The lack of agreement between the owners and players in baseball feels like it is at an all-time high. The most recent proposal from the owners would allow a 75 game season in which the players are guaranteed to earn a 50% prorated portion of their salaries that has the potential to go up to 75% should the postseason conclude without any off the field problems.
The feeling is the players are still unsatisfied with the owner’s offer but at least there is still some back and forth between the two groups. There have been rumblings, although very shallow, of a potential player’s strike in the near future. Most of these rumors were based on the escalation of player salaries as well as the dispute over service time for players still on their entry level contracts. However, recent events surrounding the COVID-19 pandemic have fostered much more angst between the owners and the players leading some observers to conclude that another player’s strike is all but inevitable.
A history of disputes
The last player’s strike was in 1994 but the seeds of that event went back decades earlier. There were lockouts in ’72, ’73, ’76, ’80, ’81, ’85, and ’90 before the last major work stoppage. Only two of those lockouts (’76 and ’81) resulted in missed games. The biggest concern on the owner’s behalf was the need to control rising player salaries. By 1984, about 75% of players testing free agency would end up resigning with their teams via one-year contracts and that year marked the first time that the average MLB salary declined since the advent of free agency in baseball (1976). While it was found that the owners were colluding in the mid-’80s, their efforts to control salaries would continue as they pushed the idea of salary caps, pay-for-performance incentives, and various revenue sharing proposals. All of this was just added pressure to the powder keg that was the relationship between the players and the owner’s in 1994.
The 1994 work stoppage
In 1992 the owners voted to have then MLBPA executive director Donald Fehr resign. The person who lead this course of action was Bud Selig who, around the same time, became the acting commissioner of MLB. This did not go over well with the players and the player’s association. The 1994 season began with a cloud of combativeness above league’s head.
On August 12 that year the players officially went on strike and on September 14, 1994, the season was officially canceled. 950 total regular season games were canceled, as were the playoffs and the World Series for the first time since 1904. It cost owners nearly $600 million in revenue and players about $230 million in salary.
There was still tension (and no agreement) when spring training started in 1995. The owners threatened to use replacement players while the MLBPA held firm in their own stance. The players filed an injunction based on unfair labor practices which was upheld by Sonya Sotomayor, the future Supreme Court justice. This allowed the players the return to their default, pre-strike position until they could reach an agreement with the owners. Despite the 1995 season returning to normal, the players and owners did not reach a new labor agreement until the conclusion of the following season in November 1996.
The Bronx Pinstripes Show put out a great overview of the historic rivalry between the owners and the players today.
What does this mean for the future of baseball today? The owners and players continued fighting over money shows tensions are at their highest point in the last 25 years. The current agreement is set to end on December 1, 2021. There are a number of issues the owners and players are going to need to get together on before that date if they want to continue what will be a 27-year streak of labor peace.
The biggest issue is and will always be money. Since 2003, the owners have seen the average player salary nearly double, going from $2.37 million to $4.45 million at its peak in 2017. Interestingly, the 2019 season marked the second straight year that the average salary actually dropped. It’s only a slight drop but it comes after 13 straight seasons of salary escalation (2005-17).
Looking at 1994, the highest paid player in each league was Bobby Bonilla ($6.3 million) in the National League and Joe Carter ($5.5 million) in the American League. For reference, the top-10 highest player salaries in 2020 range from $31 million (Clayton Kershaw) to $37.7 million (Mike Trout). That works out to a 598% increase between the top earner in 1994 and the top earner in 2020.
Was this growth in salary matched with a growth in franchise value? Yes, and more. The average franchise value in 1994 was $111 million. Today, the average franchise value is $1.87 billion. That’s a 1600% increase in value! There are obviously other factors at play when it comes to managing the revenue of a franchise with regard to player salaries. After all, no one is forcing the owners to sign a player to record contract each year. But there is an argument to be made that the players, as a whole, are underpaid.
Another point of contention is service time. As of now, a player is under team control for six years (seven if they are held down to start their rookie season). There have been a few recent examples of obvious service time manipulation such as Kris Bryant (2015), Gleyber Torres (2018) and Vladimir Guerrero Jr (2019).
For some players, it’s not as large of an impact at all. Using Torres as an example, he will have the chance to become a free agent at the age of 28. That’s right at the prime age for most players during their careers. For a player like Kris Bryant, who reached the majors at a slightly older age than Torres, he won’t be a free agent until after his age 30 season. The difference between an age 28 free agent and age 30 free agent in terms of salary and years on a potential deal can be humongous.
Here’s another example. Josh Donaldson and Anthony Rendon were two of the premiere players on the market this past offseason. Donaldson was coming off a great year but entering his age 34 season. Rendon, on the other hand, was coming off a career year and only entering his age 30 season. The main factor in their appearance in the same free agent class was that Donaldson became a mainstay in the majors at age 26 and Rendon at age 23. It’s not a perfect comparison because a team isn’t obligated to bring up a player at a certain age. However, part of the reason that Rendon was able to secure 7-year deal worth $245 million was because of his age. Donaldson was only able to secure a 4-year deal worth $92 million, which isn’t a cheap deal, but the point remains that his age limited his options for a bigger payday.
Shortening the season
The current problem that may cause the most strain in this relationship is the length of the season. This season might be an anomaly but it has brought to the forefront a conversation about whether the MLB season should remain at 162 games. There is support on both sides of the argument but this problem also brings in a third party, the fans.
Some people really like the idea of a shorter season because once you get into August, regular season baseball is not only a grind for the players, but for people to watch as well. Now there are some (including myself) that love the 162 game season and the fact that almost every day there is baseball for me to watch. I understand that the more games there are, the less important an individual game is to the team, but that’s not the point of baseball.
The goal of baseball today (and all sports) is to be entertaining. 162 might not be a selling point to the average fan who finds the long season to be a grind, but from my perspective it’s a part of the game that I don’t think I’m ready to give up. Having said that, if it means getting the owners and players back to some form of an agreement then I would be willing to listen to a potential plan of 120 to 140 games in a season.
I’m not the one who has the power to push back on that though. That would be the owners, and the financial bottom line for them is that less games mean less in-stadium revenue. Also keep in mind that if they were to move to a shorter season, everything from ticket prices to hot dogs would become more expensive. It is possible to get into a Yankees game for as little as $15, assuming it’s a mid-week game vs the Orioles, Mariners, or similar subpar team. I’ve made a hobby out of buying random single ticket games throughout the summer and spending no more than $150 total. That will be much harder with higher ticket prices due to a shorter schedule. Another drawback to a more expensive “at the ball park experience” would be that less people can afford to go. If less people can go to the games, you will see a drop in enthusiasm for the sport. It’s really hard to get that enthusiasm back for the general fan once it’s gone. The angst among the fans that was caused by the 1994 strike wasn’t really resolved until the 1998 home run chase between Mark McGwire and Sammy Sosa. The good news is that it was the on-field product that drew the fans back in. The bad news is that I’m not sure if baseball has anything similar to that on-field product currently.
This battle is just getting started. The owners and player will continue to trade proposals and use the media to take public shots at one another. We will probably get some form of a mandated 2020 season and 2021 “normal” season, but as far as 2022 is concerned, we should gear up for the first work stoppage in 27 years.