With its lack of a salary cap, and wild disparities in team payroll (New York Yankees — $228.8 million; Houston Astros — $22 million, or less than one A-Rod), baseball, more than any other major U.S. sport, pinpoints market inefficiencies. Stupid spenders, we know who you are.
So about a month-and-a-half into the season, I thought I’d have a little fun with the numbers. Yes, it’s still early, and the fortunes of many teams will change, for better or worse. But when you see baseball teams making the same mistakes, again and again, you can’t help but take notice.
Just look at the Toronto Blue Jays and Los Angeles Dodgers. Both teams seemed to buy a pennant in the offseason. The Dodgers, behind the financial muscle of their private-equity owners, and the smile of part-owner/franchise cheerleader Magic Johnson, signed staring pitcher Zack Greinke to a six-year, $147 million contract that raised eyebrows around the majors. Whoa, Greinke is good, but was he worth that much? Greinke pitched in two games this season, before he broke his collar bone in a brawl with San Diego Padres outfielder Carlos Quentin. (Greinke made a winning return against the Washington Nationals on Wednesday night). The Dodgers spiked their 2013 payroll 127% year-over-year: that’s the biggest jump in the majors, by far. Yet, the team’s winning percentage is down 21% from the final 2012 result. As of Wednesday, the Dodgers were 17-22, in last in the National League West by 5½ games. Manager Don Mattingly may be on the hot seat.
Up north, the Blue Jays haven’t impressed. The team’s winning percentage has fallen 11% — Toronto is at the bottom of the AL East by 8½ games though it has won four in a row — even though payroll is up 55.7%, the second-highest year-over-year jump in the majors, trailing only the Dodgers. Toronto made a series of splashy-moves: the team’s blockbuster trade with Miami brought in shortstop Jose Reyes, who had signed a six-year, $106 million contract with the Marlins the year before, pitcher Josh Johnson, who is making $13.75 million this year, and pitcher Mark Buehrle, who is making $11 million. The Blue Jays also signed outfielder Melky Cabrera to a two-year, $16 million contract, and last year’s N.L. Cy Young Award winner, R.A. Dickey, to a two-year, $25 million contract extension that enabled the Blue Jays to complete a trade with the New York Mets.
Many pundits hyped the chances of Toronto and Los Angeles – just like they did the year before, with Miami. In conjunction with the opening of a new stadium in 2012, the Marlins doubled their payroll — and still finished in last place. How many times will baseball teams pile up expensive, big-name assets in the offseason, and get everyone penciling them in as World Series winners, before failing? Will they ever realize that such a strategy rarely pays off?
Based on the early returns, L.A. and Toronto had the least cost-effective off-seasons. Another stinker – the Chicago White Sox, which added nearly 23% worth of payroll, for an 18% drop in winning percentage. Chicago’s in the A.L. Central cellar. On the other side, Boston made the most sensible moves. Payroll is down 13% — to a still hefty $150.6 million for sure — while winning percentage is up 45% early in the season. Though Red Sox fans, no doubt, may credit these figures to the absence of highly unpopular Bobby Valentine, who was hired to fix Boston last season, and instead became a sideshow.
Colorado and Minnesota finish second and third, respectively, in our hot-stove efficiency standings — sexy, I know! The Rockies cut payroll 8%, but winning percentage is up 36.2% early in the season. The Twins are only playing .500 ball so far this season, but they played .400 ball last season, and they’ve improved while cutting payroll 19%.
Of the teams that actually invested more money in their players this off-season — which fans always want to see — St. Louis really stands out. Payroll is up 4.4%, while winning percentage has jumped 21%. Armed with the best starting pitching in the National League, the Cards are perched atop the N.L. Central.
When ranking teams by off-season efficiency, the Marlins and Houston Astros actually both fall in the top 5. Both teams cut payroll drastically. Miami might be the most unpopular franchise in all of sports. After convincing taxpayers to support a stadium, Miami gutted the team this off-season; payroll fell 69%. Winning percentage has dropped 33.4%. As for the Astros, payroll is down 63.62% this season, while winning percentage has fallen just 26% so far this season.
But both of these teams are hopeless. They own the two worst records in the majors; as of Wednesday, the Astros were 11-30. Miami was 11-29. Sometimes, efficiency can’t buy happiness.