Money is Everything

Back in late November, New York Yankees owner Hal Steinbrenner stated his preference for lowering his team’s overall payroll for the upcoming 2026 season.  There was a lot to take from this interview but for the purposes of this post we will ignore what Steinbrenner talked about in terms of the Yankees and will focus more so on what he said about the current state of baseball payrolls.

In that article it was noted that “The Dodgers became the first team since the Yankees in 2000 to win back-to-back World Series titles, but Steinbrenner said he believes there is a ‘weak correlation’ between spending the most money and winning championships. He reiterated he would ‘consider supporting a (salary) cap only if it’s accompanied by a floor,’ depending on the number”.

Mais que o tempo (More than time)

We think Steinbrenner got it wrong when he states there is a “weak correlation” between spending the most money and winning a World Series, since per the table below, the team with the highest payroll has won the World Series 20% of the time in the past 20 years. Perhaps one might believe 20% does not represent a strong enough correlation, but in addition to those four World Series wins, the highest spending team also earned two World Series trips that ended with losses, seven trips to the championship series, and another six trips to the divisional series.  The worst a highest spending team fared in the past 20 years was in 2024 when the Mets lost in the Wild Card round.

Therefore, based on the past 20 years of data, the highest spending team has the following likelihood of reaching these rounds of the playoffs: World Series (30%); AL or NL Championship Series (65%); and AL or NL Divisional Series (95%).

Year	Team (highest payroll)	Playoff result	World Series winner?
2006	New York Yankees	Lost-ALDS	No
2007	Boston Red Sox	Won-World Series	Yes
2008	New York Yankees	Lost-ALCS	No
2009	New York Yankees	Won-World Series	Yes
2010	New York Yankees	Lost-ALCS	No
2011	New York Yankees	Lost-ALCS	No
2012	New York Yankees	Lost-ALCS	No
2013	LA Dodgers	Lost-NLDS	No
2014	LA Dodgers	Lost-NLDS	No
2015	LA Dodgers	Lost-NLDS	No
2016	LA Dodgers	Lost-NLCS	No
2017	LA Dodgers	Lost-World Series	No
2018	LA Dodgers	Lost-World Series	No
2019	New York Yankees	Lost-ALCS	No
2020	LA Dodgers	Won-World Series	Yes
2021	LA Dodgers	Lost-NLDS	No
2022	LA Dodgers	Lost-NLDS	No
2023	New York Mets	Lost-NLCS	No
2024	New York Mets	Lost-NL Wild Card	No
2025	LA Dodgers	Won-World Series	Yes

Perhaps if you are a fan of the Yankees, Mets, Dodgers or Red Sox, a 20% likelihood of reaching the World Series is not good enough, but for the rest of the league we think those fans would sign up in a heartbeat to know that they are almost guaranteed of reaching the playoffs along with a very reasonable chance of reaching a World Series.

In his own way, Steinbrenner is making our point here at BP, but in a different way, when he stated that, “Look, there are groups of fans out there in different areas, including my hometown, here in Tampa, that — and I’ve addressed this before — come to spring training games thinking their team has little chance of making the playoffs. Or at least little chance of making it deep into the playoffs. And those fans would argue that that’s not good for baseball as a whole. And, you know, it’s a valid argument. Whether it’s true or not, it’s a valid argument.”

This is a point we have continually brought up here at BP on behalf of the small market teams, most recently in our post Baseball’s Problem.  It is therefore admirable that Steinbrenner, a big market owner, does get the issue that small market fans must deal with each year, even though he did not specifically call out “small market teams” in his quote.  The problem is easily identifiable. Lots of money but concentrated with too few franchises.  The solution is more difficult and one that MLB will have to contend with as their collective bargaining agreement with their players will be ending after this season.  This topic is now front and center and could be the reason for the next MLB lockout or strike.

The solution being bandied about by small market teams is the implementation of salary caps, which the players are vehemently against.  Maximum salaries (caps) for teams would likely bring about a more competitive landscape in baseball, but those would also need to include a minimum salary (floor) for teams as well.

Another solution that would not require caps or floors would be revenue sharing. There already is a limited amount of such sharing, but ramping up the level of sharing between all franchises would certainly bring about a more level financial playing field and would likely not find any opposition from the players association.  Obviously owners, specifically the large market owners would find this solution distasteful.

We believe this money allocation issue can be best summarized in the immortal words of Pink Floyd as follows:

Money
It’s a crime
Share it fairly, but don’t take a slice of my pie
Money
So they say
Is the root of all evil today

The wisdom of Pink Floyd gets it. Hopefully soon the owners and the players will understand and be able to solve this problem.

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