Salary Floors and You: How Much Do We Need to Spend?

With the trades of Andrew Bailey, Trevor Cahill, and Gio Gonzalez, I hope we're now all on the same page. 2015 or bust. Over the next two years, there will be a lot of baseball that is difficult to watch. Hopefully, there's growth and signs that the future is in fact bright. I'm not inventing any new doctrine with this next statement, but I'd rather watch a terrible team on which each player is under 25 than a mediocre team with a bunch of veterans that leave little to the imagination.

Which would be good for a number of reasons. Most obviously perhaps, building a baseball team internally, whether through the draft, trades for prospects, or international signings, is the most cost effective manner by which to build. The A's have no choice but to use cost-effective means to build a team. You may have seen a major motion picture describing this phenomenon. Another side effect of a roster full of young players (meaning pre-arbitration) is that they're ridiculously cheap. Not one of them will make a million dollars in a season. Having a roster full of players with less than three years experience would create a payroll as low as $20 million.

That said, the MLB Players Association has certain....let's call it expectations. The MLBPA is one of the most powerful unions in operation, made so by fierce leader Marvin Miller and helped enormously by the Peter Seitz decision regarding Andy Messersmith and Dave McNally in 1975, effectively creating free agency. The players association would never allow a team to artificially hold salaries down by having no veterans on the roster, despite that being the optimal strategy for the organization. There's a breakeven point at which the A's could satisfy the MLBPA while spending as little money as possible. Where is that point?

Here's a breakdown of the A's payroll over the last ten years (courtesy of Cot's Contracts):
  • 2011: $67,094,000
  • 2010: $58,304,900
  • 2009: $62,310,000
  • 2008: $47,967,126
  • 2007: $79,366,940
  • 2006: $62,242,079
  • 2005: $55,425,762
  • 2004: $59,425,667
  • 2003: $50,260,834
  • 2002: $40,004,167
  • They've spent between $40 and 80 million in each of the last ten seasons, averaging about $58 million. In the last five years that average is $63 million with a minimum of $48 million. Let's round and call the minimum $50 million, which probably accounts for a small bit of inflation and the like.

    I went back through each team's payroll for the last five years to find the smallest payrolls. Here's the bottom five:

  • Nationals 2007: $37,347,500
  • Marlins 2009: $36,834,000
  • Marlins 2007: $30,507,000
  • Rays 2007: $24,123,500
  • Marlins 2008: $21,811,500
  • Just for kicks, the 2006 Marlins had an Opening Day payroll of $14,998,500!)
  • The minimum for 2011 was $38,176,000 for the Royals, followed by around $42 million for the Pirates and Rays.
  • After re-signing Coco Crisp, a move that raised some eyebrows around here, the A's have eight players under contract for next year for just over $28 million. They have 31 more players on the 40-man roster with under three years of experience, meaning they'll be paid between $200,000 and $900,000 for the coming season. If we call that $600,000 per player, that's another $10 million, putting us shy of $40 million in total team payroll. The A's have made it very clear that they don't plan to contend this coming season, so $40 million might be enough to satisfy the MLBPA.

    Of course, the A's are short on outfielders, and someone had to play centerfield. It just so happens that that someone likely won't be around when the A's have a chance to be good again, but it's not hard to imagine Coco earning his $6 million this season. He could prove to be a valuable trade chip this summer or next offseason. But I think his contract as much as anything was about making sure the A's spend enough money on players to not hear from Michael Weiner and his posse at the MLBPA this winter, and I wouldn't be surprised if there's one or two more like it still to come (looking at you, Cody Ross).

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