Monday, 4 August 2008

Money to Burn!


Time for my second installment of truthiness regarding the good and bad of the potential end of the JP Ricciardi era.

One of the oft mentioned myths about JP is now he's struggling to succeed with "a almost $100 million payroll!!!!" as if that number exists in a vacuum and is arbitrarily a measure of "lots of money" just because it approaches that benchmark. However, the truth is, it is not "lots of money" at all when placed in context.

Let's add a little and see what we find.

This first chart is a look at the Jay's payroll in real numbers as compared to the rest of the league, and to the Yankees (who were the only other team in that span to be ranked #1 except for one year). What you see here is -
Year - Jays' Payroll - MLB rank - Yankees' Payroll - Jays as a % of Yankees

1992   $ 43,663,666       3     $ 35,966,834      121%
1993 $ 45,747,666 1 $ 41,305,000 111%
1994 $ 41,937,668 2 $ 44,785,334 94%

1995 $ 49,791,500 1 $ 46,657,016 107%
1996 $ 28,486,708 16 $ 52,189,370 55%
1997 $ 45,894,833 9 $ 59,148,877 76%
1998 $ 48,415,000 11 $ 63,159,898* 77%
1999 $ 48,165,333 14 $ 88,130,709 55%
2000 $ 46,363,332 21 $ 92,938,260 50%
2001 $ 76,895,999 10 $ 112,287,143 68%
2002 $ 76,864,333 11 $ 125,928,583 61%
2003 $ 51,269,000 21 $ 152,749,814 34%
2004 $ 50,017,000 21 $ 184,193,950 27%
2005 $ 45,719,500 25 $ 208,306,817 22%
2006 $ 71,915,000 16 $ 194,663,079 37%
2007 $ 81,942,800 16 $ 189,639,045 43%
2008 $ 97,793,900 13 $ 209,081,577 47%

Note that the bolding indicates a different GM

If you notice the raw numbers here, it's obvious from the beginning that the Jays precentage of AYP (Annual Yankees Payroll) is never less than 50% during Ash's tenure and in 4 of the 7 years it was 68% or better. By contrast, during his tenure with the Jays Ricciardi never had a payroll as much as 50% of the Yanks except in his first year when he was under orders to slash payroll. Since then his highest mark is short of Ash's lowest mark.

Now, it's true that the Yanks stretch the ceiling of MLB payrolls, but if you look further you see that this year is the first time the Jays payroll has ranked higher than 16th in the majors, wheras Ash only had a budget lower than that once, and was often in the top half of the league.

But see, that's not the half of it.

I took an inflation calculator and normalized all the jays payrolls to 2007 dollars. That produced this table:

1992   $65,692,294.12
1993 $66,822,996.95
1994 $59,473,577.09

1995 $68,822,054.33
1996 $38,414,113.99
1997 $60,086,253.55
1998 $62,326,152.13
1999 $61,028,295.23
2000 $59,423,851.24
2001 $91,750,709.73
2002 $90,268,628.46
2003 $58,798,584.48
2004 $56,293,140.73
2005 $49,812,574.81
2006 $75,776,835.50
2007 $81,942,800.00

What do we have here? In inflation-adjusted 2007 dollars, JP's available cash (excepting the payroll slashing first year) did not exceed Ash's lowest budget (excepting 1996) until 2006. And even then, if you average Ash's six highest payrolls (out of seven years) you get around $68 million so JP's 2006 budget was up about 10% over Ash's average budget and his 2007 budget was up not quiet 20%.

Why is that important?

Because baseball economics far outpaces inflation.

In 1992 the average MLB salary was $1,084,408
In 2008 the average MLB salary is $2,739,761

Which is to say that the average MLB salary in 2007 was 256% of the average MLB salary in 1995, which is sharply higher than inflation (2007 dollar being 138% of the 1995 dollar).

So, to completely prove how much time I have on my hands, let's adjust those salaries for 2007 Baseball Dollars:

1995   $127,466,240
1996 $66,370,401
1997 $90,880,933
1998 $92,025,096
1999 $76,719,563
2000 $63,894,501
2001 $93,038,500
2002 $88,363,041
2003 $54,966,197
2004 $55,109,035
2005 $50,577,827
2006 $74,569,857
2007 $81,942,800

I'll let you draw your own conclusions about the relationship illustrated here. But clearly it reflects the previously stated reality that this is the third season of any real attempt to be competitive.

Now, the objections to the previous article included the point that a comparison to a GM who lost his job for poor performance is of limited value. That wasn't really valid there because the mantra was that JP's drafts were not as good as Ash's. In this case though, that's a valid point. Say Ash spent (in relative terms) as much or more money and failed is hardly a defense of JP. But it does go to the point that the the current payroll is, in relative terms, not high at all, either in relation to the league, or to inflation, or to baseball inflation. If JP has done an average job, and produced an average team, he's done so with average money.

So, when you make out your list of reasons Ricciardi needs to go, bypass the urge to write in "failed with a big payroll" . . . t'aint really so, McGee.

~WillRain

3 comments:

Lloyd the Barber said...

wow, that is some impressive work.

autolycus said...

I agree with lloyd, and I intend to sing your praises and expand on this a little over at Batter's Box.

I do think you may have a Data Entry error - USA Today gives the Yankees 1992 payroll as 35,966,834.

The Southpaw said...

Thanks for the catch (and the praise) I see I inadvertently got the Mets in '92 instead of the Yanks. I fixed it.