As the Chicago White Sox celebrated their first World Championship in 88 years, it’s impossible to overlook the changes in baseball in just the past ten years. For the second time in three years, a team won the World Series without a top-10 payroll, a feat that seemed impossible just a few years ago. Consequently, maybe Bud Selig actually does know what he is doing, against popular opinion, and maybe the implementation of the luxury tax was effective.

In 2002, as the league seemed to be on the brink of a strike-due to the competitive imbalance of the league, the players refused to give into the idea of a salary cap. The owners countered with the proposal of a luxury tax, a tax on the amount of money spent on salaries in excess of a pre-determined amount. This avoided the strike, although many criticized that the luxury tax would do nothing, teams would still spend a lot more than others. To some extent, this is true, as the Yankees became the first team in sports history to spend in excess of $200 million on salaries this season, approximately $80 million over the pre-determined amount, causing a $25 million tax hit for George Steinbrenner.

Although the Yankees continue to spend recklessly, only two other teams had to pay luxury tax last season, the Angels and the Red Sox. Boston was required to shell out $3.5 million, and Anaheim just under $1 million in luxury tax. This season, only the Red Sox and Yankees crossed $120 million in payroll, and only one more team, the Mets, even topped $100 million.

It seems that the imposition of the luxury tax is working as a deterrent for most teams, and as a result, the two teams in the World Series are ranked 12 and 13 in payroll, showing it’s not just the big spenders winning anymore. It has also been observed that more teams with low payrolls are competing, even if they don’t make the playoffs. This season five teams with payroll rankings between 20-30 finished with at least a .500 record, and two of those teams (Cleveland and Oakland) were in the playoff hunt until the final week of the season.

Competitive balance is not just an issue in baseball; in fact, the sport with the most competitive imbalance is probably basketball. Since 1991 there have been only five different champions in basketball, with three of those teams winning at least three championships each.

Basketball has a “soft salary cap,” meaning there is a limit on how much a team can spend. However, there are also ways around it. The New York Knicks began this offseason with a $115 million payroll, and the Atlanta Hawks had theirs at just over $20 million. Clearly a problem exists in disparity of payrolls, but in basketball this does not seem to translate into winning. Of the four teams playing the conference finals last season, no team had a payroll ranking higher than 12th, and no team spent over $60 million. Nevertheless, it is still difficult for teams like Atlanta, Charlotte, and New Orleans (all with payrolls under $40 million) to compete.

The best model to follow clearly exists in the NFL. The NFL has a hard salary cap, meaning teams cannot spend more than a certain amount on salaries, preventing the bigger market teams from overspending. As a result, teams like Carolina, Kansas City, Jacksonville, Tampa Bay, and even Cincinnati all currently have winning records, even in their smaller markets.

Before last year’s repeat championship by the Patriots, there had been eight different champions in the previous ten years. Every team has an equal chance for success, and, as a result, NFL teams sell out almost every game, and football has the highest television ratings of any sport. Although the nature of football and its media contract play a big role, the presence of a salary cap is the key reason why competitive balance, and subsequently popularity, is so strong in football.

Washington University sports fans are a bit torn on the state of competition in baseball. Sophomore Alex Groden thinks the luxury tax is not enough, and that baseball needs a salary cap.

“A salary cap in baseball would not only prevent excessively high player salaries, but would also allow more teams to be competitive enough to make the playoffs,” Groden commented. “The salary cap in football makes what the Patriots have done that much more impressive than the Yankees or Red Sox outspending everyone.”

Sophomore Martin Abel disagrees, however, stating there is no significant problem with competition in baseball.

“Even though the Yankees and Red Sox continue to spend, teams are still able to compete with them,” said Abel.

Developing a good farm system is still important; you can allow an expensive player to leave during free agency if you have a good prospect to replace them,” Abel added. “Look at the Atlanta Braves. Though they have lost Gary Sheffield and big pitchers, they have won 14 straight division titles due to a strong farm system.”

The system in baseball is far from perfect, and only the NFL can even begin to make that claim. Perhaps true competitive balance cannot be achieved without a salary cap, something that does not seem to be in baseball’s near future. You will probably never see another Tampa Bay, Kansas City, or Pittsburgh World Championship unless a cap is instituted, or a big spending owner with deep pockets buys one of the teams. But it can be said that things are getting better. No longer are the Yankees a lock to play in the Fall Classic. No longer are teams like the Brewers and Nationals destined to be yearly cellar dwellers. No longer is the playoff hunt just a five-team race. Baseball has taken a step toward the right direction, even if it is a baby step.

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