Amid Downturn, A Look At Baseball Salaries The country's economy is in free-fall but Major League Baseball salaries are still in the stratosphere. How can teams such as the Yankees afford such pricey contracts when the recession is bound to take a bite out of revenues?
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Amid Downturn, A Look At Baseball Salaries

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Amid Downturn, A Look At Baseball Salaries

Amid Downturn, A Look At Baseball Salaries

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From NPR News, this is All Things Considered. I'm Michele Norris.


And I'm Robert Siegel. The free-spending New York Yankees did it again this week. They scored another big star. The Yankees agreed to sign pitcher C.C. Sabathia to a seven-year, $161 million contract. That is the most lucrative deal ever for a pitcher. The fact that the richest team in baseball bagged one of the most sought-after free agents is not a shock. What is, though, is that the Yankees did it during a severe economic downturn. As NPR's Tom Goldman reports, it made perfect sense in the sports world.

TOM GOLDMAN: Wednesday's news that the Yankees and C.C. Sabathia agreed to the framework of 161 million over seven years came amidst news of recession and bailout for a desperate auto industry. Throughout the land, Americans channeled former tennis champion John McEnroe, who famously ranted to a lines judge.

(Soundbite of John McEnroe)

Mr. JOHN MCENROE (Former Professional Tennis Player): You cannot be serious.

GOLDMAN: On the "Dan Le Batard's" sports talk radio show in Miami, the host spoke for many when he asked Florida Marlins team president David Samson the following question.

Mr. DAN LE BATARD (Host, The Dan Le Batard Show, WAXY, Miami): Yes or no, in this economic climate what the Yankees have just done is irresponsible.

Mr. DAVID SAMSON (President, Florida Marlins): Yes. I think the economy should affect every single person because it does affect every single person. Baseball is not immune, by any stretch, to what's happening. People have to tighten their belts and act responsibly and not - to coin a phrase that I love, not to spend like drunken sailors.

GOLDMAN: Now, it should be noted that Samson's Marlins have the lowest player payroll in 2008. No way could Florida compete with the Yankees for a top-of-the-line pitcher like C.C. Sabathia. So Samson's rant, says one insider, is a bit of the sour grapes. Indeed, at baseball's winter meetings this week where the deal went down, there was little outrage over the Yankees' spending because, says veteran sports agent Leigh Steinberg, it was simply good business.

Mr. LEIGH STEINBERG (President, Leigh Steinberg Sports & Entertainment): The Yankees are spending money that they're making.

GOLDMAN: From their hugely lucrative local TV contract and money from a new stadium that's expected to bring in gobs of revenue from corporations and fans, expected is a risky word to lean on in the current economic climate. But Leigh Steinberg says the Yankees, and all major sports teams really, are right to have those expectations.

Mr. STEINBERG: Even in the Great Depression, the very last sectors that were negatively impacted tended to be entertainment. People went to movies, they went to ball games as a way of escaping the travails of everyday life. I would anticipate that people will still seek entertainment options, so there will be demand.

GOLDMAN: Albeit, scaled-back demand.

Mr. STEINBERG: The person who's watched his 401k disappear or the person that's between jobs may not want to pay $50 for a ticket. But at $25 for a ticket, he may still have interest.

GOLDMAN: It appears baseball commissioner Bud Selig isn't taking fan interest lightly. He's instructed teams to not get cocky with ticket prices. And players shouldn't assume the Sabathia deal means riches will continue to flow. Despite Sabathia's record contract, more second-tier baseball free agents than in the past left the winter meetings without jobs. Eric Fisher of the Sports Business Journal says when those players finally do sign a contract...

Mr. ERIC FISHER (Reporter, Sports Business Journal): They're very often going to be signing for 50, 60 cents on the dollar relative to what they were paid before.

GOLDMAN: Meaning, says Fisher, the broad reality of what's going on with the economy is touching baseball and may to a greater extent as the 2009 season unfolds. Tom Goldman, NPR News.

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