Last month, a franchise synonymous with winning scored another victory. The New York Yankees won a court ruling against a company that had attempted to register the phrase "Baseballs Evil Empire." The Yankees may not have appreciated it when Red Sox president Larry Lucchino first used the term to describe them in 2002, but if anyone was going to make money off the phrase, damn it, it was going to be them. Even if it means, as written in the judges' decision, "The record shows that there is only one Evil Empire in baseball and it is the New York Yankees."
Defending your brand is Business 101, but in this case, I'm not sure the Yankees should be so quick to embrace the trademark. It's not simply that the Evil Empire was, you know, evil; I think the Yankees made their peace with that a long time ago. Maybe the Steinbrenner family made the mistake of watching the Star Wars saga in numerical order, and gave up after Episode III — and let's be honest, most of us would have done the same thing — but if they did, they would have missed the fact that (spoiler alert) the Evil Empire lost in the end.
Today's Yankees aren't used to losing, but there was a time when the New York Yankees weren't The Most Successful Team In American Sports. Once upon a time, the team wasn't even in New York. The franchise began in 1901 as the Baltimore Orioles; it took two years for management to rip through all five seasons of The Wire and realize they needed to hightail it to New York. There, they were known as the Highlanders, but after a middling decade and two 100-loss seasons, they finally tired of trying to behead their opponents and rechristened themselves the Yankees in 1913.
The first eight seasons as the Yankees were no more memorable than the previous 12. After the 1920 season the Yankees still had never won a pennant, let alone a World Series that might ease the ribbing from teams like the Red Sox (five world championships) and Cubs (two).
Then New York began a stretch of 29 AL pennants in 44 years. After losing its first two World Series in 1921 and 1922, it won 16 of the next 18 it played in. From 1926 to 1964 the Yankees had 39 consecutive winning seasons. To put that in perspective, the Pittsburgh Pirates just set the major league record for consecutive losing seasons — at 20.
When you win as many championships as every other team combined during a 40-year stretch, as the Yankees did from 1923 to 1962, you'll convince a lot of people that winning is your birthright. But it's not. The Yankees didn't win anything from 1901 to 1920, and they didn't win anything from 1965 to 1975, and they didn't win anything during the dysfunctional Steinbrenner years from 1982 to 1993.
From 1989 to 1992, the Yankees finished below .500 for four glorious years in a row, the first time they had done so since World War I. In 1990 they finished dead last in the AL, were granted the no. 1 overall pick as an eternal monument to their shame, and then blew the pick on Brien Taylor. It was a good time to be a fan of any other team in baseball. Yankeefreude was at its peak.
Today, that era seems as long ago as the Highlander years. When George Steinbrenner was suspended from baseball for hiring gambler Howie Spira to dig up dirt on Dave Winfield, it finally gave the front office the breathing room it needed to build a long-neglected farm system. The 1994-95 strike exacerbated the gap between the haves and have-nots, and the Yankees had more of everything than anyone else. The Yankees are working on a new streak of 20 consecutive winning seasons. They've won at least 87 games for 17 straight years, a major league record. They reached the postseason 13 straight years from 1995 to 2007, and they've been playoff-bound in 17 of the last 18 years, both streaks unmatched in baseball history.1
Given that Yankees fans graduating high school this year have missed just one October in their lifetime, it's easy to assume that the way it has always been is the way it will always be. But the Yankees have fallen off their perch before, and they may be about to fall off their perch again.
The Yankees are old. This is not a new development; they've been old throughout their entire stretch of dominance. When they began their run in 1995, the average age of the offense was 31, and the offense has averaged more than 30 years of age for 18 years straight. Their pitching staff was relatively young in the early years, back when Andy Pettitte and Mariano Rivera were in their mid-20s, but since 1998 the average age of the pitchers has been more than 30 every year but one.
There's no mystery as to why the Yankees are old. While not all good players are old, good free agents tend to be old. This is why, on the whole, free agents are overpaid; you're buying into a declining market when you're signing players in their late 20s and early 30s. But these are the Yankees, and they have enough money to worry about talent first and cost second.
The Yankees' blueprint for success isn't particularly complicated. They developed talent from within, used their money to keep their best homegrown players for life, and used even more money to fill the roster holes with the best available talent. So Derek Jeter, Bernie Williams, Jorge Posada, Rivera, and Pettitte all have or will retire as Yankees, with only Pettitte escaping for a few years in Houston. And around them, they've brought in expensive, aging, but nonetheless outstanding players to keep the machine humming.
Sometimes they ponied up for premier free agents (Mike Mussina, Jason Giambi, Mark Teixeira, CC Sabathia), and sometimes they paid for second-line free agents to fill a need (David Wells, Johnny Damon, A.J. Burnett). Sometimes they used their money and their prestige to lure the best international talent (Hideki Matsui, Orlando Hernandez, Hideki Irabu, Jose Contreras, Alfonso Soriano, Chien-Ming Wang). More often, they took advantage of their capacity to absorb huge contracts to trade for superstars close to free agency, and then extend them at market value (David Cone, Roger Clemens, Alex Rodriguez, Randy Johnson, Curtis Granderson, even Chuck Knoblauch and Nick Swisher). Hell, they traded for Javier Vazquez twice.
Not every acquisition worked out, but most of them did — at least at first — and the Yankees had the money to flush the mistakes away and keep winning. Sure, they were old, but they were old with different players every season, bringing in new crops of past-prime stars whenever it was time to put the last crop out to pasture.
When you're able to feast on the free-agent market every winter, it's not that hard to build a perennial winner. What made the Yankees a dynasty is that they developed five Hall of Fame or near–Hall of Fame talents of their own in a short time. Williams debuted in 1991, and in 1995 the Yankees had perhaps the greatest rookie quartet by a single team in major league history: The Core Four (Jeter, Rivera, Pettitte, and Posada) all debuted that year.2
Take a franchise capable of fielding payrolls two or three times the league average, mix in the greatest rookie crop ever, and 17 playoff berths and five world championships in 18 seasons seems like a foregone conclusion.
Take away both ingredients, and suddenly 18 playoff berths in 19 seasons seems like a long shot.
The storm the Yankees are about to sail through has been cloaked by their remarkable consistency in recent years — in six of the last eight seasons, they won between 94 and 97 games. After they fell short in 2008, the Yankees signed three of the five best free agents available: Sabathia, Burnett, and Teixeira. In 2009, they won 103 games and another world championship.
That consistency masks the fact that one of their two greatest weapons — their payroll — has gone stagnant. In 2005, the Yankees' payroll exceeded $209 million, having more than doubled since 2000. No other team had a payroll higher than $126 million; the median payroll was barely $65 million. The difference between the Yankees' payroll and the second-place Red Sox would itself have been the 11th-highest payroll in the game.
Seven years later, revenues and payrolls throughout baseball have jumped, but the Yankees have stayed in place. The combined payroll of all 30 teams rose 37 percent, from $2.201 billion to $3.021 billion, from 2005 to 2012. The Yankees' payroll, meanwhile, inched up to $211 million, a 1 percent increase over seven years. This year's payroll is more of the same — currently a shade more than $208 million.
The Yankees have kept winning because the gap between them and everyone else didn't close completely. It only narrowed. But this year, for the first time since 1998, the Yankees don't have the highest payroll in baseball. This is because:
1. The new owners of the Los Angeles Dodgers are throwing their money around like drunken sailors.
2. The luxury tax, which has long been just an annoyance to the Yankees, has suddenly taken on a great deal more importance.
The luxury tax, which was first instituted in the collective bargaining agreement after the 2002 season, would be more accurately called The Yankee Tax. The Yankees have exceeded the threshold every year since its creation, and the franchise has paid anywhere from $12 million to $34 million a year for the privilege of lapping the field in payroll. The Red Sox are the only other team that has paid meaningful taxes.3 They have gone over the threshold six times, but they never paid much more than $6 million in penalties.
For years, the Yankees have acted as if the luxury tax was just the cost of doing business. But George Steinbrenner died in 2010, and his maniacal focus on winning seems to have gone with him. His sons, Hank and Hal, like winning just fine, but they would prefer to win and make piles of money. So, although they've been willing to maintain the team's payroll well above the current luxury-tax threshold of $178 million, they haven't increased payroll in eight years.
The Steinbrenners' unwillingness to raise payroll has made it more difficult for the Yankees to bring in fresh veterans to replace the worn-out ones. As a result, the team has stuck with its old guys even as they turned into really old guys — last year, the offense averaged 32.7 years old, the oldest in franchise history and the third-oldest in baseball history.
The newest CBA, agreed to after the 2011 season, included two key changes [PDF] to the luxury tax. The first is that the highest tax rate (which, of course, applies to the Yankees) was increased from 40 to 50 percent. The second change is that, should a team avoid the luxury tax even once, its tax rate will drop back to the lowest level (17.5 percent) the next time it exceeds the threshold, and rise incrementally from there.
In other words, if the Yankees can get below the tax threshold just once, they won't just save millions of dollars that year, they'll also save millions for the three subsequent years even if they jack up their payroll again.
The Yankees aren't shy in disclosing that this is their strategy — they've been talking about it publicly for more than a year. The threshold increases to $189 million in 2014, and the franchise plans to get its payroll below that mark next year. Which would be its lowest payroll in a decade.
It would be almost impossible to drop $30 million worth of salaries in one offseason, particularly with so many long-term contracts (which tend to escalate over time) on the books. To get payroll under control for 2014, the cost-cutting had to start this year. A franchise that had essentially never lost a free agent it wanted chose to let three of them get away this winter.
Rafael Soriano, who took over the closer's role and saved 42 games after Rivera tore his ACL in April of 2012, signed a two-year contract with the Washington Nationals. Nick Swisher, who provided eerily consistent production as the Yankees' right fielder the last four years — between 23 and 29 homers and an OPS+ between 120 and 129 each year — was lost to the Indians, who signed him to a four-year contract.
Swisher was replaced by Ichiro Suzuki, who doesn't have Swisher's stick at this point in his career, but brings experience and gravitas to the position — plus a much cheaper two-year, $13 million contract. Rivera's return should help paper over Soriano's absence. But the third free agent to depart, Russell Martin, is the most humiliating loss and the most irreplaceable.
It's not that Martin is a star. He hit just .224/.317/.405 with solid defense in his two seasons as the Yankees' starting catcher. His departure is humiliating because the Yankees lost him to the Pittsburgh Pirates. What's disturbing is that the Yankees let him go even though they don't have anyone to replace him. Right now the catching duties are to be split between Chris Stewart and Francisco Cervelli, and even as I type those words I can't believe THE NEW YORK YANKEES are going into a season with Chris Stewart and Francisco Cervelli behind the plate.
The Yankees don't have anyone better because of the deterioration of their other great weapon: In the 18 years since the Core Four debuted, the Yankees haven't developed anyone to replace them, with one exception. Robinson Cano came up in 2005, and to the surprise of just about everyone, he developed into the best second baseman in baseball. But aside from Cano bubkes.
A look at the team's top prospect as ranked by Baseball America every year is instructive. After Jeter topped the list in 1994, their top prospects include Ruben Rivera (three times),4 Eric Milton, Nick Johnson (three times), Drew Henson, Jose Contreras, Dioner Navarro, Eric Duncan, Phil Hughes (twice), Joba Chamberlain, Austin Jackson, and Jesus Montero (three times). Hughes is the only player on that list who was neither a bust nor traded for established veterans early in his career.
And at some point, the players who debuted in the majors the year ESPN launched its website are going to decline. Granted, aside from the retired Posada they haven't yet, which is insane. But Derek Jeter turns 39 in June. Andy Pettitte will be 41, and he already retired once. Mariano Rivera is 43 and coming off knee surgery.
Add it all together — the Yanks' sudden penurious streak, the lack of player development, the $28 million paid to Alex Rodriguez — and here's what the Yankees' lineup looks like:
RF Ichiro Suzuki: If the Yankees are getting the rejuvenated Ichiro who hit .322 after joining the Yankees last July, they won't miss a beat in right field. But over the last two years, Ichiro hit .277/.308/.361. He's 39. Even his defense is starting to slip.
SS Derek Jeter: He's still Derek Jeter, and he did hit .316/.362/.429 last year, just a tick off his career average. But he was just average at the plate in 2010 and 2011, his defensive range can be measured with a micrometer at this point, and last season ended with the Captain fracturing his left ankle while fielding a ground ball.
2B Robinson Cano: A stud. No criticisms here.
3B Kevin Youkilis: Signed to replace A-Rod, who will miss half the season with hip surgery, Youkilis hit .235/.336/.409 last season. He turns 34 later this month. He was an excellent player as recently as 2011 and he may regain his old form, but guys who fit his profile — right-handed hitters with little athleticism in their mid-30s — tend to fall off the cliff fast.
DH Travis Hafner: It wasn't that long ago that Hafner was arguably the most feared hitter in the AL. Oh, wait — 2006 was a long time ago. Hafner is a solid platoon DH when healthy, but he has spent time on the DL for five years running, and he's almost 36.
CF Brett Gardner: Gardner was one of the most underrated players in baseball three years ago, combining a high OBP with terrific speed and elite defense in left field. But he missed almost all of last season with an elbow injury and he'll be asked to transition to center field this year.
Catcher du jour: Chris Stewart is 31, he's batted fewer than 400 times in the majors, and he has a career line of .217/.281/.302. He's the starter. The backup is Francisco Cervelli, who is younger and has hit .271/.339/.353 in his brief career, but Cervelli spent almost all of last year in Triple-A (and batted poorly) because he couldn't beat out Stewart for the backup job. The Yankees haven't punted on a position like this in 20 years.
In left field, the Yankees have Curtis Granderson, who is the only hitter other than Cano who doesn't come with question marks about injuries or age-related decline. Well, they had Granderson, whose right forearm was broken by a pitch last week — he's out until at least mid-May. In his place, Yankees fans will be treated to the likes of Juan Rivera (.244/.286/.375 last year, 34 years old) and Matt Diaz (.222/.280/.333 last year, 35 years old).
The bad news continues to accumulate. On Tuesday, first baseman Mark Teixeira was pulled from the World Baseball Classic after straining his wrist on a practice swing. This isn't simply bad luck; old players get hurt more than young players, and Teixeira is 32 years old and his OPS has declined for five straight seasons. Like Granderson, Teixeira probably won't be back until mid-May, meaning that of the eight players who hit 16 or more homers for the Yankees last year, just one (Cano) will be in their Opening Day lineup. Teixeira's likely replacement, Dan Johnson, is a fantastic hitter — on the last day of the season. The rest of the year, he's terrible.
It's not necessarily a bad lineup, or at least it won't be once Granderson and Teixeira return, and assuming no one else gets hurt. But there's no there there, and if the old guys start playing like old guys, the downside risk is enormous.
The pitching staff looks somewhat better, thanks to Sabathia, a bona fide ace still in his prime. Hiroki Kuroda, who is 38 years old but is staking his claim as the best starting pitcher ever from Japan, follows him. After those two come the quadragenarian Pettitte; Hughes, who has been healthy enough to make 15 starts just twice in six seasons; and Ivan Nova, whose ERA was greater than 5 last season. At some point the Yankees hope to get Michael Pineda back, but coming off labrum surgery, it's anyone's guess how effective he'll be.
In the bullpen, so long as Rivera is Rivera, they'll be fine.
For the first time in 20 years, the Yankees are not a good team, and that won't cut it in an AL East that figures to be as competitive as ever. The Red Sox have their own issues but still possess the talent to be dangerous. The Rays have reloaded their offense and feature a freakishly good 1-2-3 in their rotation. The Blue Jays are probably the most improved team in the majors, and the Orioles — well, I suppose it's possible they'll go 29-9 in one-run games again.5
If everything goes right, the Yankees can win 90 games again and contend for an AL East title. But for the first time since before the strike, the Yankees need everything to go right. And it never does. Things are already going wrong, with a third of the projected lineup on the DL. They don't have the depth to replace Granderson and Teixeira; other players will get hurt, and they won't have the depth to replace them. Players will underperform, and they don't have anyone in the minors who can step up. (The Yankees have a pretty good farm system, but their top five prospects — Mason Williams, Slade Heathcott, Gary Sanchez, Tyler Austin, and Jose Campos — have combined for two games in Double-A.)
So long as the Yankees stick to their guns and aim to get their payroll under the threshold next year, they won't be able to purchase help from outside the organization. The team's streak of 87 or more wins is in mortal danger, and so is its streak of 20 winning seasons in a row. If the old guys show their age all at once and another key player goes down — particularly Sabathia — they could collapse like last year's Red Sox.
And 2014 will be worse. The Yankees only have four players under contract for next year, but they owe those players — Rodriguez, Sabathia, Teixeira, and Ichiro — more than $78 million. Cano will be a free agent, and with the Dodgers trying their best to out-Yankee the Yankees, it's no guarantee he'll re-sign in the Bronx.
Cano is just the tip of the iceberg. Other free agents next winter include Granderson, Kuroda, Youkilis, Pettitte, Hughes, Hafner, Joba Chamberlain, and Boone Logan. (Jeter has a player option.) As much as 40 percent of this year's roster will be available to the highest bidder next winter, just as the Yankees will be cutting payroll. The news that Rivera plans to retire at the end of this season is a further blow to the Yankees' chances. Rivera is not only the best reliever in major league history, he might be the most consistent — since moving to the bullpen in 1996, he has never had an ERA higher than 3.15. For the last 15 years, the Yankees haven't had to worry about the ninth inning. Next year, they will.
Assembling a complete roster with no immediate help from the minor leagues and precious few pre-arbitration major leaguers will be an immense challenge. It's no wonder that GM Brian Cashman has been skydiving recently — he probably wants to get intimately familiar with the sensation of free-falling. But as he found out, falling isn't the hard part; landing is.
For anyone who has watched baseball over the last two decades, it's nearly impossible to imagine the Yankees as a toothless franchise. But when you build around old, expensive players, the reckoning coming up in your side mirror is — like the dinosaur in Jurassic Park — closer than it appears. (Just ask the Phillies.) So it's time to proclaim the truth that everyone has danced around so far this year:
The Evil Emperor has no clothes. Even the Yankees are capable of down cycles. This looks like the start of one.