Jeff PassanESPN
MAJOR LEAGUE BASEBALL is in a crisis of its own making, a self-inflicted wound borne of equal parts hubris, short-sightedness and stubbornness from a class of owners who run the teams and seemingly have designs on running the game into the ground. Barring a miracle eleventh-hour agreement Monday on a new labor deal that ends its lockout of the MLB Players Association, the league has said it will cancel Opening Day games. That baseball finds itself on the precipice of such an ugly denouement is no accident. It is a study in the consequences of bad behavior — of indignities big and small, of abiding by the letter of the law while ignoring its spirit and, worst of all, of alienating those who make the sport great.
The players are angry at the trajectory of the negotiations, which have inched along for almost a year with little demonstrable progress. More than that, they’re tired of the game they love saying, in ways both active and passive, it does not love them back.
Player pay has decreased for four consecutive years, even as industry revenues grew and franchise values soared and the would-be stewards of the game pleaded to anyone who would listen that owning a baseball team isn’t a particularly profitable venture. Players’ service time has been manipulated to keep them from free agency and salary arbitration. The luxury tax, instituted to discourage runaway spending, has morphed into a de facto salary cap, and too many teams are nowhere near it anyway, instead gutting their rosters and slashing their payrolls because the game’s rules incentivize losing. The commissioner has called the World Series trophy a “piece of metal,” and the league has awarded the team that did the best job curtailing arbitration salaries a replica championship belt.
Any of these is a problem. In aggregate, they served as a call to action for the players, who even now struggle to pull off the delicate balance of being aggrieved while trying to negotiate a larger piece of a $10 billion-plus pie. The MLBPA grew into the strongest union in the United States during the late 1960s and 1970s by marrying morality and money — by fighting for itself and for the betterment of the game simultaneously. Now, following a quarter-century of labor peace and the relative complacency that accompanied it, the players are energized and engaged beyond what even they expected.
“We’re just trying not to get screwed,” one player told ESPN.
Easy as it is to point to the average major league salary ($4.17 million last Opening Day) as a sign players aren’t on the wrong end of anything, it’s also facile. Finance in sports is a zero-sum game. What doesn’t go to the players goes to the league and teams, and owners control how their teams spend money. Since the 1994 player strike that canceled the World Series — and especially over the last two collective bargaining agreements — the league has through canny negotiating positioned itself to be the aggressor, a role with which it has grown comfortable and familiar.
On Dec. 2, when the league instituted what commissioner Rob Manfred, in a letter to fans, called a “defensive lockout,” MLB acted first — ostensibly in the name of proactivity. “We hope that the lockout will jump-start the negotiations,” Manfred wrote. The league then waited 43 days to present the union its next offer.
Now, the sides find themselves at another inflection point, one with the ability to do grave harm to the game — a “disastrous outcome,” Manfred said recently. Without a deal, the league says, games will be missed and player salaries lost. If players don’t get paid for 162 games, they say, they’ll refuse to agree to postseason expansion, one of MLB’s key targets in any new deal. Neither knows for certain if the other is bluffing.
Players do know that they don’t trust the league, and those misgivings only amplify concerns that already permeate their 1,200-man group. The next basic agreement will, for better or worse, govern the sport over the next half-decade, and players are well aware of the ways front offices, ever seeking the slightest advantage over their competitors, will plumb the document for opportunities to game the system in their favor.
Getting the right deal is the players’ only recourse, and their position is simple: The sport needs to evolve with its aspirations. Baseball remains a game with incredible upside, with a collection of players young and dynamic and eminently likable. There is ample room for improvement to the sport itself, which has grown too plodding for a wide swath of young, would-be fans who regard it as slow and boring. The players have prepared themselves to miss games, to forfeit more than $20 million a day in salaries. They believe a bad agreement — one that attempts to further neuter their power — could do even more damage.
It could be a faulty premise. Even if the players outfox the Lords of Baseball — as John Helyar called the owners in his indispensable book on the history of the game’s labor strife, “Lords of the Realm” — the inherent nature of the owner-worker dynamic may be too strong to reverse. But over the last few months, as they’ve grown more emboldened, they’ve found a voice that the MLBPA had lost. The players steeled themselves to stand behind a cause that rang true across the rank-and-file: doing what’s right for the game they’ve spent their lives loving and living.
ON DAY 89 of the lockout, with MLB willing to immolate the game to achieve its goals, it’s important to understand how far apart the sides are – and why the narrative that the players aren’t giving up anything substantive in negotiations is false.
The players walked into bargaining asking for the moon but possessing a weak hand, not exactly the sort of combination that affects change. They outlined four key areas they wanted the new agreement to address — getting players paid more earlier in their careers, fixing service-time manipulation, preventing teams from tanking and removing restraints on free agency — and attacked them with an extensive set of proposals. Some, like reducing the six-year reserve period for some players to reach free agency, were dead on arrival. Others, such as offering arbitration to all players after their second full season instead of the standard third, were unlikely to gain traction. More still: an anti-tanking plan that would institute a draft lottery to penalize teams for habitual losing and a pre-arbitration bonus pool to enrich the best young players made too much sense for the league to ignore.
What players had to give in exchange for their asks was simple, and the sort of thing that tends to carry the day in labor negotiations: money.
In the week leading up to the lockout, the players offered two chips with significant value. The first was expanded playoffs. Players have stayed firm at moving from 10 teams to 12 but balked at the league’s preferred format of 14 teams. Agreeing to it would provide MLB with a guaranteed $100 million from ESPN, which secured the broadcast rights for an expanded wild-card round. The second income stream would come from on-uniform advertising. Between uniform patches and helmet decals, teams would be expected to generate at least $150 million, according to sources. In all, the union can guarantee the league well over a quarter-billion dollars a year in new revenue — on the presumption that half of it will return to the players.
Certainly the league has taken steps toward some of the union’s more right-minded goals. MLB acceded to a lottery. It moved on service-time manipulation. From a financial perspective, however, players continue to wait for the league to match their outlay. The size of the disparity is unclear. The league offered to bump its minimum salary offer Sunday, sources said, something that will be worth tens of millions to players. The league’s bonus pool offer, last reported at $20 million, is another priority for the union. Draft bonus pools are expected to grow. Other changes offered by the league, such as implementing the designated hitter in the National League and scrapping a draft-pick penalty for signing free agents, have some value. The more guaranteed money goes to players, the likelier a deal becomes.
None of this is new, of course. Players organized in the 1960s to combat a cadre of owners who had hoarded profits for decades. What has changed is the size of the pot. A $1.3 billion-a-year industry after the strike octupled in size. That has done little to change the rhetoric among some ownership hawks whose desire for a salary cap is the desired endgame. Unlike the NFL, NBA and NHL, baseball’s uncapped system does not have a salary floor, allowing teams to spend as little as they want. The Pittsburgh Pirates’ final payroll in 2021 was $50.3 million, their lowest since 2010 and less than one-fifth of the Los Angeles Dodgers’. That disparity, baseball long has contended, could be ruinous for the sport. In his letter, Manfred wrote: “(T)he Players Association’s vision for Major League Baseball would threaten the ability for most teams to be competitive.”
It was classic MLB, the sort of fear-mongering the league long ago perfected. And though it’s undeniable that money does buy a team the ability to weather mistakes more easily, the notion that baseball needs a fixed system to solve a theoretical competitive-balance problem that the capped leagues avoid doesn’t stand up to something far more reliable than the desires of owners: history.
IN 2001, MLB commissioner Bud Selig went in front of Congress and spoke of baseball’s great financial woes. The sport had lost more than $500 million the year before, he told representatives who openly doubted the veracity of his numbers. Without a salary cap, Selig continued, not only might baseball need to contract two teams, it would never achieve competitive balance. That phrase has become baseball’s tried-and-true alarm bell, red meat for low-revenue markets. Selig didn’t get his salary cap, but a year later the league negotiated the framework of the competitive balance tax that exists to this day.
Since the CBT’s arrival in 2003, 13 MLB franchises have won the World Series and 19 have played in it. That is the exact same number of teams as in the salary-capped NFL, far better than the nine champions and 14 competitors in the salary-capped NBA and right there with the 11 Stanley Cup winners and 21 finalists in the salary-capped NHL. In the championship seasons prior to the CBT era, 14 organizations won the World Series and 20 made it. The CBT was about competitive balance like “Citizen Kane” was about a sled.
Over that time, the CBT has risen, and the game has not collapsed. Baseball is too random for that, ever subject to the vagaries of chance. Always then, always now, always forever going forward, any restraint on spending will be about restraining spending. MLB sold the CBT as a way to rein in so-called runaway spending by the New York Yankees. Over time, though, the real intent — a salary cap in sheep’s clothing — revealed itself. The tax rates grew. Draft-pick penalties joined the fray. Of all the brilliant negotiating Manfred did during his time as the league’s lead labor lawyer, his work on turning the CBT from carrot to stick stands out. In September 2017, he said the quiet part out loud in an interview with a San Diego TV station.
“We have tried to deal with payroll disparity by limiting, through the use of taxes, the very highest-payroll clubs,” Manfred said, adding: “For the first time in the 25 years since I’ve been in baseball, everybody in the top quartile of clubs had payrolls that actually went down this year due to the increased penalties that were negotiated as part of this collective-bargaining agreement.”
Nothing illustrates the evolution of the CBT quite as well as the 2021 season. Only the Los Angeles Dodgers and San Diego Padres exceeded the $210 million threshold. Five other teams, however, came within $3.4 million of it. MLB had orchestrated the coup of financial coups in collective bargaining: getting what amounts to a salary cap without a floor or a guaranteed revenue split.
The players noticed. They saw how over the previous two collective-bargaining agreements, the CBT threshold rose about 18% while industry revenues grew by at least 40%. They saw that in 2018, long before COVID existed, their average salaries went down — as they did again in 2019 and 2020 and 2021, even as the biggest deals in the sport were growing and $300 million-plus guaranteed contracts were no longer outliers. They saw franchise values exploding to the point that in 2021, Forbes estimated, the 30 MLB teams were worth a combined $55.28 billion. Ten years ago, only two collective-bargaining agreements earlier, their combined valuations were $15.68 billion.
They also saw teams continuing to mimic Selig’s rhetoric that baseball is little more than a break-even business. Whether MLB claiming a lack of profitability while boasting such gaudy franchise values and generating 11-figure revenues is voodoo accounting, intentional obfuscation or some combination of the two matters not. What does matter is the players saw it, and it infuriated them.
It was all part of the same bigger-than-the-game game the league was playing. Runaway spending leads to limiting through taxes. The six-year reserve period, so sacrosanct, turned into seven years when teams realized they could wheedle an extra season out of a player if they sent him to Triple-A out of spring training. To earn a full year of service, players need to spend 172 days on the major league roster. In his first season, NL Rookie of the Year Kris Bryant was on the Cubs’ roster for 171. He filed a grievance. The arbitrator ruled in favor of the Cubs.
“It’s horrible,” one general manager said. “Six years should be six years. But what are we supposed to do? Not take advantage of them?”
For teams, service-time manipulation was seen as a feature, not a bug. And as it had with the CBT, the league codified some of its greatest advantages at the bargaining table. After decades of getting dismantled at the table, MLB has in the 20 years since recruited a deep roster of top-notch labor lawyers and economists and succeeded in changing the paradigm beyond its wildest dreams.
As the agreements continued to worsen for the players, little embarrassments started to add up. The Cubs and the Houston Astros won back-to-back World Series in 2016 and 2017 after intentionally bottoming out to get better draft position. Because of the amateur draft pool first implemented in 2012, tanking for draft position — intentionally fielding a bad team — became a strategy.
Arbitration has always been a contentious process, and players were livid when they learned MLB celebrated tamping down salaries by awarding a championship belt to the team that did it best. During spring training in 2020, when MLB was reeling from widespread criticism by players that Manfred had been too soft on the Houston Astros for cheating during their championship run, he referred to the World Series trophy as a “piece of metal” in an interview with ESPN’s Karl Ravech.
“‘Piece of metal’ was the Gulf of Tonkin,” one longtime baseball man said. “It was the aha moment for everyone. And then he did it again recently with everything about how owning a team isn’t that profitable. Treating players like they’re stupid has never worked. It’s never been a great approach.”
Baseball, it seems, can’t help from doing it, and it’s a symptom of those in ownership who regard players with disdain and struggle to stomach the notion that they warrant the salaries they receive. There are good owners, ones who prioritize winning above profits and understand baseball is wildly different from the businesses in which they made their billions.
Sports is a unique industry. Typically, workers make a product. In baseball, they are the product. The game of baseball is the framework, and in it exists two classes: players and owners. Players spend their entire lives chasing the major leagues. Just making it there is improbable. Staying long enough to make life-changing money is a miracle. Owners, on the other hand — at least those who don’t inherit their teams — join the baseball world just as they would a country club: by buying membership.
If you went and got the next 1,200 best players in the world, the product would suffer greatly. If you handed MLB teams over to any 30 competent businesspeople, the sport would not suffer. Actually, it might improve. It doesn’t take a billionaire to leverage a spot in a legalized monopoly with profound built-in revenues.
The Yankees are not the Yankees if Babe Ruth, Lou Gehrig, Mickey Mantle and Yogi Berra don’t win. Without the best players, they aren’t in the World Series, and without championships, they’re little more than an organization in a big market whose laundry features pinstripes. One would think, then, that a league would recognize that its profits exist because of Shohei Ohtani, Fernando Tatis Jr., Mike Trout, Juan Soto, Mookie Betts, Ronald Acuña Jr., Vladimir Guerrero Jr. and others — and would see players’ concerns about the state of the game not as trivial or excessive or outrageous, but vital.
It took until two days before the league’s deadline, but MLB finally accepted the union’s idea of awarding a full year of service to players even if they didn’t spend 172 days on a roster — in this case, the top two vote-getters in each league’s Rookie of the Year balloting. After Manfred’s lockout announcement, his contention that investing in stocks is more profitable than owning a team and the general unwillingness of the league to acknowledge that maybe this group of players really is as united as it contends, the move registered less as an important concession and more as an addendum to the part of these discussions that isn’t moving — and could take Opening Day with it.
ON FRIDAY AFTERNOON, Manfred and Tony Clark, the executive director of the MLBPA, met at Roger Dean Stadium, the spring complex of the St. Louis Cardinals and Miami Marlins where the sides have met all week. Over the four previous days, bargaining had gone nowhere, and in a side session Manfred had asked Clark for a comprehensive proposal that included a move on the CBT. The league had stayed at $214 million and the union at $245 million since the lockout, and the union was under the impression that even if it made a small move on the CBT, the league would reciprocate with something more.
The next day, the union proposed what it considered major moves. It removed from the proposal any changes to the revenue-sharing system. It dropped its ask on Super 2s — the 22% of players with the most service time in each 2+ class go to arbitration a year early — from 75% to 35%. And it made that small CBT move, peeling $2 million off its asks in two years of the proposal. Some player leaders disagreed with the strategy, but representatives from all 30 teams signed off on it during a call.
MLB sent the proposal to owners, and back came an offer two hours later from lead negotiator Dan Halem and Colorado Rockies owner Dick Monfort, head of MLB’s labor policy committee. The meaningful counter the union expected instead was a $1 million raise on the CBT for one year and the reduction of overage penalties to 45% for the first threshold, 62% for the second and 95% for the third — all significantly worse than the 20%-32%-62.5% for first-time offenders in the expired basic agreement. The nonmonetary penalties — including the loss of a first-round pick in the amateur draft and the theoretical international draft for exceeding the third threshold — were still there, cementing the fact that the CBT that MLB is offering now is worse than the one that just expired.
When apprised of the offer, players’ emotions varied. One said he was “furious — just incredibly pissed.” Another: “Deflated. We thought this was going to get things moving.” The league regarded the union’s offer as another in a long line of bad proposals — this one because MLB before the lockout already had told the union that revenue sharing and changes to Super 2 were nonstarters to ownership.
The league’s declaration of certain topics as off-limits never sat well with the players. This is, as MLB liked to say, a negotiation, and while revenue sharing could be seen as a third rail, expanding Super 2s — something that has been done multiple times in bargaining — belonged nowhere in that realm. Whether it’s real or the strategy is unclear, MLB’s line in the sand only fortified the players’ belief that they had engaged in a monthslong charade.
The coming days will show how real the league’s threat of a hard deadline actually is. Multiple agents believe MLB is handling this like it does an arbitration case: Wait, wait, wait, and then at the last minute, when it looks impossible, get it done. Sunday brought some progress with more CBT discussion, though not the sort that less than 24 hours before a deadline offers much hope. Unless the league makes an unprecedented and entirely unexpected move in which it deviates significantly from its position on almost every key issue at the last minute and the union responds in kind, baseball will find itself in the same place it did in the summer of 2020: trying to figure out when the season will begin.
The fear and uncertainty of COVID’s early days clouded those negotiations, and Manfred said at a news conference following the lockout that he would not equate the two. If they’re not the same, they’re at very least related. Because the frustration that accompanied the lack of a deal and eventual implementation of a 60-game season by Manfred in 2020 only has grown in the time since.
In the meantime, players will do what they’ve been doing for months: sending one another messages about the current state of affairs and, more often than the commissioner may realize, screenshots of Manfred’s golf scores at Winged Foot, as found on Reddit. Gallows humor is the only kind that plays these days, when players’ lives and livelihoods are interrupted for no good reason other than that the owners can.
Eventually, there will be a deal, and it’s likely that when there is, little will have changed about what one official called the game’s “mangled, Frankenstein economic system.” The existential elements of the game — pace of play, capturing young fans, gambling — will have gone untouched at a time when real dialogue could’ve put the game in a far better position.
If there’s any hope for 2027 not devolving into something even worse than this lockout, those sorts of conversations should happen regularly and include players young and old, league officials and a cross-section of owners. Pivoting with an eye on the future is best way to salvage the sport and the damage this lockout has done. Though it’s not over, and may not be anytime soon, there are lessons to be learned to prevent baseball labor relations from taking a time machine back to the 1970s, ’80s and ’90s.
Already this is the second-longest period of labor strife in baseball history, and though it has stopped transactions and doused the hot stove and generally cast the sport in an awful light, until today, the most tangible thing lost was spring training. Soon, that won’t be the case. This is Rob Manfred’s disaster, the league’s disaster, the owners’ disaster, and it’s been a long time coming.
