CODNP Day 36: Should There Be Pay Cuts?

Yesterday, Ken Rosenthal and Evan Drellich wrote an article for The Athletic saying that MLB owners may be looking to cut players salaries for the 2020 season.  From my reading, it’s not a question of paying players for games that don’t happen–they’ve agreed that’s not going to happen–but more cutting salaries for games that do, especially if they happen in one of these quarantine bubbles that we keep talking about (and, as we said yesterday, is really the only chance we have of seeing baseball or some version there of this year).

Right now, if they played 81 games, a player would get half his salary.  Which makes sense.  However, the owners seem to want to argue that, given the lack of revenue coming in, they should be able to adjust salaries to reflect that.  And, perhaps more reasonably, if they are going to have to foot the bill for all the lodging, security, food, and everything else that goes into this quarantine, that should count somewhat toward what they pay the players.

There’s some logic there.  I know that owners always love to be bailed out of their mistakes and would tend to cross a busy street if they saw a dollar on the other side.  However, there’s a lot of burden being put on them in this whole thing.  People expect them to take care of the stadium staff, their employees, the minor leaguers, and do so with little revenue coming in as games aren’t being broadcast and people aren’t buying tickets.  Sure, they’ve got those that bought season ticket packs or other sort of tickets early on and they are earning interest (at the least) on that money right now, but it’s eventually going to have to go back.  There’s going to come a time very soon when they are going to have to declare those games cancelled and refund the money.  Which is another cash issue for these clubs to deal with.

Teams like the Yankees, the Red Sox, even the Cardinals, it’s a big deal but it’s manageable.  What about Miami, Pittsburgh, Cincinnati, places like that?  You have to know that they are less able to take on this storm.  Yes, their owners are rich and I’m not saying that a team like the Reds is going to go under, but it can definitely be a problem.  We like to think that the rich owners can absorb any losses but these are on a scale we’ve not seen before.

So does it make some sense to ask the players to share the burden?  I think it makes sense to put it out there, for sure.  The contracts are for a certain sort of baseball season and that’s not the kind of season that we’re going to get.  Expanded rosters, weird stats, quarantined players, no fans, it’s not at all what people had in mind for the 2020 season.

On the flip side, I can understand what the players are saying.  For some of these players, people like Jack Flaherty for instance, asking them to cut into what is already an underpaid situation doesn’t feel right.  Should he be asked to get less than the $600K that (I believe) he’s scheduled to make in 2020?  Even if it’s a percent reduction, such as 10%, that’s less for him to lose but it still feels like he should have to lose anything, especially when he’s been lowballed the last couple of years because of the CBA.

The point is also made in the article that players have a limited window.  Odds are, any money they lose this year, they are never making up.  The owners?  They can.  Besides the fact that they can be in it a lot longer, a situation like the DeWitts are in means that they’ve already made more in increased valuation of the team than they ever could lose in a season.  The DeWitts bought the team (and parking garages around the stadium) for $150 million.  They immediately sold the garages, so the actual outlay for the team was somewhere under $100 million.  The club is worth $2.2 billion now.  While that’s not cash on hand, the DeWitts will be fine when they get out of the game.  A player isn’t going to have the same option for recouping losses.

Honestly, I could see some sort of meet in the middle idea where players that have been in the league five years or more making $10 million (for example) and up take a 15% cut with the idea that the money goes toward paying for the extra needed for quarantine, not to add money to the owners’ pockets.  I don’t know if that will happen–the players haven’t been real excited about giving money back or doing anything that harms earning power in the past–but there’s some reasonableness to that.

Again, the point very well may be moot.  If there’s no season, the players get that early advance and that’s it.  As long as there is a chance for a season, though, this is an issue to watch.

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