SnakePit panel discussion: The art of collapsing

What do you think is the state of the CBA negotiations?

Jack: Hard to say of course. On the one hand, it looks like if Manfred manages to unify the owners, they could break through pretty quickly. On the other hand, there’s no incentive for owners to make a deal until they’ve missed about 20 games, because that’s when they really start to lose revenue from television contracts. Players are dug in for a while, with the union offering stipends of 15,000 a month from April. It’s not a lot, but it’s enough to keep the lowest paid players around for a while. I think the current state of impasse will remain unchanged for at least a few more weeks.

Makakilo: Let’s look at the ABC from the Diamondbacks perspective.

Competitive Balance in Western NL A higher threshold for CBT allows the Dodgers, Padres and Giants to spend more, even in seasons when they may not reach the World Series. And in season when they go, the higher threshold will provide less funding for the Diamondbacks. The Diamondbacks’ ability to reach the playoffs would be significantly reduced by a higher CBT threshold.

Financial impact. The new CBA will cost the Diamondbacks between $2.32 million and $3.76 million more per season (comparing 2026 to 2021). An extremely important caveat is that, due to a lack of proprietary business information and procedures, the accuracy of my estimates (based on internet articles and jumping to conclusions) is highly questionable:

  • Raise wages before arbitration. I assumed the Diamondbacks averaged 16 players pre-arb. The ABC will increase the pre-arb salary from $570,000 in 2021 to between $740,000 and $805,000 in 2026, with the Diamondbacks’ salary costs increasing between $2.72 million and $3.76 million per season.
  • If the TCC threshold is raised, my estimated $29.2 million tax (of which about $1 million would go to the Diamondbacks on my assumptions) could drop to zero, worst-case scenario.
  • Extension of the playoffs from 10 teams to (12/14) teams. Optimistically, with this expansion, the Diamondbacks will make the playoffs once again within the next 5 years. Playoff revenue is split between the qualifying teams and the players on those teams. The year the Diamondbacks make the playoffs, I estimate the Diamondback team will make an additional $5-7 million. This represents an average of 1 to 1.4 million dollars per year.

Impact on service time. If fewer than 162 games are played, it could have an incredibly huge impact on how much the Diamondbacks pay their players. I am NOT talking about salary savings for missed games. I’m talking about not crediting players for service time when they miss games. For example, if the season is shortened by 18 days, players will receive 0.1 years less service time. There are 23 Diamondbacks for whom this reduction could be enough to delay their arbitration and free will for a year. My estimate (above the caveat plus a caveat about improving retained Diamondbacks players before free agency) is that 18 days less time on duty could cut Diamondbacks payroll by 3 million dollars on average per season.

My two conclusions:

  • The new CBA will be affordable for the Diamondbacks, but could further hurt the competitive balance in western Newfoundland.
  • In my opinion, as the season gets shorter, service time becomes as big or bigger an issue than anything negotiated so far.

ISH95: From the outside looking inside, it seems like it was a mess. MLB giving a “last, best offer” (which was seen by some as a preliminary step to declaring a stalemate that would lead to Labor Board involvement) which, given inflation, is actually a worse deal for players that the latest ABC. Meanwhile, the MLBPA hasn’t even replied in writing to the most recent offer. They also announced they were donating $1 million to stadium workers and others who lost their jobs due to the lockdown. Neither side is giving in anytime soon.

(Update: They met for about a half hour this afternoon and the MLBPA finally provided a written response)

Steve: From what the media reports, it looks like a mountain between the two parties and it is the players who make concessions to start a season. The owners want their money now and later when they sell the team and are willing to do anything, including missing games to get there. I just hope they don’t back down.

Does the cancellation of regular season games change the situation?

Jack: It changes everything for everyone. Especially the fans.

Makakilo: Jack is on target. The pressure to reach an agreement will increase as the games are lost, because if the season is lost, everyone loses.

ISH95: I do not think so. I really don’t think either team was planning to do it in time for a 162-game season, so that hardly changes anything.

Steve: It’s not pretty, and owners are going to use every outlet they have to blame players for missing games. I do hope the MLBPA will continue to hold firm. All players, today and tomorrow, deserve it.

Ken Kendrick was reported as an owner opposed to raising the luxury tax threshold. Why do you think that is?

Jack: The higher the luxury tax, the more the Dodgers can spend without having to pay a tax that gets redistributed to teams like Arizona. It makes it harder for teams like Arizona to compete AND reduces their revenue. I stand by my opinion that the union should give more on CBT and take a hard line to raise the minimum and get the bonus pool for pre-arb players as big as possible.

Makakilo: This is a competitive balance in the NL West (see my previous comment).

ISH95: (redacted so Jack doesn’t lose press access)

I will add, however, that not only would increasing the CBT decrease the tax money being redistributed to it, but it would also generally increase the average cost of WAR, which would further reduce its profits.

Steve: If Ken had what he wanted, he would pay the league minimum for every guy on his roster. This list shows that he is 3rd from the bottom on this owner’s net worth list. I have a feeling Ken isn’t doing so well in the finance category.

Who will blink first? Players or management?

Jack: The union has already blinked and made a lot of concessions. MLB blew them anyway.

Makakilo: Let’s look at the perspective from each side:

Manfred wrote this letter to the fans. Management believes they listened to what players and fans wanted so they could come up with solutions. They are working to avoid a repeat of the 1994 strike that canceled the World Series. Management is of the opinion that they are fair and reasonable and care about everyone.

The players’ point of view is that they are right and they are good, and the management is bad and bad. Players are victims of past deals that deserve a vastly improved deal with black hat management.

Recently, a source told The Athletic that players were unhappy that a management proposal included the cost of food paid to players in the calculation of payroll for CBT purposes. On the surface, it makes the steering look like black hats. Athletic’s article included a response from the commissioner’s office. Their response showed that the players’ anger was totally disconnected from the reality of the situation. Players responded to the answer. My opinion on the player response was that we disagree, but we won’t tell you why. We will continue to be angry and we will not listen to reality.

In summary, neither side will blink, ever. Nevertheless, I predict that the season will start in June.

ISH95: The union. They have more to lose and, as Jack pointed out, have already several times

Steve: Unfortunately the players. The owners don’t care about baseball, it’s just a revenue generating project for these guys and they don’t make money from players coming into free agency with deeper pockets and at a younger age .

Predict when opening day will be.

Jack: After May 15

Makakilo: My June prediction is unchanged. Initially my prediction seemed pessimistic and now it seems realistic and possibly optimistic.

ISH95: A day ending in Y, but probably in June

Steve: No baseball will be played this year.

What’s the most annoying sound you can hear?

Makakilo: Saturday morning I dreamed of riding a snowmobile in the deep snow of a mountain. I was with two friends who were driving their snowmobiles up the mountain. It was very fun. Then my alarm woke me up. More than the type of sound, any sound that interrupts such a big dream is annoying. In case you were wondering, I set my alarm clock so I could volunteer early in the morning, and I’ve never ridden a snowmobile except in my imagination.

ISH95: These mufflers designed to make the car look like it doesn’t have a muffler.

Jack: Chop chant in Atlanta

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