OTL Summer 2005 .PUB

A publication of the Society for American Baseball Research Business of Baseball Committee Volume XI, Issue 1 Summer 2005 Purchasing Pennants: Annual Report 2005: The New York Yankees Business of Baseball Committee Then and Now The Business of Baseball committee was founded by the Part 1: Yankee revenues and expenses late Doug Pappas in 1994. Our mission is to study Organ- By Michael Haupert ized Baseball off the field: the economic, labor, legal and Department of Economics, organizational side of the national pastime. We publish a University of Wisconsin – La Crosse quarterly newsletter, Outside the Lines. Introduction This year saw a considerable shift after the passing of Doug Pappas last year. Gary Gillette and Maury Brown were se- lected as co-chairs of the committee while Don Coffin holds The recent discovery of a unique set of financial the vice-chair position. John Ruoff took over as the editor of records for the New York Yankees covering the Outside the Lines, as well as editor for other published period 1914-43 allows us to take a fascinating behind the scenes look at how an MLB franchise was (Continued on page 3) financed. The records include daily cash books, ledgers and financial journals detailing the team’s finances in great detail. Business of Baseball Committee Meeting at SABR 35 in Toronto Among the interesting tidbits to be found in the records are the amount the Yankees spent to hire The Business of Baseball Committee will meet at 4:00 p.m. detectives to trail their players and report on their on Saturday, August 6, at the Toronto convention. We will nocturnal activities, how much Mrs. Ruth spent for talk about what we’ve been up to and where you want to breakfast when accompanying her husband on the take the committee. occasional road trip, and the annual laundry bill for player uniforms. Among the more substantial pieces of information contained in the records are INSIDE THIS ISSUE detailed payroll information, annual profit and loss statements, and the financial details concerning the Purchasing Pennants: The New York 1 construction of Yankee stadium and its impact on Yankees Then and Now, Pt. 1 the Yankee bottom line. Annual Report 2005 1 In this essay, I will touch on three aspects of these financial records: how the Yankees earned BoB Committee Meeting —SABR 35 1 their income and spent their money, how they com- pensated their players, and the impact of those MLB’s 2004 Attendance Record revenues and expenditures on their on-field per- Or “Let’s Pat Ourselves On the Back 2 formance. Due to space limitations, this essay has About How Far We’ve Come and Ignore been broken into three parts and will be run in What Might Have Been” separate issues of Outside the Lines. The first in- stallment focuses on the source and use of Yankee A View from Japan 3 funds from 1914-43 era. In order to put these num- (Continued on page 6) The GM Project 5 Summer 2005 Outside the Lines MLB’s 2004 Attendance Record Or Given the attendance boost that new ballparks typi- cally provide, it is perfectly reasonable to assume “Let’s Pat Ourselves On the Back that—absent the great strike—MLB attendance would About How Far We’ve Come and Ig- have continued its upward march for throughout the nore What Might Have Been” 1990s and possibly into the first decade of the new century. After all, MLB had seen per-game attendance By Gary Gillette increases in eight of the 10 years preceding the strike. Copyright 2005 by 24-7 Baseball, L.L.C. Thus, the 1994-to-2004 comparison substantially un- derstates the lasting damage wrought by the 1994–95 You’ve heard the news about how well the Grand Old strike—at least as measured by regular-season atten- Game is doing, haven’t you? A fan can’t turn on the dance. TV or tune into a game on the radio without hearing someone parroting the company line: “Baseball is The Three Great Ballpark-Building Booms back, all the way back. And it’s better’n ever! Atten- dance is at an all-time high!” Major League Baseball has seen three great ballpark- building cycles since the dawn of the twentieth cen- A serious baseball fan would have to be both deaf tury: 1909–1923, 1962–1977, and 1989–present. Each and dumb to be unaware of the hype and not get the changed the face of the game and helped bring about a message. Yet, something’s not right in the state of lengthy period of higher attendance and greater pros- Doubleday. perity. Despite the pride with which Major League Baseball The so-called “classic ballpark” era started with the announced setting an all-time attendance record after opening of Shibe Park in 1909 and, before it ended the 2004 season, per-game attendance was still 3.8 with debut of The House That Ruth Built in 1923, 14 percent below its 1994 peak. Frankly, MLB’s 2004 new ballparks had opened. Attendance increased a attendance record isn’t all that impressive--it is merely healthy 21.7 percent from 1908 to 1923, then in- an aggregate record made possible by expansion to 30 creased another 16.8 percent in the seven years after clubs in 1998. Furthermore, even with the attendance the opening of Yankee Stadium before the Great De- boosts provided by the new ballparks in San Diego pression took its toll. Since per-game figures are not and Philadelphia, only a cleverly designed late-season available, these historical comparisons are based on ticket giveaway pushed MLB over-the-top. That give- average attendance per club per season. From 1908 to away—neatly obscured by a PR smokescreen that 1930, that was a whopping 42.2 percent. would make the CIA PsyOps department proud, al- lowed what were essentially one million comp tickets The so-called “superstadium era” dawned with the to be counted as paid attendance. opening of what would later be called RFK Stadium in 1962. Before it ended 15 years later, 14 new ge- Let’s focus on attendance per game (technically, in neric, multipurpose ballparks had opened (counting MLB parlance, per opening) in 2004, the third-highest Oakland-Alameda County Coliseum, which was ever behind only 1993 and 1994. Again, that seems opened for a football team two years earlier). Plus, deceptively good. But without the disastrous labor storied Yankee Stadium was completely rebuilt. Aver- war, MLB attendance would almost certainly have age team attendance increased 41.8 percent from 1961 climbed substantially higher in the late 1990s, driven to 1977, then increased a further 11.1 percent through by a booming economy and a baker’s dozen of posh 1980, the last year before the first midseason strike. new venues. The two highest per-game attendance Increase in per club attendance from 1961 to 1980: a figures were posted before most of the new “retro” huge 57.6 percent. ballparks opened. In 1994, there were only five new ballparks in MLB (counting the five-year-old Sky- Dome and the almost instantly obsolete Comiskey Park). Since then, 13 new or extensively renovated parks have opened. (Continued on page 4) 2 Summer 2005 Outside the Lines (Continued from page 1) pieces within the committee. The biggest news was the founding of a new committee Website. The new site, BusinessofBaseball.com, pulled a great deal of research material that Doug Pappas had been displaying on the his personal Website. Many other resources have also been added. In addition, the committee operates a listserv at [email protected] Since July 2004, the Business of Baseball committee has published eight interviews with important people within the business of baseball. Those interviews include Fred Claire, Bob Costas, Kevin Towers, Marvin Miller, Andrew Zimbal- ist, Janet Marie Smith, Bowie Kuhn and Buzzie Bavasi. The committee Website now includes an extensive documents library with nearly 100 recent and historical documents pertaining to the business of baseball. We will see this library double by the end of 2005 with the addition of court documents from SABR’s research library. To add to this, there is an extensive collection of data, suggested readings and a facilities section within the new site. The committee will release on July 4 the long-awaited first version of its GM Project, which has compiled a complete, chronological list of all general managers in baseball history. A complete list of team owners and presidents has also been compiled and will be published later this summer. A View from Japan byYoshihiro Koda entine. He has been managing the Chiba Lotte Ma- Interleague Play rines since last year. They led the 36 game series with a record of 24-11 with 1 draw game. That brought a \50million (US$470,000) prize. They have not won Japanese baseball held its very first interleague the league championship for 31 years and had poor games from May 6 to June 19. During those six attendance. But this year, they show more exciting weeks, each club played three games at home and performances on the field. Fans unfamiliar familiar three more on the road against each of the six clubs with Pacific League clubs should be impressed. Since belonging to the other league. the Chiba Lotte Marines are doing it without any big name signings, the improvement is credited to Valen- The less popular Pacific League clubs have tine’s handling. sought these games for a long time. But the Central League clubs had been resisting because they didn’t On the other hand, the Sankei News Paper poll like losing television revenues from home games found that 60% of fans said that they spent no more against the Tokyo Giants.

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