Free market theories don't completely apply to baseball, because, unlike a real world economic model, if their competition goes out of business, so do the Yankees. The Yankees need opponents to remain in business, and it's in their own best interest, as well as that of the other teams and the league in general, to not become so far above the rest of the league that other teams become non-viable due to lack of fan interest. That's where revenue-sharing comes in.
Even as recently as twenty years ago, I would agree with you whole-heartedly. Now, when the Yankees have virtually unlimited resources and can pluck All-Stars from other teams' rosters at will, I can't agree. The only thing that that can bring about the downfall of the Yankees now is ineptitude in the general manager's office, and that's not going to happen as long as Cashman's there.