Toronto Blue Jays general manager J.P. Ricciardi came to a simple conclusion recently.
The American League East is a completely different animal from baseball's other divisions. You still need to put a hungry, selfless, hard-working team out on the field every day. But you also must spend cash, too.
"I don't think you are going to compete in our division on a $50 million payroll. That's just inconceivable," said Ricciardi, who increased his club's salaries from about $50 million to $73 million this year. "I think our division is the toughest division in baseball."
With the Chicago White Sox winning the World Series last season and the Florida Marlins doing it in 2003, mid-to-lower-tier payrolls have proved it's not how much you spend, but how wisely.
Yet in the AL East, the disparity has been so great that it's tough to dismiss economics when talking about titles. The New York Yankees and Boston Red Sox have finished 1-2 in the division for the past eight seasons. Not coincidentally, those teams have spent the most money overall - by far - in that period.
This season won't be any different, at least in the races for most money spent and top revenues received. Although 2006 payroll numbers are not yet official, the Yankees again will easily be No. 1 in the majors with an estimated roster totaling about $190 million. Boston is second in baseball with a projected payroll nearing $135 million.
The only other team expected to cross the $100 million mark on Opening Day is the New York Mets in the National League East.
To put the AL East's spending into proper perspective, the Yankees' payroll is expected to be about $11 million more than the Blue Jays' (an estimated $73 million), the Orioles' (estimated $70 million) and the Tampa Bay Devil Rays' ($36 million) combined.
The left side of the Yankees infield, third baseman Alex Rodriguez ($25 million) and shortstop Derek Jeter (about $21 million, including prorated signing bonuses), out-earns the Devil Rays' entire 25-man roster by almost $10 million.
"Not only that," adds Devil Rays senior vice president Gerry Hunsicker, "but [the Yankees'] total payroll by far is more than the total revenue that this franchise will generate in a year."
In other words, the Yankees spend more on salaries than the Devil Rays will make in all baseball facets in 2006. And, in a competitive environment that pits different markets against each other, there is no realistic solution to level the field barring a salary cap, which the powerful players union would never let happen.
To compete dollar-to-dollar with the Red Sox's and the Yankees' lucrative television deals, soaring merchandising and advertising sales and salty ticket prices, the Blue Jays, Orioles and Devil Rays would have to substantially increase their current streams of revenue. Ticket prices, as an example, likely would have to escalate to the point where games would be cost-prohibitive for many fans in those cities - which would defeat the purpose of raising the cost.
"It is hard to ignore; that is reality," said Rodriguez, the reigning AL Most Valuable Player and baseball's highest- paid player. "But, at the same time, it still comes down to sound baseball decisions, farm systems and then execution on the field by the players. There are a lot of components to that [other] than just saying it is the highest salary."
That's the silver lining for the rest of the AL East. Teams with payrolls less than $80 million can, and do, win the World Series if they have a little luck and a solid management plan. Last year, the champion White Sox were 13th overall with a $75 million payroll when the season began, and their opponent, the Houston Astros, were 12th with $76.7 million dedicated to salaries.
The Yankees, who were at about $208 million through much of 2005, won the division, but lost in the first round of the playoffs.
"I think a $70 million payroll can be more than competitive, which is indicative of what happened last year," Orioles vice president Jim Duquette said. "If you are in the $70 [million] to $80 million range, you can do it the right way, with a combination of veteran players and using players from within. But your scouting and player development are critical in doing it."
With the second-lowest payroll in baseball, behind only the Marlins' $19 million, the Devil Rays know just how important player development can be. They already have a major league roster filled with young talent, and their farm system, ranked 10th overall by Baseball America, has a few of the game's most heralded minor leaguers.
Still, first-year executive vice president Andrew Friedman said: "I definitely think we need to be [at] more than $36 [million] to build a competitive team that we can sustain."
The club's new owner, Stuart Sternberg, has promised a payroll increase between 10 and 20 percent in the near future. But Friedman said he's not sure what would be the absolute minimum needed to ensure competitiveness in such a difficult division.