The reason you can’t have relegation in American sport leagues has to do with the structure of such leagues.
In professional football as it is played in almost all the world, a “league” is not the same thing as it is in America (sorry, Canada, but the NHL is American now, but I do concede that the CFL follows the same “American” organizational set-up). In the rest of the world, football is played by “clubs.” These are organizations of people who get together for the purpose of playing football. Sometimes, the club is an athletic club, which participates in other sports besides football. The national organization which governs the sport of football in the country sets up a competition, in which the clubs participate. Usually, such competitions are stratified by ability, so that each division of the competition has somewhere between 18 and 24 teams. But it is important to note that the clubs are not part of an integrated whole. “Serie A” in Italy is not an organization made up of the 18 teams which participate in it; it is the top flight of the annual competition run by the Federazione Italiana Giuoco Calcio, the Italian Football Federation.
In contrast, the American league is an entity unto itself, from which the teams obtain franchises, much the same way that Joe Blow Restauranteurs, Inc. obtains a franchise to run a Big Boy, or a McDonald’s. Joe Blow ponies up the franchise fee, and gets for his investment the secret and the machinery to make the world famous Big Boy™, or, if he is smart, the somewhat more world famous Big Mac™. On the other hand, with $500M, you might convince the NFL to let you obtain a franchise for Los Angeles, for which payment you would receive the headache of fielding a team of spoiled brats who get paid exhorbitant sums of money to play. But you would get the right to rub elbows with Lamar Hunt. Of course, there is a difference; while McDonald’s exists as a separate entity from the franchises it licenses, the franchises of American professional sports leagues run the entity from which they obtain the franchise. Thus, Lamar Hunt is an “owner” of the NFL, as well as of the Kansas City Chiefs.
This difference explains why “relegation” works in worldwide football, and won’t work in American professional sport leagues (hockey and baseball are the only two really set up with enough depth in ability levels and clubs devoted to playing to make the system work anyway, not including our own anemic attempt to organize professional soccer). When the Football Association says to the lowest three teams in the First Division, “Sorry, lads, but you need to play Wrexham next season, not Crystal Palace; be good boys and do well and we’ll let you play up the next season after that, now run along…” and offers to the top three teams in the Second Division the chance to make fools of themselves at a higher level, while feverishly raking in the gate receipts for having played better teams in the antiquated grounds inhabited by most Second Division teams, there isn’t much the teams can do. After all, it’s the Football Association’s competition, and it doesn’t belong to the clubs. But if MLB attempted to tell the Tigers, “Um, Mr. Ilitch, your team is pathetic, why don’t you try the International Association for a year while we let the Columbus Clippers have a go at being a major league team,” the whole thing wouldn’t work, because the Tigers have invested in the League, and to move them “down” would involve paying off that investment, obtaining an investment from the Clippers, etc. For good or bad, MLB is stuck with the Tigers.
I might note that American “football” (meaning soccer, not gridiron football) went one step further. Major League Soccer does not have “franchises” in the typical sense of that word in American sports. Instead, the owners invest in the league itself, for which investment they are awarded the right to control the destiny of one or more teams which the league creates. Lamar Hunt doesn’t own the Kansas City Wizards; he is an owner of MLS, and gets to operate the Wizards. This explains why the league has failed for four years to allow in the eminently successful Rochester Raging Rhinos, who have been perennially successful at the next lower level (the “A-League”), and who consistently draw as many or more fans than many of the MLS clubs, to join MLS. Technically speaking, the Rhinos can’t join the league; at best the owners of the Rhinos could pool their money, buy into MLS, and receive for their investment the right to control a team called the Rhinos, based in Rochester.
What is the point to relegation? It accomplishes two things. First of all, it allows the organizers of a national competition a way to make sure that clubs that do a poor job of investing in competent play get removed from the flight they are in, to be replaced by teams who have proven they can excel at the next lower level. Sometimes, indeed often, the promotion of a team to a higher level lasts only a year, and the relegated team is right back up. But sometimes a club’s dynamics change, perhaps because of a new majority owner who invests in the needed players, perhaps because a new ground allows a larger gate, allowing more investment in quality players, or perhaps because a team’s manager accomplishes more with his team than anyone else has. Excellence is allowed to rise, ineptitude is forced to its own level in a reverse Peter Principle.
Second, it provides drama near the end of the season, as teams attmepting to avoid relegation battle it out. Some of the best late season games in any football league involve the last four or five teams, as they try desperately to stay just beyond the range of demotion. Indeed, there is usually much more interest in that battle than there is at the top of the table; most championships are decided well before the end of the season, because there is no playoff system, and the top dog at the end is the winner. Of course, at lower levels, there is interest at both ends of the table, as both promotion and relegation are possible.
It should be noted that the structure of football internationally may soon change. Already, in many countries, the top teams have begun to modify the structure of competition, in order to maximize their marketing potential. In England, the top flight of football is called the Premier League, and is not run directly by the Football Association, although it retains most of the same rules, including relegation to, and promotion from, the misleadingly named First Division. A more close parallel to American leagues was almost created by Europe’s top teams, who threatened to form a Europe-wide league of top teams competing without the sanction of the UEFA, which runs competitions among the previous year’s winners of each country’s champions and top finishers. UEFA were forced to modify their competition in such a way that certain teams (e.g. Manchester United, Barcelona FC, etc.) were granted almost a permanent status in the “Champion’s League.” It likely won’t be too much longer before the teams finally break away from the model of competing in someone else’s playground, and create an American type of league.