Robert "Lefty" Grove and the Business of Baseball
Last year, three players, Manny Machado, Bryce Harper and
Mike Trout, signed contracts worth in excess of $25 million per year to play
baseball. When baseball players sign
such record breaking contracts, you often hear someone complain about our
nation’s priorities, decrying that we value sports stars more than teachers.
Of course, paying big money for star players is nothing new
in baseball. In 1925, Connie Mack paid
$100,600 so Robert “Lefty” Grove could play for his Philadelphia Athletics. That would be worth approximately $1.5
million in 2020. This was the highest
amount paid for a player at that time, exceeding even the $100,000 the Yankees
paid the Red Sox for Babe Ruth in 1920 (estimates place the value of the Babe
Ruth sale between $1.3 million and $1.5 million adjusted for inflation). The problem, however, is that Lefty Grove
received none of that money. In 1925,
Mack paid Grove a mere $6,500 (worth approximately $97,000 in 2020).
The economics of baseball were much different in Lefty Grove’s
time. There were no lucrative TV
revenues. Teams didn’t make a lot of
money off merchandising. The economic
calculations were simpler. How do we get
more people to buy tickets? How do we
keep expenses down?
For team owners, how to keep expenses down was simple. Let’s control the growth of players’
salaries. Sure, owners recognized that
star players brought fans into the stands.
Those star players in turn would command higher salaries. But those salaries were nowhere near what
major league ballplayers make today.
To start with, the way talented athletes were found and
brought into the league differed greatly from the amateur draft and minor
league affiliations baseball has now.
Without television or other forms of mass entertainment, baseball
leagues flourished across the United States.
Often, there would be teams associated with factories or other local
businesses that played each other. Minor
leagues formed in areas considered remote now.
A young man might start playing for a factory team, and be spotted by a
minor league manager, who just happened to be scouting the company
leagues. When offered a contract to play
ball for money, young men would jump at the opportunity, knowing it was a way
out of monotonous and sometimes dangerous work.
The bigger economics of the game, which favored owner exploitation of
their players, may not initially affect a player’s decision to sign a contract and
go pro.
At the heart of this system of exploitation lay the reserve
clause. Player contracts invariably
contained the reserve clause, which required a player, once the season had
ended, to play for the same team in the following season. Player contracts could be bought, sold and
traded among the different team owners.
This meant that a player for a team in Durham, North Carolina, could
find himself playing in Dayton, Ohio the next season, without having any say in
the matter. Once a player signed a
contract to play baseball professionally, if he wanted to continue to continue
to play baseball for money, he no longer had any choice where. An agreement that almost all professional
leagues concluded after the war that the American and National Leagues fought,
poaching players from each other, meant that almost all teams, whether in major
or minor league honored the reserve clause of each other.
This meant that if a major league owner wanted to have a
star athlete from the minor leagues on his team, he would have to buy that
player’s contract from the minor league club’s owner. Savvy minor league owners could make a business
of identifying young talent, willing to play for pennies just to escape work on
the farms or in the mines, and then selling their contracts in a bidding war
among major league teams.
This was the world that existed for Lefty Grove when he
began his professional baseball career.
One of eight children born into a mining community in Lonaconing,
Maryland, Grove quit the mines after only two weeks. He bounced from heavy labor job to heavy
labor job throughout his teens. At age
nineteen, a general store owner offered Grove a chance to play for a local team
in Midland, Maryland. After pitching a
no-hitter, where he struck out eighteen batters, against the B & O Railroad
team, Grove found himself working for the railroad so he could play on the
company team in the next season. Before
the 1920 season started, Bill Loudon, the manager of the Martinsburg Mountaineers,
a Class D team from the Blue Ridge League, offered Grove $125 a month to play
ball professionally (between $1,600 and $1,800 today).
In his first six games, Grove had amassed sixty strike outs
over fifty-nine innings. Jack Dunn,
owner of the Baltimore Orioles, a club playing AA ball in the International League,
heard about Grove, and sent his son, Jack, Jr., to watch him pitch in a game in
Hagerstown. With Dunn, Jr. impressed, the
Orioles agreed to pay for the installation of new fence for Martinsburg, as the
old outfield fence had been destroyed in a storm, in exchange for Grove’s
contract. The fence cost $3,500 (about
$45,000 to $52,000 when adjusted for inflation).
Dunn had previously sold star pitchers Babe Ruth and Ernie
Shore to the Boston Red Sox when is first installment of the Baltimore Orioles
found themselves under attack from the upstart Federal League. The owners of the Federal League challenged
the dominance of the American and National Leagues, poaching star players from both
major and minor league teams in order to create a competing third major
league. The Federal League placed a team
in Baltimore, the Terrapins, who built their ballpark across the street from
the Orioles’ home field. This undercut
Dunn’s AA Orioles, whose attendance dwindled.
To rescue his finances, Dunn took steps to move his team to Richmond,
Virginia. Once the Federal League
collapsed, however, Dunn sold his shares in the Richmond team, and purchased a failing
team from Jersey City to move the team to Baltimore, where he had purchased the
Terrapins’ ballpark. This became Dunn’s
second iteration of the Baltimore Orioles.
Dunn stocked his Orioles team with talented players, and
began a seven year run of winning the International League pennant. Grove, for example, amassed a record of 108
wins and 36 losses, for a win percentage of .750 in this four plus years with
the Orioles. Grove also led the
International League in strike outs every year he played for Baltimore.
The Baltimore team was so dominant, that it would often have
the championship sown up by mid-season.
This depressed ticket sales for the other International League ball
clubs, who pressured Dunn to sell his players to the major leagues in order to
create greater parity within the International League. The other owners used a newly instituted
draft as their leverage against Dunn.
The draft allowed major league teams to pick players from the minor
leagues, and pay the minor league owners a flat fee for the players’ contracts,
depending on the league’s level. The
price for drafting a player from a double A team was $5,000. Minor league teams could likewise draft
players from the leagues beneath them.
However, leagues could exempt themselves from the draft, provided they
give up the right to draft players from the lower leagues. The International League was one of five AA
leagues that chose to exempt themselves form the draft.
Dunn opposed the draft, believing it unfair for the major
league teams to be able to purchase a player’s contract for a mere $5,000, when
the player could be worth far more than that.
He had convinced fellow owners to forgo the draft. When those owners saw their attendance drop
due to the uneven distribution of talent, they threatened to join the draft
system if Dunn did not sell some of his star players to make the league more
competitive.
Reluctantly, Dunn relented.
By 1925, Dunn agreed to sell his ace pitcher to his friend, Connie Mack.
The 1925 season was a disappointing one for Grove. While he threw with power, his command was
often erratic. Grove posted his only
losing record in the major leagues, at 10-12.
Nonetheless, he showed promise, as Grove led the American League in
strike outs, with 116. Grove would go on
to lead the American League in strike outs in his first seven seasons. Indeed, over the course of his seventeen year
career in the majors, Grove led the American League nine times in ERA.
From 1929 through 1931, the A’s boasted one of the most
powerful line-ups in baseball history.
Three Hall of Famers, Jimmy Foxx, Al Simmons and Mickey Cochrane, along
with outfielders Mule Haas and Bing Miller, provided the power to the
Athletics’ offense. Only Haas, who batted .299 in 1930, and Foxx, who batted
.291 in 1931, fell below .300 during this period. Grove, meanwhile, led the league in win
percentage in all three years, at .769 in 1929, .848 in 1930 and .886 in
1931. Together they propelled the team
to three straight pennants, and two World Championships, in the second of
Connie Mack’s dynasties.
In 1931, the Baseball Writers’ Association of America instituted
the Most Valuable Player award in both leagues, as determined by a ballot of
one writer in each city with a team.
Grove, who led the majors in the categories of wins (31), win percentage
(.886), ERA (2.06), and strike outs (175), won the award for the American
League. Yet, during the three year
dynasty, Mack never paid Grove more than $20,000 (estimated to be between
$340,000 and $345,000 when adjusted for inflation).
By 1932, Mack found himself in a financial strain. He had borrowed $750,000 before the stock
market crash of 1929 to renovate Shibe Park.
Mack also noticed that once Philadelphia fans had a championship team,
they lost interest even if that team continued to dominate play. Thus, gate receipts dwindled after the 1929
World Championship, despite the two more pennant victories and a second World
Championship. By 1932, the team had
fallen to second place, and ticket revenue continued to fall. Mack found himself selling off Simmons, Haas
and infielder Jimmy Dykes to the Chicago White Sox for $150,000. Depending on current income to meet expenses,
Mack continued to sell his key players as the A’s fell to third place in 1933
and fourth place in 1934. Grove was sold to Boston after the 1933 season.
Grove battled injury, but continued to pitch well with
Boston. Yet the most he was paid was $45,000
in 1934 (valued at approximately $870,000 to $895,000 when adjusted for
inflation). Indeed, Grove earned only
$10,000 in the following year. While his
salary reach $19,000 in 1937, Grove found his earnings dwindle in his last few
years in baseball. After winning his 300th
career game, Boston released Grove after the 1941 season. In the off-season, Grove decided to
retire. He had earned $10,000 in his
final year (valued between $176,000 and $183,000 when adjusted for inflation).
During his playing career, and after retirement, Grove
supplemented his income by running a bowling alley, called “Lefty’s Place,” in
his hometown of Lonaconing. He also
served as a town councilman and the town’s Police Chief. Nonetheless, Grove endured a divorce, and
required financial assistance in his later years. In the end, the Hall of Fame pitcher never
realized the multi-million dollar salaries players now command due to the elimination
of the reserve clause and the rise of free agency.
By: William J. Kovatch, Jr.
References
Dollar figures used in
this article were estimated based on figures adjusted for inflation using four
inflation calculators: Morgan Friedman,
CoinNews, smartasset, and Calculator.net.
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