MLB Is In Crunch Time To Get A Deal Done And The Owners Will Be The Ones To Blink First

Please excuse the boring thumbnail pic I used. Not very "click bait-y" of me. But in the midst of our country somewhat imploding, I felt a sense of serenity in staring at a baseball just chilling in perfectly manicured grass. Even if it only lasted for a moment, the sense of calm I felt just staring at that beautiful picture took my mind off how fucked up everything is right now, so I'm rolling with it. Bitch about it amongst yourselves in the comment section if you must. 

And in the midst of all the chaos this weekend, the MLBPA snuck a proposal to owners in yesterday:

Excuse me, because my brain is in a complete fog as I didn't sleep for shit because I'm so stressed out over everything that's going on right now, but I will try to explain this as best I can. Let me first direct you to an article I wrote a few weeks back, if you want to get the spin on the current state of baseball in layman's/common man terms:

These are the bullet points of my blog that I'd like to highlight:

the owners are crying poor because they're going to be out on gate, parking and concessions. Duh. No fans are going to be in attendance. But the owners' value is tied to their franchise values, which have gone up exponentially and will continue to do so, as Corona is not a permanent thing.

- the owners want to limit losses by cutting player salaries, which is what they're trying to wack first and they're doing so by trying to bully the players into a revenue share where the players would be paid solely based on revenues brought in in the 2020 season. This is a FAT no-go for the players for one BIG reason: owners won't open up their books to be audited to ANYONE they don't have to, especially the MLBPA. If it's proven owners are making a gazillion dollars more than the players, player salaries would skyrocket in the next round of collective bargaining negotiations. If there's not stone cold proof the owners are actually losing money, there's no way in HELL the players would agree to a revenue share, nor should they. 

- More off the previous bullet point:  when franchise values skyrocket into the billions, players don't see bonuses. They don't see extra money when new TV deals are signed, or when new ad partners are brought in, or when beer is upped by $.25 a pop. The players make what the players make. 

- Owners take all of the risk in owning their franchise, just like any other business. They assume ALL the risk and ALL the reward.

Now for a more nuanced and better written piece, check out these two pieces. First read part I:

and then read part II: 

Roger Ehrenberg, a managing partner at a venture capital firm, expounded on my point not in common man terms, but in "I'm really smart and know WTF I'm talking about terms":

Now here’s the important part: take a deep breath, divorce yourself from the sums involved and think about principle. It’s hard, but it’s really important if we’re to understand what’s really going on here, and to allow our feelings to migrate to the party who is acting in good faith vs. the one who is using framing and context to manipulate and to avoid focusing on the facts. The owners of baseball clubs own the equity. The club and all of the cash flows associated with its operation are its assets. When someone owns equity, they’re supposed to get the benefit of an increase in asset value, and to bear the loss of a decrease in asset value. With the steady rise in TV revenues and sweetheart stadium deals, team values have generally skyrocketed. During COVID-19, there has been a short-term hit to asset value as ticket sales, ad revenues, merchandise sales, etc. have slowed to a trickle.

Look familiar? It's exactly what I said over three weeks ago. But I digress. The two sides obviously do not trust each other, as detailed in part III of Roger's trilogy:

Consider the juxtaposition of these articles, Joel Sherman’s piece in the NY Post that carries a leak that, in fact, the MLBPA had left the door open for subsequent negotiations after March 26th should baseball not be played in front of fans, while Variety ran a story concerning the ground-breaking of a $2.5 billion project 50% controlled by the SF Giants ownership while they were claiming poverty and crushing losses associated with the MLBPA negotiations. The fact of the matter is that none of this really matters. Whether Sherman uncovered an inconsistency in the MLBPA’s statement or not, the fact remains that the owners, as a group, have more than enough resources as equity owners of the business to make good on the losses of playing games in the absence of fans. The truth is that they don’t want to bear these losses, and that they’re hoping they can be treated as equity owners in the good times and starved debtors in the bad times.

People coming at me for taking the side of the players and calling me "comrade Dave"… this is exactly why. The players know that the owners aren't actually losing SHIT for money. They aren't taking in as much revenue as they would in a normal season, sure, but they're not "losing" money either. That's why the players want prorated pay, because the owners are having their cake and eating it too, or however that saying goes. It doesn't work like that, and it's total bullshit the owners are operating like this. 

So where are we now? We have the owners laughing in the faces of the players' proposal less than a week after the players were laughing in the face of the owners' proposal. We got this leak late last night saying owners would "gladly" sit this season out: 

Yeah, that's bullshit. That's a scare tactic designed to place fear in the players to say "fuck it we'll sign" or to not get paid at all. Just a media news dump. The owners have said they'll lose upwards of $4 billion if there's no season. You think they're perfectly willing to do that (even if I just said it's not true)? For sure not. 

But let's look at the players' proposal a little more in depth:

Again, and I said this last week as well - the 114 game season wasn't proposed because the players want to play more games. It's actually the opposite. It was proposed because they want to play FEWER games. The language of the proposal serves two purposes:

1. if owners actually agree to it, more games = more prorated pay, which the players refuse to move from and
2. if owners say "no, we agreed to 82 games in March, we're leaving it at that" then the players can say "yeah and we agreed to prorated play in March and we're leaving it at that too" 

it's designed to make the owner's look hypocritical. That amendment to the original march agreement puts the owner's in a bad spot because now they either have to budge and show that they're willing to work on the economic differences, or they're not willing to budge and they look hypocritical because they won't work with the players on the amount of games played. It's honestly a genius tactic employed by Tony Clark and the MLBPA.

So do we reach an agreement? If the two sides do, it HAS to happen this week. 

If you're asking me, a perpetual optimist, what I think? Yes, and I think it's eventually the owners that budge more so than the players. Gun to head, mid July start date. I think that there will be salary advancements, deferrals and pro rated play for all 40 man players and that the owners will give in some time in the next 5ish days, but there's no way in hell they're playing a 114 game season. Probably more like 50 with ~24 teams making the playoffs and one LONG ass tournament to end the "season". Don't forget that TV deals are massive in the playoffs. Just saying.  

Tune in tomorrow for updates, or lack thereof, but also chime in now as we're live on Twitch.  Always nice to carry on the discussion.  

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