MLB negotiations reach a stalemate, risk more than just a season

Ken+Lund+%7C+Flickr

Ken Lund | Flickr

Isaiah Hinton

As spring turns to summer amidst the COVID-19 pandemic, the desire for sports to resume has grown exponentially from fans and players. Some leagues, such as the National Basketball Association, Women’s National Basketball Association and the National Hockey League, provided a showcase as to the power of communication and compromise between owners and players.

As spring turns to summer amidst the COVID-19 pandemic, the desire for sports to resume has grown exponentially from fans and players. Some leagues, such as the National Basketball Association, Women’s National Basketball Association and the National Hockey League, provided a showcase as to the power of communication and compromise between owners and players.

And then there is baseball; once considered a safe bet to be the earliest returnee to play.

The reputation of Major League Baseball has experienced an unprecedented downward spiral, comparable only to the negative press received during the strike-shortened 1994 season. The MLB could ill-afford for this to happen at a time like this, especially as the popularity of the league was decreasing regardless, at least according to attendance numbers and the exposure of its stars to a national audience.

There are many questions and few answers to the league’s inability to agree on a plan for the start of the 2020 regular season. Although there is no short supply of figureheads to blame, the crux of the issue seems to be money.

On one side of the negotiations, the owners argue that they cannot give the players what they want in terms of salary because they are already financially bludgeoned by COVID-19.

If the season were to resume, the economic reality for the organizations is that their revenues will be slashed significantly due to the lack of fans and their gate receipts. Compounded with the fact that running a baseball team is expensive, owners are not necessarily as financially secure as the casual fan and contract player is led to believe.

The Oakland Athletics are the quintessential example of a team that have already felt the effects of the pandemic on its finances.

Although the A’s are valued at $1.1 billion, they are one of the least valuable teams in the Majors and generate the second-smallest revenue in the league. This translates to an economic disadvantage that cripples their ability to function.

Possessing an operating income of only $10 million, the A’s find themselves unable to pay their lease in the Oakland Coliseum and were one of the first teams to suspend pay to their minor league players. Reactions to that decision ranged from angry to visceral.

Nevertheless, it highlights the greater truth of baseball business – it is not extremely profitable.

Even though the last thing fans and players want to hear is multi-millionaire owners crying poor during a time when unemployment numbers have skyrocketed, it is important to look at the numbers.

Every team in the Major Leagues is valued at over one billion dollars, apart from the Miami Marlins. However, their revenues represent only 10%-20%of that valuation.

From that chunk, operating expenses, interest and taxes must be paid. That revenue stream worth at least nine figures dwindles down to eight.

Although the big-market teams such as the New York Yankees, Los Angeles Dodgers and the Boston Red Sox are not profoundly affected by this, the small-market teams feel the brunt of this reality.

The A’s, Cincinnati Reds and the Kansas City Royals are just a few teams who suffer the most from a lack of finances. The Marlins, another small-market team, also operate at a loss.

“The industry isn’t very profitable, to be quite honest,” St. Louis Cardinals owner Bill DeWitt Jr. bluntly stated.

Because of this, the tact that the owners used was the portrayal of players as the villains in the negotiation process; demanding more money from their teams.

The owners even went public in order to stake their claims as the martyrs in the talks. However, as the talks stalled, it was the players who emerged from the flames as martyrs.

The main issue that players are fighting for is full prorated salaries.

Months prior, the Major League Baseball Players Association and the league itself agreed that the players would take a pay cut, corresponding to the amount of games played. This initial agreement came after players, such as Blake Snell of the Tampa Bay Rays, publicly expressed their desire to play, provided they get paid properly.

The tension between the owners and the players started to increase with the first economic proposal given by the owners, which included an additional player pay cut based on a sliding scale. While the owners saw this as benefitted low-wage athletes, it also punished high-earners and superstar talents.

The players countered this offer with a 114-game season and full prorated salaries, which the league swiftly denied. The league then proceeded to make a series of offers that were essentially the same, but with different packaging.

Whether it was a 76-game season with 75% of prorated salaries, a 50-game schedule with full salaries or a 72-game season with 80%prorated salaries, the message was clear– the players were getting played.

Players argue that they were promised full prorated salaries and the league is reneging on their promises. After being fed up with negotiations, the players gave the league an ultimatum of when and where. With this move, the players firmly established themselves as the heroes in the eyes of the public.

“This has always been about extracting additional pay cuts from players and this is just another bad faith tactic in their ongoing campaign,” said MLBPA President Tony Clark in a statement released earlier this month.

At the risk of sounding dramatic, these negotiations are more than just for the 2020 season—they are for the soul of baseball.

A cancellation of the season due to the inability of billionaires and millionaires to agree on how to restart will set the league back at least a decade in terms of popularity and goodwill. Even now, the good will that fans have towards the MLB is withering.

Distrust between the PA and the MLB is growing, and the reputation of Commissioner Rob Manfred is destructing, especially considering his public declaration and walk-back of 100% certainty in the start of the MLB season over the course of five days.

For the sake of fans, players and the owners, Major League Baseball needs to figure something out.