Pro Salary Cap
According to Dan Oleary, “Since baseball is the only major sport without a salary cap, and with the way baseball’s big-spending teams throw around money, having a different winner each year seems to defy logic” (OLeary). A salary cap is issued in every professional sport’s franchise, excluding Major League Baseball. With no salary cap, one club can dominate it’s competition on money alone. The New York Yankees spend the most money on it’s players each year (Goldman). It is no coincidence that they have won the most World Series of any other club in baseball history (Wikipedia-World Series). Not only have they won the most world championships, but they are a consistent contender for the American League title year after year. If a salary cap is not issued in professional baseball soon, then many fans will begin to loose interest in the sport due to repetitive results. The money saved from salary caps could be used more efficiently on other things to stimulate the economy better, such as government. More money is spent on players in Major League Baseball than all other professional sport franchises (Bryant). All of the money spent is not just in favor of benefiting ridiculously rich athletes. The result of excess money spent effects baseball’s fans negatively. The price of tickets, concessions, souvenirs, etc. all sky rocket as a result of ridiculously overpaid athletes. Before the sport is damaged irreparably, a salary cap needs to be issued in Major League Baseball immediately.
Many people have introduced the idea of a salary cap system to Major League baseball over the years, but have all been denied, or somewhat ignored. Back in the day, talented and well developed teams were not gifted because of which club ...
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...tic. "A Salary Cap." The Hotline 3 Feb. 2010. Print.
OLeary, Dan. "Salary Cap Would Help Majoe League Baseball." SIlive.com. 1 Nov. 2008. Web. 28 Mar. 2010. .
Reber, David. "School Dictricts in Kansas Struggle." Examiner. 9 Dec. 2010. Web. 3 Mar. 2010.
"Salary-cap Talk Will Dominate Major League Baseball's Offseason, Thanks to the New York Yankees' 27th World Series Title. - ESPN." ESPN: The Worldwide Leader In Sports. Web. 28 Mar. 2010. .
Toms, Pete. "Salary Cap in MLB, Reforming the Draft, Biz Tidbits." The Biz of Baseball 1 Feb. 2010. Print.
Warner, Charles R. Boston: Greenwood, 2001. Print.
"World Series -." Wikipedia, the Free Encyclopedia. Web. 28 Mar. 2010. .
There’s 30 major league baseball teams divided into two divisions. The payrolls for the 2007 30 major league teams are based on a 40 man roster and include salaries and prorated shares of signing bonuses, earned incentive bonuses, non-cash compensation, buyouts of unexercised options and cash transactions. There may be some cases were parts of the salaries are deferred or discounted to reflect present-day values. The following list is in order of highest payroll. The chart on the left is payroll and the one on the right is number of wins for 2007.
Anyone who has been involved in an organized sport, whether it is backyard football or a high school sports team, knows that these sports all have organizations that are responsible for setting rules, determining conditions of play, and penalizing individuals who infringe the rules. Some of the organizations like the National Football league and the MLB are familiar to most people, the rules they follow are not generally understood by anyone who is not closely associated with the sport. Most fans and sport critics assume that what is happening inside these organizations are of little concern to them. However, this is not the case. In the MLB, the New York Yankees spend an excessive amount of money every year to obtain big name players. A luxury tax was put into effect for teams that go over the spending limit. However, the Yankees are the only team that pays the tax because they are the only team that exceeds the spending limit. The players, coaches, fans, and I have argued that a salary cap would be the best possible way to allow teams in the Major Leagues an equal opportunity getting to the World Series.
Overall, compelling points exist supporting or not supporting a salary cap in baseball. Teams have the benefit of a salary cap existing, and out of that, a balance in free agency forms and a sense of championship parity develops too. On the other side of the spectrum, teams can use the Moneyball method of recruiting and signing players, along with tax implications and revenue sharing to balance out payrolls. The main factor in deciding if a salary cap is appropriate is the factor of fairness among the teams. Therefore, based off the support the research provides, the implementation of a salary cap is necessary.
Under the protection of Major League Baseball’s (“MLB”) longtime antitrust exemption, Minor League Baseball (“MiLB”) has continuously redefined and reshaped itself according to Baseball’s overall needs. But while MLB salaries have increased dramatically since the MLB reserve clause was broken in 1975, the salaries of minor league players have not followed suit.
Economic Theory Labor market theory is one of the most integral economic theories needed to dissect the inefficiencies in professional sports. Looking first at the type of market these leagues function in, one can see that they do not necessarily meet all the criteria that a competitive market requires. The big four sports leagues in the US have a set number of teams, which creates barriers to entry. Only when an expansion is agreed upon by the league, such as NHL has done for the upcoming season, are teams allowed to enter, and even then, it is limited to a maximum of a few teams in recent history. Additionally, the league makes it virtually impossible to exit, as selling a team is the closest they come to exiting the market.
A salary cap gives all the teams an equal chance to sign players. It also keeps teams with a lot of money not able to acquire every all-star they want , or any player who is a free agent. Some Major League Baseball teams like the Anahiem Angels and the Atlanta Braves are owned by very wealthy people and companies. The Anaheim Angels are owned by Disney.(Worisnop, 128) So with no surprise the Angels can produce a team which can be very competitive, and have several all-star players. Just recently they exercised this advantage by signing Mo Vaughn for ninety million dollars over seven years.(Antonen, 2) There were at least four other teams that wanted to sign this all-star, but the Angels easily had the money, and outbid everyone who wanted to sign him. If there was a salary cap in Major League Baseball then the Angels would have thought twice about giving that much money to one player. With the its roster for one year. So giving one player 12.8 million dollars for one year does not really make sense if the salary cap is fifty million dollars a year. That would leave only 37.2 million dollars for the twenty-four other players, which equals each player getting on average a little less than one and a half million dollars a year.
Colclough, W. G., Daellenbach, L. A., & Sherony, K. R. (1994). Estimating the economic impact of a minor league baseball stadium. Managerial and Decision Economics, 15(5), 497-502.
How many of you sports fans out there are sick of paying twenty-five dollars for a lousy seat at an NBA game? How many of you are sick of seeing the same teams in the finals every year? I'm sure there are thousands of you out there that feel this way, as do I. The way we can fix these problems is to demand that the NBA enforce a hard salary cap. A hard salary cap would lower ticket prices, allow for more teams to be more competitive and eliminate the possibility of any future lockouts. If the three things listed above aren't met, it's hard to say if the NBA will survive at all. I want to see the NBA survive, but not in the way things are being run now. A hard salary cap is the only way the fans and the players can coexist.
In Topeka, Kansas, the school for African-American children appeared to be equal to that of the white school. However, the school was overcr...
...ategies” that have been used and research shows how schools are impacted” (Ramsey, 2006, p.xv11).
Nemee, David. “100 Years of Major League Baseball.” Lincolnwood, Illinois: Publications Infernational, Ltd, 200. Print.
The problem with this is the inflation of players' salaries. When players are drafted young, they demand to be paid what they want; teams pay them millions right out of college.
The controversy of athletes being overpaid dates back to 1922, when well-known baseball player George “Babe” Ruth received $50,000 within the first year of his career. Ruth’s extensive wealth was bolstered by dozens of endorsements (Saperecom). As it is shown in figure 1, in the Fortunate 50 Tiger Woods takes the number one spot for highest paid athlete. Tiger’s salary for 2011 is $2,294,116 and like Babe Ruth, his endorsements exceed his salary earning $60,000,000 making his total $62,294,116 (Freedman). It’s crazy to think that 89 years ago professional athletes scarcely made more than the average person today. This is of course not counting the inflation that has occurred since the years which Babe Ruth played baseball.
...ecks and be treated as a farm system for the NFL, NBA, or MLB. If these athletes started getting paid now, at the college level, then the major leagues of these sports would suffer tremendously and lose marketability and money. A final solution to not having players get paid or receive certain benefits is maybe these head coaches of certain universities should not be getting the average 2 million dollars a year to be a coach, in some cases more than the presidents of these universities.(Chicago Tribune) There could be major strides made by simply merging that athletes shouldn’t get paid in whole dollars, but should receive paid benefits in which they would not have to worry about starving, losing scholarships due to injury or sub-par play. That I think would make the world for college athletes a better place, where both the schools benefit and the players benefit.
A young boy goes up to his mother and says, "Mommy! I want to be a baseball player!" If this was said in 1930, the boy's mother probably would have told the boy, "That's not future for you! You need to get a real job and make good money." If this was said in 1999, the boy's mother probably would have said, "Let's go to the store and buy you a baseball glove so you can start to practice." It is visible to every sports fan that in the past few decades, sports has undergone a whole new renovation. It isn't just an activity that is played for fun. It is a business in which owner and players attempt to coincide. It is a business where TV controls fan interest. It is also a business that affects many people's lives, both monetary and living aspects. There are many aspects that are involved with the economics of sport. Each one having unique qualities that adds to the greatest source of entertainment.