With the almost-certain expiration of baseball’s CBA coming at 11:59 pm ET on Dec. 1 without a new deal between the MLB owners and the MLBPA and the work stoppage that is expected to follow — in the form of a lockout imposed by the owners — we’ve seen what is basically an unprecedented flurry of activity on the free-agent market over the past few days.
Parties on both sides — the owners and players — spent the final few days before the anticipated lockout seeking certainty, and the hot stove was as hot as ever as transactions were agreed to at a pace typically reserved only for the July 31 trade deadline.
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On Sunday, Marcus Semien, Kevin Gausman, Avisail Garcia, Jon Gray, Corey Kluber and Michael Lorenzen (among others) all reportedly agreed to deals worth a combined $409 million. That, friends, was just the warmup act for Monday’s mania, when ex-Dodgers Max Scherzer and Corey Seager cashed in with enormous contracts — the 37-year-old Scherzer landed a three-year deal with the Mets with an average annual salary of $43.3 million and the 27-year-old Seager said yes to a 10-year, $325 million deal with the Rangers. And, oh yeah, AL Cy Young winner Robbie Ray agreed to a $115 million contract with the Mariners.
If the CBA expired every year on Dec. 1, free agency would be a lot more fun, eh?
The big question is this: What does this frenzy mean for the upcoming CBA negotiations? And the answer, of course, is this: It’s complicated. Let’s take a look at a few thoughts and implications.
1. The MLBPA will remain adamantly anti-salary cap
Watching the rumors and transactions roll through Twitter for the past two days, I kept thinking back to something Hall of Famer Tom Glavine told me in a phone interview during the World Series. Glavine, of course, was a player representative for the MLBPA during the strike of 1994-95 and often served as a union spokesman during that nasty labor dispute.
“During the last strike, we never asked for more money. We never asked to be paid for more. We just didn’t want a salary cap,” Glavine said. “Pay us whatever you want to pay us, but we didn’t want to put a system in place that artificially helped owners control themselves in an environment they otherwise wouldn’t.”
Without a hard salary cap, Mets owner Steve Cohen showed no restraints in signing Scherzer to that three-year deal with an average AAV of $43.3 million, which is light years ahead of Gerrit Cole’s $36 million AAV that used to be the record. And the Rangers showed no restraint, committing an even $500 million to a pair of middle infielders, Corey Seager and Marcus Semien. The players want no part of a system that prevents these type of deals.
Those ownership groups focused only on one thing: We want this player and will do whatever it takes to land him. Now, are all the owners happy the Mets and Rangers spent with winning as the objective instead of sticking to a budget as the incentive? No, probably not. That brings us back to Glavine’s quote, about not wanting a system in place to prevent owners who want to spend big from spending big.
It’s also a primary reason the MLBPA will also almost certainly oppose a salary floor, even though that would seem to address the concerns of other members of the MLBPA. A salary floor is seen as the first step toward a salary cap — if there’s one limit, why not two limits? — and that’s pretty much a non-starter.
It’s also why the MLBPA will push to increase the levels for the Competitive Balance Tax (luxury tax), which hasn’t kept pace with increased revenues. The threshold, for example, grew from $189 million in 2014 to $206 million in 2019 (11.1 percent higher), while MLB gross revenues jumped from $7.86 billion in 2014 to $10.37 billion in 2019 (31.9 percent higher).
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2. Dig in, folks
Nathaniel Grow, an associate professor of business law and ethics at Indiana University’s Kelley School of Business, has written extensively on baseball’s CBA topics and issues for several years. I posed this question to him via email: Do the events of the past few days better enhance MLB’s position or the MLBPA’s position heading into CBA negotiations?
His reply: “Great question. I think the primary thing it reflects is the fact that the players are anticipating a potentially lengthy work stoppage, hence the desire to sign now, rather than wait for a condensed off-season squeezed in between an agreement on a new CBA and the opening of spring training. In terms of leverage, it could slightly enhance the MLBPA’s position, insofar as it suggests that the players are prepared for a lengthy holdout.”
Maybe it’s worth noting that the two members of the eight-player MLBPA executive subcommittee who were free agents — Semien and Scherzer — agreed before the Dec. 1 deadline. At All-Star media day in Denver back in July, Semien talked with TSN.
“We have a good leadership group. We have eight subcommittee members who, most of us have a decent number of years in the game,” he said. “For player reps, we have young guys, veterans, a good mix of player reps. We’re in constant communication.”
That communication was all about preparing for the storm they knew was on the horizon. Gerrit Cole, another executive subcommittee member, had thoughts in Colorado, too.
“We’ve had a lot of player involvement,” he told TSN. “To a certain extent, some of the tribulations that we went through with the commissioner’s office last year gave us a little bit of experience as a group. Right now, the information’s getting passed along accordingly, players are as educated as they can be and certainly have access to whatever information they want.”
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3. Don’t read into the frenzy
Here’s the truth: The free-agent free-for-all was compelling, no doubt, but the reasons that the players and owners are likely prepared for an extended negotiation go far beyond the dollars handed out to elite free agents over the past few days.
Let’s look at what ESPN’s Jeff Passan lists as the primary objectives for both sides.
MLBPA: bigger paydays earlier in their careers, more competitive integrity, no service-time manipulation and fewer artificial restraints on players via the competitive-balance tax and draft-pick compensation.
MLB owners: a static amount of spending on players, expanded playoffs, an international draft and on-field changes.
Of those eight primary issues, how many involve free agency? Only two. So, while on the surface it might seem strange for a sport that’s clearly generating lots of money for both sides to have the owners shut down the offseason, know that free agency is just the tip of the iceberg for what could be a cold couple of months for baseball.