COMMENTARY | “New York Yankees managing general partner Hal Steinbrenner says it’s his goal to lower the team’s payroll to $189 million over the next few years,” according to an Associated Press report released on March 1.
No one is saying the mighty New York Yankees empire is in decline nor is the team in any sort of financial trouble, but like in all business, unsustainable operating expenses, especially in labor is not the wisest way to conduct business.
As a business, the Yankees are in a great position. They have an extremely loyal following worldwide which supports their brand identity. Smaller market teams such as the Cleveland Indians simply do not have similar caliber income streams to compete at that level. It is not a question whether it is fair, but more a statement of pure economic fundamentals.
Major League Baseball charged the Yankees with a $13.9 million luxury tax for the 2011 season for a payroll of $212.7 million dollars. By the end of the 2013 season, the luxury tax threshold will be set at $189 million under baseball’s new labor contract according to the report.
I believe it is safe to assume the idea of showering exorbitant amounts of money on athletes in order to lure them to the franchise is becoming a thing of the past. What happened to the days when it was an “honor” to be given the chance to play for such a storied team? Has it really become all about the money?
A slow decrease in team payroll is not going to make the team any less of a contender every year. Smart acquisitions and fair deals to players is what will make a team successful. It has already been proven that money does not World Series championships as the most recent title came in 2009, but before that in 2000.
Love the Yankees for the talent they put on the field or hate them for the way they dominate baseball, they should be respected for using smart business sense moving forward. It appears they have finally realized there is no reason they should be paying a fine, or they can simply buy championships.