How Much Do Major League Baseball Salaries Matter?
PORTLAND, Ore. ( TheStreet) -- Major League Baseball's playoffs aren't just a few extra home games for playoff teams and a few more millions for those teams' coffers. They're a return on a sizable investment.
Going into the 2013 season, 14 of the league's 30 teams spent $100 million or more on payroll. Just five made it past Game 162 and one, the Texas Rangers, did so by playing an extra game to determine the American League's Wild Card spot.
The team it faced in that playoff -- the Tampa Bay Rays -- came into the season with a $57.9 million payroll that was third-lowest in the league. By comparison, the New York Yankees had Major League Baseball's top payroll on opening day at $228.8 million, just missing the playoffs for the second time since 1995. In doing so, they spent more on three players -- Mark Teixeira ($23 million), C.C. Sabathia ($23 million) and Alex Rodriguez ($28 million) -- than the Rays did on their entire team.
That's not shabby for a team with a payroll ranked 28th in the league, but the Oakland A's and their general manager Billy Beane won the American League west on just $60.7 million. That payout ranks 27th in the league and still less than the combined $74 million earned by the Yankees named above.Phil Roth pointed out by delving through contract data, transactions made during the season bumped the Dodgers' payroll from $216.6 million on opening day to closer to $225 million. It's just some couch change for the Dodgers, who are getting a cool $6 billion of the $8 billion television deal the team struck with Time Warner Cable (TWC) before the season, but that would be a 14% payroll increase for the A's. It's a similar situation for the Boston Red Sox, who began the year with a $150.6 million payroll but jumped above $160 million after adding pitcher Jake Peavy and others to help clinch the American League East. That boost is roughly 17% of division rival Tampa Bay's overall salary pool. While the Pittsburgh Pirates ended a streak of losing seasons and playoff absence dating back to 1992 by spending a relatively scant $79.5 million, they did so in an NL Central in which three teams spent $100 million or so going into this season ($115.2 million for the St. Louis Cardinals, $107.5 million for the Cincinnati Reds and $104.3 million for the Chicago Cubs) and the fourth, the Milwaukee Brewers, still outspent them by more than $3 million. The $77.8 million Cleveland Indians, meanwhile, earned a wild-card spot in a division where the champion Detroit Tigers nearly doubled their payroll at $148.4 million.
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