angeles Dodgers ($216,302,909)
3. Philadelphia Phillies ($159.578,214)
4. Boston Red Sox ($158,967,286)
5. Detroit Tigers ($149,046,844)

26. Oakland A's ($68,577,000)
27. Pittsburgh Pirates ($66,289,524)
28. Tampa Bay Rays ($57,030,272)
29. Miami Marlins ($39,621,900)
30. Houston Astros ($24,328,538)

The disparity in income between the top and bottom teams is truly shocking. How is a team with a tenth of the player salaries supposed to compete. It is difficult and those teams that can should be recognized for excellence. The 2013 opening payrolls have a greater disparity than that of 2012. Lets take a look at the top and bottom payroll teams from 2012 and see how much success they had.

Top 5 Payrolls

New York Yankees- 95 Wins 67 Losses
Philadelphia Phillies- 81 Wins 81 Losses
Boston Red Sox- 69 Wins 93 Losses
Los Angeles Angels- 89 Wins 73 Losses
Detroit Tigers- 88 Wins 74 Losses

Bottom 5 Payrolls

Pittsburgh Pirates- 79 Wins 83 Losses
Kansas City Royals- 72 Wins 90 Losses
Houston Astros- 55 Wins 107 Losses
Oakland A's- 94 Wins 68 Losses
San Diego Padres- 76 Wins 86 Losses

The numbers reveal that spending money does not guarantee wins, but it does play a factor. The 2012 team had large disparities in payrolls, yet the disparity is far greater for the 2013 season.

Final Thought
The financial disparity in baseball is a serious issue. Leagues like the NFL have been far better at providing an even playing field for all teams. The presence of a hard salary cap may be necessary in order to fix this issue. If the disparity in baseball continues to increase, I suspect that the higher spending teams will become progressively too talented compared to the lowest spending teams. Under this scenario, the lowest spending teams will never be able to compete.

Great organizations can be made by being a lower spending team and having success. It is rare to be able to have this success, but it is recognized league-wide when it does. If a hard salary cap is not an option for Major League Baseball, something needs to be done to make the league more fair. The current MLB luxury tax is significant, yet clearly not significant enough. Further taxation on the wealthy teams in the MLB may be necessary in order to provide a more level playing field.


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