Meyer countered Wednesday that, \u201cif you include all the compensation paid pursuant to the current major league CBA, the players\u2019 share is comfortably over 50 percent.\u201d<\/p>\n
A cap system eliminates year-to-year variability. The sides would negotiate the percentages they receive in advance. Importantly, the league could offer players a larger share than they receive now if they agree to a cap.<\/p>\n
\u201cMy first deal where I was the chief negotiator in 2002, we were spending 63 percent of our revenue on players,\u201d Manfred said.<\/p>\n
Manfred has told players in meetings across the league that had they long ago adopted a system where they shared revenue equally with owners, players would have made billions more.\u00a0<\/p>\n
The union has several objections to Manfred\u2019s claim.<\/p>\n
\u201cWe don\u2019t know what proposal Rob is referring to, but first of all, it doesn\u2019t make sense on the most basic level,\u201d Meyer said. \u201cIf they\u2019re saying, \u2018Oh, we\u2019re willing to pay you more,\u2019 then why do they want the system? It\u2019s obviously worth even more than that to them.\u201d<\/p>\n
The players\u2019 split would also likely go down over time, Meyer warned.<\/p>\n
\u201cWhatever the special introductory offer is, the history has shown that doesn\u2019t last,\u201d Meyer said. \u201cOnce they get you in that system, you never get out, and they drive that percentage down by repeated lockouts. In fact, in the salary-cap sports since 1994, they\u2019ve had way more work stoppages, way more lockouts, way more missed games than in our sport.\u201d<\/p>\n
But how the split is calculated \u2014 revenue definition \u2014 would also be contested. It is even today without a cap.\u00a0<\/p>\n
Many team owners have real-estate developments and other ancillary business that owners would fight to exclude, and players to include. The union thinks the current system accounts for some of that value.<\/p>\n
\u201cTalking about share in the abstract really doesn\u2019t tell you anything,\u201d Meyer said.<\/p>\n
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\n Massive contracts like Juan Soto\u2019s deal with the Mets would likely come to an end under the cap. (Al Bello \/ Getty Images)<\/p>\n
If MLB gets its way, contracts like the 15-year, $765 million deal Juan Soto signed with the New York Mets could never be given out again.<\/p>\n
MLB is eyeing a NHL-style \u201chard cap,\u201d a source said, which would create firm limits in three areas: club payroll, individual contract length and individual player salary.<\/p>\n
But caps can take different forms. MLB could initially propose a max number of years for individual contracts and then relent, for example.\u00a0<\/p>\n
The NBA has what is referred to as a \u201csoft cap,\u201d where the limit on team payroll has some flexibility \u2014 but when the dust settles, everything still falls in line with the overall split.<\/p>\n
The free agency and arbitration processes would also change. In the current system, it would be almost unthinkable for owners to let players become free agents sooner than the current wait time of six years, or to hit arbitration earlier than the current standard of three years. But a cap could reduce those wait times.<\/p>\n
A big bump in the minimum salary, which is $780,000 this year, would likely be on the table as well, one larger than the league would otherwise propose.\u00a0<\/p>\n
\u201cI think it\u2019s going to be very persuasive for a lot of the players,\u201d a management source said. \u201cYou\u2019re seeing a lot of players now see the NBA, NFL and NHL, nobody\u2019s in the poor house. There\u2019s a lot of money going around to a lot more people.\u201d<\/p>\n
A cap makes those changes much easier, but in some ways, less meaningful. When the amount of money going to both sides is predetermined, the issues are distributional.\u00a0<\/p>\n
Manfred has positioned the current economic system as a \u201cgreat deal\u201d for baseball\u2019s elite, but not the rest of the players. A key contested matter is whether a cap would improve other players\u2019 earnings and opportunities.\u00a0<\/p>\n
\u201cThe salary cap is bad for players at all levels, because it converts the system into a zero-sum game, which is to say a system where every time a player gets paid a dollar, that dollar has to come from another player\u2019s pocket,\u201d Meyer said. \u201cThe middle-class players get squeezed because they pay the stars, and everyone else gets basically whatever is left.\u201d<\/p>\n
A free-agent signing deadline would likely arrive too. Players and agents today oppose the idea, which the league wants to spur winter action, because it could push players into lesser deals. But the fixed pot of money would dampen that concern.<\/p>\n
The end of the guaranteed contract?\u00a0<\/p>\n
The revenue split means the sides more directly share in year-to-year booms and busts. The league paints this as a positive that better aligns everyone.<\/p>\n
But to the union, it means the end of guaranteed contracts. Today, baseball players are entitled to the salary their agreements call for, regardless of how the industry fares in a given year. A cap would require salary adjustments depending on how much money actually comes in.\u00a0<\/p>\n
In some leagues that\u2019s achieved through escrow, putting money aside until the results are in. For the 2024-25 NBA season, players had to effectively give back nearly $500 million amidst declining TV revenues. Sources said MLB will likely propose escrow.<\/p>\n
Then there\u2019s roster churn to fit the cap. In the NFL, free agency pushes players who are already under contract out the door.\u00a0<\/p>\n
\u201cEvery free-agent period, it\u2019s blood in locker rooms as they cut players,\u201d Meyer said.<\/p>\n
MLB players particularly benefited, and the owners suffered, from being outside a cap system a few years ago. When a shortened season was played during the COVID-19 pandemic in 2020, MLB players fared much better than their counterparts in cap leagues, where a drop in revenues meant player salaries sharply declined.\u00a0<\/p>\n
Will teams be worth more?\u00a0<\/p>\n
All clubs, in markets large or small, would ultimately gain in a cap system, because franchise values would jump everywhere.\u00a0<\/p>\n
\u201cThe perception around baseball is that without a salary cap, its values will lag behind, at least behind the NFL and the NBA, and that\u2019s been the case,\u201d Steve Greenberg, a banker at Allen & Company who handles franchise sales, said last year<\/a>. \u201cWe\u2019ll see what happens in Rob\u2019s final negotiation.\u201d\u00a0<\/p>\n MLB teams were worth $2.6 billion on average entering last season, per Forbes<\/a>.<\/p>\n The union believes that some of that value flows to players in the current system. An owner might be willing to pay a hefty sum on the belief that improving the team will increase the franchise\u2019s stature and sale price.<\/p>\n \u201cThe nature of a salary cap is to artificially suppress their labor costs, resulting in teams being more profitable,\u201d Meyer said. \u201cSo it makes sense that it would increase their franchise values. That increase in franchise values doesn\u2019t get shared with the players in any of the cap sports.\u201d<\/p>\n Is competitive balance actually broken? And if so, would this actually fix it?<\/p>\n The public arguments always circle back to what fans care about most: what baseball looks like on the field. An already large series of debates, then, turns into two others: whether MLB has a problem with parity, and how to improve it either way.<\/p>\n The sides disagree on both fronts, and have for a long time.<\/p>\n \u201cThe only way to fix baseball is to do a salary cap and a floor,\u201d Colorado Rockies owner Dick Monfort, the head of MLB\u2019s labor committee, told The Denver Gazette<\/a> last year. \u201cSomething\u2019s got to happen. The competitive imbalance in baseball has gotten to the point of ludicrosity now. It\u2019s an unregulated industry.\u201d<\/p>\n The optics are poor when the Dodgers have a payroll more than four times larger than teams like the Miami Marlins and Tampa Bay Rays. The league says payroll disparity \u2014 the ratio between the top and lowest spending clubs \u2014 has never been greater, while the union\u2019s numbers show otherwise.\u00a0<\/p>\n
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