Rob Manfred Threatens to Cancel Season

On Saturday, after rejecting Major League Baseball’s latest offer, the Major League Baseball Players Association agreed to abide by the threat MLB had floated at the beginning of the month and allow the commissioner to set the schedule. In response, MLB sent a letter to the MLBPA indicating it would not set a schedule unless the players agreed not to file a grievance over a shortened season. Before looking at why MLB might be taking this approach, let’s take a look at how we got here. It’s been almost a week since the first day of the amateur draft, when Rob Manfred spoke to Tom Verducci about the start of the season on MLB Network. Early in the interview, Verducci asked about the possibility of imposing a shorter schedule:

Tom Verducci: Obviously, you want an agreement. In the absence of an agreement, according to the March 26 agreement with the players the owners believe that you as commissioner can schedule a season that “uses the best efforts to play as many games as possible”. How close are you to that point, how many games are we talking about.

Rob Manfred: I remain committed to the idea that the best thing for our sport is to reach a negotiated agreement with the MLBPA that plays as many games as possible for our fans. We do have rights under the March 26 agreement and there could become a point in time where we’ll exercise those rights.

Manfred went on to say the two sides were “very, very close” on health and safety protocols. After he also indicated that finishing the season in November was not practical due to a potential second wave of the coronavirus and the difficulty of moving the playoffs around for television partners, Verducci got to the heart of the matter and asked whether there would be baseball this season.

Tom Verducci: Negotiations are complicated. Simple question for you. Can you guarantee we will have major league baseball in 2020?

Rob Manfred: We are going to play baseball in 2020. 100%. If it has to be under the March 26 agreement if we get to that point in the calendar, so be it, but one way or the other we are playing major league baseball.

Two days later, MLB provided the players with its “Final Counterproposal for 72 games,” along with a letter from deputy commissioner Dan Halem to union negotiator Bruce Meyer complaining that players were not entitled to pay to begin with and that MLB could have opted to not have negotiated a deal in March at all. The letter did not mention the owners’ fears of the players suing for full salaries in the event of a partial season, the elimination of the roughly $20 million in minimum postseason bonus pools, the relaxation of debt rules that might otherwise have opened up the CBA completely, or the $400 million in amateur signing bonuses that were deferred or eliminated. The March agreement was not an act of generosity, but rather a pact between two sophisticated parties trying to reach the best deal possible. And as Manfred noted, the March agreement gives the commissioner certain rights, including the right to set the schedule.

But the commissioner appears less than eager to impose that right, likely because there are other provisions in that agreement that might not be as beneficial to the league. The commissioner agreed to use “best efforts” to play as many games as possible, but has since indicated that a longer season is impossible due to a potential second wave as well as the difficulties surrounding television rights; the league has also scoffed at the idea of doubleheaders. It is this provision of the March agreement that could lead to a grievance should MLB impose a short season. The slow pace at which MLB has negotiated lends credence to the idea that the league is actually attempting to delay the start of the season to pay players less and thus that the commissioner might not be using his best efforts.

As to discussions of economic feasibility, the union has characterized the league’s disclosures as insufficiently transparent, and even a cursory examination of the league’s own financial presentation provided to the players back in May shows not that regular season games are unprofitable, but rather that their profitability varied on an individual team basis. Overall, teams would make money playing regular season games compared to playing no games at all, which meets one definition for economic feasibility. The league’s likely issue was that those games weren’t even close to as profitable as the postseason, which is less certain to occur and where the money is divided equally by team. While the commissioner’s office views a grievance as a “gotcha trap,” it isn’t a possible measure the league would have been unaware of. It’s something I mentioned more than a week ago after MLB made it’s second offer. It was one of the reasons I questioned MLB’s willingness to bargain in the first place, considering all that MLB had to gain by making a much better offer but instead opted not to.

It’s possible to argue that MLB’s threat is simply a continuation of a prior plan to trim the schedule to as few games as possible to limit salaries and get to the playoff money. If the owners could get more regular season games on very favorable terms (like the 30% pay cut from full pro-rated pay over 72 games that they last proposed, which is a 40% pay cut from an 82-game season), they were willing to proceed to the playoffs. For the owners, this mode of negotiation appeared to be a win-win. Either run out the clock and pay less, or hope the union agreed to a deal with huge cuts that would provide more money to the owners. MLBPA’s response — to a shortened schedule and to any offers not significantly better than the threatened pro-rated 50-game slate — has thrown a wrench in those plans. Demanding more discussion or that the players agree not to proceed with a grievance gets the owners slightly back on track, but they are clearly still concerned about the potential for a grievance, which might provide more transparency into the owners’ finances and comes with the threat of hundreds of million of dollars in awards to the players.

There are a couple other theories over what could be influencing the negotiations. One is simply that the owners are not a unified voice in these discussions, and that a compromised solution among them is required before any compromise with the players can be reached. There have been talks that some owners don’t want to play the season at all; those voices could be hampering a decent offer from heading the players’ way. (Perhaps the threat of hundreds of millions of dollars in damages is the kind of outcome that could get those owners back to the table.) The other possibility, far worse, is that the owners are simply indicating that they are willing to sink this ship and take the players with them. There’s not any reasonable scenario in which owners lose less money by not playing games. Regular season games will net the owners millions while the playoffs promise nearly a billion dollars, if they can get there. That’s why the threat over the last month hasn’t been one of canceling the season, but rather of imposing a 50-game version.

It’s hard not to see MLB’s current threat to the cancel the season as anything other than another bluff. As I noted yesterday, MLB is being presented with the opportunity to make a good offer, a real compromise where they receive significant concessions from the players in the form of expanded playoffs, ending the potential for a grievance, and additional revenue that even MLB acknowledges is not insubstantial. According to MLB’s own figures, going from 50 to 70 games, without even accounting for national television revenues, would cost owners just $6 million per team. It’s hard to see why such a relatively small sum is holding up the potential for a meaningful baseball season, or why it’s worth threatening to cancel the season less than a week after guaranteeing the fans one was coming.

We hoped you liked reading Rob Manfred Threatens to Cancel Season by Craig Edwards!

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Craig Edwards can be found on twitter @craigjedwards.

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TJ177
Member
TJ177

I’d be really interested to read who’s actually in charge some of these proposals and how they are put together.

It seems clear that MLBPA is just essentially Bruce Meyer with Tony Clark as nothing other than a spokesperson. Meyer has a long history in the space and presumably is recommending all of the hard stances, with Clark sponsoring them from a player’s front.

But if we believe that the owners aren’t unified in what they even want (which is totally believable), who is the one who’s even coming up with the recommendations? Is it just Halem?

It just feels like the actual number of people ACTIVELY involved in this is very small given the stakes and scope. I don’t get the impression that anyone is pushing back on Meyer and I really am not sure how Halem is manuevering the potholes of different owners having different goals.

This isn’t a “both sides are wrong” take – but more of a “are there any good guys here?” take.

dukewinslow
Member
Member
dukewinslow

Those are really good questions. I think someone at the WSJ or NYT should be picking at them, but it’s really hard to do the kind of reporting that takes right now.

D-Wiz
Member
Member
D-Wiz

I fail to see what the PA is doing wrong here. They tried negotiating, and when that failed conceded what they and the league had already agreed to – that the commissioner can unilaterally set the season length with prorated salaries. Why are they at fault in this scenario?

dukewinslow
Member
Member
dukewinslow

I think, strategically, they could have made the march agreement a little more airtight, but otherwise they’re representing the interests of their membership pretty well. Which is unusual for a professional sports union in the United States.

sadtrombone
Member
Member
sadtrombone

The MLBPA is really bad at negotiating new things that would improve membership’s positions, but they seem great at resisting in this specific scenario. It’s the best set of moves they’ve made in the Tony Clark era, by far.

CliffH
Member
CliffH

They didn’t really make an effort to negotiate. They made an offer clearly intended to call the owner’s bluff by demanding many more games, which makes them more money but doesn’t make the owners any more money unless each game is profitable. Otherwise, it is a large additional demand, not any kind of concession.

Now they’re not obligated to negotiate, they can just say- pro rata, take it or leave it. Whether that is a good idea depends on what they end up getting. If they get no season, maybe it wasn’t such a great position.

That said I’m a bit puzzled that they negotiated pro rata based on fans being in the seats and agreed to renegotiate if there were no fans, but then when they found out there would not be any fans, decided not to renegotiate anyway.

aflorimonte
Member
Member
aflorimonte

According to Craigs’s article from just a day ago, MLBPA in fact offered significant additional value to the owners:

“If we want to have a discussion about bargaining in good faith or economic feasibility […], MLB offered far less in value than they wish to receive, while the players offered considerably more in the way of economic benefits to the owners than they were asking for.”

https://blogs.fangraphs.com/players-ask-owners-how-much-baseball-they-want/

sadtrombone
Member
Member
sadtrombone

There are 5 owners on the labor committee who are in constant contact with the league’s office. They’re supposed to represent all 30 owners’ interests. Manfred and his team present options and walk them through, and present recommendations. And then the 5 owners come to consensus; they may check in with the other 25 owners, and maybe they all vote, but those 5 drive it.

I am guessing the same thing happens with the executive committee on the union side.

The problem here is that for whatever reason, there are apparently 8 owners who are now threatening to tank the whole process. This could be yet another bluff to get the union back to the table (which…I don’t think is likely to work, given how badly the 50-game season threat went), or it could be that the owners on the labor committee did not have a good handle on the different interests of ownership. Or it could be that people who have always gotten their way are pissed that they’re not going to. Baseball historians are going to have a field day with this.

The Guru
Member
The Guru

I think the 2nd to last sentence is likely scenario. MLBPA hasn’t had this good of representation in a long time and they have constantly been taken advantage of. Not this time as they actually have someone fighting for them. The owners are pissed and are threatening to take their ball home. They’d rather burn the house down than lose a negotiation in a sense.

They are pouting right now but the great news is they are threatening their last major bargaining chip…complete lockdown. One way or another its almost all over. They are used to the players just cowering until demands are met but i think they’ve read the room wrong this time. I don’t see the players doing that with meyer in charge.

Honestly the owners can’t afford to not have a season. Revenues would basically be close to zero for the year with no tv and playoff revenue……..they can say what they want but that would put a huge dent in the valuation on their franchise.

tomerafan
Member
Member
tomerafan

Separate from thoughts on how we got here… and acknowledging that we are here… I think that Rob Manfred has one card in his hand, and that’s the fact that there are still travel restrictions in place, and fans will not be in the stands, and therefore the season cannot commence until he consents (per the March agreement).

Setting aside the financials for a moment, and the questions of “would the owners actually drive off that cliff?”, that card in his hand has value from a negotiating standpoint (even if not from a good decision-making standpoint). Canceling the season will cost the owners their fixed costs, and may escalate other financial matters. But if some or most owners really will lose money for each game if the playoffs are canceled, and they really think that no-playoffs is a material-risk outcome (I do), then they will lose less money to cancel the season. I know some folks here don’t buy that premise. I think it’s clear that *without the playoffs*, the owners will lose money and it’s a question of how much. So not playing would actually lose less money. I think there are a lot of folks who have never believed this premise. After looking at the numbers again last night, for me, I am convinced it is true. In a financial vacuum, the owners will lose less money to cancel a playoff-less season than to play a playoff-less season even if finding the cash flow to pay the bills hurts like hell.

Of course, the logical response is that this will cost the owners more in the long run, in terms of the damage done to the sport, etc., and I believe that is correct. But business people make bad decisions in the name of pride all the time. And that’s what this would be – a bad financial decision in the name of pride. And pride is what has us here right now. Regardless of my distaste for Tony Clark and the way the Union has handled certain things here, they have shown an iron resolve thus far unlike anything they have in, well, maybe ever. And I don’t think MLB planned on that (and Manfred has to be catching HELL for that behind closed doors).

I also think that the Union knows that losing the season under the terms of the March 27 agreement costs the players more, financially, than it costs the owners in terms of the constituents relative ability to weather the financial storm. Manfred does have the right to cancel the season and pay the players nothing more than the $170M that they already got so long as fans can’t be in the stands. (I’m not saying that I like that option; I’m saying that he has that right.) It would be very hard for most players to afford to lose a year of their salary, and of their performance in terms of driving future salary. And it wouldn’t even require collusion for that to ripple HARD through the free agent market, etc. and cost a lot of players a lot of money. Owners are simply going to slash spending in future years to recoup what they lose this season. The Union knows that is a bad long-term outcome.

If this action is an attempt to divide the Union again (like the pay-scale proposal, which was a far wackier and off-putting concept than revenue sharing), then it’s a poor move, an ill-advised move, and an ill-executed move.

If this action is an entreaty to draw the Union back to the table to actually find a reasonable compromise – because showing the “destruct” button and the finger on the trigger can be a valuable thing – then I’ll be grateful for the outcome (actually bringing the parties to the table) even if I have an extreme distaste for the card being played.

sadtrombone
Member
Member
sadtrombone

FWIW, I consider the issue of your (tomerafan’s) comment yesterday resolved. You made a comment that seemed like it was wishing ill on the site. You clarified you did not mean that. I believe you.

docgooden85
Member
Member
docgooden85

Monfort has a powerful (leading?) role on the owner’s labor committee, so if the rumors are true that the Rockies would rather not play in 2020, he is a in a good spot to help make that happen.

sadtrombone
Member
Member
sadtrombone

Colorado is also one of the teams slated to lose the most money per game in a fanless season and 50% revenue sharing, along with the Mets and Astros (and in contrast to the teams that make money per game).

sadtrombone
Member
Member
sadtrombone

Answer:
The labor committee consists of the ownership of the Rockies, Brewers, Red Sox, Rangers, and Padres. Monfort is the chair of the committee. The Red Sox (Werner/Henry) are known hardliners.

Knoblaublah
Member
Knoblaublah

Question: if Red Sox are hardliners and succeed in canceling the season, will they then have “won” the Mookie Betts trade if they got players for him and he becomes a free agent without ever playing for the Dodgers?

Jim Brice
Member
Member
Jim Brice

They don’t reset their own luxury tax without a season (Sox)

martyvan90
Member
Member
martyvan90

But they get the Dodger young players (Verdugo, Downs, et al) for nothing.

gtagomori
Member
Member
gtagomori

The owners have ALWAYS colluded. The current FA system only exists because they colluded enough to get nailed LEGALLY.

They could have avoided general FA altogether by surrendering the reserve clause back in cardinals vs curt flood days. That’s all the players were asking for originally.

But wealth create entitlement. That’s how we get to owners demanding tax breaks and free stadiums.

That’s how W Bush profits by 800k by using his influence to seize land for Arlington stadium. Seize the land at desert prices sell at developed price. Instant millionaire. Instant presidential credibility.

The Guru
Member
The Guru

100% agree gtagomori. I got roasted on here a year ago during the big FA market fiasco where collusion was happening left and right. No doubt there was collusion going on then by the owners as they do every year but that year was outlandish……some of these posters on this site are just naive.

Collusion has happened since the beginning of time and is happening currently. They’ve even been caught more than once doing it. Only problem is that now its harder to prove it as there is no smoking gun evidence but 100s of circumstantial evidence. People can say what they want but circumstantial evidence is still evidence.

Hell just this year, 2 days into the FA market…..GM of the Braves said “Every day you get more information. And we’ve had time to connect with 27 of the clubs — obviously the Astros and (Nationals) being in the World Series, they were tied up — but we had a chance to get a sense of what the other clubs are going to look to do in free agency, who might be available in trades,”

Total collusion going on and anyone that actually thinks there is a free market into the FA system is naive. FA system has very little integrity and the values are 100% controlled.

sadtrombone
Member
Member
sadtrombone

On the one hand, I do agree with you.
On the other hand, it does not seem to respond to the point above, or anything in the article.

gtagomori
Member
Member
gtagomori

Yes. You are correct. That rant went sideways. Apologizes

tomerafan
Member
Member
tomerafan

I don’t think literal collusion happens anymore as much as you think. I’m talking 1980’s style, let’s decide how much we’re willing to pay and hold the line type collusion.
Conspiracies and collusions are very difficult to maintain because of the number of people who have to keep quiet in order for it to work.

I do think that implied collusion happens. It’s very easy for GM’s to have conversations about wants and needs in the trade or labor market to gauge value and set parameters. But implied collusion is easily busted by one team that decides to spend.

Personally, I think that the salary trends of the last two years are driven much, MUCH more by analytics than they are by absolute collusion. Baseball’s proverbial middle-class is getting hollowed out because of how much greater access there is to inexpensive replacement-level talent. It’s not popular to say so, but this is an example of a more efficient labor market under the existing rules/regime than it is collusion.

The biggest thing the Union can do to level that playing field is push for changes to the pre-arb system, especially for 2nd and 3rd year players. It’s insane that 3rd year players have to either sign the Kingery-type deals young or accept inflationary increases over the league minimum. Raising the pay scale for pre-arb players completely changes the payroll calculus and removes the impetus to cycle through cheap replacement talent. Ending service time manipulation is important, but raising the wage scale for 2nd and 3rd year players will also serve some to disincentivize such manipulation (and that may get bargained away in its own right.)

cowdisciple
Member
Member
cowdisciple

I agree. I’d also add that with the soft salary cap the players agreed to, it’s now much more difficult and expensive for a rogue rich team to bust the implied collusion (or convergent valuation methods, whichever you prefer).

tomerafan
Member
Member
tomerafan

This is a topic that is ripe for statistical analysis – how do player contracts for 2013-2019 (pre CBA renewal to current, covering a time where more analytical minds moved into front offices) compare on a distribution scale? We know that team payroll is down and revenue is up. But what do the underlying contracts tell us? Are we indeed seeing the hollowing-out of the 3-to-5 year player middle class? Are we seeing more Denard Span situations where team are bringing in replacement-level talent rather than giving vets even $4m or $5m contracts? There seem to be higher AAV contracts handed out to quality relievers – is this true? If so, what does willingness to spend in an area where it seems spending used to be less tell us? Is it true that non-superstar starting pitchers are literally being valued less since they are seen as, potentially, more replaceable (in terms of contract and in terms of innings distribution)? If so, what impact has this had on overall salary? The data set that exists could be mined to analyze the hell out of this in a really comprehensive way.

Paul G.
Member
Member
Paul G.

Do keep in mind that collusion is somewhat difficult to define with MLB. By its very nature, MLB is not a free market situation. The Yankees and Red Sox are competing on the field for a championship. However, economically it is not like the Yankees are trying to gain market share from the Red Sox, which could eventually lead to the Red Sox’s bankruptcy and/or acquisition. The Yankees need the Red Sox and the Red Sox need the Yankees; playing intramural games is not much of a draw. MLB is more like a cartel than anything else. By its very nature there is going to be coordination and, to a certain extent, collusion.

That said, there are different levels of collusion. All the owners deciding that they will not sign each others’ free agents is one thing. All the owners deciding to cap salaries on agreed upon levels is another thing. Putting out feelers to see which teams are interested in which players is pretty minimal. This is the sort of thing that companies try to do in a free market situation by gaining intelligence on their competitors. For that matter, it is the sort of thing players’ agents would do as well. If you are considering that last one to be collusion you may do so, but there’s not a lot there to get outraged about.

I suppose I should also mention as free agency has matured over the years, teams have gotten smarter about it. The Pujols and Cano contracts have certainly opened up quite a few eyes to the risks of spending huge amounts of money on aging players.