WHEN FREE AGENCY WAS YOUNG AND BASEBALLS

ODDS WERE EVEN

By Dean Gearhart (April 2015)
I began this article right around opening day as I reviewed a list of the top ten
salaries in baseball for the 2015 season. The minimum to sit at this table is a cool
$24M a year. Being long past your prime is not a barrier, nor is the fact that you
may not even play this year. Those owners from the mid-1970s who predicted that
free agency would ruin baseball must be feeling pretty smart right about now
the ones who are still around, that is.
Im sure you all know the story of that crazy free agency thing that baseball came
up with back in the day. Curt Flood knocked on the door in 1970. Jim Catfish
Hunter slipped out a side door in 1974 and then Dave McNally and Andy
Messersmith knocked the door down in 1975. Messersmith, was granted free
agency in March of 1976 and signed a 3 year/$1M deal with Ted Turner and the
Braves..McNally actually retired. The rest, as they say, is history.
In 1976, the owners had threatened to lock the players out of Spring Training, and
later the players discussed boycotting the All-Star Game. The world was coming to
an end but a good time was being had by all.
Well, Im here to tell you that free agency was never the problem it was projected or
portrayed to be. In fact, free agency did exactly what it was supposed to do. Lets
start by looking at the preceding couple of decades.
THE 1950s
The New York Yankees opened the decade by winning four straight World Series
titles. When they won in 1953 it was actually their 5 th in a row. They would also win
in 1956 and 1958. The Giants (then of New York) won in 1954 and the Dodgers
(then of Brooklyn) won in 1955. The only championship teams not from New York
were Milwaukee in 1957 and the Dodgers (now in L.A.) in 1959. Of the 20 pennants
won, 14 were won by teams from the Big Apple.
As far as salaries, Ted Williams and Joe DiMaggio appear to be the only $100K+ per
year players. Joe D, earned an even $100K in 1950. In 1951, - Joes final year - his
reward for a career that included 9 world championships and 3 MVP awards, was a
10% pay cut. Ted Williams salary was $125K during the entire decade and he was
rewarded in 1960 his final year - with a $30K pay cut for his final year.
I will make no attempt to bore anyone with any kind of economic data comparing
1950s dollars to current day dollars and absolutely no reference shall be made to
GDP or any other such economic terms. My main concern as I look over the decade
is the complete lack of competitive balance. This was an entire decade where no
team outside the border of a single U.S. state had much of a shot.
THE 1960s

The 1960s began in familiar fashion with the Yankees winning the first five A.L.
Pennants. Over in the N.L. the Dodgers and Cardinals dominated from 1963-1968,
with each team capturing 3 pennants and 2 championships. Willie Mays was the
highest paid player in 8 of the 10 years, beginning the decade at $80K and working
his way up to $135K.
The most significant advance in the competitive balance of the game began in
1965. That was the first year of baseballs amateur draft. Prior to that all baseball
players were free to sign with any team they liked. Free, insofar as you had to sign
a lifetime contract. Actually it was a perpetual series of one-year contracts that
stipulated the maximum pay cut that your owner could impose upon you.
An actual Yankees executive is quoted as equating the new draft to communism.
Fictional Yankees executive Henry F. Potter would probably have been quoted as
saying, What do you mean the Yankees cant have whoever they want? How is
that fair?!?
Im sure that it is just a coincidence that the Yankees fell from 1 st place in 1964 to
the second division in 1965. They finished last in 1966 and did not make the postseason again until 1976.
In 1969, baseball began a new era of divisional play. Baseballs post season would
now double in size from two to four teams. The door was open and now any team
had a shot to win it all.or did they?
INTO THE 1970s
Divisional play coincided with the emergence of the Orioles as an American League
power. They made a mockery of this new ALCS by sweeping the series in 1969,
1970 and 1971. The Tigers won the AL East in 1972, but the Orioles bounced back
and won the division in 1973 and 1974. After winning Game One in 1973 against
Oakland, they were a perfect 10-0 in ALCS play.
Out west, the Twins won the first two division titles before giving way to Oakland,
who proceeded to win five straight from 1971 to 1975. The Orioles and As squared
off in the ALCS three times in a four year span.
Beginning in 1976, the Yankees and Kansas City Royals took over. Each team won
its respective division four times in the next five seasons, and they meet in the
ALCS each time.
Over in the National League, Cincinnati and Pittsburgh were the dominant teams.
The Pirates and Reds won their divisions six times each during the 1970s, meeting
in the NLCS four times. The Phillies and Dodgers also captured three division titles
each.
Of the 40 division titles contested in the decade, 20 of them were repeats thats
50%. And that number doesnt really tell the whole story of the dynastic 70s. In
the AL, you had four teams (Orioles, Yankees, As & Royals) win 80% of the division
titles and in the NL, four teams (Reds, Pirates, Dodgers, Phillies) won 90%. That
doesnt sound very competitively balanced at all, now does it?

This dominance culminated in 1978 when all four division winners were repeats
(Yankees, Royals, Phillies and Dodgers), the same two teams (Dodgers and Yankees)
won the pennant and the same team (the Yankees) won the World Series.
CHARLIE O AND THE BOSS
The first free-agency frenzy took place after the 1976 season. Several big named
players played the season without a contract and were free to seek their fortunes
elsewhere once the season ended. This list included nearly every major contributor
from the Oakland As dynasty that had won back-to-back World Series just a few
years before.
Charlie Chicken Little Finley decided that the sky was falling and he cashed out. It
was a mistake by Finley that led to the departure of Catfish Hunter after the
1974 season. After the 1975 season, he unloaded Reggie Jackson and Ken
Holtzman via trade and then tried to sell Joe Rudi, Vida Blue and Rollie Fingers in the
middle of the 1976 season. The sale was negated, but Rudi and Fingers walked at
seasons end. Vida Blue and Bill North were the only two players on the 1977 As
roster who were part of the 1974 champions. Blue was traded to San Francisco in
March 1978 and North was shipped to the Dodgers that May.and then there
were none.
On the other hand there was George Steinbrenner. George was more than happy to
take advantage of the Finley fire sale. The Yankees walked away with one of
Charlies Cy Young winners in Catfish Hunter and his MVP in Reggie Jackson. They
also went out and got Don Gullett who had defeated the Yankees in Game 1 of the
1976 World Series. The Yankees already had a good team in 1976, but their new
additions put them over the top in 1977.
The 1977 Yankees had a Cy Young award winning closer in Sparky Lyle, but
Steinbrenner did not let that stop him from spending big bucks on yet another
closer in Rich Goose Gossage. The Yankees won the World Series again in 1978
and would go on to win another division title in 1980 and another pennant in 1981.
Steinbrenners Yankees were the exact thing that the other owners feared as free
agency approached and the Yankees immediate success was, I assume,
disheartening to some of the other smaller market teams.
Player salaries, as one would expect, sky-rocketed during the last few years of the
decade. Willie Mays began 1970 as the highest paid player at $135K per year, and
Rod Carew ended on top of the list in 1979 with a whopping $800K. Heading into
the 1980 season, the league average was now $143K - $8K more than Willie Mays
top salary had been just ten years before.
THE 1980S
In 1980, Nolan Ryan signed with the Houston Astros and broke the $1M a year
barrier and the numbers would only climb, nearly tripling by 1989. But, lets take a
look at the competitive balance in baseball in this new era of free agency.

As previously stated, the 1970s was dominated by 8 teams with 20 of 40 division

titles being repeats. From 1980-1989, the number of divisions that were won by a
team in consecutive years was three. Thats right, THREE..the Yankees (1980 &
1981), the Royals (1984 & 1985) and the As (1988 & 1989). Thats a pretty
immediate impact. During the decade, for the first time in possibly ever, any team
appeared to have a legitimate chance in any given year.
The Astros and their new million-dollar man won its first division title in 1980. The
next year the Expos broke through and won the NL East. In 1982 it was the
Cardinals. In 1984, the Cubs and Padres who had both finished last in 1980 and
1981 captured their first division titles. When those two met in the NLCS, every
club in the NL had a division title under its belt. The Padres / Cubs match-up
featured quite a few familiar names from those 1970s dynasties such as Gossage,
Graig Nettles, Steve Garvey, Larry Bowa and Ron Cey.
The Dodgers and Cardinals won the most division titles with four and three
respectively, but no NL division had a repeat winner. The only teams in the NL who
didnt win a division in the 1980s were the Cincinnati Reds and the Pittsburgh
Pirates. The Reds did finish with the best record in all of baseball in 1981, but Bowie
Kuhns idea of using the Little League playoff structure (with a first half and second
half winner) screwed them out of the post-season that year.
The funny thing is, although they missed out in the 1980s, the Reds and Pirates
met in the NLCS in both 1979 and 1990. In a nine-year span from 1979-1987 and
then again in a ten-year span from 1981-1990 everysingleteam in the NL won a
division title. Were not talking about hockey here, where at one point 16 out of 21
teams made the playoffs. This was baseball, where you can win 100 games and if
another team in your division wins 103, youre watching them on TV in October.
In the AL, 11 of the 14 teams won a division title during the 1980s. In the East, the
Yankees won in 1980 and 1981. In 1982 the Brewers won, after finishing 2 nd in
1981. The Orioles fell a game short in 1982, but broke through to win in 1983.
After the Tigers finished 2nd in 1983, they took the division by storm 1984. They
started that season 35-5 and went wire-to-wire to capture the title. After finishing a
distant 2nd behind the Tigers in 1984, the Toronto Blue Jays won its first AL East
crown the next year. A pretty clear procession plan, I should say.
In the AL West, the California Angels embraced free agency from the very
beginning. They snagged Don Baylor, Joe Rudi and Bobby Grich from the very first
free agent class. After suffering through losing seasons from 1971 to 1977, the
Angels made their very first playoff appearance in 1979. They did lose Nolan Ryan
in 1980, but when Reggie Jackson left the Yankees in 1981, the Angels signed him
and he helped them win division titles in 1982 and 1986. [Side Note: From 1971 to
1986 (16 seasons), Reggie Jackson played in the post-season 11 times.]
Apparently, not even free agency was enough to help Cleveland, Texas or Seattle.
Those are the only three teams that did not win a division at all from 1969 1993.
Their salvation came when MLB went to three divisions with the Indians and
Mariners capturing division titles in 1995 and the Rangers winning the West in 1996.

KING GEORGE
So, what were the Yankees up to during this time? After George Steinbrenner
ridiculously apologized to the people of New York for his team losing the 1981 World
Series, he went on to hamper his club for nearly a decade with questionable free
agent acquisitions as well as trading away of many of his best minor league
prospects. As time went on, successful signings like Jackson, Gossage and Dave
Winfield gave way to.less successful ones like Steve Kemp, Ed Whitson and
Andy Hawkins and the Yankees went into a period of mediocrity. The Boss just
wasnt as smart when the free agent pool wasnt full of future Hall-of-Famers and
the Yankees spent a twelve season run from 1982-1993 with not a single postseason appearance.
George topped it all off with a suspension in 1990 for hiring a gambler to dig up dirt
on Dave Winfield. Winfield was nearing the end of his 10 year, $23M contract with
the Yankees and was suing George for failure to make contributions to his Winfield
Foundation(sigh).
SHOW THEM THE MONEY
In November of 1989, Kirby Puckett signed a new deal with the Twins making him
the first $3M per year player in baseball history. Less than a week later, Rickey
Henderson signed with Oakland for $3M per season. I can still remember my
college roommate doing some elaborate calculations on exactly what $3M per year
really meant - $18K per game, $5K per plate appearance, and (my favorite)
$1,442.31 per hour assuming this was a salary for a 40-hour-a-week job. We were
so innocent back then and could not fathom that $3M would one day turn into
$30M.
Beginning in 1990, baseball signed huge network television deals with CBS and then
FOX and the players definitely reaped the benefits. The average team payroll went
from just under $25M in 1991 to over $60M by 2001.
Bobby Bonilla signed a deal for over $6M per year in 1992.Cecil Fielder $9M in
1995..Albert Belle $10M in 1997..Kevin Brown $15M in 2000.and then ARod, A-Rod, A-Rod.
TV MONEY
I, like Homer Simpson, have always believed that TV is my friend. George
Steinbrenner recognized that TV was his way to buy himself a position of
advantage. In December of 1988, the Yankees announced that they had sold their
television rights to the MSG network. A 12 year deal was struck, beginning in 1991
that would pay the Yankees $500M.
The major network money I mentioned benefitted all clubs, but this cable money
was his! his! his! A decade of peace and tranquility (for me, anyway) was about to
be shattered because the Yankees had figured out a way to buy the pot.
In 1994, the Yankees moved to the #1 spot in payroll with a payroll of over $45M.
The league average that year was just over $31M meaning the Yankees total was

144% of the MLB average. With the exception of 1998, the Yankees would hold the
top spot on the payroll list up until 2014,
By 2000, the Yankees payroll topped $100M, which was 183% of the MLB average.
In 2005, they broke the $200M mark. That figure was $75M more than the next
highest club and was nearly three times the league average for a ball club.
It wasnt until 2014 that the Yankees were outspent by anybody. Last year, Magic
Johnson and his new L.A. team, the Dodgers, broke the record held by the Yankees
and had a payroll of about $235M.
LOST GENERATIONS
Money cant buy a World Series title, but it can secure a playoff spot. A couple of
facts to support this claim are (a) Derek Jeter played in the post-season in each of
his first 12 full seasons and (b) the Yankees have only captured one World
Championship in the last 10 years (2005-2014) despite a total payroll of cue Dr.
Evil with his pinky to his mouth - two billion dollars.
The real problem is on the opposite end of the spectrum. In the past twenty years,
some teams have simply been priced out of the World Series market.
Pittsburgh & Kansas City
An entire generation of kids in Pittsburgh and Kansas City grew up without their
respective teams even getting a whiff of the post-season. I can just picture the
dads in these cities telling stories about the glory days of Roberto Clemente and
George Brett and Pops and Sabes and Bonds and Bonilla to their children. After
a few years, they must have realized that their stories were taking on the sepia
tones of the stories their grandparents had told to them about the Great Depression
or World War II.
A child born in Pittsburgh in November of 1992 was almost old enough to buy beer
for the first Pirates playoff game played in his lifetime in October 2013. A child born
in Kansas City in November of 1985 might possibly have had a wife, kids and a
mortgage (as he would have been almost 28 years old) by the time he saw his first
Royals playoff game in 2014.
While I am heartened by the recent resurgence in Kansas City and Pittsburgh, I fear
that reality will set in when their young stars start looking for their big pay
days..but that remains to be seen.
Minnesota
From 2002 to 2009, the Minnesota Twins won five AL Central division titles. During
this span, the annual Minnesota payroll was less than $60M, which was about $20M
per year less than the major league team average. The best player on the Twins
during this time was catcher Joe Mauer. Mauer won an MVP and three batting titles.
He was one of the best hitters in the league and was certainly the face of the
Minnesota franchise. One could not blame the Twins for wanting him to be a Twin
for life.

Despite the fact that they didnt have the financial resources of the big market
teams, the Twins signed their star catcher to a market-value contract8 years,
$184 million, $23M per year. The Minnesota payroll went from $65M in 2009 to
$97M in one off-season and they did capture another division title in 2010. Since
then, however, success has eluded them.
Mauer had a couple of All-Star seasons since, but he has been hurt, he no longer
catches and since 2013, his batting average is around .270. Meanwhile, the Twins
have not been above 4th place since 2010. There are many factors in a teams
success and one player cant win a championship all by himself, but when one
player is paid 27% of his teams allotted payroll as was the case with Mauer in
2014 that player can certainly sink a team under the weight of his contract.
Oakland
I understand and appreciate the job done by Oakland GM Billy Beane. He is the
architect (not the author!) of baseballs current Moneyball era. However, I cant
help but scratch my head at some of the moves they have made in the past 12
months.
Last July, Oakland had Yoenis Cespedes (their 3-hole hitter with a cannon for an
arm), Josh Donaldson (owner of #2 WAR in the AL in both 2013 and 2014)and
the best record in the American League. This apparently was a huge burden to
them so Cespedes was dealt away in July, they collapsed in August and for good
measure they traded away Donaldson in November. Is it really a noble goal to build
and maintain a team whose ceiling seems to be a first round ouster in the playoffs?
FINAL THOUGHTS
With all the network TV money that has been poured into baseball in the past few
decades, the average baseball player has benefited significantly.
Fox reportedly paid $500M in 2014 for its baseball contract, but last year when I
tried to tune in the league championship series I couldnt find it on Fox. The ALCS
was on TBS and the NLCS was on Fox Sports One. I didnt have Fox Sports
One.or maybe I just couldnt find it. Too many channels.
At the same time, the recent ratings for the World Series have been dreadful. In
1986, the average viewership for the Series was over 36 million. The past 5 series
(2010-2014) have had four of the lowest television ratings averaging around 14
million viewers.
As an accountant, I begin to wonder about the value of the investment these
networks are making. Itll be interesting to see how things play out over the next
decade or so, but for now, Ill just sit back and relax and enjoy the new
season..unless the Yankees actually finish first or something.

Now you kids get outta my yard!

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REFERENCES: The payroll data used in this article were culled from several
websites. The historical payroll numbers do vary a little from site to site, but the
numbers presented above are estimates based on all the sources consulted. The
main sources for team payroll data were:
thebaseballcube.com this site contained a very handy payroll database for the
past 10 seasons.
stevethehump.com (yeah, thats right) listed opening day payrolls by team dating
back to 1998
thebaseballchronology.com includes payroll data from 1976 to 2006.