Yankees Spending Spree Shows It's Time for a Change in Major League Baseball

Rick DeGirolomoContributor IDecember 31, 2008

The New York Times ran an article on Christmas Eve titled "Yankees Defend Spending as Almost a Public Service."

Amid much criticism from both within baseball circles and from without, Yankee president Randy Levine defended the recent multimillion dollar spending spree, saying "(the Yankees) follow all the rules of baseball, we pay millions of dollars to other teams and we are essential to the revenues generated by Major League Baseball and its networks and other entities." 

The Yankees have spent more than $420 million on the contracts of three players during the offseason, a record amount that easily outpaced the rest of the league. The effort here, according to Levine, was to ensure that the team remain a top asset to the sport.

Are you sure you aren't just trying to buy another championship, Mr. Levine?

Last year's team was an embarrassment, largely due to the fact that the Yankees failed to reach the playoffs despite having the highest payroll of any team in the majors. The New York media ate the Steinbrenners' lunch on a regular basis, and they responded by bringing in players like Xavier Nady and Ivan Rodriguez in an effort to rise to the top of the division, led by the Tampa Bay Rays for most of the season.

It didn't work, and the Yankees missed the playoffs. And, as the saying goes, "desperate times call for desperate measures." So, in the midst of one of the worst recessions in our nation's history, the Yankees are spending money as if it grew on trees. And it is embarrassing.

Levine defended the recent expenditures, stating "We are sensitive to the economic times and our fans. We believe it is good for the franchise and good for the fans to put the best possible product on the field, and that is what we strive to do."

I can certainly agree with a management team that strives to field the best team possible. That is, after all, what they are paid to do; however, I cannot see how this is possibly good for Yankee fans, or baseball fans. If a fan wants to sit in a field-level seat in the new stadium, it will cost somewhere between $500 and $2,500 per seat!

When I was a kid, my father took our family of five to see the Yankees Old Timer's Day game. We had seats on the first base line, right on the first row. That was back in 1975, and the economy was awful back then, too. Today, a father would have to dole out over $12,000 to see the same game. Does this seem like a a price within reach of the average fan? Not by a long shot.

I just don't see how soaring ticket prices (and the increasing cable network subscription fees) are good for the fan. It just increases the distance between the fan and the game, and that will just result in apathy, which is not good for the game.

Another, more important point is that the free spending serves to create large performance gaps between the Yankees and the other teams, which is not good for the game. Disparity is only ever good for the team that is always on top. The average fan will not engage in a game in which the outcome is a foregone conclusion, regardless of star attraction.  

The NBA utilizes a salary cap that solves these problems, and I believe that it is now time for one in the MLB.

The idea of a salary cap is not new. It was actually used in the NBA back in 1946, and has kept the league in good health and under control for more than half a decade. The salaries are kept under control, the ticket prices are comparatively reasonable, and the league enjoys a competitive balance that not only engages its fans, but attracts new ones.

The current structure does not serve the fan or the game well. It only serves the upper echelon of the financially wealthy teams, and the Yankees are right there at the top. Oh, and the luxury tax is nothing more than a minor inconvenience to the New York baseball club, especially in light of the annual revenues the club post.

The New York Yankees are the No. 1 team in baseball, financially speaking. Forbes estimated the team worth at $1.2 billion, boasting gate revenues exceeding $150 million dollars in 2007, a figure expected to increase by more than $75 million next year over the 2007 figure. No team in baseball compares to them financially.

A salary cap would allow teams to compete on the field of play, however, and that would be great for baseball.

The New York Yankee way of doing baseball business is sadly myopic, and considerable changes need to occur if this game is going to have any future. Baseball needs to wake up. Stop this out of control spending and restore the competitive balance in the game. Its good for the game, and good for the fan.