Yes, it’s about money.
But the feud between Major League Baseball and the Players Association over player compensation in an abbreviated season without fans cuts deeper than dollars. It’s about negotiating principles. Mostly it’s about the terms and language in a March 26 agreement, the mere existence of which has framed the players’ view of all subsequent proposals, including MLB’s latest offer on Monday, and set the stage for an increasingly likely mini-season of about 50 games.
It doesn’t make this mess any less detestable, especially because it’s happening amid a virus that has killed more than 110,000 people in the United States, an unemployment rate of nearly 14%, and nationwide unrest over police treatment of African Americans. Nor does it leave baseball in good standing with even its most loyal fans, many of whom are disgusted by a public back-and-forth that has the owners and players looking like rival cliques waging a rock fight from opposite ends of the schoolyard at recess.
But a look back at the details of that oft-mentioned March accord does paint a fuller picture of what the sides are actually fighting over and why a resolution has been so elusive at a time when baseball should be stepping up to help the country heal.
In its proposal Monday, first reported by ESPN and confirmed by multiple media outlets, MLB pitched a 76-game season that would keep the playoffs contained to October, with players getting 50% of their prorated pay and an opportunity to earn up to 75% if there is a postseason.
But like the infamous “sliding scale” plan proposed by MLB last month, in which the highest-paid players would receive the steepest salary cuts, the players are expected to reject this offer because it asks for a reopening of the March 26 agreement of prorated salaries based on the length of the season -- roughly 75% for 121 games, 50% for 81 games, and so on.
A deal is a deal, according to union leadership, which is adamant about not accepting additional salary concessions. That’s a precedent the players don’t want to set, especially with potentially contentious negotiations for a new collective bargaining agreement looming in 2021.
MLB points to language in the March agreement that stipulates the sides would “discuss in good faith the economic feasibility of playing games in the absence of spectators.” Commissioner Rob Manfred claims the lack of fans would decrease the teams’ annual revenues by an average of 40%, conditions that don’t permit owners to pay players in the way that was agreed upon in March.
In an internal memo last week informing full-time employees of pay cuts, Phillies managing partner John Middleton also used the 40% figure as the basis for his estimate that the team will lose “substantially more than $100 million” this year. The Associated Press reported that MLB claims it will lose $640,000 per game without fans in attendance.
“You don’t have to be a lawyer. It’s very explicit,” Smith College economics professor Andrew Zimablist said recently of the terms of the March 26 agreement. “There's nothing nuanced about it at all. And I do think it makes perfect sense from the standpoint of economics.”
In a 162-game season, player salaries would total roughly $4.37 billion, about 41% of MLB’s $10.5 billion in revenues last year, according to Forbes. Revenues will be substantially less this year, with MLB projecting $2.9 billion for half a season. At the prorated rate agreed to in March, the salary total would be reduced to $2.21 billion over an 82-game season, nearly 80% of MLB’s projected overall revenue.
Each of MLB’s proposals or ideas -- 82 games with sliding-scale secondary cuts, 76 games at 75% of prorated pay, and 50 games at 100% of prorated pay -- bring the salary total down to roughly $1.4 billion. Based on that math, the cost to owners between honoring the March agreement over an 82-game schedule and MLB’s subsequent proposals is roughly $800 million.
Considering baseball set a record last year for revenue, the players believe the owners can shoulder the financial hardship of games without fans and have requested a thorough audit to prove that they can’t, a nod to the mistrust between the sides that has built up over eight work stoppages since 1972. The players also have a finite window to make their money; many owners have sat back for years and watched their franchise values skyrocket.
“It’s not a dispute about money,” Eugene Freedman, special counsel to the president of the National Air Traffic Controllers Association and a contributor to Baseball Prospectus, tweeted last weekend. “It’s a dispute about enforcing a deal that’s already in place.”
The March 26 deal does empower MLB to propose a schedule “using best efforts to play as many games as possible while taking into account ... the economic feasibility of various alternatives.” MLB has therefore threatened to force a mini-season -- reportedly from 48 to 60 games -- on the players if the sides are unable to reach an agreement.
Players could argue that a 50-game schedule doesn’t reflect “best efforts” based on a definition of “economic feasibility” that clearly differs from MLB’s. But they don’t seem to have much recourse to contest the mini-season. The best they can do is block the owners’ request for an expanded postseason this year and next, an action they likely would take.
Fifty games would be better than none. But the rancorous tone of these negotiations has been such a turnoff that some fans are already gone. Baseball could have made a grand return on July 4. Instead, if it does come back for a severely shortened season, it will have to compete with the delayed NBA and NHL playoffs and NFL training camps.
In a recent Twitter poll, a sports-talk radio host in Boston asked, "Do you want Major League Baseball to come back and play in 2020?" Of the more than 13,500 respondents, 58.6% said no.
And Boston is one of baseball’s most rabid markets.
So, the players can stick to their negotiating principles while the owners can fret over what paying players their full prorated salaries for 82 games without fans rather than 48 or 50 or 54 would do to their bottom line.