Tagged: luxury tax

More Thoughts on a Salary Floor

I posted this to an old thread out in MLB land, so I figured I would repost it here. The original article argued for a division realignment and expansion (so you would have 8 4 team divisions) and for eliminating the wild card. What follows is my response, built on the quick thoughts I scribbled yesterday.

I don’t think baseball needs a salary ceiling as much as it needs a floor. Rather than instituting a cap, I would push for a more realistic luxury tax. If you look at the luxury tax rules [wikipedia], then you can see that the MLB luxury tax is set impractically high, such that only the Yankees are ever really in danger of crossing the threshold. By implementing a realistic cap, say at 100 million dollars (to throw out a figure that represents about the top 33% percentile in payrolls–9 teams have salaries over 100 million this season[cbssports.com]), you could produce a revenue sharing system that would help teams like the Marlins, the Pirates, and the Nationals meet a 65 million dollar floor.

Of course, the baseball owners will never agree to such a revenue sharing system. This is the system that propelled the NFL to the top of America’s sports landscape, and we can see those owners are ready to repeal the very system that stimulated their growth. Instead of expansion, the long-term prognosis for the current economic ecology probably dictates a bit of extinction. Teams at the bottom will likely never get the opportunity to compete. I get that the league has a fair amount of competitive balance at the top, but its ridiculously unfair for those teams at the bottom.

The only other thing I would disagree with is getting rid of the wild card. The wild card allows good teams in the same division as great teams a chance to compete for the title. Nothing is more annoying than watching a team in the AL West make the playoffs when a third place team in the AL East has a better record against tougher competition. I remember how much more annoying it was when you had to watch lesser teams make the playoffs over second place teams in better divisions. Let’s not go back to that.