clock menu more-arrow no yes mobile

Filed under:

There is no rational argument for a labor stoppage in baseball

All you have to worry about are people being irrational. And when has *that* happened?

MLB: Baseball Hall of Fame-Induction Ceremony
This is probably a picture of Rob Manfred singing an original song he wrote about the Hall of Fame. Probably.
Gregory J. Fisher-USA TODAY Sports

This will be an article that appeals to the rational side of Major League Baseball’s negotiations with the Major League Baseball Players Association. There will be no appeals to emotion, no fawning mentions of Curt Flood, and no references to Matewan or the young Will Oldham therein. The premise is that Major League Baseball will not end on Thursday. Both sides have too much to lose, not enough to gain with a work stoppage. It’s just a matter of seeing which side swerves first.

The first thing we need to know is that a lockout is possible. The Collective Bargaining Agreement expires on December 1, and both sides are negotiating to make more money. Or, at least, negotiating to recoup some of the monies that would be diverted to the other party. If, during these talks, either side feels like they would lose less money with a lockout or extended work stoppage, that would be the logical next step.

The second thing we need to know is that baseball is healthy, but that it’s easy to make too much of that health. MLB Advanced Media is a powerhouse, and local broadcasts of regular season games often dominate their respective markets. But actual attendance has plateaued recently.

Year Season attendance per team
1976 1,304,930
1986 1,827,162
1996 2,146,335
2006 2,534,797
2016 2,438,635

The average ticket prices are going up, so the larger point — baseball is healthy — is still valid. But the sport isn’t spiraling into the stratosphere on a staircase made out of world domination. That’s before you get into the aging demographics and the need to suck in younger fans.

The third thing we need to know is that the issue is artificially suppressed salaries and bonuses, and MLB and the MLBPA are arguing about exactly how much artificial suppression should be allowed. MLB would love to impose an international draft (suppressing the hell out of bonuses) and keep draft-pick compensation (which suppresses the contracts for the top dozen free agents or so every year, sometimes significantly), but it’s offering to ditch the draft-pick compensation in exchange for an international draft.

The negotiations are presumably a lot more complicated and varied than that, but those are the reported sticking points. Let’s check the scoreboard on who would win and lose with a straight swap of draft-pick compensation for an international draft.

The owners
The owners’ families
The owners’ business interests
The players who reach free agency at the top of their game
Free agents in general, if you assume some of the money saved on international players will be indirectly redistributed to veterans.

A bunch of dudes who aren’t even in the MLBPA yet, if they will be at all

You’ll notice that the winners are the people actually negotiating right now. The losers are intangible members of a future union. This is a problem for the latter group.

Instead of paying players like Yoan Moncada $31.5 million after he’s allowed to decide who will employ him, the owners would prefer to pay him something like the $9.9 million Bryce Harper received when it was decided the Nationals were the only team allowed to employ him. The extra $21.6 million would then be divvied up between the owners, the owners’ families, the owners’ business interests, and all current and future free agents.

This sounds like a pretty sweet deal for almost everyone involved. It is. Except for the international players who would miss out on millions and millions of dollars, so many millions, especially if they’re unable to navigate the gauntlet and make it to the major leagues. And especially if they’re unable to make it to free agency as a player other teams would fight over. We’re talking about the four percent of the international pool that gets to a six-year, post-arbitration payday.

Historically, the other 96 percent haven’t mattered much, which is why minor leaguers get paid shoe-store money until they make it to the majors. There’s no collective body arguing on their behalf yet. It’s possible, if not likely, that the players will ditch the future players again.

This year could be a little different, though. The MLBPA is less than enthused about bargaining away the rights of future members.

The international players who made it and are at the negotiating table right now They’re friends, former teammates, and relatives of the players who would get hosed under the new system. They know how financially devastating an international draft would be to most international prospects. It’s not just the players like Yasiel Sierra, who wouldn’t get three times as much as Bryce Harper and get to pick their organizations, but the lesser prospects, all the way down the ladder. Less leverage equals less money. That’s a truism of life, not baseball.

If you want a real-life example of just how much the lack of freedom can cost a player, consider the 1996 MLB Draft, in which two players, Travis Lee and Matt White, were borased into free agency because of a technicality, and they both ended up making five times as much as the no. 1 pick in the draft. The open market is a powerful thing, and the union knows it.

One possible argument in favor of the international draft would be that it’s unfair that the international players aren’t subject to the same rules as the high school and college amateurs from this country (and Canada/Puerto Rico). That’s true. However, that doesn’t mean the current system for domestic prospects isn’t trash. The MLBPA would burn it to the ground if they could, but they correctly assume that litter of demon kittens isn’t getting stuffed back in the cat. A second wrong isn’t going to make the first wrong any less wrong. There’s no choice but to fight against the international draft extra hard.

The fourth thing we should know is that a labor stoppage would be absolutely devastating. The sport is humming along, but don’t underestimate the people who would yell and scream about millionaires and billionaires and never come back. If that’s one percent of the baseball-loving demographic, that’s a huge chunk of potential revenue, even if most of them worm their way back after a couple years. People don’t like it when millionaires and billionaires argue about money.

There are two options. The owners might consider the international draft to be so important to their revenue that they’re willing to risk a stoppage. This is the new salary cap, then, and it would be implemented in a way that wouldn’t effect the current members of the MLBPA. So there’s a chance of it happening, at least.

In this scenario, the union would have to decide if the earnings of future members and non-members would justify a stoppage that would hurt the entire sport. You can understand the ethical argument, but as rational actors, it makes more sense for the players to look out for themselves, avoid the work stoppage, and collect the extra money for their highest-paid members.

Alternatively, the owners might not be willing to play this game of chicken, especially if they’re picking up hints that the MLBPA would risk a stoppage. December 1 would get here in this scenario, and the international draft would be tabled, with draft-pick compensation sticking around. It would be the status quo, and the particulars would still be really, really rich, in a sport that’s doing just fine.

The losers would be the players like Kendrys Morales and Jeremy Hellickson, who would have to settle for a substantial one-year salary or gamble that draft-pick compensation wouldn’t ruin their market. The MLBPA could shake off the status quo easier than an irreversible decision to suppress bonuses and salaries indefinitely, even if that money might not always make it back to the members of the union.

My guess is the status quo and a new CBA without any major changes. The international draft might be inevitable, but it doesn’t have to happen this year. There’s just no rational argument to set everything on fire just yet.

The only thing that should worry you, though, is that we’re not guaranteed rational. There were enough owners who thought the sport would die without a salary cap, and that led to a strike. The issue here is the same: Making sure there are rules to prevent owners from spending unlimited money because they’re incapable of doing so on their own.

It’s just on a different scale, in a league that isn’t quite as worried about its future. That should be enough to keep baseball going for now. But don’t take this relative labor peace for granted, and let this hiccup be a warning. Those certainly are storm clouds gathering. Keep an umbrella close for the next few years.

Edit: Looks like status quo has an early lead.