As MLB’s Deadline Approaches, Why Can’t They Just Come Together?

2-27-22 – By Gary Morgan – @garymo2007 on Twitter

Baseball is in trouble.

A simple statement that when made at the beginning of this process brought down a bucket full of screen captures showing the league’s overall revenue increases in recent years, and scoffing in general.

Here’s the thing though, it was true then, and it’s true now.

Denying it, would be like saying because America’s GDP increased the poverty line doesn’t exist. MLB isn’t an equitable system, and it will eventually catch up with them, in fact in many ways, we’re watching it happen.

Let’s address it today by addressing some of the comments I most often see and try to talk to each one.

Why Won’t The Small Market Clubs Just Band Together and Force Change?

Well, who’s to say they haven’t? I mean do you think the Yankees are unwilling to budge on revenue sharing? The secret is in the sacred cows the owners came to the table with and things they won’t budge on. Bottom line, it’s fair to say they’ve banded together to hold the line.

For instance, there isn’t a world where this game comes back without some version of the CBT (Competitive Balance Tax), and a strengthened version at that. Again, you don’t think the Dodgers are fighting for that do you?

Now, what you’re really asking here is why don’t they force a salary cap system right? Couple things here, one the owners went too hard in the paint on this in 1994 and it led to calls and ultimately a ruling that they were not negotiating in good faith. And second, it has to be pretty common knowledge that some of those small market owners (you all might know one) aren’t even spending close to the revenue sharing figure on payroll so it’d be hard to sit there and argue they’ve tried as hard as they could to make the current system work for them.

Now, I know and you know that if one team can spend 280 million on payroll and one can’t really get above 160, at least not consistently, if everything went perfectly, the result won’t be different very often, but being completely fair to both sides I think you could see why unifying on something as drastic as instituting a cap system is difficult. Even this is being too fair to the big spenders, if MLB were to lift restrictions, we’d easily have two teams, maybe three, spending upwards of 350-400 million within a decade. All while the lower tier potentially becomes even less capable of competing.

These Two Sides Are Killing Baseball Over A Few Million Dollars

Oh come on.

It’s far more than that and you do a disservice to any point you make after this statement by pretending it is. This is Millions of dollars we’re talking about. In fact on just one subject, the pre-arbitration bonus pool for young players these sides are approximately 95 Million apart. On a completely new concept that has never been part of any CBA (AKA new spending) the Players are at 115 million and the owners are at 20.

That’s one subject. Just one. The CBT, well depending on which year of the proposed deal you’re talking about they are between 31 and 51 million dollars apart, and that doesn’t even speak to the additional penalties and taxes MLB wants to bake in which would essentially make it a hard cap anyhow. A hard cap with no floor that forces accountability because if you had that you’d have to use a bad word one side can’t hear or say.

Keep in mind, I don’t even have to tell you who I think is right or wrong to show how wrong this way of thinking is. These problems are real.

If Everyone Saw This Coming, Why Didn’t They Fix It Before Now?

This one is really tough.

Let’s just say, kick the can down the road isn’t just a saying. Those of us, and I’m in no way lumping myself in with the journalists who cover these things, just saying folks who pay attention to this stuff even when it isn’t up for discussion of threatening baseball games, knew from the moment baseball failed to structure the economics entering the cable tv era of MLB way back in the early 90’s this moment would come.

The inequity in the game grew fast, in fact most of you who are close to my age probably remember asking yourself if the Yankees were ever going to not be at least in the ALCS for a minute there.

The league saw it too, because despite popular belief, most owners actually do want to, and care about winning. They addressed it, by fighting for and instituting the CBT. Now I’d argue it hasn’t worked as they intended. I think they believed it would act as a cap from the jump and instead for quite some time it was just ignored. Only recently have teams started reversing course and trying to stay under, after going through multiple cycles of paying the penalties for exceeding it. They’ve now felt the penalties and learned that even they (and by they I’m speaking to teams like Philly, Boston, Chicago, Texas, LAA) couldn’t keep up with those who could almost double the damn thing if they wanted to.

Essentially, as with just about any rule, someone finds a loophole or someone realizes it isn’t working for everyone. It’s not by accident MLB is looking to tighten the penalties and barely raise the CBT.

Meanwhile, the players have allowed rising salaries for the top 1% (we used to like the 99% didn’t we?) to dictate nearly every negotiation since fighting off a salary cap way back when with an assist from the Feds. We’re still seeing that this year, with one thing different, this time the players have a growing upswell of the young and talented players pushing to have their rights protected. Remember that can being punted forward from earlier? Yup, here it is, young players.

The very existence of Tampa Bay, Oakland, Minnesota, and the realization by mid-large market clubs that they could only compete to a point, led to a shift in how young ball players were brought to the game along with less willingness to pay for 33+ veteran players who were statistically proven to only provide marginally better performance.

It’s given them more of a voice than they’ve had in the past, and has become too loud even for Scott Boras’ crew to ignore. Plus, he’s starting to see some of those early on mega deals getting signed more frequently, threatening his ‘take ’em to free agency every time’ philosophy. For his own revenue stream he may need to shift some of his client base to that demographic or miss the gravy train. Better show ’em you care eh Scott? Wink Wink.

Those 33+ guys, well they just have to take less in what used to be their best years to cash in. The big spenders aren’t going to sign them for big dollars, at least not a ton of them. There’s only so many jobs out there after all and they have young players too.

Here’s a terrific way to put why this has blown up from Sportico.

MLB teams added well over $1 billion in total annual revenue between 2015 and 2019, salaries barely budged. The divergent growth trajectories of revenues and salaries have fueled animosity and sowed distrust between the league and union.

https://www.sportico.com/leagues/baseball/2021/mlb-lockout-baseball-player-salary-growth-1234648078/

Given everything I mentioned there, you see why getting young players paid is such a focus?

Again, I could prove a cap system fixes 90% of the problems these two sides have, but for now, that’s why it’s coming to a head right this moment. If that group of teams I mentioned, even taking into account the Mets have jumped back in with both feet on spending, had just continued spending, there’d have been more money for the small market teams to spend too due to the tax and thereby the ratio doesn’t get this whacky at least.

But here we are.

The Owners Could End This Lockout Anytime And Just Go to Spring Training

True statement. But loaded.

They could certainly end it and default to the last CBA but there are two reasons they won’t. One, the CBT that enough member teams deem worth dying over sunset, separately from the CBA so it would be a year of wild wild west. And everyone knows what happens when the horse is out of the barn. Secondly, they don’t trust that the players wouldn’t simply strike mid season and hold the playoffs hostage. On top of that, we’re already here, the fight isn’t going away if they simply pushed it to 2023. No GMs want to operate under the uncertainty all of this has brought to their doorstep. I mean think about it, we don’t even know if we’ll have a Rule 5 draft this year, I’d imagine that might have changed some moves already made, don’t you?

No way do I want to drag it out or worse fight all season long and distract from the game.

No, this isn’t a serious suggestion. They simply can’t just end the lock out. I mean the can, but they can’t, well you get what I’m saying right?

Can They Seriously Not Even Agree on the Number of Playoff Teams?

No, they really can’t.

This is really the only true chip, save their actual talents on the field, the players have. They know they have the owners by the short hairs on this one because MLB has already sold the television rights for 14 team playoffs.

There’s a reason MLB tied the players desire to have a draft lottery to this. They’re at 6 right now, I get the impression MLB would easily add to that number if the players will come up from 12 on playoff teams. In fact I’ll bet right now if this thing gets resolved, we’ll have 14 playoff teams and 6-8 lottery teams in the draft.

A Cap Isn’t Happening! Stop Talking About It.

In a word, No. I won’t stop talking about it. Anymore than I’ll stop saying the US Congress and Senate need to institute term limits while acknowledging they themselves would have to vote for them.

It would instantly fix almost everything that’s wrong with this game, and just because they aren’t going to do it doesn’t mean we should sit here and pretend they’re going to come up with some magic formula of convoluted money shuffling that makes it work.

So when a writer whines about how out of whack revenues and payrolls are, all I can really say is, man that’s tough, I sure wish there was a system out there that would tie payroll to revenue.

If you can look at the economic discrepancies in this league and with a straight face claim it’s not an issue for the health of the game, regardless of wanting a cap or not, I’m not sure how to move the conversation forward.

If that’s ok, yeah, I’m not going to convince you a cap is needed. I’d also add, by talking about a cap system, I’m not claiming it’s happening right now, I’m advocating for something I firmly believe could turn MLB back into a hotly contested fight for the pennant in places that hadn’t experienced it in more than spurts for decades.

It’s not about your hopes or dreams being shattered, it’s about knowing there is an alternative, a viable solution out there, and not seeing a sport I truly love even consider using it as a template to work from.

We’re going to lose games folks, and I don’t see much changing for the better if you fan a market like Pittsburgh. At least not from what’s proposed right now.

Stay Tuned…