Fallout economics at heart of baseball labor dispute – Chillicothe News Constitution-Tribune

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BY RONALD BLUM AP Baseball Writer

NEW YORK (AP) — Francisco Lindor’s $341 million contract with the New York Mets was supposed to be a boon to other shortstops. Same thing for pitchers when aces Gerrit Cole and Max Scherzer signed mega deals.

Baseball players have long benefited from the trickle-down economy, where stars create a market that leads to bigger salaries for those below. While a slew of record-breaking deals in recent seasons have pushed the top of the salary scale up, they haven’t done much for players at the bottom of the ladder and may have contributed to a thinning of the middle class.

Players’ belief in a descending market and their desire to increase team payrolls are at the heart of the financial differences that led to Major League Baseball’s first work stoppage in 26 years.

Lindor, Cole and Scherzer serve on the union’s eight-member executive subcommittee. The group also includes infielder Marcus Semien, receiver Jason Castro and pitchers Zack Britton, Andrew Miller and James Paxton. Of those, only Castro — at $3.5 million — earned less than $12 million last season.

Of the 1,670 players who appeared on a major league roster this year, 1,145 have earned under $1 million, including 771 under $500,000 and 241 under $100,000.

“At the end of the day, we’re fighting to make things better in many places for the next CBA,” Miller wrote in an email to The Associated Press. “We want every player to be treated and compensated fairly, for every team to try to win, and for every fan of our game to see the best version of baseball possible.”

Affected wages have been depressed by the luxury tax and a decline in major league payrolls since 2017, the union proposed raising the tax threshold from $210 million to $245 million. The players would reduce free agent eligibility from six seasons of big league service to five for players 29.5 and under by 2025-26 and reduce salary arbitration eligibility to two years. The overwhelming percentage of the gains would go to the top earners.

MLB says the union proposals would entice more stars out of smaller markets, a stance players see as a ruse designed to mask an aversion to a spending spree.

“The closer you get to a free market, the closer you get to accurate player valuation, and the more restrictions there are in place, the more artificial salaries are,” said Gabe Feldman, director of the law program. of Tulane sports. “But there’s also the concern of all leagues, that if there’s a free market, then the big market teams will bring in all the best players because they’ll be willing to pay more.”

Negotiations broke off on December 1, hours before the collective agreement expired, and MLB initiated a lockout the following day. The parties have remained publicly silent ever since. Discussions on key economics are expected to resume this month as the scheduled start of spring training on Feb. 16 approaches.

MLB’s 100 highest-paid players accounted for 50.6% of 2021 earnings on Opening Day rosters.

While many teams spent a higher percentage of the wage bill on stars, some journeymen with seven-figure salaries were jettisoned in favor of young players with split contracts: much lower pay in the minor leagues than in the majors . Because of this and the increased role of relievers, the bottom of the rosters became a constant turnover between majors and minors.

“We’ve been at war with our midlevel players extensively over the past two decades, in salary-cap sports and in baseball with the luxury tax and with free agency,” said Bob Boland, a former agent who teaches at Penn State’s School. labor and employment relationships. “If you’re a player’s union, you know that the high end of free agency will always have some value. What you’re concerned about is if there’s a dynamic part of the next level, and baseball has already greatly reduced this.

MLB has proposed raising the major league minimum wage by $570,500 to a series of levels: $600,000 for players with less than a year of big league service, $650,000 for at least one but less than two and $700,000 for at least two. Each would increase by $10,000 per year, reaching $640,000, $690,000 and $740,000 in 2026.

The players requested the highest minimum percentage increase in decades: $775,000, rising to $875,000 last season. Both parties would increase minimums while assigned to minors.

Players also proposed that those not yet eligible for arbitration share a $105 million bonus pool from central revenue, based on WAR, all-MLB team appearances and recognition. such as best position player, best pitcher and best rookie.

Extending the designated hitter to the National League would likely create several better-paying jobs for veteran hitters.

Baseball’s luxury tax threshold started at $117 million in 2003, rose to $148 million in 2007 and reached $206 million in 2019, the last season before the pandemic. The threshold was up 18% from 2013-19, a period in which MLB announced revenue numbers with a 49% increase.

Commissioner Rob Manfred estimated MLB operating losses at $3 billion in 2020 due to the pandemic and said it was too early to announce a figure for 2021.

At most, six teams have paid the luxury tax in any season and the norm is closer to three. Many clubs have treated the threshold as a ceiling, making the tax the most important factor in limiting club spending. If the level of taxation were the only factor, the proposed changes to free agency and arbitration would likely transfer an extra percentage of money to the stars, but the union insists the economic system is not to zero sum and that its proposals have cumulative benefits for many actors.

The teams proposed a tax threshold of $214 million for each of the next three seasons, rising to $216 million in 2025 and $220 million in 2026.

And while the teams proposed a minimum payroll of $100 million, this would be funded by a 25% tax on payrolls over $180 million. The union says the penalty at the top would more than offset any gain at the bottom.

Additionally, players want to stop what they call tanking and what clubs call cautious decisions to demolish short-term big league rosters aimed at rebuilding for longer-term success.

Both sides have proposed expanding the playoffs, owners of 10 teams to 14 and players to 12, which would incentivize more competition. Players also want safeguards against service time manipulation, such as offering the ability to accumulate service time based on achievements.

Negotiators also discussed an NBA-style lottery, but owners would limit it to the top three teams and players would expand it to the top eight. The union would reward teams in smaller markets with additional draft picks for success, such as making the playoffs or finishing with a winning record.

For the moment, possible changes to speed up the pace of play have been put aside.

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