High-Payroll World Series Shows Difference Between MLB and NFL

Our business of football columnist breaks down one sport with a salary cap and one without. Plus, analyzing Haason Reddick’s return, two big wide receiver trades and Tom Brady’s Raiders purchase.

Aaron Judge and the Yankees play in a very different environment than Jordan Love and the small-market Packers. / Brad Penner/USA TODAY Network (Judge); Jeff Hanisch/USA TODAY Network (Love)

As the NFL’s regular season approaches the halfway mark, there’s no shortage of business and off-field issues percolating around the league. And as the World Series takes center stage in the sports ecosystem, I’ll compare the NFL’s salary cap system to Major League Baseball operating without a cap. After that, I’ll analyze the curious Haason Reddick holdout, the “same but different” trade compensation for Davante Adams and Amari Cooper, and the NFL’s deference to Tom Brady the owner-as-broadcaster.

NFL cap vs. MLB no cap

As I talk about and teach to my students, a salary cap is a collectively bargained mechanism to (1) promote competitive balance between teams in leveling the financial playing field and (2) protect owners from themselves. While the NFL has had a salary cap since the inception of free agency in 1993, Major League Baseball has never had one and, at least this year, the results in that league reflect what is not always true in sports, which is: more spending = more winning.

This year’s two World Series teams hail from the two largest markets in the country with two of the three highest payrolls in baseball. The New York Yankees ($311 million) and Los Angeles Dodgers ($266 million) are second and third in player spending, with the top team (the New York Mets at $332 million) just eliminated in the NLCS by the Dodgers. Baseball does have another method to ostensibly promote parity, as the competitive balance tax (CBT) levies penalties to deter high-spending teams, but there are no stop signs or penalties—other than contributing to a fund for lower-revenue teams—for zooming past the CBT.

In sharp contrast, the NFL not only has a cap, but a team can never be “over the cap.” Were a team to submit a contract that would take it beyond the cap, the NFL would reject the deal until the team made a corresponding move—a release or restructure—to create the needed cap space.

An informative way to illustrate the differences between an MLB system and the NFL system is to look at the disparity in player payroll from the highest spending team to the lowest spending team. Over the past five years in Major League Baseball, the average payroll disparity between the highest- and lowest-spending teams is over $200 million. Over the past five years in the NFL, the average payroll disparity between highest- and lowest-spending teams is under $100 million.

This past MLB season saw the Mets and Yankees with payrolls over $300 million and six teams with payrolls under $100 million. Yes, teams on the lower end of that scale (such as the Detroit Tigers) do rise up and contend, but without a salary cap: (1) The odds are stacked against that, (2) there is no margin for error with lower payrolls and (3) success is not sustainable without spending.

I worked in Green Bay, with a population of roughly 100,000, for an NFL team that not only survived but thrived. We could never have done that without the two pillars of the NFL’s competitive balance system: revenue sharing and the cap. MLB has revenue sharing, but it does not have a cap.

Many ask why MLB does not have a cap. Well, the MLB Players Association has successfully fought off one since its inception; MLB owners don’t even bring it up as a collective bargaining issue anymore. As for the NFL Players Association, well, it is not that strong.

Baseball’s ratings and popularity are higher with these marquee teams still playing, so no one is complaining about all the player spending right now. But, for better or worse, this disparity in payrolls could never happen in a salary cap league like the NFL.

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Head-scratching Reddick return

Reddick now returns to the New York Jets after a still-confounding holdout that cost him $12 million between training camp fines and lost salary. And I still don’t get it; I don’t get the holdout and I don’t get his agreeing to the contract that got him to return.

As a former NFL agent, I could never justify telling a client to hold out from when the “real checks” started coming in during the regular season. Offseason money is negligible, regular season money is real. And this is not the NBA or MLB. This is the NFL, where career lengths are short and contracts are not guaranteed.

Perhaps CAA, the mega-firm that represented Reddick, advised him as I would have, telling him he should at least “hold in” and start receiving those checks. Whether it was CAA “firing” Reddick or vice versa, or something in between, that relationship has soured and ended.

Enter Drew Rosenhaus, a known dealmaker. Rosenhaus has so many clients that he has to move quickly. And now Reddick returns to the Jets with what looks to be no “real money” to make up for the $12 million lost. Rather, reports indicate that Reddick can make up that money with incentives, meaning he has to earn it. So, if I am seeing this right, if Reddick gets injured or does not play a lot due to coaching decisions, he will lose out on the money that he turned his back on? This whole situation is confounding.

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Cooper scored a touchdown in his debut with the Bills. / Tina MacIntyre-Yee/Rochester Democrat and Chronicle / USA TODAY NETWORK via Imagn Images

Trades of third-round picks that are very different

Last week two upper-echelon wide receivers were traded, as Adams and Cooper were sent to the New York Jets and Buffalo Bills, respectively, for the same trade compensation: a third-round pick. However, not all trades are created equal. No matter how you compare the two players on the field, the Bills got a better deal off the field.

The Jets inherited more than $11 million in 2024 salary on Adams (in addition to two puffed-up, unrealistic $36 million salaries for ’25 and ’26. The Bills inherited roughly $800,000 in ’24 salary on Cooper. Indeed, the Bills are paying less for Cooper for the rest of the season than the Jets are paying Adams each week.

Before the season, the Browns converted all but the minimum salary of Cooper’s $20 million into signing bonus, reducing his 2024 cap charge significantly and pushing the cap charges into future years. While the Browns had and have plenty of cap room, they keep pushing it out to the future, adhering to a strategy that cap later is better than cap now.

As I always say, trades must be evaluated not only on the talent side but also on the financial side. These are both trades of wide receivers for third-round picks, but with vastly different financial consequences. Price matters.

We saw this in the third trade of a big-name wide receiver—DeAndre Hopkins to the Kansas City Chiefs—where the Tennessee Titans are paying off half of the remaining balance on his contract for the year.

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The curious Brady ownership in the Raiders

This sale of a minority interest in the Las Vegas Raiders to Brady—a 10% share split between he and partner Tom Wagner—had not been approved by NFL ownership for over a year due to (1) Brady’s role as a Fox broadcaster and (2) the discount factor on his purchase being deemed too steep. That was then; this is now.

On the broadcast issue, guardrails have been placed on Brady limiting him from production meetings and facilities, tried and true ways for broadcasters to prepare for their games. To me, this seems kind of silly, not to mention lessening his value as a broadcaster. So the league’s highest-paid media commentator can’t really be a suitably prepared commentator? And wouldn’t his colleagues and producers on his broadcast team tell him what they hear anyway?

As to the valuation, there is definitely a celebrity discount here. Brady is not paying retail. If the Raiders are valued at, say, $5 billion, my guess is Brady and his partner are paying something like $250 million, or a 50% discount rate to have Tom Brady become a minority owner in the league. That discount is less than whatever it was that held up the purchase to begin with. It is also reported that Brady’s shares are not subject to a right of first refusal from other Raiders investors, as other shares are, meaning no one else can get the Brady discount.

Whatever the discount rate is, it will now be a precedent for other former star players who want to buy small pieces of franchises.

Finally, I am still a bit confused as to why the Raiders are the team Brady has now bought into. I know he was courted by owner Mark Davis, but if Robert Kraft loves him like a son, as he says he does, why did this not happen with the New England Patriots?

Like so many other things coming out about the two-decade relationships between Kraft, Brady and Bill Belichick, this is curious.