SWC75
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BASEBALL GETS ‘RUINED’ - AGAIN
First baseball was ‘ruined’ by integration, then by expansion, then by division play, then by the designated hitter. In the late 70’s came a new and ominous threat: free agency. For years players had been trying to free themselves form the hated “reserve clause” that bound them to teams until the teams no longer wanted them but various court cases, including Curt Flood’s had all failed.
Marvin Miller had carefully laid the ground work for a more successful challenge to the clause from another front. His 1968 collective bargaining agreement, (CBA) with the owners included “written procedures for the arbitration of player grievances before the commissioner”. His second CBA morphed that into “a three-member arbitration panel with a neutral chairman selected jointly by the players and owners”. He convinced two players, pitchers Dave McNally of the Expos and Andy Messersmith of the Dodgers to hold out. Miller pressed the case that the reserve clause, while legal by the various court rulings that had come down over the years, had been misinterpreted.
The clause read that if an owner and player had not been able to come to an agreement on a new contract by the termination date of the old one, the team could retain the right to his services for another year under the terms of the old contract. The players argued that that clause was intended to be applied once to give the participants an extra period to come to an agreement, not to be reapplied at the end of each year such that owners could simply refuse to give a player what he was worth and keep him as long as they wanted, (and then get rid of him whenever they wanted). Arbitrator Peter Seitz agreed with that position. The owners went into panic mode and immediately sued in court to get the decision overturned. This time the courts were against them, rather than the players, and the flood gates were opened.
It had always been argued that if players were free to sign with whoever they wanted after their contracts was up, the richest teams would sign all the best players and dominate the play on the field. Meanwhile the poorer franchises, being unable to compete would fold up. Miller, now holding the best cards, proved magnanimous by agreeing to limit free agency to players with 6 years of service, knowing that a restricted pool of free agents would drive salaries up better than flooding the market with them.
So baseball braced itself for a period of utter domination by the richest teams, horrendous records complied by the many uncompetitive teams, bouncing paychecks, bankruptcies and a greatly reduced number of teams. And baseball did what it’s usually done when something ‘ruins’ it: it got better.
It’s been 39 full seasons since the Seitz decision, 1976-2014. The 39 seasons before the decision were 1937-1975, (inclusive). Let’s look at those periods.
From 1937-1975, there were 710 “teams” (16 a year from 1937-60, then 18 for one year- 1961, then 20 from 1962-69 and 24 from 1969-75). Thirteen of those teams, (1.8%) won 2/3 of their games and 20 teams, (2.8%) lost 2/3 of their games. 89 of those teams, (12.5%) won at least 60% of their games and 93 (13.1%) lost at least 60% of their games. 17 of the 24 franchises made it to the World Series, (70.8%- but all 16 of the original teams) and 12 of them (50%- but 11 of the original 16- 68.8%) won it.
From 1976-2014, there have been 1090 ”teams” (24 in 1976, 26 a year from 1977-1992, 28 a year from 193-1997 and 30 years from 1998-2014). Four of those teams ((0.4%) won 2/3 of their games. Six of those teams (0.6%) lost 2/3 of their games. 67 of those teams ((6.1%) won 60% of their games. 80 of them ((7.3%) lost 60% of their games. There have been far fewer extremes in the era of free agency than there was before that. 27 of the 30 franchises made it to the World Series (90%) and 20 of them won it (66.7%)
Bill James in his “New Historical Baseball Abstract”, which came out in 2000, presented a stat which he called the ‘Index of Competitive Balance”. He combines ‘the standard deviation of winning percentage for teams in each single season during the decade, averaged” with ‘the standard deviation of winning percentage among franchises for the decade as a whole1. Typically, “I’d have to spend three more paragraphs to explain the parameters used to derive these numbers and I’m going to skip that, because it’s boring”. Thanks, Bill. He does say “These two figures (in each decade) are then added together and the sum is divided by .53, which is what the sum would be in a perfectly competitive environment. This figure is then divided into 1000 to produce the index of competitive balance. “ Got that? Anyway, here are the results, (the higher the number, the more balanced the game was in that decade):
1870’s 21%; 1880’s 24%; 1890’s 27%; 1900’s 30%; 1910’s 36%; 1920’s 34%; 1930’s 31%; 1940’s 34%; 1950’s 34%; 1960’s 40%; 1970’s 45%; 1980’s 56%; 1990’s 57%.
That’s right the period after free agency ‘ruined’ the game has been the most competitive in baseball history!
But even James was a hold-out. He’s a Kansas City Royals fan and was wiring in the long dry spell, (a desert, really) between their 1985 championship and last year’s resurgence. “When I was in high school, we knew this kid who drank like a sponge and drove like a maniac; we all used to say he would kill himself in a car wreck by the time he was 30. Boy were we wrong. He didn’t kill himself in a car wreck until he was almost 40. It would be a mistake to conclude that, because the destruction of competitive balance by free agency didn’t happen when we expected it to occur, it therefore isn’t going to happen. Many things suggest that free agency is now is destroying competitive balance, although it took twenty years for this to happen.”
Bill doesn’t identify these “many things”, except that that competitive balance has “begun to fray” in the 1998’s, noting that the standard deviation of winning percentage in 1990 was .054 in 1990 , “one of the lowest figures in baseball history” and increased (bad) to .081 in 1998, “the highest figure since 1977”. But he does admit that “overall competitive balance was greater in the 1990’s than in any other period of baseball history.”
Bill’s numbers are something of a mystery but let’s break down mine.
From 1976-2000, there were 670 ‘teams’. Three of them teams won 2/3 of their games (0.4%). Four them lost 2/3 of their games (0.6%). 46 of them won 60% of their games (6.9%) and 47 lost 60% of their games, (7.0%). 20 of the thirty franchises (66.7%) made it to the World Series in 25 years and 15 of them, (50%) won it.
From 2001-2015, there were 450 ‘teams’. 1 of them won 2/3 of their games, (0.2%) and 2 of them lost 2/3 of their games (0.4%). 21 teams won 60% of their games, (4.7%) and 33 of them lost 60% of their games (7.3%). 15 of the 30 teams, (50.0%) made it to World Series in 15 years and 10 of them ((33.3%)
won it 25/15 X 15 = 25 teams in the series and 17 teams winning it, including the Red Sox for the first time in 86 years, the White Sox for the first time in 88 years and the Giants for the first time in 56 years.
So basically, the kid who “drank like a sponge and drove like a maniac” still hasn’t crashed, 39 years into free agency. Meanwhile, the revenues of Major League baseball, which were $50 million when Marvin Miller was hired, have grown to $7.5 billion. Nelson Doubleday and Fred Wilpon bought the New York Mets for $21 million dollars in 1980. By 1986 the team was worth $81 million. By 2002 it was $270 million and today Forbes values the franchise at $1,350 billion, (despite the stupidity of the Wilpons getting involved with Bernie Madoff). Every sport should be so ‘ruined’ as baseball in the free agency era.
Why didn’t free agency destroy the competitive balance of the game? The biggest reason was that the game was afloat in money. Television revenues and all the various marketing schemes the game and the teams have come up with so dramatically increased revenue that there were really no “have-nots” in baseball any more. There was a gap in revenue between the top teams and the bottom teams but nothing like it was in the old days. When the Braves moved from Boston to Milwaukee, their attendance increased from 281,278, (3,652 per game) to 1,826,397, (23, 719). In 1953, the St. Louis Browns drew 297,238, (3,860) while the Yankees drew 1,537,811, (19,970). In those days the live gate, parking and concessions were a team’s primary source of revenue. Broadcasting and marketing were in their infancy. How were the Boston Braves and St. Louis Browns to compete?
We think of baseball as losing popularity compared to other sports but in fact baseball is more popular than ever: all sports are, thanks to television. Last year the lowest attendance in the major leagues was at Cleveland where 1,437,393 fans attended games, (17,746). That would have finished third in the majors in 1953, behind the Braves and the Yankees. The Dodgers led in attendance with 3,782,337 (46,636). The ratio between the top and bottom team in 2014 was 2.6 to1. In 1953 it was 6.1 to 1. And today those fans are paying much more for everything, even factoring out inflation, than they were in 1953. And the ball clubs have much more extensive revenue from broadcasting and marketing than they did back then. Now that’s where they really make the big money.
The talent base has grown exponentially. The population of the country became 200 million in 1967. It’s now over 300 million. There’s more organized training at a younger age than ever before. And the game has become international, with many players coming from South America or the Pacific rim. Beyond that not all teams had developed complete farm systems in 1953 and not all teams had integrated. Nowadays they have the structure they need for success and none of the limitations that would prevent it. Everybody has the wherewithal to have a good team these days. What they need is the desire and the smarts to actually do it. Then the issue becomes: can they keep it?
Free agency actually contributed to the balance rather than degrading it. The tendency was for successful team to come apart as the players who contributed to that success looked for the best deal they could get and teams wanting that sort of success bid for their services. The Oakland Athletics’ mini-dynasty dissolved due to free agency and then the Big Red Machine was dismantled. The Yankees won two straight titles from 1977-78 but then came a stretch of 13 straight years without repeat champions with 11 different franchises winning the World Series. The Blue Jays won two in a row from 1992-93 and the Yankees had an amazing stretch of 4 wins in 5 years from 1996-2000. No team has repeated since then, although the Red Sox and Giants have each won three titles and the Cardinals two of them.
These factors would probably be enough to negate any negative impact of free agency by themselves. But they’ve had further assistance from the modern playoff system, which forces a team to essentially win a World Series to get into the World Series and now forces them to win two of them and maybe a wild card playoff game as well to get a shot at the championship. That makes it hard to build a dynasty, even if you’ve built a team that could be one. One wonders how many times the old Yankees might have been upset if they’d had to win a series or two just to get into the World Series. It might not have happened often but it would have happened.
What’s more attempts to build championship teams primarily through free agency have failed. People think that the Yankees of the late 70’s were constructed that way due to Reggie Jackson, Catfish Hunter, and Goose Gossage. But that team was built mostly from trades, engineered by Gabe Paul: Chris Chambliss, Willie Randolph, Bucky dent, Graig Nettles, Lou Pinella, Mickey Rivers, Ed Figueroa, Mike Torrez and Sparky Lyle. And their teams of the late 90’s were built mostly through the farm system when Gene Michaels was running the team: Derek Jeter, Bernie Williams, Jorge Posada, Andy Pettitte, Marino Rivera. When George Steinbrenner was making the decisions, he’d bring in high priced free agents, who tend to be players in the latter half of their careers. It greys the roster and makes the payroll top-heavy. That’s when the Yankees have struggled. Other teams that have gone in heavily for free agents, such as the Rangers and Angels, have similarly struggled.
It takes a 25 man roster to win a championship. If collecting superstars did it, the Cubs would have been a dynasty in the 60’s and the Mariners in the 90’s. They weren’t. It takes a village.
First baseball was ‘ruined’ by integration, then by expansion, then by division play, then by the designated hitter. In the late 70’s came a new and ominous threat: free agency. For years players had been trying to free themselves form the hated “reserve clause” that bound them to teams until the teams no longer wanted them but various court cases, including Curt Flood’s had all failed.
Marvin Miller had carefully laid the ground work for a more successful challenge to the clause from another front. His 1968 collective bargaining agreement, (CBA) with the owners included “written procedures for the arbitration of player grievances before the commissioner”. His second CBA morphed that into “a three-member arbitration panel with a neutral chairman selected jointly by the players and owners”. He convinced two players, pitchers Dave McNally of the Expos and Andy Messersmith of the Dodgers to hold out. Miller pressed the case that the reserve clause, while legal by the various court rulings that had come down over the years, had been misinterpreted.
The clause read that if an owner and player had not been able to come to an agreement on a new contract by the termination date of the old one, the team could retain the right to his services for another year under the terms of the old contract. The players argued that that clause was intended to be applied once to give the participants an extra period to come to an agreement, not to be reapplied at the end of each year such that owners could simply refuse to give a player what he was worth and keep him as long as they wanted, (and then get rid of him whenever they wanted). Arbitrator Peter Seitz agreed with that position. The owners went into panic mode and immediately sued in court to get the decision overturned. This time the courts were against them, rather than the players, and the flood gates were opened.
It had always been argued that if players were free to sign with whoever they wanted after their contracts was up, the richest teams would sign all the best players and dominate the play on the field. Meanwhile the poorer franchises, being unable to compete would fold up. Miller, now holding the best cards, proved magnanimous by agreeing to limit free agency to players with 6 years of service, knowing that a restricted pool of free agents would drive salaries up better than flooding the market with them.
So baseball braced itself for a period of utter domination by the richest teams, horrendous records complied by the many uncompetitive teams, bouncing paychecks, bankruptcies and a greatly reduced number of teams. And baseball did what it’s usually done when something ‘ruins’ it: it got better.
It’s been 39 full seasons since the Seitz decision, 1976-2014. The 39 seasons before the decision were 1937-1975, (inclusive). Let’s look at those periods.
From 1937-1975, there were 710 “teams” (16 a year from 1937-60, then 18 for one year- 1961, then 20 from 1962-69 and 24 from 1969-75). Thirteen of those teams, (1.8%) won 2/3 of their games and 20 teams, (2.8%) lost 2/3 of their games. 89 of those teams, (12.5%) won at least 60% of their games and 93 (13.1%) lost at least 60% of their games. 17 of the 24 franchises made it to the World Series, (70.8%- but all 16 of the original teams) and 12 of them (50%- but 11 of the original 16- 68.8%) won it.
From 1976-2014, there have been 1090 ”teams” (24 in 1976, 26 a year from 1977-1992, 28 a year from 193-1997 and 30 years from 1998-2014). Four of those teams ((0.4%) won 2/3 of their games. Six of those teams (0.6%) lost 2/3 of their games. 67 of those teams ((6.1%) won 60% of their games. 80 of them ((7.3%) lost 60% of their games. There have been far fewer extremes in the era of free agency than there was before that. 27 of the 30 franchises made it to the World Series (90%) and 20 of them won it (66.7%)
Bill James in his “New Historical Baseball Abstract”, which came out in 2000, presented a stat which he called the ‘Index of Competitive Balance”. He combines ‘the standard deviation of winning percentage for teams in each single season during the decade, averaged” with ‘the standard deviation of winning percentage among franchises for the decade as a whole1. Typically, “I’d have to spend three more paragraphs to explain the parameters used to derive these numbers and I’m going to skip that, because it’s boring”. Thanks, Bill. He does say “These two figures (in each decade) are then added together and the sum is divided by .53, which is what the sum would be in a perfectly competitive environment. This figure is then divided into 1000 to produce the index of competitive balance. “ Got that? Anyway, here are the results, (the higher the number, the more balanced the game was in that decade):
1870’s 21%; 1880’s 24%; 1890’s 27%; 1900’s 30%; 1910’s 36%; 1920’s 34%; 1930’s 31%; 1940’s 34%; 1950’s 34%; 1960’s 40%; 1970’s 45%; 1980’s 56%; 1990’s 57%.
That’s right the period after free agency ‘ruined’ the game has been the most competitive in baseball history!
But even James was a hold-out. He’s a Kansas City Royals fan and was wiring in the long dry spell, (a desert, really) between their 1985 championship and last year’s resurgence. “When I was in high school, we knew this kid who drank like a sponge and drove like a maniac; we all used to say he would kill himself in a car wreck by the time he was 30. Boy were we wrong. He didn’t kill himself in a car wreck until he was almost 40. It would be a mistake to conclude that, because the destruction of competitive balance by free agency didn’t happen when we expected it to occur, it therefore isn’t going to happen. Many things suggest that free agency is now is destroying competitive balance, although it took twenty years for this to happen.”
Bill doesn’t identify these “many things”, except that that competitive balance has “begun to fray” in the 1998’s, noting that the standard deviation of winning percentage in 1990 was .054 in 1990 , “one of the lowest figures in baseball history” and increased (bad) to .081 in 1998, “the highest figure since 1977”. But he does admit that “overall competitive balance was greater in the 1990’s than in any other period of baseball history.”
Bill’s numbers are something of a mystery but let’s break down mine.
From 1976-2000, there were 670 ‘teams’. Three of them teams won 2/3 of their games (0.4%). Four them lost 2/3 of their games (0.6%). 46 of them won 60% of their games (6.9%) and 47 lost 60% of their games, (7.0%). 20 of the thirty franchises (66.7%) made it to the World Series in 25 years and 15 of them, (50%) won it.
From 2001-2015, there were 450 ‘teams’. 1 of them won 2/3 of their games, (0.2%) and 2 of them lost 2/3 of their games (0.4%). 21 teams won 60% of their games, (4.7%) and 33 of them lost 60% of their games (7.3%). 15 of the 30 teams, (50.0%) made it to World Series in 15 years and 10 of them ((33.3%)
won it 25/15 X 15 = 25 teams in the series and 17 teams winning it, including the Red Sox for the first time in 86 years, the White Sox for the first time in 88 years and the Giants for the first time in 56 years.
So basically, the kid who “drank like a sponge and drove like a maniac” still hasn’t crashed, 39 years into free agency. Meanwhile, the revenues of Major League baseball, which were $50 million when Marvin Miller was hired, have grown to $7.5 billion. Nelson Doubleday and Fred Wilpon bought the New York Mets for $21 million dollars in 1980. By 1986 the team was worth $81 million. By 2002 it was $270 million and today Forbes values the franchise at $1,350 billion, (despite the stupidity of the Wilpons getting involved with Bernie Madoff). Every sport should be so ‘ruined’ as baseball in the free agency era.
Why didn’t free agency destroy the competitive balance of the game? The biggest reason was that the game was afloat in money. Television revenues and all the various marketing schemes the game and the teams have come up with so dramatically increased revenue that there were really no “have-nots” in baseball any more. There was a gap in revenue between the top teams and the bottom teams but nothing like it was in the old days. When the Braves moved from Boston to Milwaukee, their attendance increased from 281,278, (3,652 per game) to 1,826,397, (23, 719). In 1953, the St. Louis Browns drew 297,238, (3,860) while the Yankees drew 1,537,811, (19,970). In those days the live gate, parking and concessions were a team’s primary source of revenue. Broadcasting and marketing were in their infancy. How were the Boston Braves and St. Louis Browns to compete?
We think of baseball as losing popularity compared to other sports but in fact baseball is more popular than ever: all sports are, thanks to television. Last year the lowest attendance in the major leagues was at Cleveland where 1,437,393 fans attended games, (17,746). That would have finished third in the majors in 1953, behind the Braves and the Yankees. The Dodgers led in attendance with 3,782,337 (46,636). The ratio between the top and bottom team in 2014 was 2.6 to1. In 1953 it was 6.1 to 1. And today those fans are paying much more for everything, even factoring out inflation, than they were in 1953. And the ball clubs have much more extensive revenue from broadcasting and marketing than they did back then. Now that’s where they really make the big money.
The talent base has grown exponentially. The population of the country became 200 million in 1967. It’s now over 300 million. There’s more organized training at a younger age than ever before. And the game has become international, with many players coming from South America or the Pacific rim. Beyond that not all teams had developed complete farm systems in 1953 and not all teams had integrated. Nowadays they have the structure they need for success and none of the limitations that would prevent it. Everybody has the wherewithal to have a good team these days. What they need is the desire and the smarts to actually do it. Then the issue becomes: can they keep it?
Free agency actually contributed to the balance rather than degrading it. The tendency was for successful team to come apart as the players who contributed to that success looked for the best deal they could get and teams wanting that sort of success bid for their services. The Oakland Athletics’ mini-dynasty dissolved due to free agency and then the Big Red Machine was dismantled. The Yankees won two straight titles from 1977-78 but then came a stretch of 13 straight years without repeat champions with 11 different franchises winning the World Series. The Blue Jays won two in a row from 1992-93 and the Yankees had an amazing stretch of 4 wins in 5 years from 1996-2000. No team has repeated since then, although the Red Sox and Giants have each won three titles and the Cardinals two of them.
These factors would probably be enough to negate any negative impact of free agency by themselves. But they’ve had further assistance from the modern playoff system, which forces a team to essentially win a World Series to get into the World Series and now forces them to win two of them and maybe a wild card playoff game as well to get a shot at the championship. That makes it hard to build a dynasty, even if you’ve built a team that could be one. One wonders how many times the old Yankees might have been upset if they’d had to win a series or two just to get into the World Series. It might not have happened often but it would have happened.
What’s more attempts to build championship teams primarily through free agency have failed. People think that the Yankees of the late 70’s were constructed that way due to Reggie Jackson, Catfish Hunter, and Goose Gossage. But that team was built mostly from trades, engineered by Gabe Paul: Chris Chambliss, Willie Randolph, Bucky dent, Graig Nettles, Lou Pinella, Mickey Rivers, Ed Figueroa, Mike Torrez and Sparky Lyle. And their teams of the late 90’s were built mostly through the farm system when Gene Michaels was running the team: Derek Jeter, Bernie Williams, Jorge Posada, Andy Pettitte, Marino Rivera. When George Steinbrenner was making the decisions, he’d bring in high priced free agents, who tend to be players in the latter half of their careers. It greys the roster and makes the payroll top-heavy. That’s when the Yankees have struggled. Other teams that have gone in heavily for free agents, such as the Rangers and Angels, have similarly struggled.
It takes a 25 man roster to win a championship. If collecting superstars did it, the Cubs would have been a dynasty in the 60’s and the Mariners in the 90’s. They weren’t. It takes a village.
