Friday, April 29, 2011

The Lowest Payroll In Baseball

You probably know that the Kansas City Royals have the lowest payroll in baseball. The average payroll in baseball in 2011 is about $93 million. The median payroll in baseball is about $87 million. The Yankees, of course, have a $200 million payroll -- fifth year in a row -- and a record 12 teams have at least a $100 million payroll.

The Royals payroll, just a touch over $36 million, is the lowest by about $5 mil.



And with revenue sharing hitting new highs, Royals owner David Glass figures to pocket a whole lot of money this year no matter how bad the Royals play.

I bring this up now because, best I can tell, there really isn't much of an uproar in Kansas City about this. Oh sure, there are the usual grumbles about Glass being cheap and the Royals being a cut-rate team and so on. But mostly -- and this is new, I think -- mostly people don't care that the Royals are spending so little on talent. In fact, people almost seem to be cherishing it.

Now, this is certainly due in large part to the fawning press the Royals minor league system has received from pretty much everybody (though ESPECIALLY me) -- everybody knows that 2011 is kind of a mulligan year and the future looks promising and so why spend a lot of money now? Also there was the Royals hot start (which, predictably, has screeched to a halt -- the Royals have lost six in a row, giving up 17 homers in the process).

But I think there is something else. I think Kansas City baseball fans have grown sick of money. It's an odd thing to say, but there you go. For years and years, Royals fans -- and you can point to other places as well but I've seen it first-hand in Kansas City -- have spent a substantial portion of their time griping about the unfairness of the business baseball, and they had their fair points. A league where one one team makes five or 10 times the money of another, and can by rules spend infinitely more than another, well, yeah, it's not easy for the little guy to compete.

There has not been a GOOD time to be a Royals fan for approaching 20 years, but always thought the worst time was the off-season when teams were teams were signing big names, making big moves, and the Royals were simply MIA. It was during these off-season months that the Royals did not even feel like they were a part of the major leagues. They were never mentioned on Baseball Tonight. They were never written about in the various Hot Stove stories. The very idea that the Royals might be in on a C.C. Sabathia or Carl Crawford or whoever was laughable. That's the word. Laughable. The Onion would make jokes about the Royals being able to compete for those sorts of players with those sorts of demands. And this complete disconnect from baseball, this annual pressing of noses against restaurant windows, I think this wears on fans in ways that go beyond wins and losses and beyond decades without competing. Professional sports build around hope. Royals fans, for good reason, found it hard to hope.

So what changed? Well, I think a couple of things changed. For one, every small market team except Pittsburgh and Kansas City have competed in recent years. The definition of "small market" changes all the time, but in the 2000s Oakland, Milwaukee, Cincinnati and Cleveland all made the playoffs at least once. Tampa Bay went to the World Series. Florida won a World Series. The owners really do share more quite a lot more revenue now, and while there is still a wide disparity in payroll and various other baseball operation spending, and while you would expect the Yankees to make the playoffs every year in perpetuity, the game does seem to have corrected somewhat. Minnesota was brought up for contraction not too long ago. And the Royals are really competing against Minnesota.

But the second change is what interests me here ... I really think Royals fans in particular have grown sick of money. That is to say: Money brought Kansas City fans Jose Guillen. Money brought them Gil Meche. Money brought them Jason Kendall and Rick Ankiel and Mike Jacobs and Kyle Farnsworth and Juan Cruz and Odalis Perez and Juan Gonzalez and if that's what money brings, really, you can just keep your money.

Of course, there are wiser ways to spend money ... everybody knows that. But it's become clear that the Royals don't know those wiser ways. Even this year, with the lowest payroll in baseball, the Royals found $3.75 million to pay Kendall, who is injured but when healthy has slugged .310 the last three years and last year went 434 plate appearances without hitting a triple OR a home run. The Royals found $2 million for Jeff Francis, who was a fine pitcher in 2007 but, on the other hand, he was a fine pitcher in 2007. He has had injuries and hurdles ever since and is now throwing his fastball about 83 mph.

The Royals found $2.5 million for Jeff Francoeur, who is hitting great and wouldn't that be a great story? To be blunt about it, Francoeur always seems to hit great his first 100 or so plate appearances in a new situation, and then things start to go downhill as pitchers remember they don't have to throw him strikes. So I wouldn't rush out and buy his rookie card in bulk just yet. But maybe this time it's real, and nobody would be happier than I would ... I'm already preparing the Francoeur Arrives story. In any case, nobody else seemed to want Jeff Francoeur. The Royals found the money to get him.

And then there's the most startling one of all -- the folks are Royals Authority did a post with the rather frank headline: "Kyle Davies Is Historically Awful." It seems a harsh judgment for a nice guy like Kyle. but it's also pretty much indisputable. I like their numbers, but I'll try to do it even more simply:

Highest ERAs in baseball history with 125-plus starts:
1. Kyle Davies, 5.59
2. Jimmy Haynes, 5.37
3. Kevin Ritz, 5.35
4. Scott Elarton, 5.29
5. Jose Lima, 5.26

Three Royals on that list. Hmm. Anyway ...

At 125 starts, Davies has the fifth-highest WHIP ever -- and he comes by it honestly. His 4.29 walks per nine innings is absurdly high. His 10.21 hits per nine is, historically, even worse. His 78 ERA+ -- which adjusts ERA by era -- is the third worst ever behind Phil Ortega and Wade Blassingame. He has the sixth-lowest WAR. He is one of only 19 pitchers to start at least 125 games without throwing a single shutout. Over his entire career, major league hitters are hitting .286/.364/.461 which means he basically turns every hitter in the game into Ron Santo.

Here's my favorite one: Davies has a 32.8% quality start percentage -- meaning he throws a quality start fewer than one out of three times. That is the lowest percentage since 1950, which is how far back Baseball Reference figures the stat. No starter in the last 60 years has been LESS likely to throw you at least six innings and give up three or fewer runs.

What does this tell you? To be honest, I don't think it tells you that Kyle Davies has been dreadful. There have been thousands and thousands worse pitchers. What it does tell you is that, unlike those thousands and thousands, Kyle Davies has received a HISTORIC opportunity to keep starting games at the big league level. Pitchers don't get 125 starts in the big leagues once they've proven they cannot get batters out. They get shuffled to the bullpen, or they get sent to the minor leagues, or they get released.

But the Royals are one of those teams that simply cannot let go of a player's potential. The Cleveland Indians or my youth were like that too. Rick Waits had one moderately good year for Cleveland and it took three and half more before the team was willing to let go. Neal Heaton had one so-so year and it took two and a half more before the Indians were willing to let go. This is a trait of struggling teams, I think. They have so little good going on that they desperately fear giving up on someone too soon.

Davies basically had a couple of good Septembers -- in 2008 and 2009 -- and because September comes at the end of the season it gives the Royals the unmistakable sense that there's a good pitcher in Davies just waiting to come out. Maybe there is. Heck, after watching what has happened to Jose Bautista, I'm not willing to write off ANYBODY. I can't blame the Royals for being patient with Davies. They like his stuff. They like his makeup. They don't really have anyone else. Why not keep giving the guy a chance?

But circumstances changed this past off-season. Kyle Davies was arbitration eligible, which means the Royals would actually have to pony up some pretty decent coin to bring him back. Of course, there was an obvious solution to this -- you don't bring him back. If Kyle Davies had been non-tendered, he probably would have signed a major league deal with somebody for a million bucks or less. But the Royals decided they had not quite given up hope on Davies. And so they tendered him an offer for $3.2 million this year.

I'm going to repeat that: The Royals offered Kyle Davies $3.2 million this year. Davies is now 1-3 with a 7.98 ERA, though at the moment he does lead the American League in starts.

My point really is not to bash Davies's performance, but to say that the Royals have the lowest payroll in baseball and there's still PLENTY of waste in there. And I think in the end, this is why the Royals fans don't seem to care too much about payroll. Years ago, payroll represented opportunity and hope and potential. Now, it represents tendering Kyle Davies. It's almost like the feeling is this: The Royals have built a team for $36 million that will probably lose 90 or 95 games. Imagine how much worse they could be if they spent more.

36 comments:

  1. That the Royals have spent the money they have so poorly is evidence that, for them, it's not about the money. Other teams can make that complaint. Royals fans ought to look at who is signing the checks.

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  2. I've often wondered how it really works in an MLB clubhouse over the course of 162 games when a veteran who is not producing is making multi-millions and 5-6 much younger guys are carrying the club and their combined salaries don't equal the vet's. I suppose the younger guys might say "Some day I'll be getting mine" but at that moment there must be lots of pent-up frustration amongst the younger fellows.

    Are player's salary discussed much in clubhouses or is that a subject (like politics) that it's better to steer clear of?

    Here's a dream...Wouldn't it be great if the team paid every player a near equal amount with some seniority bonus thrown in during the season but then at the end of campaign the remainder of payroll is divided among all of the players based on worth or production that year?

    I know, never happen, but a fun thought. Hey, if a pretty commoner girl can find her a prince, anything's possible@!

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  3. I know how I've felt about co-workers earning more than me who I didn't think deserved it. I assume that's how baseball players feel, too.

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  4. There is an interesting synergy for developing teams, and I think given the nature of things, we can tentatively call the Royals developing. The thing is, without enough starting pitcher innings, even if all the starters are dreadful, then relievers get overused. Say the Royals have 2-3 relief pitchers that could easily be part of a Royals renaissance in 2013. Are you going to tell the manager not to use them when he has a chance to win a game? Of course not. You have to try to win. But if the starters don't give enough innings, then even if you're trying to protect the precious arms from overuse, eventually the whole bullpen gets tired. Then they get injured, and then the 2013 team that could have been 81-81 turns into 71-91.

    That's not to say that Davies is a good signing at $3M. Far from it. But you see this everywhere in baseball except on teams that legitimately have shots. The Dodgers signed Jon Garland to eat up innings so that Hong Chi Kuo and Jonathan Broxton might both be healthy when the team finally becomes competitive again. The Dodgers *LOOK* like they could be competitive, but it's a mirage. They could be competitive if their rotation went five deep, like the Giants. They could be competitive if they still had 2008 Manny in left field, 2008 Furcal, 2008 Blake, Orlando Hudson at second base, 2008 Russell Martin, and an average first baseman. Instead they have Maris and Mantle (okay, Ethier and Kemp) and a whole lot of below average hitters. But they won't kill any arms they care about from overuse while they're waiting for ownership to change.

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  5. In 1980, Brian Kingman of the A's lost 20 games. There are quotes about Kingman that say, more or less, "you have to be a pretty good pitcher to lose 20 games."

    The point being if you started enough games to amass 20 losses, you must have been somewhat decent. Sure enough, Kingman's ERA+ that year was 98. He was an average pitcher, essentially, but probably well above average for a #5 starter..

    So, I give you this:
    "You have to be a pretty good pitcher to have the worst ERA in baseball history for any pitcher with at least 125 starts."

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  6. Actually, Joe I think he has the worst WHIP also (1.611.) When you run the play index for a minimum of 100 starts and 500 innings, with 90% starts, there are only 6 people who have ERA's over 5.00. 3 of them were on the Royals at the same time two years ago. (Davies, Bannister, Ponson)

    I think Royals fans are patient with the low payroll this year because they know the future is coming and the time of 5 years of Kyle Davies will move into the past.

    By the end of the year, the Royals could have 7 former first round draft picks on the team, if Maier is still on the team. (Maier, Butler, Gordon, Hochevar, Moustakas, Hosmer, Crow.) They could have 3 others that they trade a 1st rounder (Greinke) for. (Escobar, Cain, Jeffress) That's 40% of a team.

    From 1988-2001 (14 years) the 7 most productive careers by Royals 1st rounders were Michael Tucker, Brent Mayne, Mike Macdougal, Kyle Snyder, Dee Brown, Joe Vitiello, and Dan Reichert. That's how you build a losing team.

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  7. I think this post, and Khazad's comment, highlights something about the Royals and Dayton Moore. KC's problem for the past 2 decades has been equal parts payroll and an utter lack of success in the draft.

    There's very good reason to believe that Dayton Moore has been in the process of solving the latter part of the problem. But the money he has paid Guillen, Davies, Kendall, etc. also gives every reason to believe he has made no progress at all with respect to the former.

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  8. "Wouldn't it be great if the team paid every player a near equal amount with some seniority bonus thrown in during the season but then at the end of campaign the remainder of payroll is divided among all of the players based on worth or production that year?"

    Maybe one of the worst ideas I've ever heard, and I had a good friend when I was a kid who developed schizophrenia in college.

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  9. I'm fine with a low payroll if it means not signing ridiculous contracts to the Jacobs/Farnworth/Kendall/Juan Gonzalez/Guillens of the world when we aren't going to win anyways. That will spending spree a few years ago probably did more to hurt the team than help. As prospects emerge and they still aren't spending money to fill out the roster, then there will be problems.

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  10. It's a shame they don't let Davies pitch for longer in games or he could easily be the worst relatively long lasting pitcher in history.

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  11. In the books Soccernomics, there is this idea that team owner are caretakers for something that's really possessed by the community. It's like owning a museum or cultural institution: the main benefit of a sports team is the bond that it brings to the community. You spend as much as you can on payroll--most years you lose a little money, some years you break even--because it makes the community happy when you're at least trying to win. And any profit that you do make isn't cash flow, it's appreciation in the value of the team (unless you're Tom Hicks or Frank McCourt you can always sell for more than what you paid). And I've had conversations with people that own sports teams or want to own sports teams, and that's the idea--the whole benefit of owning a team is that you do all that you can to increase revenues (the people that buy the damn things are business people, they're good at generating revenue) so that you can spend more money on the team. It's fun to own a team when you're trying to win.

    These cheap small market baseball owners must drive fans crazy (I wouldn't know, I root for large market teams). The idea that the owners pocket a bunch of their fans' money is terrible. If your goal is to make money, buy some fast food franchises, grocery stores, or car dealerships--people are happy when those things make money. And while sports teams are businesses, they're not big businesses. What does it cost to buy an MLB team, like $600 million? That sounds like big money, but it's small potatoes in the grand scheme of things. That's like a small regional casino. Even the largest sports teams don't get close to the Fortune 500 list.

    Sports teams don't exist to generate excess cash flows.

    If you own a sports team, try to win. Don't pocket your fans' money--they're your fans, you should love them (and be one of them). If you need the income from your team to pay your bills, sell the damn thing and buy something else. I'm sure that there is another potential owner out there who would love to break even (or lose a little money) if it means fighting to bring home a winner. And there are much better income generating investment vehicles than sports teams. Everyone would be much happier if you sold.

    As much as I always hated George Steinbrenner, at least he always tried to win.

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  12. Mark Daniel,

    Davies' career ERA+ is 78. He has exceed that number exactly three times in his career: 86 in '05 with Atlanta, 108 with KC in '08 and 84 the next year in KC. Two of those years are still horrible. This is not a guy giving people league average years on terrible teams. He is a guy giving people really terrible years for terrible teams.

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  13. Biggus Rickus,
    I know, I was only joking. The last line of my post is utterly ridiculous.
    It only made sense with Kingman because the readout was won-loss record, which can be deceptive.

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  14. "Maybe one of the worst ideas I've ever heard, and I had a good friend when I was a kid who developed schizophrenia in college."

    Um, care to elaborate on why? Not that I necessarily agree with NMarkW, but it's pretty annoying when someone snarkily puts someone else down while adding nothing at all to the discussion. Personally, I don't see why the idea is so horrible.

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  15. "Maybe one of the worst ideas I've ever heard, and I had a good friend when I was a kid who developed schizophrenia in college."

    Huh? That is a total non sequitor. Actually, that's giving it too much credit.

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  16. "Sports teams don't exist to generate excess cash flows."

    What world are you living in? I am waiting for a team to open its books and prove such an absurd assertion. OMG, negative cash flow -- and the value of the franchise goes up and up and up. Poor little rich babies. I feel so sorry that they have to bear the burden of owning teams.

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  17. Hartzdog has one of the best most well thought out comment about the responsibility of sports team owners to their communities that I have ever seen.

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  18. This comment has been removed by the author.

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  19. @ Olentangy said: "Hartzdog has one of the best most well thought out comment about the responsibility of sports team owners to their communities that I have ever seen."

    Agreed.

    Wish I thought it actually worked that way.

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  20. It's hard to be excited about the amazing Royals farm system. After these players get good enough to demand more money, will the Royals not trade them like Dye, Damon, and Beltran?

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  21. ". . . this annual pressing of noses against restaurant windows . . ."

    Nominee for best sports metaphor of 2011.

    — Graphite

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  22. If my previous theory on trading away the talented players in the farm system has a certain amount of truth to it, then I'm left with three options for hoping the Royals achieve post-season success in the next decade.

    1. They have one good run at it before they trade the good players away (then 9 years of misery?).

    2. That the players actually underachieve to the point of getting big offers from other teams while still flashing just enough brilliance to have some team success (coldhearted).

    3. Convince other GMs that each talented Royal has been receiving personal training advice and general life couseling from Manny Ramirez (even more coldhearted).

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  23. So, if the Royals don't win at least like, 75 games next year and/or show some signs of life, the KC faithful kinda have to burn down Kauffman. Right?...

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  24. I think the Royals really listened to the fans. The fans bemoaned the fact that the Royals would have to keep trading away thier major league talent because of their small market status. So, the Royals stopped producing major league talent. Seriously. They might as well have been an expansion team when Dayton Moore took over--an expansion team with very low morale. 

    I think it was a smart call on Moore's part to begin to produce major league talent again. However, I can understand how it would have been hard for him to sign or trade for premiere players. That left him to choose from a lot of highly volatile B-level talent plus a bunch of AAAA talent. I don't think anyone could have taken the Royals to even the cusp of league average any faster. 

    And it's going to get really interesting--and a lot better--soon. The Royals could add 5 league average to superstar caliber players before the end of the season. And Kyle Davies will become a distant memory. 

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  25. I just want to point out my disappointment in my fellow BRs that it took until me at post #26 to ask if Joe was talking about Wade Blasingame the ballplayer or the attorney-at-law who sues dogs.

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  26. Since Meche retired with $12.6MM remaining on his contract, the Royals were relieved of that burden for this season. Assuming he would have been on the DL all year (and maybe the Royals were insured for part of his contract, I don't know), that would have put their payroll at $48.3MM -- ahead of the Padres, Pirates, and Rays, and virtually tied with the Indians. It definitely would have only increased the amount of waste in the payroll, but it would change the conversation a little. They tendered Davies the same day that Meche announced his retirement, so maybe not having to waste $12.6MM allowed them to justify wasting $3.2MM?

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  27. What's this I read in my Rainy Day Books e-newsletter that you are moving to North Carolina? Say it ain't so, Joe!!

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  28. You know, I quit on the Royals in 1994, when McRae cleared off his desk. Nothing makes sense in MLB anymore. You'd think that owners would want a competitive league, one where every game would be a challenge. Wouldn't that generate more fan interest, thereby greater cash flow? Or is the real reason for owning a major league team, as someone indicated above, just increasing your own bottom line with the least amount of effort possible?

    Baseball as it is now really sucks. I quit going to games when KC lost 2 out of every 3 games I went to one year. Now I'm about to quit (really, I guess I have already) watching them. It's no fun when you know what the outcome will be before the game starts, based on who is the opponent. After 17 years I've come to the conclusion that no one really gives a damn, and it's going to take something on the scale of the second coming to get a lot of us interested again. Anyway there's always something else to do in the summer, so forget about it...

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  29. Hartzdog, do you really, seriously, believe that the Yankees "pocket" less of their fans' money than the Royals?

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  30. I mean damn just cause you have a high payroll doesn't mean you are going to win, so all the winners who complain YANKEES BUY CHAMPIONSHIPS should start to shut up cause obviously they haven't watched baseball the last 5 years.


    payroll

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  31. Payroll is a complex business and that is precisely the reason why many small businesses and organizations prefer to outsource their payroll to a specialist payroll company.

    payroll

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  32. Payroll plays an important role in the business for several reasons. It maintains records of employee wages, bonuses and raises, etc.


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  33. Payroll outsourcing services are very beneficial for large organizations where employees are in thousands.
    But in organizations having a few hundred employees, a good payroll software will do the required work.

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  34. I want to learn more about using some payroll software. I have never used it but I have heard from my friends that it makes the calculations and money management very easy. Please do share some views regarding it.

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