When will they sign?
It’s the second half of January and baseball fans are still being subjected to the incessant teasing from MLB Network talking heads and baseball websites, not to mention the humming Twitter accounts of scribes Jon Heyman and Ken Rosenthal, wondering where the two superstar free agents, Manny Machado and Bryce Harper, will play their home games this year.
The Ringer’s Ben Lindbergh recently called the process “disturbingly slow” and likened the glacial pace to the federal government’s partial shutdown.
Lindbergh’s right that something’s afoot. The most valuable free agent signing of the 2013-14 offseason that came after December, as calculated by Baseball-Reference.com, was reliever Grant Balfour. The following offseason, Max Scherzer, easily the most sought-after commodity, didn’t sign until Jan. 21. One year later, Alex Gordon and Chris Davis, the third- and fourth-most valuable on the board, both signed in January. Ditto with Jose Bautista and Edwin Encarnacion in 2016-17. Last offseason was downright extreme: Each of the top five players signed in the new year, with the second-most valuable, Jake Arrieta, not inking his contract until mid-March.
The delaying of most free agent signings isn’t necessarily synonymous with owners being cheap. Back in December, the Nationals handed $140 million and six years to Patrick Corbin, who, before enjoying a breakout 2018 season, had been a modestly above-average starting pitcher.
But does it really matter to fans if a player signs with their favorite club while Christmas shopping online or out to see the groundhog?
Even after ESPN’s Buster Olney reported on Jan. 16 that the Chicago White Sox offered Machado “only” $175 million over seven years, it strains credulity to believe he and Harper (or even lesser stars like Dallas Keuchel, AJ Pollack, and Craig Kimbrel) will be unemployed on opening day. The signing franchises will treat themselves to a flashy press conference and see a bump in ticket sales and advertising dollars.
No, the danger for fans — and the sport — is what transpires after the 2021 season, when the current collective bargaining agreement between the players and owners expires.
Lindbergh noted that, even as profits have soared, the average big-league salary sank in 2018 for the first time since 2004, a wake-up call for the players’ union.
“The slow free agent market is only a symptom,” observed Baseball Prospectus writer Russell Carleton. “This is really about whether players believe that they are receiving a large enough share of MLB’s revenues.”
Former San Francisco Giants and Kansas City Royals reliever and now-Yeshiva University professor Bob Tufts acknowledged that players are unhappy,but he downplayed the immediate concern. “Now the issue is about being selective with free agents, especially those above 30 years old. I will worry when all contracts offered are three years or less, as in the 1980s collusion era.”
According to Kennesaw State University economist and The Baseball Economist author J.C. Bradbury, “I think it has more to do with players contributing less to financial success.”
Bradbury is hitting on an additional problem, namely the consequences of revenue sharing, which had been advanced as a means of fostering “competitive balance” across the league, where parity would be championed. But it has altered the economics of the game in a way that doesn’t benefit labor.
“Even though MLB revenues have been growing, a smaller share has been going to the players,” he said. “When more revenue is shared equally, individual players are less able to enhance their value through winning. So while revenue is up, it’s mostly independent of individual player value.”
Carleton added, “MLB added a luxury tax which was explicitly designed to dis-incentivize teams at the top of the revenue ladder from throwing money at their problems (and by extension at free agents). What exactly did people think was going to happen?”
An analyst who has consulted for multiple big-league teams agreed. “The more central and shared revenue you have, the less incentive there is to spend to win.”
So, need fans start to worry about a strike?
Because there’s considerable grumbling within the union ranks, Tufts said he thinks it’s likely its leadership will adopt a more aggressive negotiating strategy in 2021.
Bradbury concurred, but speculated this perception may ultimately stave off a lengthy work stoppage. “Angry players and high revenues may make owners more willing to capitulate if they think the lost games will cost them more money. The cost of a strike is now higher for owners.”
Jason Epstein is the president of Southfive Strategies, a boutique public policy and consulting firm.
