Do the owners even want a deal?

Because when you look at what we know, it doesn't seem like it

Over the weekend, negotiations broke down between the Major League Baseball owners and the Players Association on a new economic agreement to get the 2020 season underway. The owners have accused the Players Association of a failure to negotiate in good faith while the players have publicly said that further attempts at negotiation would be fruitless, and the team owners should just tell the players when and where to report for “Spring” Training.

The breakdown is the latest in a long line of troublesome negotiations between the players and the owners—and really Major League Baseball and anyone these days.

There are a lot of similarities in how MLB worked to negotiate their new agreement with Minor League Baseball and now the Players Association. As I summarized those MiLB negotiations back in December:

MLB: We want to eliminate a bunch of teams
Minors: Oh wow, why?
MLB: Because reasons.
Minors: Okay, well those reasons aren’t applicable to a lot of these teams.
MLB: OMG! Why won’t you negotiate?

And fundamentally the league has treated the players the same day during these negotiations.

MLB: Since we have to cancel games for COVID, how about we only pay you for the games that get played?
Players: Okay, that seems fair.
*two months later*
MLB: How about we pay you for 50 games, but you play 82?
Players: How about we play 114 and you pay us for 114?
MLB: How about we pay you for 60 games, but you play 76?
Players: How about we play 89 games and you pay us for 89?
MLB: Final offer. How about we pay you for 60 games, but you play 72?
Players: How about we play 70 games and you pay us for 70?
MLB: Fine, we’ll just pay you for 60 games, but you play 60.

After all of this, they followed up with an accusation that the Players’ Association wasn’t negotiating in good faith. And while the above descriptions aren’t totally accurate, the general idea is correct as the owners never made an offer to the players that was better than what they’d get if MLB had just set a 54-60 game season. Why would you take the additional injury risk for no additional pay? The team owners never offered a better deal than what already existed and because of that, I think you can argue that they never wanted a deal.

First, we need to figure out what our baseline is going to be. The total payroll of all 25 man rosters for the 30 MLB teams totals just shy of $4.1 billion. That’s a big number that’s big enough that most of us don’t grasp what it would mean for individual players, I know I don’t. So instead, let’s consider the median player in baseball. For 2020, that player makes $1.6 million. Still a big number, but small enough in comparison of what we think about when it comes to professional athletes and their contracts.

Back in late March, which feels like years ago at this point, the owners and players agreed on a deal that would prorate the players’ salaries based on the number of games played, expecting that there would be roughly half a season remaining after the world had successfully “flattened the curve” and emerged from the other side of a brewing global pandemic. But it didn’t take long before the idea of playing games without fans as a way to get back to playing sooner began to circulate and that, if so, the owners would want further concessions from the players.

The owners claimed that the March agreement gave them the right to go back to the negotiating table, and there was some debate whether it did or not, but it wasn’t just the players that got things out of the March deal. The owners avoided a potnetial multi-billion grievances by prorating salaries and maximized their opportunities to shorten the draft to just five rounds and setting a maximum signing bonus for undrafted players among other cost saving measures.

In May, the league leaked the idea that the owners had agreed to offer a 50/50 revenue split to the players. However, that offer was never officially proposed to the Players Association, but it was a tactical move. By making it public that they were prepared to offer a 50/50 revenue split, they were able to paint the players as being greedy when they asked for more because a 50/50 revenue split seems fair.

The league would then go on to make their first official proposal to the players at the end of May, offering a sliding scale of pay cuts. The lowest paid players would receive the highest portion of their salary while the highest paid players took the largest cuts. On the whole, it’s believed to have offered the players roughly 67% of their total prorated salaries for an 82-game season. Based on that number, that’s 33.9% of their regular full season salaries. For our median player, that’s a cut from $1.6 million to $542,400.

The league’s second offer guaranteed players 50% of their prorated salaries for a 76-game season, with an increase to 75% if the postseason was completed. Based on those numbers, the players were guaranteed 23.4% of their full season salary, up to 35.2% if the postseason was completed. For our median player, that meant $374,400 for the regular season and up to $563,200 once the postseason was completed.

The league’s third and final offer guaranteed players 70% of their prorated salaries for a 72-game season with an increase to 87% once the postseason was completed. Based on those numbers, the players were guaranteed 31.1% of their full season salary up to 36.8% if the postseason was completed. For our median player, that meant a $497,600 regular season and up to $588,800 once the postseason was completed.

Throughout the entire process, the commissioner has maintained that the league has had the power to force a shortened season under the March agreement. Such a season would mean that the players would make 100% of their prorated salaries for the games played. Such a season has been rumored to be about 54 games, which means that the players would be guaranteed one-third of their regular season salaries. For our median player, that means $532,000.

But the owners want to go back to the well for further concessions.

In the latter of the two deals, the owners attempted to shift the risk for being unable to complete a postseason onto the players. There is some concern that a second wave of COVID could end up cancelling the postseason. The owners aren’t stupid. They understand the risk, which is why they’d want to shift it off onto the players. Without a postseason, the owners’ offers become far less attractive.

• Offer 1: $542,500 for 82 games

• Offer 2: $374,400 for 76 games

• Offer 3: $497,600 for 72 games

• or the original deal: $532,000 for 54 games

While the sliding scale of the first offer makes it difficult to really compare apples to oranges, since players would each be affected differently—one of the prime reasons the Players Association nixed the idea—fundamentally they’re asking the median player to play 28 additional games for just $10,500. That’s 28 more games away from their families, 28 more games of injury risk, and 28 more games of possible exposure. 51.9% more games for not even 2% more money.

Then the second and third offers both guaranteed less money than what the players would make for 54 and only marginally more once the playoffs were completed. Why would they accept that and take on all their own risks plus a risk that the owners don’t want?

Now, I’m not the only person who can do math and I’m sure that the owners employ a large number of people with that ability as well. It’s also important to remember that the team owners hold all the cards. They know what they make, and they know what every player makes as well. Whereas the players only have an idea of what the owners make.

Because of that, after the first offer, the players asked for more financial information to determine how bad it was going to be for the owners before responding with their own offer. The owners said no.

Then they turned around and made an offer to the players that would guarantee them even less money than the short season they were already threatening. If the owners were really interested in playing an 82, 76, or 72 game seasons, they could have made it interesting and offered a number that would have met the players in the middle. If they’d offered 80 games for 70 games of pay, might the players have accepted? We’ll never know. Instead, they repacked their existing rejected offers and asked the players to assume more risk for little additional reward.

Then you have owners go on the radio and claim that they want to be partners with the players, like they are in the other three major North American sports, instead of adversaries. But then reject their requests for additional information to help you better?

There are already reports that there are some team owners who don’t actually want to play the 2020 season and that zero games would be better for them.

If the owners had made the players an offer that was better than the one the situation that they’d already agreed upon back in March, the players might have said yes. Instead, they failed to do that. And it’s the players who are acting in bad faith?

Because when you look at what happened at every step, I think it becomes pretty clear that it’s not the players who are negotiating in bad faith and it’s the owners who may not even want a deal.