Nationals Arm Race

I’m a little late with this post, thanks to this time of year being a little tough to keep up with in Baseball, but I wanted to comment on the opening offers in the upcoming CBA labor war.

I’ve been on record for some time as being a real cynic for essentially anything that comes out of the MLB owners’ collective mouths when it comes to bargaining sessions. I’ve shown before how the owners have systematically pocketed hundreds of millions of dollars of collective salary over the past decade of CBAs, and how they’ve picked and picked at a “salary cap” for years in the form of a Luxury tax with increasing penalties.

Now, in the first salvos of the upcoming Collective Bargaining sessions for the soon-to-expire CBA between the league and its players, the owners have laid it bare: they want a hard cap.

They’ve proposed a floor of $171,200,000 and a cap of $245,300,000.

• Union initial proposal
• Owner initial proposal

In this post, let’s talk about the Cap and Floor, specifically. This is the first time the owners have proposed a Floor, and it’s a hefty one. So, naturally you may say, “ok well the $171M floor is super high … that would guarantee a ton more money goes to the players, right?”

Wrong.

Here’s some quick simple arithmetic to show that the owner’s offer is self-serving. Using Cot’s macro numbers for each of the 30 teams’ 40-man/CBA tax figure (which includes salaries for all 40-man players, plus deferrals, plus minor leagues, plus benefits), I’m going to show you why this initial proposal is disengenuous.

Team	CB tax rank	CB Tax figure		O/U	Amt over Cap or Amt to get to floor	Cap/Floor
LAD	1	$420,000,000		Over	-174700000	$245,300,000
NYY	2	$379,200,000		Over	-133900000	$245,300,000
NYY	3	$338,700,000		Over	-93400000	$245,300,000
tor	4	$322,700,000		Over	-77400000	$245,300,000
Phi	5	$314,800,000		Over	-69500000	$245,300,000
Bos	6	$268,700,000		Over	-23400000	$245,300,000
SDP	7	$259,200,000		Over	-13900000	$245,300,000
Atl	8	$253,400,000		Over	-8100000	$245,300,000
CHC	9	$249,700,000		Over	-4400000	$245,300,000
Det	10	$245,200,000		Within		$245,200,000
Hou	11	$237,200,000		Within		$237,200,000
SF	12	$230,900,000		Within		$230,900,000
Ari	13	$226,100,000		Within		$226,100,000
Bal	14	$218,800,000		Within		$218,800,000
Tex	15	$207,800,000		Within		$207,800,000
Sea	16	$199,500,000		Within		$199,500,000
LAA	17	$196,400,000		Within		$196,400,000
KC	18	$185,300,000		Within		$185,300,000
Cin	19	$151,100,000		Below	20100000	$171,200,000
Col	20	$141,900,000		Below	29300000	$171,200,000
Oak	21	$141,400,000		Below	29800000	$171,200,000
Mil	22	$139,700,000		Below	31500000	$171,200,000
Pit	23	$138,500,000		Below	32700000	$171,200,000
Min	24	$131,800,000		Below	39400000	$171,200,000
Was	25	$122,700,000		Below	48500000	$171,200,000
STL	26	$112,900,000		Below	58300000	$171,200,000
TB	27	$112,200,000		Below	59000000	$171,200,000
CWS	28	$111,700,000		Below	59500000	$171,200,000
Cle	29	$88,800,000		Below	82400000	$171,200,000
Mia	30	$82,000,000		Below	89200000	$171,200,000

Sorry for the crummy formatting, but hopefully you get the gist.

• 9 Teams are currently over the proposed hard cap. They’re a collective $598M over.
• 12 Teams are currently under the proposed floor. They’re a collective $579M under.
• If you add up the 30 team’s current CB tax figure, you get to $6.228B in payroll.
• If you add up the Cap/Floor figures, assuming that the 9 over teams get under, the 12 teams currently under raise to the floor, and the middle ground teams stay where they are … you get $6.209B

In other words … the Owners just proposed a system that will see them spend LESS than they currently are. And that’s before we get any details in to the supposed 50/50 split on “league revenues” that is usually laughable to arrive at, since 28 of the 30 teams are privately owned and refuse to open their books.

Yes this is just a first offer, so presumably the next offer will raise these figures to something more palatable. There’s no details on penalties for teams who refuse to spend the floor (and you KNOW there’s going to be teams that refused to get there). There’s no details on how we possibly get to this system from where we are now, with long-term contracts that would have to be grandfathered in somehow or an incremental implementation plan.

Yes, I get it; NFL, NBA, and NHL all manage to live with a defined revenue split and a cap/floor. but, all three of those leagues also have simple, national TV contracts that facilitate and equalize revenue across teams. That instantly make playing in NYC little different than playing in Green Bay, Wisconsin. So it’s still apples and oranges. Baseball is such a regional sport, it’s just hard to imagine teams like the Yankees, Boston, Cubs, and Dodgers giving up their lucrative local RSN deals for the betterment of their co-owners. Especially when we don’t even KNOW what some of these teams actually earn from RSN deals because they, you know, own the RSN.

There’s a slew of other issues presented that go along with this, but I wanted to focus on this issue as a starting point.