Memo to Corporate America: Be Like the Yanks

Though it kills him to say so, Red Sox fan and YFSF regular Daniel Drezner has no problem with the Yankees’ big spending ways this offseason, and, indeed, thinks they should be a model:

First, it would be awesome if American corporations acted more like the Yankees.  One cause of the deepening recession is that firms are afraid to do anything other than hold cash in hand at the moment. The smart ones should invest in expansion—capital is ridiculously cheap right now and they’ll be well-poised once the economy takes off again. If enough firms acted that way, the economy actually would take off again. In signing these players, the Yankees have made long-term investments while keeping their expenditures constant relative to last year’s payroll. Given their move to a new stadium, their revenues should increase. They have made these moves in order to improve their chances of competing. That’s how corporations should behave.

He also notes, for those advocating such a system, that leagues with salary caps are more prone to dynasties than those without. A lot to mull there on a holiday weekend….

16 comments… add one

  • I can’t imagine baseball ever getting a salary cap for the simple reason that the player’s union is so strong.

    Nick-YF December 27, 2008, 10:27 am
  • “He also notes, for those advocating such a system, that leagues with salary caps are more prone to dynasties than those without.”
    And he’s only the 4.3 millionth person to point this out.
    Surely you see the mistake in your logic. This has nothing to do with salary caps. Baseball has fewer dynasties because it’s baseball, not because there’s no salary cap.
    Being baseball, the yankees can only guarantee they’ll be competitive almost every single year, and they do that. Fortunately in the playoffs a hot pitcher or two can give any team a chance.

    dan December 27, 2008, 11:22 am
  • Baseball has fewer dynasties because it’s baseball,
    Given the history of the sport — even its recent history — this statement makes no sense.
    Dan Szymborski over at Baseball Think Factory has a similar take to Drezner. I found this passage especially enlightening:
    The Yankees do spend more money than other teams in MLB, but the differences would be less drastic if the payrolls of many teams had been rising up to the waves of new cash that have entered baseball in recent years. Going by the NFL formula, very generous considering the MLBPA is far more powerful an entity than any other union in sports, the payroll floor for 2009 would almost certainly be in the $100 million range. 58% of league revenue, as the players in NFL get, would be, in baseball, an average team payroll of a hair under $120 million. It’s pretty clear that while the Yankees are outspending everyone comfortably, the rest of baseball has just as much to do with the payroll disparity as the Yankees do.

    Paul SF December 27, 2008, 12:44 pm
  • “Given the history of the sport — even its recent history — this statement makes no sense.”
    If your post was suppose to be a response to mine, I’m guessing I wasn’t clear, since it had nothing to do with my comment.
    The author pointed at other sports with salary caps that had dynasties and then at baseball with a lack of a salary cap and no dynasties. The lack of dynasties in baseball has nothing to do with having no salary cap. It’s simply more difficult to guarantee victory in baseball, where 2 pitchers getting hot in a 5 game series is trouble for anyone. But it does give a team a much better chance to reach the playoffs and have a chance, which the yankees (and red sox) do every year.
    “the payroll floor for 2009 would almost certainly be in the $100 million range. 58% of league revenue, as the players in NFL get, would be, in baseball, an average team payroll of a hair under $120 million.”
    So the yankeees would only outspend the average mlb team by 80 million? Am I reading that correctly?

    dan December 27, 2008, 1:22 pm
  • But baseball has had several dynasties – and perhaps the biggest one in all of sports. Name me one sport which has one team with almost a fourth of all the championships?
    I’ll give him this – baseball, today, has much more ‘parity’ because of the well-known fact that short playoff series are a great equalizer. Add a best-of-3 series into the mix, and the chance that the best team actually wins drops significantly.

    AndrewYF December 27, 2008, 2:27 pm
  • AndrewYF: “Name me one sport which has one team with almost a fourth of all the championships?”
    Um… basketball. The Celtics have won 17 world championships, or 27.8% of all championships.
    Combined, the Lakers and Celtics have won 31 of 61 titles, or 50.8% of all titles.

    academic-SF December 27, 2008, 4:03 pm
  • and the percentage is likely to go up at the end of this season.

    Nick-YF December 27, 2008, 4:10 pm
  • Not if the Knicks have anything to do with it!

    YF December 27, 2008, 4:17 pm
  • 2010! That’s when everything will change!

    Nick-YF December 27, 2008, 4:28 pm
  • The Montreal Canadiens have won 23 titles in the 91 years since the NHL was founded. That’s 25.27%.

    SF December 27, 2008, 4:56 pm
  • Hulk Hogan had a monopoly on the WWF world wrestling title during my childhood. Ric Flair was the same with the NWA.

    Nick-YF December 27, 2008, 4:59 pm
  • Oops.

    AndrewYF December 27, 2008, 5:19 pm
  • So basically every sport has had one significant multi-decade dynasty, and baseball is no exception. Likewise, every sport has had many smaller dynasties and, again, baseball is no exception — the Philly A’s, the old Red Sox, the Big Red Machine, the Oakland A’s from the late 1980s, the most recent Yankee run, etc.
    Baseball is a harder place to build a dynasty now, but that has nothing to do with anything inherent in the sport. Free agency, more teams and shorter playoff series are far greater contributors to the decreasing likelihood of dynasties in all the major sports.

    Paul SF December 27, 2008, 5:41 pm
  • I’m perplexed by the statement that dynasties are more prevelent in leagues with salary caps. The vast majority of titles won by the Canadiens, Oilers, and Islanders in the NHL occurred before salary caps were instituted. The same is true of the Lakers/Celtics titles. In the NFL, The Packers, Steelers, Dolphins, and 49ers dynastic runs were in uncapped seasons. In fact depending on how you judge the Cowboys 90’s titles (teams assembled pre-cap) there is really only one cappped team that could reasonable called a dynasty..The Patriots. Am i wrong?

    VicSF December 28, 2008, 10:02 am
  • I know YF has an aversion to the term “dynasty”, and I do too, to an extent. I think the idea of a dynasty relies too much on the championship and not on consistent success. To me, the Yankees of the last 8 years, the Braves of the past 15, the Red Wings and Devils of the past 15 years, the Patriots of the last four, are something dynastic as well, even in their “failures” or non-consecutive championships. The championship is the easy definer of a dynasty, but brilliantly run franchises are dynastic even in the absence of a trophy.

    SF December 28, 2008, 10:13 am
  • > I know YF has an aversion to the term “dynasty”, and I do too, to an extent
    and so do I. It is a wrong word for the purpose, but it is stuck now. Regarding the idea of a salary cap: I find it difficult to believe that anyone thinks capping player salary is rooted in competitiveness regarding championship aspirations vs. competitiveness in profit margin.

    attackgerbil December 29, 2008, 7:07 pm

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