First Pitch: How Baseball is Still Unfair to Small Markets, Despite Small Market Success

I’ve written a lot about how baseball is unfair to small market teams. The fact that some teams can spend double or triple what about a third of the league can spend in payroll illustrates that baseball doesn’t have equality.

A lot of times, this argument is mistaken as saying “small market teams can’t win.” We’re currently in a year where the Kansas City Royals are going to a World Series. The Pittsburgh Pirates went to the playoffs for the second year in a row. The Baltimore Orioles won the AL East, while the New York Yankees and Boston Red Sox missed the playoffs. The Oakland Athletics made two of the biggest trades of the summer, only to lose in the playoffs to the Royals. And expanding beyond this year, the Tampa Bay Rays have been one of the most successful teams in baseball since the start of the 2008 season, despite having one of the worst payrolls in baseball.

Small market teams can win in baseball. But that doesn’t mean baseball is fair.

The key to winning for small market teams is being smart. That’s the obvious key for any team, but it matters so much more for teams like the Royals, Rays, and Pirates. These are teams that can’t afford to make a mistake. A $15 M per year contract is nothing to a team like the Dodgers or the Yankees. But for a small market team, that’s a massive expense, and if you make that expense, you had better be sure it will work out. If it doesn’t, you can’t just sign another $15 M player to replace him.

That’s the advantage big market teams have. They can afford to make mistakes. Look at a lot of the biggest payrolls in baseball, and you’ll see that some of those expenses were either bad contracts or mistakes. For example, the Yankees were spending $7.4 M this year on Alfonso Soriano and Vernon Wells. They are spending $23 M on Mark Teixeira, who looks worse than Ike Davis. CC Sabathia made $23 M, and is owed $48 M over the next two years, despite looking like he might be on the decline. Despite these bad contracts, the Yankees will be back next off-season, spending on new needs. Meanwhile, if a small market team could even afford one of those players, they’d be in “blow it up” mode if they had a Teixeira or Sabathia situation.

The successful small market teams have found a way to compete by being smart. They’ve drafted well, and focused a lot of resources on amateur talent. That also includes the international market — and not just spending on the big names, but investing in scouting in Latin American countries to find million dollar talent for a fraction of the price. They’ve made smart trades to build for the long-term, rather than going for a quick fix. They’ve used advanced analytics to get an edge and find value where other teams can’t.

There have been “big market moves” along the way. The Athletics traded one of the best prospects in the game to get Jeff Samardzija, and traded one year and two months of Yoenis Cespedes (and the draft pick that would have come with his free agency departure) to get two months of Jon Lester (and no compensation). The Royals traded Wil Myers, one of the best prospects in the game, along with a few other valuable pieces to get James Shields and Wade Davis. The Pirates traded Dilson Herrera and Vic Black for one month of Marlon Byrd.

All of those cases involved teams taking a risk to win-now, while their fans hoped the moves didn’t hurt them in the long-run. That’s the thought which only small market teams have. The Angels and their fans probably weren’t thinking that when they traded practically the only prospects they had left for Huston Street.

Baseball is unfair for small market teams, but that doesn’t mean small market teams can’t win. At least for now.

What about the next era? What happens when the big market teams decide to get smart? This isn’t a new concept. The Boston Red Sox won the World Series in 2004, adopting similar strategies that the Oakland Athletics used with a much smaller budget. Theo Epstein left Boston to take over with the Chicago Cubs, and they’re now a huge threat in the NL Central — a team that built up some of the best young hitting prospects in baseball, with tons of money to buy a great pitching staff to pair with that group.

This week we’ve seen one of the biggest moves in large market teams adopting small market strategies. Andrew Friedman was hired by the Los Angeles Dodgers from the Rays to take over baseball operations for the Dodgers. Here we have one of the best executives in the game being grabbed up by the biggest spending team in baseball. The Dodgers were already a threat due to their ability to spend countless dollars. When you combine that ability with the approach that made the Rays one of the most successful teams with a payroll that was a fourth of what the Dodgers can spend, then you’ve got a dangerous situation.

On a smaller scale, the Pirates just lost Jeff Banister to the Texas Rangers. This isn’t as big of an impact as Friedman to the Dodgers, obviously. That said, it does represent a downfall to a small market team having success. That success attracts attention from other teams, and causes you to lose personnel. It almost happened last year with the Phillies trying to hire Jim Benedict.

In the press conference with Rangers’ General Manager Jon Daniels today, I couldn’t help but get the impression that the Rangers were about to adopt some of the things that made the Pirates successful. Daniels mentioned that Banister would be bringing a concept similar to Clint Hurdle’s, where he makes scouting, development, and the big league roster co-dependent. He also had this quote when being asked about the Pirates’ use of stats.

“There might be a perception because of my background, some of the folks in the front office, etc, that we’re an analytics-heavy group,” Daniels said.
“What was illustrated to me throughout this, is we’re probably below average in that department.”

The Rangers are another team that can spend a ton of money. They have some great scouting, as shown by a lot of the young talent that always comes through the Texas system. So what happens when they start spending that money based on the combined advice of their scouts and analytics departments? What happens when they start applying analytics to the field? That’s something that most managers would be against, but Hurdle and Banister have been open towards. What happens when other big market teams start taking the same approach?

Baseball has been unfair for about 20 years because big market teams could out-spend small market teams. That leads to a situation where the Pirates would love to have Russell Martin back, but will have no shot if the Dodgers or Rangers or Red Sox really want him. But we ignore that, because somewhere along the way, small market teams found a way to win, despite not having access to the best players in the game. They started winning by hiring the smartest executives, coaches, and putting more focus on analytics.

The next development will involve big market teams trying to hire those executives, coaches, and even analysts away from the small market guys. It will no longer be a battle for Russell Martin and Francisco Liriano. It will be a battle for Neal Huntington, Ray Searage, Dan Fox, and every other person who plays a key role in the success of a small market team. Based on the financial divide in the league, the raid on executives and coaches will probably be the same as the situation with players. The best example I can come up with is Andrew McCutchen. He’s under team control through the 2018 season. After that he will have two choices. He can either take one of the biggest contracts in baseball with a big market team, or he can accept less money to remain in Pittsburgh.

That will be the same situation a few years down the line for coaches and front office members. And small market teams won’t always lose. There will be people like Jim Benedict who stick around with their team, despite being pursued by a bigger market. But as we’ve seen with the battle for the best players, the best coaches and executives will eventually end up with the big market teams. The strategies that small market teams use to gain an edge will be adopted by big market teams as well.

What can small market teams do to contend when that happens? I have no answers. But if small market teams want to continue winning in the future, they’d better hope they find the solution first.

Links and Notes

**Jon Daniels: “Probably Unlikely” That More Pirates Personnel Follows Banister to Texas

**AFL: Thomas Harlan Throws Three Strong Innings

**Pirates Plan to Extend Qualifying Offer to Russell Martin

**2014 Recaps: Starling Marte Has Quietly Become One of the Best in Baseball

**Jeff Banister to be Hired as the New Manager of the Rangers

**Pirates Signed Three of the Best Independent League Pitchers This Year

First Pitch

  • For all those who continue to believe Theo Epstein is a ” genius “, this is a story to check closely. http://beisbols.org/ There are no geniuses in professional sports, these guys all make a ton of mistakes. Some just know how to cover theirs up better than others.

  • No small market club has played in the World Series since 1991, when MINN. won.

    The World Series of the past nearly 25 years proves that baseball is a true reflection of America. Money can buy anything, including a World Series title.

    Having little money will NOT buy a championship.

    • See ClayDog’s list above. Are you drawing a line for “small market” that begins with Pittsburgh and only includes six teams? Sorry, that doesn’t work.

      It looks to me like ClayDog is using “television households” as the criteria, which is fair, although it doesn’t agree 100% with CBSAs which measure actual population – but it’s close. Only Miami is an outlier (16 in DMA, 9 in CBSA). While any line drawn would be arbitrary, the common consensus seems to be that DMAs of less than 2 million or CBSA less than 4 million are “small markets”, so you start with Minneapolis/Seattle and include all teams below. Therefore, St Louis is firmly entrenched in the small market category. And obviously they’ve been to the World Series multiple times.

      So what advantage does St. Louis have over Pittsburgh? Is it because they were the westernmost team in MLB until 1958 thus able to build a huge fanbase? Is it because their NFL and NHL teams generally suck, therefore the Cards still get most of the media coverage? Or is it simply because their front office has been a whole lot smarter than anyone else’s over the past 50 years? Given all the changes in population shifts, sports culture and MLB itself, I’m going with door #3.

      Fun facts: The Cards have not finished in last place since 1918. The only two managers with losing records since WWII while at helm of the Cards were both former Cards (Torre, Boyer).

      Since the 1994 lockout, the Cards have finished 1st 10 times, and three times each at 2nd, 3rd and 4th. Other than one year when they finished 6th, they have also consistently been in top four of MLB attendance.

      Pittsburgh is right behind St. Louis in both DMA and CBSA numbers. So what is Pittsburgh’s excuse again?

      • I would rather use the term Small Revenue.
        Bad ownership and management can hold down revenues by putting non competitive teams on the field or using the team as a cash cow but MLB can root out badly run franchises.
        Teams in certain areas just cannot compete financially with others whether due to population or other factors.
        MLB will never admit that there is a disparity on the playing field due to size of market.
        The Cardinals are a well run team that had an advantage of being in the same division with Pitt, Milw, Cinn, Chi, and Hou. and although they may be regarded as a smaller market also create a lot of revenue.

        • It’s worth noting that the Pirates make $5 mill more per year on their crappy TV deal than the Cardinals do on their even more crappy TV deal. However that is peanuts compared to what the Cards make in attendance.

          Estimated gate, NLC, in millions:
          Cards $120.2 (3.54 million attendance x $33.84 average ticket price)
          Cubs $117.1 (2.65 x $44.16)
          Brewers $69.8 (2.79 x $24.96)
          Reds $54.6 (2.48 x $22.03)
          Pirates $44.7 (2.44 x $18.32)

          Now, for anyone complaining about a 9% ticket increase that still doesn’t even get the Bucs up to $20… really?

          But this brings up an interesting point – that local TV revenue isn’t the Holy Grail. If the Bucs could reasonably expect their local deal to go to $30 mill/year when the current term ends (2019), one would expect the Cards to do about equally as well, if not better, correct?

          So the only real question becomes: what can the Pirates do to increase gate revenue? They’ve tried this thing called “winning” and that’s certainly helped. The average game attendance has gone from 19.5K to 30.2K in the past four years. Somewhat surprisingly, the Pirates were the third best road draw in 2014, behind only the Yankees (Jeter) and the Dodgers. Obviously people elsewhere want to see Cutch & Co.

          Seems to me that a 9% ticket increase isn’t enough. There’s no reason why a Pirates ticket should cost 20% less than a Brewers ticket. More importantly the Pirates need to figure out a way to sell all those empty seats in April and May when it’s often pretty miserable outside.

          To better illustrate why ticket prices have to increase substantially, the Cards sell out 99.4% of Busch’s capacity on average. The Bucs sold 78.6% of PNC’s in 2014. In order to reach 3 million attendance, the Bucs would need to sell out 96.4% of capacity on average, which, with projected 2015 ticket prices would create $59.9 million in gate revenue – still less than half of what the Cards earn in gate. The Pirates would need to average $40 per ticket in order to be competitive.

          Of course that’s not going to happen. $40 would be the 4th highest ticket price in MLB. And most teams in cities with similar CoL are in the $25 neighborhood. Still, a 3 million attendance with an average $25 ticket gets the Bucs to $75 million. A bit better, though still not in the Cards zip code.

          Basically, if people really want to see a winner here, they have to show up and pay more.

          Argue away.

  • I’m a life-long, diehard Pirates fan dating back to 1971, but here’s what confuses me re the small market arguments… How do we define a “small market?” Is it a team with low attendance? Is it a team that doesn’t win? Is it based on population? Or is it the media market size (which presumably drives $s to clubs based on local tv deals? As a threshold matter, this site, and others, should define the term before opining how MLB is unfair to SMTs, otherwise it’s hard to know how to respond. If, for example, SMTs are defined my designated media area (DMA) size, here’s how the top 35 shake out:

    1 New York, NY
    2 Los Angeles, CA
    3 Chicago, IL
    4 Philadelphia, PA
    5 Dallas-Ft. Worth, TX
    6 San Francisco-Oak-San Jose, CA
    7 Boston (Manchester), MA
    8 Washington, DC
    9 Atlanta, GA
    10 Houston, TX
    11 Detroit, MI
    12 Seattle-Tacoma, WA
    13 Phoenix (Prescott), AZ
    14 Tampa-St. Pete (Sarasota), FL
    15 Minneapolis-St. Paul, MN
    16 Miami-Ft. Lauderdale, FL
    17 Denver, CO
    18 Cleveland Akron (Canton), OH
    19 Orlando-Daytona Bch-Melbrn, FL
    20 Sacramnto-Stkton-Modesto, CA
    21 St. Louis, MO
    22 Portland, OR
    23 Pittsburgh, PA
    24 Raleigh-Durham (Fayetvlle), NC
    25 Charlotte , NC
    26 Indianapolis, IN
    27 Baltimore, MD
    28 San Diego, CA
    29 Nashville, TN
    30 Hartford & New Haven, CT
    31 Kansas City, KS
    32 Columbus, OH
    33 Salt Lake City
    34 Milwaukee, WI
    35 Cincinnati, OH
    A few things to note… One of the teams in the 3rd largest DMA (the Cubs) hasn’t won a WS in a century! Teams in DMA 5, 8, 10, 12, 14 and 17 have NEVER won a WS. DMA 21 (St. Louis) has the 2nd most WS titles in MLB history, is a perennial contender and widely regarded as the paragon of MLB success, and just 2 spots higher than the Pirates.

    Also, MLB has revenue sharing, a luxury tax, and a draft which gives the worst teams the highest draft picks (without worrying about the odd bounce of a lottery ping pong ball). So, a team can build for success using its high picks on players like Gerritt Cole and Jameson Taillion or waste them on guys like Daniel Moskos and Tony Sanchez. Whether that team is an SMT is beside the point. Also, SMTs now have a special competitive balance draft reserved just for them to help further level the playing field. (Note: as much as we may not like it, the Cards are rightly in that draft given their DMA size).

    So, while I agree that the Bucs cannot compete with the Dodgers, Yankees, Red Sox and others from a pure tv contract $ perspective, the DMA data, historical MLB WS results, and MLB-contrived “cantilevers” suggest that the perceived gap is more a crack than a chasm, if ownership knows how to pull the right levers. So long as the Cards, Rays, O’s, and now the Royals, continue to thrive, let’s not let the Pirates FO off the hook by buying into the SMT “woe is us” argument, assuming we can all agree on what constitutes an SMT in the first place.

  • “Based on the financial divide in the league, the raid on executives and coaches will probably be the same as the situation with players.”

    This is only scary if one assumes the supply of intelligent executives and coaches is finite.

    It is not.

    The Friedmans and Beanes of the world were special because they were the exception. That’s simply no longer the case. As more knowledge is accepted about the game, the old guard will be the dinosaurs that go extinct and those individuals replacing them will have far less of a gap in ability.

    Just as we’ve seen with players.

  • The Dodgers and Astros situations regarding cable fees will not be unique in the near future. Unbundling is coming, there will be no stopping it. Cable subscriptions dipped this year for the first time in history. The number of people unplugging from cable continues to increase. The future is in alternative distribution via phone, Roku, laptop, etc. I believe if MLB gave individual teams more control over distribution through these alternatives, that would somewhat flatten the rich vs. poor stratification. Much like early adopters of analytics have had at least a short-term advantage, savvy marketing departments could achieve long-term advantages through quality online product, sales and customer service. That MLB.tv currently blocks local games is absurd.

    • If your goal is parity you don’t want teams to have more control over their revenue streams. This is why all the calls for a salary cap are myopic, if you cap major league payroll what are large revenue owners going to do with that extra revenue. Maybe invest in front office personal. (Though the idea that large revenue teams are dumber or less analytically inclined than small revenue teams is much more narrative than reality.)

      If revenue disparities are truly an issue, centralization of revenue is the solution. And if local TV contracts/cable companies start dying off, baseball has MLB Advance Media to step in and all 30 teams are invested equally.

      http://www.forbes.com/sites/maurybrown/2014/07/07/the-biggest-media-company-youve-never-heard-of/

      • Isn’t that implied in any salary cap debate, as is a salary floor?

        • Now I have to start inferring things from internet comments, you have some high standards.

          No I don’t believe it is implied, the NBA had a payroll cap since the mid 1980s, a salary cap since 1999 (another issue that isn’t address, do people want a payroll cap or a salary cap), and revenue sharing wasn’t implemented until 2011.

          And comparisons to the NFL are specious, there are large difference between the league structure and revenue streams, so much so, that I really don’t understand why baseball and the NFL are juxtaposed either negatively or positively.

          • If that’s the case, then you’re saying that dozens and dozens and dozens of articles written on the issue are worthless after the first word.

            I chose to believe people are smart enough to realize that revenue would have to be heavily redistributed in order for any type of cap/floor system to be implemented in Major League Baseball.

            Without that basic assumption, the issue isn’t even worth arguing.

            • Might be callous, or you could even call it conceited, but I don’t think there are many well written articles on the economics of baseball and sports in general. It is a very hard subject to cover and write about because there are a lot of intersecting and competing interest and incentives, it is not a subject that is easy to have a hot take on.

              Baseball’s revenue generation is always going to a have a significant local component, there are 81 home games a year. I think there needs to some centralization of revenue but if it is completely centralized the incentive of owners to grow their local market is gone, and this isn’t good for baseball overall. It is possible that you might end up with more free riders like Loria who just cash their revenue sharing checks.

              • You may be right, most of these writers may not be smarter than you.

                But I personally don’t think it’s difficult to believe people understand that without HEAVILY centralized distribution of revenues, a workable cap/floor that owners would accept would leave so much profit at the top coming out of player paychecks that the Union would never even entertain the idea. The disparity in local revenues makes that obvious, at least to me.

                And yes, there would have to be structural changes to the way the league is run, but again, I don’t assume that a writer doesn’t know better just because they don’t publish a full dissertation on their proposal.

                • Fair point. I don’t that it is an intelligence issue, but more that it is easier to find holes in arguments that actually construct them.

                  I think some revenue sharing is necessary in baseball, but I don’t think a complete centralization is desirable and more importantly actually feasible.

              • Read my reply to bucsws2014 above.

                • Friedman’s statement sound like textbook attribution bias. He broke the type A, type B, free agent compensation system and Tampa Bay has nothing to show for those picks. There is still a lot of value to be found in picks 20-30, the Rays just failed to find it.

                  Ideal world I would abolish the draft. But more realistic changes I would like to see is, abolish the free agent compensation system, all competitive balance picks after 1st round and entrance in the lottery tied to total revenue and money spent in free agency, be able to trade all draft picks, and relax spending draft slotting limits.

                  I’m not sure I can get behind a total reworking of the draft order based on market size/revenue I think the expected value of the top picks is too high, possibly tiers could be created on market size and draft spending limits structured by tier. Teams would move up and down within tier based on performance but they would be locked into the tiers.

                  Current system leaves a lot to be desired, Yankees should not be rewarded for losing free agents, and the Cubs for being terrible while earning a pile of cash.

      • Good points and MLBAM is indeed an impressive operation. But there are still opportunities where MLB should allow and encourage individual markets to do their own thing. As a general rule, the best marketing is local.

        I have a few ideas right off the top of my head, but I’ll admit I’d have to look deeply into the current agreements to see what already qualifies as shared revenue and what doesn’t.

    • Good point, not sure how well it would work, at this point baseball has to do something to level the playing field and all ideas should be considered.

  • William Wallace
    October 17, 2014 11:20 am

    The biggest factor is with arbitration and what is going on with the QO. Both these are based upon the inflated salaries that big market teams pay for player salaries. If you look at what Pedro/Walker will get in arbitration this year it is based upon what large market team over pay for their players. There is no way that Pedro should be given a raise in top of what he earned this year but it is essentially what is being paid by a continuous stream of high salaries that have no bearing on performance.

  • in 2016 the collective bargaining agreement needs to be renegotiated, the small markets should come up with a plan to present to mlb to narrow the gap between the haves and haves not. will they actually do it or are they happy with the current slice of the pie they are getting and let things go as is we shall soon find out

  • One of the biggest ironies, IMHO, of the 2014 baseball season is the huge mistake made by Billy Beane. Long known for his frugal decision-making regarding talent and player contracts, this year he allowed his pride to change his long held philosophy and it blew up in his face. He essentially ruined his own team’s chemistry with his impulsive, short-term deals in an effort to win – when his team was already playing so well.

    I especially felt that the Lester trade just ruined his team – as he dealt the heart and soul of the lineup – and his one true difference maker in Cespedes – for a 2-3 month rental. I’d like to know what the team’s record was after that deal, it had to have been pretty bad. And after the big trade with the Cubs, the team had already started regressing.

    The Tigers have made similar mistakes as well – and both teams are going to be pretty bad IMHO in 2-3 years.

    • I agree, I think samardjia(?) Was smart, lester was pretty dumb as I said at the time. Ya never trade your #4 hitter for a guy who plays every fifth day no matter how good he is. Same thing for the cards, although that deal will most likely hurt them more in the long term, I just did not see the cards as being any better after the trades they made than they were before, the a’s definitley were not.

  • Obviously the new market inefficiency small market teams can adopt is using the Wichita Wingnuts for bullpen arms.

    j/k

    For all the praise Friedman gets, IMO he had maybe 4-5 good years to start followed by 3-4 so-so to poor years. He got the Rays to be competitive using market inefficiencies, the draft, scouting and development and did well on the international market. But once the Rays were competitive, he didn’t advance them further or restock with quality. Their drafts since Longoria/Price has been pretty poor with exception of a couple of good 3rd round picks and Kiermeier (31st round surprise). The came into this year with Ordorizzi the only Ray on BA’s top 100 prospects – and they got him from KC via Milwaukee. He did well in getting Wil Myers/Odorizzi, et.al. for Shields, but was that significantly better than another GM would’ve done? I wonder. Could he have done better dealing Price, their biggest asset save Longoria? If Adames doesn’t pan out, that deal will look very poor regardless what Smyly does.

    It makes a nice story, but once you start peeling away the onion layers, TB looks more like a team in deep trouble than a model of sustainable success.

    • Friedman was asked at his Dodger news conference about the Rays recent poor drafts and the first thing he brought up is their lower drafting position since they became competitive
      The same thing will happen to the Pirates and all small revenue teams that have some success.
      The best hope for acquiring top quality players for small revenue teams is through the draft but once they become competitive that advantage ends. But large revenue teams …NEVER… lose their financial advantage.
      The easiest way to rectify the unfair situation is for small revenue teams to always be allowed to draft no lower than say 15th ( depending where the cutoff point is).
      I have advocated for this idea for a long time but without much interest but I can’t think of another way to somewhat even the playing field.
      Large revenue teams don’t want to give more money to small revenue teams.
      Players agents don’t want spending restrictions.
      The Union also doesn’t want spending restrictions or lose any of their power.
      I’m sure that large revenue teams will fight this but not as much as giving up more money.

      • And yet the Angles picked Trout at what, 26th?
        And what is Mozeliak’s secret? When is the last time the Cards picked in the top half of a draft?

        The Bucs may not get the creme de la creme each year, but they also shouldn’t flounder in the 1st and 2nd rounds like the Rays have.

        If Nutting wants to spend $20 million to create camps in Venezuela, Panama and Australia instead of putting it into Russell Martin, it would be hard to argue that’s not a sane long term plan. Obviously they’ve gotten results from the DR, except when they act completely stupid a la Miguel Sano. If they need more scouts in non-traditional outposts, go hire them. You can hire eight scouts for the price of one Michael Martinez.

      • That’s a pretty good idea, I gotta say it’s simple,elegant and probably effective. Just mad I did not think of it first. Kudos piratemike.

  • I agree with just about all points…until MLB does the following, there will never be a real level playing field:

    (1) impose a hard salary cap and floor
    (2) institute rule that all international players have to apply to be eligible to be included in the MLB draft – no more international player free agency as there is now

  • How anybody who is a fan of a small market team can read this or any of tim’s other articles on this subject can stil say with a straight face that baseball does not need a salary cap, well all I can say is go find a good head doctor cause you are crazy!

    • A salary cap is part of the solution, but what would the cap be? More importantly, could the Pirates spend anywhere near a cap? I think greater revenue equity is a bigger piece in terms of leveling the playing field.

    • I say it’s you and Tim who need a course in Economics by an intelligent Professor like Thomas Sowell of Stanford. In sports like life, it’s far less about the circumstances and far more about how you react to them. Given time, a smart and savvy GM will be just as successful in Pittsburgh as he would in NY not because of his salary constraints or lack thereof, but because of his decision making prowess.

      Now I will admit it’s easier to make a quick turnaround with a larger budget, just as it’s easier to build a successful business with a large reserve of Capital. However, as time increases, money becomes less of a factor and intelligence becomes greater.

      • Laughably ignorant.

      • Paul Krzywicki
        October 17, 2014 9:34 pm

        This reasoning is flawed from a sport perspective because every other major sports league has a salary cap. If it was not important to competitive balance why did they implement it? It took the Pirates 20 years, the Royals nearly as long and the Rays have yet to win a title. In your world, competing for a short period of time is as good as a title. Not in mine.

      • I have been a successful business owner for over twenty years, why would I want or need a lesson in economics from a liberal/socialist from stanford who’s ideas never work? When my sound economic decisions based on common sense have made me very successful over the last two decades? Not trying to pick a fight it’s just those so called economists are usually wrong, mainly because their theories look good on paper they just don’t work in the real world. Thanks for the advice, I think I’ll stick to what works and not some crackpot with a piece of paper telling him he’s great.

        • Thomas Sowell, is a (gasp) black, conservative economist. He runs circles around the Paul Krugman’s of the world. If you have a chance, read some of his writings or Youtube him.

          • Sounds interesting, it’s refreshing to hear about a fellow human who does not think that mine,yours or anybody elses money is better in someone elses pocket (without us spending it first)I will do a little digging on mr.sowell, thanks bill.

            • No problem. I don’t like to bring up politics in a sports forum, but when in Rome……….

        • Scott Kliesen
          October 18, 2014 7:37 am

          Thomas Sowell is a brilliant conservative who artfully points out the flawed reasoning of liberal/socialist/communist doctrine.

          BTW, a salary cap is sports socialism.

          • As bill pointed out mr. Sowell is not what I thought, my apologies to you and mr. Sowell. And yes a salary cap is sports socialism, while I do not agree at all with socialism for a society as a whole ( it does not work on a societal level for myriad reasons) it does work for small closed enviroments with basically the same goal in mind. ( that’s the part that always leaves socialists scratching their head and wondering why thier grand idea did not work when they imposed it on society )

            • Scott Kliesen
              October 18, 2014 6:04 pm

              no need to apologize. But nice if you to do so anyways. I don’t take anything said on these threads personally.

              I think you hit the nail on the head pretty well w this post. Sports organizations need to have years of player control and cost certainty in order to have time to develop their talent.

          • In your opinion. Some others definitely would disagree.

            • Only the truly delusional would disagree. If Paul Krugman were to debate him, Sowell would clean his clock. In fact there would have to be a mercy rule to prevent further humiliation to Krugman.

              • Yeah, I am sure…….once again, in your opinion.

                • Why is it that your opinion trumps anyone else’s? You’re the blowhard who chimes in on people’s opinions as if they were invalid. You’re a Class AA hypocrite, period.

                  You know and I know Sowell would wipe the floor with Krugman and his ilk.

                  • Once again…..that’s YOUR opinion Chuck…I mean Bill.

                    • You’re delusional and there’s no debate about it. I’d tell you to read your own posts on how you jump on people, but what good woüld that do? The delusional think they are rational and always correct.

                    • Yeah, sure, anything you say. I will try to help you here Bill. When considering trickle down economics, let me introduce you to to one David Stockman. I am now done discussing this with you and others of your ” ilk “.

                    • You liberals always love referencing “trickle down” because you loathe Reagan. You probably lost your union job and held it against the GOP.

                    • Why am I not surprised you went directly to “trickle down”. You have absolutely no clue about economics, but your disdain for conservatives allows you to parrot liberal talking points like a champ, without fully understanding what your parroting.
                      BTW, running away from a debate is a typical leftist tactic. This is a baseball forum, and I’d rather not continue it here, but I’d be happy to clean your clock on a political forum. Maybe I can meet you at Crooks and Liars. LOL

                    • I have to admit, part of that last comment of yours is true.

                    • It’s all true. No clue about economics, disdain for conservatives, spewing talking points of which you know not of what you spew and running away. Yep, all true.

        • If you think Sowell is a ” Liberal/socialist from Stanford “, you need to get a lot better informed.

          • You apparently never heard him speak. It’s not surprising, given your closed minded attitude.

      • Thomas Sowell….intelligent ? Uh, ok …..now I see perfectly where you are coming from.

        • Your liberal pals couldn’t hold a candle to him. You questioning his intelligence, is further proof of you lack of it.

  • Another point. If i was a GM, I don’t know if I would necessarily want to go to a big market just because i would have more money to play with.

    I mean… it’s your full time job either way. I doubt NH has more work to do than Brian Cashman just because the payroll is lower. I mean… both guys have the same goal. Optimize present performance without ruining future performance while staying under a certain salary figure. They’re just picking from different pools of FAs.

    So unless the big teams start offering significantly more for executives, i really can’t be worried about this. There are a lot of smart guys out there ready to be a GM if NH leaves anyway. There are only 30 GM positions available, so there will always be attractive options.

  • I guess we can only hope that the big market teams will continue to spend money just because they can.

    Keep buying good players’ declining years.

    Honestly, keeping a small payroll DOES make you more careful about what you do. When a player signs an albatross contract then ages poorly, the team is stuck with him!

    Friedman has been good at scrapping together lineups and making smart short term free agent signings and trading veterans for prospects at the right times. If Friedman keeps finding diamonds in the rough, then it’s no different than when he was with the rays. His FAs are going to be the under the radar types. If Friedman starts signing the best players for market rate, then the Dodgers will be no different than what they were previously. Just perhaps a little more careful.

    I think as long as the big market teams continue to give aging stars huge contracts, the Pirates will be fine as long as they continue to be smart.

    And i guess it’s times like this where the new draft system is kind of good. You bet your booty that Friedman would spend $20 mil in the draft every year with the Dodgers if it was still the old system. Now he’s limited by the system.

    • To accentuate your point, I saw a stat the other day regarding Albert Pujols and his current and former teams. Since the Angels signed Pujols away from the Cardinals, they have zero playoff wins while the Cardinals have won two WS titles.

      • ResistanceIsUseless
        October 17, 2014 11:39 am

        Either you misunderstood, or the stat you saw was incorrect. Pujols was in his last year with the Cards when they won their most recent World Series championship (2011). While they’ve been winning a couple division titles and some playoff series, last year was the only time they made it back to the WS since he left.

  • Paulie Corleone
    October 17, 2014 8:04 am

    You reference Baltimore as a small market team that had success, but I would LOVE if the Pirates could even remotely approach their $107m payroll…. I have a hard time calling any team that spends $100m + “Small” … their payroll puts them in the top half of the league

    • ResistanceIsUseless
      October 17, 2014 11:44 am

      Was going to say something similar. Tim and I had a discussion after another article a while back about Baltimore. There’s a reason the Orioles blocked a move of the Expos to DC for a while – they didn’t want to share a megapolis market, as DC and the suburbs in between are part of the same market. Yes, the Nats have probably taken most of the DC fans and of those in the ‘burbs, but there are plenty of folks who are still loyal to the O’s or see them as their 2nd team. The O’s definitely shouldn’t be characterized as a small market team.

      Also, remember that the O’s are raking in TV money from the Nationals (due to the deal the Selig made to get the Expos moved to DC), yet they keep their own payroll fairly low. I see plenty of people complaining about Nutting being cheap and convincing his fan base that the market is too small to spend more money, but if anyone has unjustly succeeded with that argument, it seems to me that it’s Peter Angelos.

  • Joe Sweetnich
    October 17, 2014 8:04 am

    Another big market advantage has blossomed, that being the Cuban defector. After the success of Cespedes, Puig, etc. those guys are now getting big $’s. Small market teams now have no shot there as well.

    • Who is the “etc…” in your comment? After Puig and Cespedes, the other talent out of Cuba has been relatively average. And the new guy who just defected doesn’t have power — just another singles hitter with good defense. And now the rumors out of LA are that the Dodgers are tiring of Puig, while Cespedes has already been traded once. Cuba isn’t going to change anything dramatically I don’t think.

      • Joe Sweetnich
        October 17, 2014 1:28 pm

        Without looking and speaking in generalities, Cespedes signed for $32MM, Puig $36 MM, Abreu $42 MM not sure on Soler, Rusny Castillo was $72 MM, now the new guy is supposed to top $100 MM and another has just defected. Since the early success of the Cubans hitters (not pitchers) the cost is now out of reach for the Pirates and other small payroll teams. They may not be better but they sure cost way too much for anyone but the Yankees, Dodgers, Red Sox, etc.

        • Paying huge dough for mediocre talent doesn’t sound like a great idea anyway. I guess I’m kind of glad to be priced out of that talent pool. Let the Yankees and their ilk waste more of their ill-gotten gains.

    • Jose Abreu would be anoth

  • Scott Kliesen
    October 17, 2014 5:49 am

    Baseball is more representative of America from a financial perspective than any other major sport. It’s easy to focus on “unfairness” when comparing payrolls of large vs small market teams. Just as it’s easy to say America is unfair to those who are born into a poor, single-parent household in a crime ridden community compared to those who come from a well off two-parent family.

    However, in America the land of opportunity and in baseball success is predicated on intelligence, hard work, timing, taking risks and overcoming obstacles. Just as baseball is littered with small market team success, America is defined by rags to riches stories.

    The whole notion of “fairness” be it in sports or life is fools gold. And those who preach it as some form of higher doctrine are living in a fantasy world that only exists in their mind.

    • Paul Krzywicki
      October 17, 2014 7:19 am

      Scott that is simply a poor comparison. Sport is all about having a level playing field in accruing talent, but then proving it on the field. How is it a competitive sport when all you have to do is write a larger check? It does not take a genius to write checks. It is supposed to be about identifying talent, developing that talent and then putting those players in the best position possible to succeed. It is not supposed to be about buying those players after other teams have developed them. In that world, the small market teams are the developmental AAAA teams for the big market clubs. Eventually, this will catch up to MLB and hurt its overall bottom line when more than half the country stops caring.

      I grew up in an era (Lumber Co.) when trades, releases, promotions, etc., were predicated upon simple baseball decisions, not the unfair economics of the game.

      • Scott Kliesen
        October 17, 2014 9:44 am

        Paul, the facts don’t support your argument. This season the WS teams have the 7th & 19th largest payrolls according to the AP. The Championship losing teams were ranked 13th & 15th. Two teams in the bottom 20%, Pittsburgh & Oakland made the playoffs.

        Furthermore, the NFL has the most level playing field from a salary standpoint, yet some teams ( NE, PITT, SF, etc.) seem to almost always be playoff teams, while others ( Cleve, Oak, STL, etc.) nearly never are competitive.

        Payroll in baseball can give you an advantage, but it’s not the end all be all that some like Tim claim it is. Success is predicated on draft and development far more than FA signings.

        • ResistanceIsUseless
          October 17, 2014 11:25 am

          Did you read the article? If so, you must have missed the part where Tim mentioned that small market teams can win, but it’s harder for them.

          As for comparing to the NFL, the Steelers missed the playoffs the last two years, and I don’t see them getting there this year. Next year is still too far to handicap, but it isn’t looking good to me.

          • and why exactly have the Steelers fortunes changed? Is it because of a change in the economic structure of the NFL? No, it’s because they have made poor draft and coaching decisions which has caused them to suffer compared to previous years.

            All money does is provide more options, it’s still primarily about, and always will be about choosing the best option.

            • ResistanceIsUseless
              October 17, 2014 12:05 pm

              Your analysis of the Steelers, like everything else you’ve said, is your opinion, not cold hard fact.

              It’s a fact that baseball allows teams to spend on players as they choose. Another fact is that the markets are bigger in NY, LA, Chicago, Philadelphia and a few other cities than Cincinnati, Pittsburgh, etc. It’s also a fact that the teams in those teams in larger market cities have higher revenue because they can draw more people to their games and get larger TV contracts, thus they have more money to spend. After that, it’s a matter of personal preference as to whether you want to have a level playing field between the teams or have a situation where some teams have a clear advantage (“more options” in your words). Most people who are Pirates fans are probably going to choose a level playing field. It seems you prefer 20 years of losing.

              • Here’s the biggest problem with your position, there is no such thing as a level playing field! In sports, nor in life. Once you come to grips with this reality, you realize it’s more about what you do with what you have, than just what you have.

                As for the Pirates and their losing streak. Was it baseball’s revenue sharing that caused the streak to end? Or was it hiring smarter people, investing in player development and scouting by building Pirate City and the DR Baseball Academy, and identifying and applying better in game strategies?

                Ask Raiders fans how that “level playing field” employed by the NFL is working out for their team.

                • “Or was it hiring smarter people, investing in player development and scouting by building Pirate City and the DR Baseball Academy, and identifying and applying better in game strategies?”

                  If you think all that could’ve been done while also fielding the teams they’ve had the past two seasons WITHOUT revenue sharing then you haven’t been paying attention for very long.

                  • Scott Kliesen
                    October 17, 2014 1:32 pm

                    Hogwash! With or without the money from MLB, Nutting would’ve implemented the same plan. He may have done it over a longer time frame, but the steps taken by the franchise to bring it back to relevance would not have changed.

                    • Scott, answer this question with a simple yes or no:

                      Without revenue sharing, would the Pittsburgh Pirates have been able to afford the upgraded facilities, increased draft spending, and the Major League roster that was on the field for the past two successful seasons?

                      You can even call your buddy at Stanford if the math is too difficult for you to handle.

                    • Scott Kliesen
                      October 17, 2014 5:20 pm

                      That’s a good Q for Frank Coonelly. Since I don’t have access to the Pirates financial statements, I can’t answer. What I can say with confidence is the Pirates have implemented a successful plan to turn the franchise around primarily because of the plan and its’ implementation. Not because of MLB’s financial handouts.

                • ResistanceIsUseless
                  October 17, 2014 1:25 pm

                  Where did I say that life has a level playing field? It’s true that sports doesn’t have a level playing field either, and I didn’t say it should. Taking that to an extreme would mean something like randomly assigning players to teams each year.

                  That said, your position lets the big market teams buy championships. They can just use the smaller market teams as their AAAA minor leagues. If that continues unabated, the smaller market teams have little to no chance to win a championship. The result of that is that fan interest in the smaller markets will wane and teams will either have to move or will fold.

                  Also, what started the Pirates 20 year losing streak? It was the departures of Bonds, Bonilla, Drabek, et al. through free agency. Was that bad decision making? Or was it recognition by ownership that there was no way they could compete with the bigger markets so they didn’t even try?

                  Also, yes, some managerial decisions were poor, but look at a couple of things that kept the streak going: An albatross of a contract with Jason Kendall that prevented the signing of other good players for years. The 2003 “fire sale” trades of some of the team’s best players in a season where the team showed occasional promise. After that, they had 8 straight seasons where the won 72 or fewer games. Both those issues were brought about by the financial circumstances of the game.

                  • Scott Kliesen
                    October 17, 2014 1:39 pm

                    I’m sorry I got lost in your comment, wS it the spending money ( Kendall) or not spending money (Bonds, Bonilla, Drabek) that you blamed for their losing streak?

                    When you look at any winning organization objectively, you realize it’s the quality of the plan and how it’s implemented that causes the success. And conversely, when there’s a lack of success, those factors are missing.

                    Earlier you referenced Chicago and Philadelphia as examples of large markets who can buy championships. The two teams in Chicago have won 1 championship in over a collective 200 baseball seasons, and Philadelphia is a dumpster fire now because they failed to draft and develop talent to replace the aging players who won for them earlier.

                    • ResistanceIsUseless
                      October 17, 2014 2:14 pm

                      You’re not going to sucker me into your false dichotomy. I think you know I’m blaming the environment that baseball has set for itself.

                      Yes, it’s the quality of the plan that makes a winning organization. However, some teams are able to plan to buy talent, while others cannot. Or more accurately: Talent can be difficult to evaluate; some teams try to can buy it and if it doesn’t develop they can just try to buy some more, while other teams cannot afford to do that.

                      Lousy decision making by Chicago and Philadelphia doesn’t negate that fact that they have the means to roll the dice more times in the talent roulette game. Do you attribute the Yankees’ 27 WS championships and 40 appearances (and especially the 7 championships and 11 appearances of the Steinbrenner era) to nothing more than smart decision making?

                      BTW: Are you being selective in your “over a collective 200 baseball seasons” in which “The two teams in Chicago have won 1 championship”? The White Sox won the World Series in 1917 and 2005.

                      Am I the only around here who remembers when a pennant was considered a championship?

                      Anyway, now that we’re debating semantics, it’s time for me to end participation in this debate.

                    • Scott Kliesen
                      October 17, 2014 5:21 pm

                      Enjoyed the debate and your point of view even if I don’t agree with all of it.

                  • Paul Krzywicki
                    October 17, 2014 9:28 pm

                    Solid analysis.

                • Paul Krzywicki
                  October 17, 2014 9:26 pm

                  Poor ownership, poor coaching and poor drafting cannot overcome a level playing field. That’s why the NFL is the most popular sport nowadays. Every team has a chance to compete. It’s now up to them to take advantage of it by drafting smarter, developing their players better and coaching better. Simply writing a check does not count as much in the NFL due to the short careers of the players.

                  • Scott Kliesen
                    October 18, 2014 7:43 am

                    NFL is most popular sport because of many reasons: gambling, fantasy teams, violent nature of sport, are just a few. To say it’s about the salary cap is shortsighted.

            • Paul Krzywicki
              October 17, 2014 9:23 pm

              It also was the residual of them drafting late for a period of years and the team aging together, much like the 1970 dynasty. I think you have tunnel vision on this issue and refuse to see the entire picture other than the one that supports your argument.

        • Paul Krzywicki
          October 17, 2014 9:21 pm

          Sustainability, my friend. With a level playing field, the Pirates would not be worried about losing Martin or Frankie this offseason. Split all the revenues that MLB has on hand, and then the teams can make baseball-related decisions and financial decisions. Instead, teams like the Pirates and Royals are worrying about how to keep their teams together since neither can approach $100M let alone $150 or $200M like the Dodgers, Angels, Red Sox, Yankees, et al.

          Of course teams will catch lightening in a bottle every once in a while, but in order to sustain that excellence or success you need money. Therefore, you get a high turnover rate in small markets and a small window of opportunity.

          Life is different in that you make your own opportunities. Its supposed to be that way, unless you are born with a silver spoon in your mouth. Sports, IMO humble opinion, is about having a somewhat level playing field to determine who is the fastest, best overall team, etc. Finances should not play a role. If that was the case, NASCAR would not have restrictions on the cars and the best financed team would have the fastest cars. There’s no sport in that. The frustration in MLB has been boiling over for some time and it will only get worse with these outrageous cable TV deals.

          • Scott Kliesen
            October 18, 2014 7:46 am

            Even if you took it to the extreme and made it a true free market where players were free to sign any contract at any time, it would still be the GM’s who are best at identifying talent and developing it who would be most successful. Not the ones w most money.

  • Well, if the big market teams end up with the best players as well as the best managers and GMs there might be a need to either strike to put a lid/bottom on player salaries or else the big market teams could have their own league and the same for the small market teams. I don’t know either.

    • The winning strategies of small market teams don’t include overpaying and overextending for aging, high-priced free agents for a brief run at one title.

      If the small market geniuses out to the larger budget clubs, then what will actually happen will be increased parity, as each club assigns a more realistic value to the players on the free agent market. Guys like Scott Boras will finally start to get squeezed out, as they find they have no Yankees vs Red Sox to play off against each other in order to double or triple their players’ contract value.

  • I don’t know what Neal Huntington or Dan Fox gets paid, but I’m sure its not in the eight figure range. I would hope we could be competitive for these guys.

    • RB: NH signed an extension through 2017 earlier this year, and the contract includes a Club Option for 2018.

      Tim: Excellent article – the days of just getting more and better talent and winning with brute force are over. Texas found that out and now find themselves either 3rd or 4th best in a division they owned for years. NH is one of the many who toiled in relative anonymity with teams like the Indians (is this a “Moneyball” re-run) until he was given an opportunity. And since, he and the rest of the Management team have caused MLB to re-write the rules for the Amateur Draft, and were one of those teams who caused changes in the International Free Agent Draft. Who was Ray Searage before his years with the Pirates? In recent years, was there a better GM/Manager combo than Friedman and Maddon in TB? But, this is nothing more than business as usual in a capitalistic society. The important thing is to backfill with talented guys who have an imagination and are waiting for their opportunity to show what they have. The Cubs raided the Red Sox a few years ago, but the Red Sox had another guy just waiting for an opportunity, and he has done an excellent job of stepping up.

  • There’s no draft pick with Cespedes

  • Good points. Thank you.

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