Point finger at gap, not cap
The cry was heard throughout the land Friday. With anguish and with agony, the voices demanded that only a salary cap could cure the evils of baseball.
Of course a team in Los Angeles can attract the best players.
Of course the sport cannot enjoy competitive balance without a salary cap.
LeBron James is here. The NBA has a salary cap. The Sacramento Kings have not made the playoffs in 15 years, in a league in which more than half the teams make the playoffs.
While James and the Cleveland Cavaliers were playing the Golden State Warriors in the NBA Finals four times in four years, seven teams appeared in the World Series.
So let us dispense with the fiction that Trevor Bauer joining the Dodgers means baseball needs a salary cap so every team can compete.
Throwing money at a pretty good pitcher — $40 million this year for Bauer — does not in itself make for a winning team. The Colorado Rockies could have thrown $40 million at Bauer this year and finished last in the National League West.
That is because a team strapped for offense just traded its franchise third baseman, Nolan Arenado, who asked out because the Rockies signed him to a $260-million contract extension two years ago and then stopped investing in the team.
“We know that we’re not going to ever get out there and go after [an ace like] Gerrit Cole or some of the really top-line free agents,” Rockies owner Dick Monfort said Tuesday, “because, you know, we’re in a grouping, a mid-market team where we just can’t take that risk.”
The Padres play in a smaller media market than the Rockies. The Padres spent $300 million on a top-line free agent, Manny Machado, after the 2018 season. They spent heavily on player development too, and they spent the last six months redeeming prospects to trade for a top-line starting rotation: Yu Darvish, Blake Snell, Mike Clevinger and Joe Musgrove.
It is good to be smart. It is good to be rich. It is better to be both.
But it is disingenuous to peddle the notion that teams have no money, particularly at a time when teams are finding ways to make money off the field. The Dodgers own their cable channel. The Angels are developing the land around their stadium. So, ahem, are the Rockies.
In 1994, the owners pushed for a salary cap. The players refused and went on strike. The owners outsmarted the players’ union by instituting a luxury tax on themselves: spend above a certain amount and pay a tax. So long as most or all of the owners do not cross the tax threshold, the league gets a de facto salary cap.
What the Dodgers did Friday was to prioritize winning over avoiding the tax. The threshold this year is $210 million. If the Dodgers run a payroll of $240 million, they’ll pay a tax of $7.2 million, which is hardly onerous.
In 2015, the Dodgers ran a $298-million payroll and paid a luxury tax of $43.6 million.
This, ladies, gentlemen and fans of all ages, is what a major league team should deliver when it promises sustained success: a foundation of player development, targeted free-agent spending, wise payroll management and repeated postseason appearances. Without that, “sustained success” is just jargon.
The revenue disparity in baseball is not created because L.A. is a big market and Cincinnati is not. The disparity is created because the Dodgers’ local television contract is worth much more than the Reds’ local television contract, and the teams do not pool all that revenue and share it equally.
Maybe they shouldn’t. The Dodgers were sold for $2 billion and the Padres for $600 million, so it is not unreasonable to say those revenues should not be split equally. And it would be naive to pretend there are no major financial issues: The Miami Marlins do not even have a local television contract at the moment.
But the Bauer signing throws another stack of wood onto the bonfire of distrust between players and owners, with baseball’s collective bargaining agreement 10 months from expiration.
When the Dodgers last year signed Mookie Betts to a 12-year, $365-million extension, president of baseball operations Andrew Friedman said the team was comfortable with the commitment even amid a pandemic that forced the season to be cut from six months to two and played without fans. Commissioner Rob Manfred has said teams lost a combined $3 billion last season.
“It speaks to the faith we have about things getting back to normal,” Friedman said then. “Go to 12 years, you’ve got nothing but time.”
The pandemic is not over. The Dodgers will not play to a full house at Dodger Stadium anytime soon. Dodgers President Stan Kasten has said the team lost “north of $100 million” last year.
The Dodgers nonetheless are paying Bauer more this year than any team has paid to any player in any year.
They are playing to win, and one item on the agenda for collective bargaining is how to incentivize more owners to play to win.
Draft picks could be tied to a team’s payroll, for instance, as well as to a team’s record.
The concept of a salary floor — that is, a minimum team payroll — has been opposed by the players’ union, because a salary floor usually comes with a salary cap.
James, arguably the best player in NBA history, is slated to make $44.5 million in 2022-23.
In 2022, Bauer is scheduled to make $45 million.