Cooper: Here's Why MLB's Hot Stove Could Quickly Turn To A Deep Freeze
When the Major League Baseball Players Association president Marvin Miller was negotiating with MLB’s owners at the dawn of free agency in the mid-1970s, he always knew something that many rather myopic MLB owners of the time generally failed to grasp.
Miller wanted free agency for the players, but not all at once.
Oakland’s Charlie Finley was the lone owner who seemed to grasp the concept. He proposed that all MLB players should be granted free agency. That was Miller’s nightmare. Free agency would unleash salaries for players who had long been hamstrung by the perpetual reserve clause. But total free agency would flood and crush the market.
As the book “Lords of the Realm” explained, the MLBPA would have a hard time turning down complete free agency if it were offered, since they had just spent years in the courts trying to get players their freedom.
Because it was Finley (who was seen as a renegade by other MLB owners), the rest of the owners disregarded the idea and instead proposed free agency after 10 years. Miller’s nightmare was avoided. Eventually, the two sides agreed to free agency after six seasons in the majors. And salaries, as Miller expected, began to soar.
Miller’s nightmare is likely to come true—to some extent—this offseason. Free agents are going to flood the market like never before. The pandemic has sped up many of the trends that were already underway. The reasonably well-paid MLB veteran is becoming an endangered species. And with many teams trying to cut payroll, there will be few teams looking for bargains.
If you’re J.T. Realmuto, the lone star catcher on the market, you’ll still get paid. But if you’re a productive reliever, second baseman or outfielder who isn’t a star? Well, there are going to be 10 other, similar players also looking for a contract.
Many in baseball expect the list of non-tenders for players who would have been headed to arbitration to more than double last year’s already large numbers. Other players will likely agree to cut-rate deals to avoid being non-tendered.
The expectation is that the effects on free agents will trickle down through all levels of baseball. Veteran players who could expect to receive major league deals in a normal season will likely have to settle for minor league deals with invitations to spring training. Players who could expect minor league deals with a major league spring training invite might find themselves only receiving minor league deals.
And minor league free agents may find it hard to find any interested teams at all. With MiLB contraction about to cut dozens of teams in 2021, there will be fewer spots overall. Add the fact that no one knows what the 2021 MiLB season will look like—there is plenty of speculation within baseball that the minor league season may get off to a later start—and MiLB free agents are going to have the roughest winter of all.
The pandemic is also exposing the issues with the MLB-MLBPA relationship. Compared to other U.S. sports, baseball seems ill-equipped to handle a global pandemic.
All professional sports are facing difficulties because of the pandemic. Seasons have been shortened. Playing games without fans or in front of dramatically reduced capacities cuts significantly into revenues.
But the NBA, NFL and NHL all had systems in place that ensured that when the pandemic happened that players and owners began their negotiations with a mutual understanding of the economic effects.
Those sports’ collective bargaining agreements ensure that the league and the players split revenues somewhere around a 50-50 share. And those three leagues all have provisions by which the revenues are either compiled by an independent entity or audited by an independent firm that ensured that both sides agree that the revenue numbers are accurate.
Baseball does not have a set revenue split. The MLBPA has been adamant that it does not want a salary cap, which is the mechanism by which the other sports ensure a split of revenues. And baseball does not have a system under which owners allow the players to independently audit their books. Owners have consistently declined to do so, leaving the players understandably unwilling to take the owners at their word when it comes to revenue losses. In baseball, the two sides don’t even really agree about what constitutes baseball revenue.
So when other U.S. professional leagues begin to talk about adjusting their economic systems, they’ve already agreed on the size of the pie and how it’s going to be split. With those big issues out of the way, the sides can work on resolving the issues caused by loss of revenue.
The NFL and the NFLPA are working to spread the reduction in the league’s salary cap over multiple years to ensure that next year’s salary cap doesn’t drop precipitously. The NBA and NHL are expected to hold a significant amount of players 2021 salaries in escrow, which will then be distributed based on how much revenue the leagues actually earn.
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In baseball, owners and players don’t agree on how big the pie will be in 2021 and how it should be split. So both sides begin from a position of having to fight over the pie, not the mechanisms to smooth out the effects of the pandemic.
And the mechanisms baseball currently has will require significant tweaking to handle the effects of a shortened season.
The arbitration system is supposed to be a significant part of how players get paid for their production. But the arbitration system wasn’t set up to handle anything like a 60-game season. With just a month until teams have to decide whether to tender contracts to arbitration eligible players, no one knows how stats from the 2020 season will be handled.
Will the 2020 season’s stats be prorated to a 162-game equivalence? Will the previous full season of production take on a larger weight? How will players who opted out of 2020’s season be treated? There are a lot of difficult questions, few obvious answers and little time left to resolve them.
All of this likely only turns up the temperature on what was already going to be a very difficult negotiation for a new collective bargaining agreement after the 2021 season.
And that means next winter could be even tougher.