An excellent assessment of the current MLB trends regarding this free market frenzy…

How, exactly, is free agency any less natural, more artificial, or more arbitrary, than the various amateur and professional drafts, trades, waiver systems, etc.?

is a better distribution of revenues. Of course the Yankees deserve to be the top dog, they have the most fans and rake in the most money, but…there are 29 other teams, and half of every single game the Yankees play, is played by players on other teams. (Did that make sense?) Without those 29 other teams, there’s no competition, except perhaps some Cuban or Japanese teams.

Bill James suggested one time that if a team like the Yankees gets too big of an advantage, a team on the opposite end of the spectrum, let’s say the Royals, can make their voice heard by just not showing up for games in Yankee Stadium, making the Yankees lose millions.

i thought free agency was making the “team” more expensive?

The teams winning the World Series aren’t doing the same thing as the Yankees. Hell, the Rays made it to the Series last year and the Yankees didn’t even make the playoffs. The left side of the yankees infield made more than the Rays entire team.
It’s disappointing to see a team spend money like this but where has it gotten them recently?

is that when they decide at the last minute to give a major X-mas gift to their fans that no one else can give, all they have to do is call up Scott Boras, check what the last contract offer was and offer $10 million more than that…

Whereas, when I make the same decision, I have to stand in-line for 2 hours on my lunch break to get a damn box of Ghirardelli chocolates that ANYBODY can buy for anyone.

I officially hate Christmas.

in other words whatever helps as many teams as possible to be competitive.

That said, I don’t think bad planning should be rewarded.

However, it’s not an amount that is typically ever reached. It’s a system where they divide up the amount of Type A and B Free Agents and then divide that number by another number to come up with an amount of those Free Agents a team is allowed to sign. Problem is (depending on your POV), it’s never a small number. It’s something like 4 or 5 Type A’s this year, I believe.
I really don’t believe there is a fair way to police this, you cannot simply tell a team to stop spending at the point we are at right now in the game. If there truly is to be a solution, I think that there would need to be bigger monetary disciplines to a team that keeps spending all this money.
However, I don’t think there needs to be any sort of cap or anything. Let the Yankees be the Yankees. What’s great about the sport of baseball is any team can likely beat another team on any given day. This differs a lot from the NHL, NFL, and NBA. In General, a 3-13 football team almost never beats a 13-3 team. A 60 win basketball team will beat a 20 win team 9 out of 10 times. However, in baseball, a team with 100 losses will still have a good chance to win 1 game in a 3 game series against a 100 win team. And this has been proven in the playoffs, time and time again. In this century, I can recall one year where the best team won the World Championship. That’s why I say go and let them spend the money, none of it matters if they can’t finish it out in the playoffs.

Howsabout: any time a team spends > $150M the other team gets four outs per inning, or the Yankers only get two. Four stricks? Three balls=a walk? 2 DHs? Four outfielders?

BTW — to whom is the luxury tax paid?

The only one I can think of that doesn’t directly impact salaries is to limit how many FAs a team can sign; after all, they weren’t your players, so why should you get to sign an unlimited number of players you didn’t develop or trade for?

This is certainly false. If you limit the demand of free agents, the aggregate price for them goes down. See also:

Pretend this graph is moving in reverse and P1 is the new price for free agents and P2 is the existing price. As demand decreases, you lower the price of free agents.

You might think that supply is static due to the rules of baseball (meaning that price is unchanged), but this isn’t true. Plenty of free agents would go unsigned or would sign extensions to avoid free agency because of this phenomenon.

What I do have a problem with is the restrictions that are put into place. I.E. The Oakland A’s can’t move into certain area’s because of the Giants. It’s one of the only business models where you can’t move your business to certain area’s to become more competitive.

There are zero rules in place to stop the Yankees from spending 300 Million a year on FA’s. There should be zero rules for a very good Business man such as Lew Wolf to move his team whenever and wherever he can cut a deal, that’s including NY. If he can get the land, the investors and a stadium built then he should be able to move his business (his team) to any location that makes his business more successful. To me it’s the American way.

I also dont like MLB taxing the the teams that spend over a certain amount of money. It really should be sink or swim. Dont keep teams like KC around just to be the Yankees, Mets, Sox and a few other teams extended farm systems. If they cant make money or keep customers (fans) returning to buy their product, then they should move or be out of business.

Is this Yankee Nation now? We’ve had 4 straight front page posts dedicated to the Yankees! 4! AN has East Coast Bias! NOOOO!

Has to say in this piece.

in your views there Nico. Free enterprise. De-regulate. May the best team win, no matter how constructed. Win at any cost if you got the dough. That’s what it is all about. Second place is first place for loosers.

The team had quite a few non homegrown players (especially pitchers).

…in luxury tax for the priviledge of no post season last year [hat tip The Sports Economist].

With the most recent signings, the Yankees look to be in great shape for the next couple of seasons. But beyond the next two seasons is anyone’s guess. As those annual salaries on those contracts is going to increase there is no guarantee that the players they signed will continue to play at the same elite level of performance that they had done in the past.

I am pretty comfortable that by year number five, those contracts are going to resemble a crippling albatross to the Yankees organization…and they’ll likely be paying a significant luxury tax next year and for years to come for the substantially increased opportunity to win in these next two to three years and to be mediocre thereafter; though I am probably underestimating the Yankees ability to continue to purchase talented players indefinitely.

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Is it hypocritical for Oakland Athletics’ fans to knock the free agent signing of the Yankees yet in separate posts want the management/ownership of the Athletics to sign its own free agents? And just how many non-homegrown players constitutes a team as a fraud? Is there a specific number; a gut feeling; one just knows it when they see it?

To hate the Yankees primarily on the basis that they can do what the do financially and that somehow this just isn’t fair, strikes me as envy. If the Athletics were to ever begin making more in revenue, I’m sure that us fans would want to see the team start signing free agents more often. Would buying a championship be okay then? I tend to believe many of us would be willing to check our outrage at the ‘unfairness’ of it all at the door if the situation were different.

and didn’t win the World Series.

no doubt it is a huge advantage. As far growing your own team the A’s are the best example of growing stars and watching them leave for more money than the A’s can afford. As an A’s fan the names Tejada, McGuire, Jackson, Rudi, Giambi, Catfish, Vida Blue, etc. just makes you think of what it could have been with a salary cap. None of those left because they thought Oakland was too ghetto — it was the money.

Despite 2008 record attendance, someday MLB will pay a price for this uncompetitive system. I predict resession of 2009 will be start of downward spiral MLB interest.

That the Yankees more or less establish the market in these actions. It seems unfair that they can automatically sign the best two free agents without competition. I mean is there any doubt that they would have won a bidding war for Tex against slegnA or Boston? But the market is the market. And it seems a little funny to be overly upset as an A’s fan because our club’s philosophy would dictate that a FA signing on this level is just not worth the risk (eight or ten years guaranteed to a player at their performance peek). I am not an A’s fan in spite of this philosophy, this is why I love this team. So whatever. I have to agree with LCJ, that the Yankees actions may not even significantly improve the chances that they make the playoffs. The Rays and Sox look very good for the foreseeable future.

What I really hate, on Christmas even, is the level of exposure this will receive on ESPN and chances are the games on that excuse for a network, which is almost exclusively Red Sox and Yankees all the time, will be even more east coast centric.

So this will be the year that I find the money to pay for some kind of MLB package, whether it be on my computer or whatever. I will not sit through another season of ESPN (the ministry of plenty of yankees and red sox) drivel.

I’ve had an idea for a couple years now, but it would require a salary cap. It’s obviously imperfect as I think any solution will be, but I guess it depends on what you are trying to solve. This idea was to make baseball teams hold onto their player identity, which is a big part of their overall team identity.

The idea is to give teams a discount against the cap on longer term contracts. The first year or two count 100% toward the cap, but the following years only make that year count at a percentage and go down from there, until it hits a minimum percentage at 10 or so years. I figure it could go down in small increments (98, 96) at first, and hit 80% at year ten.

In addition to keeping down the amount of money that big-market teams can spend, this would encourage teams to sign longer term contracts. The players still get the same amount of money they normally would under the cap, and perhaps more if the teams have a lot of long term contracts on the books.

Trading would restart the clock, so the receiving team no longer gets the discount until that second or third year (whichever was the first discount year). This should keep the number of trades down, as teams will only be able to trade if they have the cap room.

How this would be affected by arbitration and other contract things, I don’t know. What are the holes in my idea? Anything actually have merit?