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Baseball Is Broken. Can Anything Short of a Strike Fix It?

Manny Machado and Bryce Harper remain unsigned. One of the sport’s best catchers had to settle for a one-year deal. Kyler Murray might play another sport if he can’t get paid. Only the players can fix this, but to do so, they’ll have to risk a work stoppage they’re not currently prepared to win.

Getty Images/Ringer illustration

Last week, the top catcher on the free-agent market, Yasmani Grandal, signed with the Brewers for just one year and $18.25 million, barely eclipsing the qualifying offer he rejected from the Dodgers in November. Just four seasons ago, free-agent catcher Russell Martin signed a five-year, $82 million deal with Toronto, even though he was two years older then as Grandal is now, and not as good.

Grandal’s game is polarizing: He is an elite hitter and pitch framer for his position who sometimes struggles to work well with pitchers and—to his immense embarrassment in the 2018 playoffs—block pitches in the dirt. But in total, he’s one of the best players—perhaps the best—at a position where it’s very hard to find big league talent, and yet the highest bidder for his services wound up being a small-market club that offered him only a one-year contract.

After a glacially slow free-agent season in the winter of 2017-18, a troubling number of clubs have decided to place economic considerations ahead of fielding a competitive team. The tepid interest in Grandal is merely the latest data point in what can now be described only as a trend: In 2018, the average major league salary went down, and, as of January 14, 2019, Andrew McCutchen’s three-year, $50 million deal with the Phillies is both the richest and joint-longest contract given to a free-agent position player this offseason. The doldrums of last offseason, it turns out, weren’t an aberration. Free agents are signing later, and for less.

This trend ought to trouble both players, whose salaries are declining, and fans, who are increasingly reluctant to come out to the ballpark, either because tickets are too expensive or the local ball club isn’t competitive or both. But with league revenues at a record high, neither owners nor the league office that serves their interests have any incentive to change course.

The players are the only stakeholder capable of challenging ownership’s single-minded pursuit of profit, and reversing the damage that pursuit has done. But to do so, they’ll have to risk baseball’s first work stoppage in a generation when the CBA runs out in 2021, forcing a confrontation the Major League Baseball Players Association currently lacks the power, leverage, and resolve to win decisively.

On December 11, 2000, Alex Rodriguez made history by signing a 10-year, $252 million contract with the Texas Rangers. Rodriguez was a uniquely valuable free agent, just 25 years old and coming off a 10-win season at an up-the-middle position. Rodriguez looked like he could become one of the best players of his generation, and that’s exactly what happened. The total value of his contract, famously, was more than what Rangers owner Tom Hicks had shelled out to purchase the team 30 months before.

Manny Machado hits a home run for the Los Angeles Dodgers
Manny Machado
Photo by Dylan Buell/Getty Images

Eighteen years and one month later, Rodriguez’s contract remains the third richest in baseball history, behind Giancarlo Stanton’s 13-year, $325 million mega-extension before the 2015 season and Rodriguez’s own 10-year, $275 million renegotiated extension before the 2008 season. This reluctance to spend top dollar on top talent comes despite exploding revenues. Leaguewide attendance was at a 15-year low in 2018, but even so, more than 69 million fans came through the turnstiles. Fold in fees from TV, streaming rights, and other corporate partnerships, and the money adds up quickly; as a conglomerate, MLB took in $10.3 billion last year, more than four times what the league made 20 years ago. This offseason, Bryce Harper and Manny Machado, two MVP-caliber 26-year-olds, hit the market with 10 All-Star appearances and 61 career bWAR between them. Through mid-January, neither has signed, and reports indicate that only a handful of teams are interested in them, even though there isn’t a team in baseball that wouldn’t get better by signing at least one of the pair.

And it’s not just at the top that player salaries are being rolled back and free agents are being disregarded. MLB has set new highs for league revenue in each of the past 16 seasons, but despite that, clubs spent less on payroll in 2018 than they did in 2017—not just as a proportion of total income, but in absolute terms. For years, it was generally accepted that it was undesirable for a team to let arbitration-eligible players actually go to a hearing over salary, since a hearing would force the team to bad-mouth a player; the morale costs outweighed the potential financial gain from holding a hard line. Last year, more arbitration cases went to a hearing than in any year since 1990. This season, all 30 teams are reportedly taking a so-called “file-and-trial” approach to arbitration, which means that any arbitration case that doesn’t get settled by the filing deadline will go to a hearing, and implies a greater willingness to hold a hard line in general.

In the past few years, it’s become standard procedure for clubs to manipulate the service time process, holding players down in the minors for longer than is developmentally necessary in order to push back the age at which they can reach free agency. Even amateur players are feeling the squeeze. In the past, big league clubs could pay draftees or amateur free agents whatever they wanted: In 2012, the Dodgers gave Cuban defector Yasiel Puig a seven-year, $42 million deal before he’d played a game in the U.S., and in 2009, the Nationals gave Stephen Strasburg a four-year major league contract worth $15.1 million when they drafted him no. 1 overall. That’s changed. In the last CBA, negotiated in 2016, the league instituted a hard cap on spending on amateur free agents: Next year, the teams with the largest bonus pools will have a hair over $6 million to spend on all their international free agents under age 25 combined. In the CBA before that, they negotiated a de facto hard cap on bonuses given through the draft. In 2009, the Nationals gave Strasburg about $4 million more in guaranteed money than they gave their past two draft classes put together.

These restrictions on amateur spending are in the news right now as the Oakland Athletics are trying to persuade their first-round draft pick from last year, Oklahoma quarterback-outfielder Kyler Murray, to stick with baseball instead of fleeing for the NFL. The league has already granted Oakland clearance to extend Murray a major league contract and put him on the 40-man roster—an opportunity that, by league rule, can’t be extended to prospects straight out of the draft—but the A’s might end up losing the Heisman Trophy winner to football because the league won’t let them outbid the NFL, and look foolish and thirsty in the process.

Since the dissolution of the reserve clause in 1975 and the concurrent birth of free agency, the economic structure of baseball has rested on a set of norms: Players would have little autonomy and be paid relatively little at the start of their careers, but more talented and experienced players would be rewarded for their performance later on. Even as the rights of minor leaguers and amateurs were eroded, veterans cashed in. Jayson Werth signed a $126 million contract after the 2010 season, and a year later Albert Pujols cashed in for $240 million. As recently as 2015, Zack Greinke signed a six-year, $206.5 million contract. Young players weren’t denied access to wealth; such access was merely deferred. For about 40 years, this system suited the players just fine; the MLBPA, being a labor union, valued the concerns of veterans over young players while negotiating the CBA.

At some point in the past decade, though, management stopped holding up its end of the bargain. Norms against service-time manipulation turned out to be unenforceable. And in the past couple of seasons, as analytics showed that players tend to decline as they hit free agency, teams have simply stopped paying older players too. Meanwhile, they used the fact young players are underpaid at the start of their careers as leverage to encourage players to sign below-market contracts through arbitration and into what would have been their first few years of free agency, pushing back the age at which stars like Mike Trout, Clayton Kershaw, Christian Yelich, and José Altuve hit the market, reducing their free-agent value even further.

T-Mobile Home Run Derby
MLB commissioner Rob Manfred
Photo by Patrick Smith/Getty Images

MLB commissioner Rob Manfred has been involved in the past four CBA negotiations in some capacity, and in each case has used the divisions within the player ranks—over age, service time, and status—to roll back salaries across the map: The MLBPA signed off on those caps on amateur spending without putting up much of a fight and declined to take a hard-line stance on service-time manipulation in order to preserve an economic order where older players get paid the most.

No single action by team or league management brought the system to the brink of collapse. Service-time manipulation isn’t legal, exactly, but there’s no way to force a team to promote a particular prospect at a particular time. So far the MLBPA hasn’t been able to successfully win a grievance. Capping bonuses for amateur players and lobbying to rewrite minimum wage laws for minor leaguers—in other words, nickel-and-diming the poorest, most vulnerable players in the sport—is immoral, but not against the rules of the sport or the laws of the nation.

The growth of quantitative analysis in baseball in the 21st century has shown that older free agents are a bad investment, at least on the aggregate. Giving out contracts like the ones Pujols, Greinke, and others received just a few years ago is now simply seen as bad business, an inefficient allocation of resources. Rebuilding teams, even big-market teams like the Astros and Phillies, have run rock-bottom payrolls during rebuilds at some point or another in the past decade, while economic powerhouses like the Dodgers and Yankees have cut payroll to get under the competitive balance tax in the past year.

World Series - Boston Red Sox v Los Angeles Dodgers - Game Three
Yasmani Grandal
Photo by Ezra Shaw/Getty Images

Teams sell fans on tanking and resetting the luxury tax with the promise that money saved in the short term will be reinvested in the long term. Or the slow offseason last year gets explained away as teams saving up for a stronger free-agent market this year, when clubs would trip over themselves to throw money at Harper and Machado. And yet they remained unsigned a month from spring training, as do superstar closer Craig Kimbrel, 2015 AL Cy Young winner Dallas Keuchel, and former Diamondbacks outfielder A.J. Pollock. Grandal and 2015 AL MVP Josh Donaldson settled for one-year deals, and only two free agents who have signed so far (Donaldson and Nationals left-hander Patrick Corbin) signed for more than $20 million a year.

In the 2015-16 offseason, eight free agents signed contracts worth at least $20 million a year, with two (Greinke and David Price) coming in at more than $30 million a year. In the past three offseasons put together, eight free agents have signed for $20 million a year or more, and none for more than $27.5 million.

Every step that has led to the average MLB salary going down has been sanctioned, either tacitly or explicitly, through the CBA, by the MLBPA. Manfred and the owners have either outflanked or outsmarted the union at every turn, and these dozens of small victories and exploitable loopholes have finally added up to a breaking point. The effects have been so drastic that it almost looks like a repeat of the collusion scandal, when MLB teams collectively decided not to sign free agents from 1985 to 1987, a choice that cost them $280 million in a settlement with the players in November 1990. The MLBPA brought forth another collusion case against the league regarding free-agent inactivity after the 2002 season. In 2006, Manfred, in his capacity as league executive vice president, settled the case as part of the next CBA.

So far there’s no smoking gun to indicate that owners are colluding again, but just because they got burned by collusion before doesn’t mean they wouldn’t try it again. Alternatively—and perhaps most frighteningly—it’s possible that there has been no collusion, but that the standard labor strategies of the 2010s are just as deleterious to workers as the intentional malfeasance of the 1980s.

Every conspicuously unsigned or underpaid free agent and every acrimonious and unnecessary arbitration case until the CBA runs out makes a work stoppage more likely. The idea of a strike is gaining traction among the players; a year ago, MLBPA executive director Tony Clark called the free-agent slowdown and growing number of uncompetitive teams “a fundamental breach of the trust between a team and its fans and threatens the very integrity of our game,” while Dodgers closer Kenley Jansen came out and proposed in so many words that the players might have to go on strike. In order to come away from a work stoppage with a win, the MLBPA needs to play its cards perfectly and start building the groundwork now.

In any confrontation between labor and management, labor starts at an inherent disadvantage. Management has more money, which allows it to wait out its opponent. If MLB shuts down for half a season, superstars like Stanton won’t have trouble paying their mortgages, but players with half a season’s worth of service time at the league minimum might. Moreover, the owners’ material advantage allows them to hire better lawyers, more lobbyists, better PR—in fact, Major League Baseball has its own news agency, MLB Network, and employs dozens of journalists at MLB.com. The Players’ Tribune and social media are useful tools for the players, but they’re no substitute for a league-owned news organization.

That’s a substantial obstacle for the players, particularly in a U.S. political culture so hostile to labor that Amazon can not only survive stories of warehouse workers on food stamps or peeing in bottles because they can’t make it to the bathroom on their breaks, but have cities trip over themselves to give the company billions of dollars in subsidies to build new headquarters. When a worker is making $1 million a year playing baseball, and not $8 an hour unloading boxes, the public gets even less sympathetic.

On Saturday, on the heels of the arbitration filing deadline and the Grandal contract, Phillies pitcher Jake Arrieta cautioned young players not to count on the riches they were promised down the line. That Arrieta is fed up with the sports economics is instructive—he made $30 million last year, and from a political perspective, isn’t exactly Eugene Debs. But if you want to know how sympathetic the average baseball fan is to the players’ plight, go check the responses to Arrieta’s tweet. You’ll find the odd fan frustrated that their team isn’t spending in free agency, but most of what people wrote back to Arrieta was some variation on “You get paid millions to play a kids’ game.”

It might not be possible to sway every fan, or even a majority of fans. But to have a chance, for the next three years, players, agents, and union leadership need to build the case that players and fans are in this together. Fans are fiercely loyal to their local team, and ownership exploits that loyalty for profit—the players and their representatives have to expose that artifice.

Washington Nationals v Philadelphia Phillies
Bryce Harper
Photo by Mitchell Leff/Getty Images

The past two offseasons offer an opportunity to make that case clear: The Dodgers cut $68.1 million in payroll from 2017 to 2018 in order to get under the luxury tax, with the stated intention of spending again once the repeater penalty reset. Well, the penalty has reset, and not only have they not signed Harper, or Keuchel, or Kimbrel, they’ve sent Puig, a fan favorite, to Cincinnati in a salary dump. How do you make that case to fans? The 2018 Yankees ran a $180 million payroll, down almost $30 million from the year before and down about $40 million from their spending level in 2015 and 2016. Now they’re willing to sign Machado only if he takes a discount, while the Red Sox, who ran the highest payroll in baseball last year, won 108 games and the World Series. George Steinbrenner is rolling in his grave.

Yet it’s rare that players criticize management on the record for not building a competitive team. One of the few recent examples of a player doing so was Keuchel, who expressed his frustration that the Astros didn’t make a move in July 2017; a month later, they went out and traded for Justin Verlander, and two months after that, they won the World Series. After this offseason, with Grandal taking a cut-rate deal and the Yankees and Dodgers setting self-imposed financial limits rather than pursuing superstar additions after years of playoff frustration, that message should be on every player’s lips: “I get that the fans are frustrated, but the team would be better if ownership had seen fit to pay Harper or Machado or Kimbrel what he’s worth to improve the team. Ownership isn’t sufficiently committed to winning.”

It’s ludicrous that the Yankees and Dodgers are crying poor in the face of record revenues. Actually, it’s worse than that—they’re just choosing not to spend without even bothering to put up the artifice of crying poor first.

Players should also spin the disparity between revenue and salary growth into a consumer issue: Revenue has grown while player wages have stayed stagnant and ticket prices have gone up. The league is making billions in TV and streaming revenue, but an average working-class family can’t afford season tickets anymore, and that money isn’t going to the players who fans love; it’s going right back into the wallets of anonymous billionaires.

But it’s not enough for players to win over the fans—they have to present a united front within the union as well. Whether deliberately or through extremely fortuitous coincidence, MLB teams have put financial solidarity above the desire to compete. But players are routinely encouraged to go above and beyond the strict call of duty in order to gain an edge over their competitors. Being the self-motivated, hypercompetitive folks that they are, athletes usually oblige, by accepting team-friendly contracts, putting in extra hours training, or agreeing to wear biometric monitors and trading privacy for a perceived competitive edge.

On New Year’s Eve, ESPN’s Buster Olney published extracts from a memo that player agent Jeff Berry had been circulating in MLBPA circles since the summer. In it, Berry outlined many of the ills that have befallen the contemporary MLBPA: service-time manipulation, abuse of the disabled list, and so on. Berry proposes remedies for some of these ills; it’s anyone’s guess whether a unified MLBPA approach to arbitration, for instance, would be effective, but it’s good that someone is giving the issue serious thought. The most interesting proposals came at the very end of Olney’s article, and in a section of the memo titled “Miscellaneous Membership Considerations.” Berry proposed that players could refuse to report early to spring training, and boycott all league-owned media outlets, offseason fan fests, and the winter meetings.

Los Angeles Angels of Anaheim v Oakland Athletics
Kyler Murray
Photo by Thearon W. Henderson/Getty Images

In labor relations parlance, these are known as “work-to-rule” actions, in which workers don’t go on strike, but instead do the bare minimum required of them by their contract in an attempt to decrease productivity and put pressure on management. And in this case, a work-to-rule effort would be appropriate, given that the league precipitated this situation by doing the bare minimum required under the CBA. Here Murray might offer further inspiration. Rather than playing by the norms of the MLB draft, he used the leverage his football career afforded him to win concession after concession: first the right to go back to Oklahoma for one more year, now the major league contract offer. All because he had the wherewithal to ask, and the leverage to make it dangerous for MLB to say no.

But to pull off a work-to-rule protest, much less a strike, the union would need solidarity within its membership. Not only because a unified labor force is the only entity that can extract concessions from ownership, but because any kind of boycott of the league’s training and PR machine would require the players to set up their own system to replace it, and building that infrastructure would require time and money. After all, it’s hard to win over the fans by skipping fan fest; the players would need to come up with an equivalent event of their own.

The MLBPA has three years to prepare for a confrontation in which they not only aim to stop the league’s string of victories in CBA negotiations, but to roll back some of the previous losses. That’s a tall order for a sports union—the NHLPA, for instance, has been locked out four times in the past 27 years and made substantial concessions each time. And the NHLPA’s current executive director, Donald Fehr, was the last MLBPA boss to stand up effectively to ownership. The risks of entering the next confrontation unprepared are immense, and given Clark’s performance thus far, something has to change this time around.

But maybe this offseason will be a tipping point, when enough players get fed up with ownership twisting the system that they decide to do something about it, and enough fans tire of watching ambitionless 78-win profit geysers that it sways public opinion. Ownership has been preparing for baseball’s next labor war for years, and the first salvos have already been fired. Now it’s up to the MLBPA to respond.