On 8 March 1930, baseball legend Babe Ruth signed a two-year contract with the New York Yankees for $160,000, thus making him the highest paid player of all time (up to that point, anyways). In the midst of the Great Depression, this contract definitely raised some eyebrows.
At $80,000 per year, someone pointed out, Ruth now had a higher salary than the President of the United States, Herbert Hoover. Ruth’s response? “So what? I had a better year than he did.” Ruth went on to lead the American League with 49 home runs that year.
Now, let’s take this a step further. I’m not one for doing the math myself, but I did a little poking around, curious to see how Ruth’s contract measures up to some of the big contracts in Major League Baseball today. Taking into consideration things such as cost of living and inflation, Ruth’s $80,000 in 1930 would have been worth $1,027,895 in 2005. The average Major League salary in 2005 was $2,476,589.
That’s right. In 2005, the average Major League ballplayer made more than double what the great Babe Ruth made. Meanwhile, the highest-paid ballplayer today, Alex Rodriguez, made a whopping $26,000,000.
What a difference 75 years makes! No doubt, had the country not been in the midst of the Depression, Ruth’s salary would have been higher. But would he have made the equivalent of A-Rod’s $26 million? Somehow, I doubt it.
“2005 MLB Top 25 Player Salaries.” USA Today. Gannett, 2012. Web. Accessed 8 March 2013. http://content.usatoday.com/sportsdata/baseball/mlb/salaries/player/top-25/2005
“Major League Baseball Salaries.” Baseball Almanac. Baseball-Almanac, 2000-2013. Web. Accessed 8 March 2013. http://www.baseball-almanac.com/charts/salary/major_league_salaries.shtml
Riess, Steven A. Touching Base: Professional Baseball and American Culture in the Progressive Era. Westport, Connecticut: Greenwood Press, 1980.
“Was Babe Ruth Underpaid?” EconEdLink: Economics & Personal Finance Resources for K-12. Council for Economic Education, 2013. Web. Accessed 8 March 2013. http://www.econedlink.org/lessons/index.php?lid=604&type=educator