I started playing organized baseball when I was five-years-old. As I grew up, I competed in a lot of other sports, but baseball was always my favorite.
As a kid, I watched as many Cubs games on WGN as my dad would allow, had my heart broken in 1969 when the Cubs fell short of going to the World Series (Damned Mets!), watched the greatest game in Cubs history (in my opinion) in 1984 in what became known as the Sandberg game, suffered through many years and many bad teams, celebrated the 2016 World Series along with millions of other long-suffering fans, and for the past several years, have been a loyal subscriber to MLB.TV, which allows me to stream hundreds of games a year with streaming quality that has yet to hit 1980 Soviet-era standards.
I love baseball. Sadly, baseball doesn’t love me (or any of their other fans). Earlier this week, it was announced that Major League Baseball and the MLB Players Association had failed to reach a deal on a collective bargaining agreement. As a result, Commissioner Rob Manfred postponed spring training indefinitely and cancelled the first two series of the season.
Watching all of this unfold has been like watching a disaster movie in slow motion. MLB owners, who are represented by Manfred, have been completely unrealistic in the way they have approached the negotiations. They locked out the players from MLB facilities last year, claiming the lockout would help spur negotiations, then proceeded to completely ignore the MLBPA for 43 days, never contacting them or making them an offer.
Ken Rosenthal, writing in The Athletic, didn’t pull any punches when describing the behavior of the owners:
“How dare they. That’s all I keep thinking. How dare commissioner Rob Manfred and the baseball owners treat their players and their fans like this. Don’t they recognize the impact of canceling games, the damage it will do to the sport, the idea that baseball is more than simply an industry, bigger than anyone lucky enough to be a part of it?
“Oh, Manfred and the owners will object to that very premise, tell you all about their love for the game and how the other side is more to blame. Manfred said it himself Tuesday, ‘If it was solely within my ability or the ability of the clubs to get an agreement, we’d have an agreement.’ Yep, if not for those damn players that fans pay to see — if only Manfred and Co. could remove them from these negotiations the way they scrubbed them from the league’s website — then everything would be all right.”
ESPN’s Jeff Passan also offered a tough-eyed observation:
“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…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 owners—who cry poor, even as they rake in more and more money from larger TV contracts, sports gambling proceeds, and soon-to-come uniform advertising patches—are doing their best to cut player salaries. They’re not going at it directly, though. They are using the Competitive Balance Tax (CBT) to limit their obligations.
The CBT operates basically as a salary cap. It limits how much teams can spend on player salaries (lest an onerous penalty kicks in), but it doesn’t include a salary floor, which would require teams to spend a minimum amount on player salaries. The result has been several teams each year that, at the beginning of the season, decide to severely limit player salaries, giving up on being competitive.
This lack of spending is called tanking, and, at least in theory, gives teams a chance to spend money on the draft and on building up the quality of their farm system. The Cubs and the Astros are two prime examples of teams that used temporary tanking to their advantage. On the other hand, the Pirates, and to a lesser extent, the Reds and the Marlins, are examples of teams that tank year after year, never loosening the purse strings enough to be competitive.
“Baseball’s luxury tax (CBT) — which, essentially, has become a salary cap as even the richest teams strain to stay below it — has grown by just 7.6% over the last five years, which is absurd even against simple inflation but particularly so when judged against the huge rise in baseball revenues,” Joe Posnanski writes. “Player salaries on the whole have actually gone down since 2017. The owners did not want to share any of their newfound riches (billionaires never do, I guess), and unsurprisingly they did not.”
Did you catch that line there near the end of Posnanski’s quote? “Player salaries on the whole have actually gone down since 2017.” That’s right. While team revenues were increasing, player salaries were decreasing. That might be hard to believe since the best players often make tens of millions of dollars each year. But there’s another side to that story.
As a general rule, players don’t have much to gain by complaining in public about the way they are treated by ownership. For example, Dodgers’ pitcher, Walker Buehler, recently tweeted this:
“PLEASE tell me how what we, the players, are asking for is crazy? Inflation happens. Markets rise. Money grows. Ask our owners. They know. Why would we agree to less than even inflation level income rises? Would you take that?”
As you might imagine, a lot of people responded negatively to Buehler’s tweet. I get it. The minimum MLB salary was $600,000/year in the last CBA, and many players are making much more than that. For a guy making $15/hour, it’s hard to understand why Buehler is complaining. Even so, he makes a good point.
The way the system in MLB is set up, players are at the mercy of the team to pay what they want for their first three years in the league (subject to league minimums). For the next three years, if players and their teams can’t reach an agreement on salary, they go to binding arbitration. It isn’t until after their sixth year in the league that players finally reach free agency, where they can negotiate their salary with other teams. It isn’t until free agency that players enter the free market and have an opportunity to make what the market says they are worth.
But there’s a problem. It used to be that players made less than they were worth in their early years, but then made more than they were worth in their later years. There was a kind of equilibrium. But teams didn’t like overpaying older players. Who could blame them? Discontinuing overpaying players late in their career would make sense if those same teams didn’t benefit from underpaying players in their early years. I mean, fair is fair. Owners didn’t care. The system allowed them to underpay younger players, but there was nothing that said they had to overpay older players, so they stopped.
So, when fans scream that players are spoiled and ungrateful, they have to remember that a lot of players never end up making their market value during their playing career. They receive less than they are worth in their early years, then in their declining years, when they are subject to the free market, they receive generally what they are worth, or less, never making up for the money they lost during their early years.
Let’s take Walker Buehler as an example. During Buehler’s first three years in the league, his performance was worth:
- 2018 — $25 million
- 2019 — $41 million
- 2020 — $43.7 million
These values are provided by FanGraphs, a baseball think tank that has calculated the value of a player’s performance.
Here’s what Buehler was actually paid:
- 2018 — $600,000
- 2019 — $600,000
- 2020 — $3.75 million
Is that fair? Would you work for such a tiny fraction of your value? I’ll bet not.
Let’s go a little deeper. Let’s look at the ten most valuable players of 2021 (based on FanGraphs values) and the ten highest paid players of 2021 to see how player salaries compare to their true value.
2021 Most Valuable Players*
- Corbin Burnes – Value: $59.8 million Actually Paid: $600,000
- Zach Wheeler – Value: $58.1 million Actually Paid: $22.5 million
- Trea Turner – Value: $54.9 million Actually Paid: $13 million
- Vladimir Guerrero Jr. – Value: $53.5 million Actually Paid: $605,000
- Bryce Harper – Value: $53.0 million Actually Paid: $26 million
- Marcus Semien – Value $53.0 million Actually Paid: $18 million
- Juan Soto — $53.0 million Actually Paid: $8.5 million
- Jose Ramirez — $50.4 million Actually Paid: $9 million
- Fernando Tatis Jr. — $49.1 million Actually Paid: $1 million
- Carlos Correa — $46.2 million Actually Paid: $11.7 million
Highest Paid Players*
- Trevor Bauer – Value: $14.0 Million Actually Paid: $40.0 million
- Mike Trout: — Value: $18.2 million Actually Paid: $37.1 million
- Gerrit Cole – Value: $42.1 million Actually Paid: $36 million
- Jacob deGrom – Value: $39 million Actually Paid: $36.0 million
- Nolan Arenado – Value: $32.1 million Actually Paid: $35.0 million
- Stephen Strasburg – Value: -$0.2 million Actually Paid: $35 million
- Max Scherzer – Value: $42.9 million Actually Paid: $34.5 million
- Manny Machado – Value $35.2 million Actually Paid: $34 million
- Justin Verlander – Value: $0.0 million (DNP) Actually Paid: $33 million
- Zack Grienke – Value: $10.3 million Actually Paid: $32.9 million
The numbers don’t lie. Of the ten best players in the league in 2021, every single one is underpaid. Even those that are making tens of millions of dollars per year are still making less than they are worth.
And what about the ten highest paid players? Some of them are making less than they are worth, but that’s not the case with all of them. In fact, there are five outliers in this group that made significantly more than they were worth. Zack Grienke is the most straight forward case. His performance just wasn’t worth what he was paid. But the other four are a bit different.
Trevor Bauer missed most of the season while MLB investigated sexual assault charges against him. Although he sat out during the investigation (which is still on-going), the team still paid him.
Mike Trout, Stephen Strasburg, and Justin Verlander’s cases are a bit different. All were injured for part (Trout), most (Strasburg), or all (Verlander) of the year. Missing games decreases a player’s value. But teams usually (but not always) insure against such injuries, recouping some or all of the money they paid to the player. For these three players, although they received their full salary, some or all of it was paid for by insurance, not by the team.
The point is, the system is skewed heavily toward the owners. It does happen where a player is paid more than they are worth, but those cases are somewhat rare. When it comes to signing players, most general managers are known to be conservative, erring on the side of caution rather than taking a big risk on a player. Much more often, players are paid about what they are worth or less. Sometimes, far less.
Sadly, the owners hold most of the cards. Players should be paid what they are worth, and the CBT should increase at least at the rate of inflation, but the owners don’t have to do anything they don’t want. They are in a much better position than the players to weather the storm of a long lockout. And the owners know that the longer the lockout drags on and the more the players resist their petty offers, the more public sentiment will turn on the players. MLB can hide behind Manfred, but as the faces of the game, there is no where for the players to hide.
This is all to say that I’m done with baseball. There are too many other things to spend my time on that are not so frustrating. I’ve already cancelled my MLB.TV subscription, and I’m done actively following the labor negotiations. When MLB and the players work thigs out—if they work things out—we’ll see what happens. I may fall back into my old fandom, but I doubt it. I’m tired of asking baseball to love me.
*Salary information provided by the great Joe Posnanski.
