What Led to the Lockout – An Introduction

This is the first of a three-part series in which the lockout is examined from all angles: how both sides got to this point, what the players hope to accomplish, and just how exactly can they accomplish it.

Today, we look at why they’ve come to a lockout in the first place.

It’s no surprise there is a lockout in Major League Baseball right now. It was obvious this was where they were heading, maybe as early as December 2016, when the agreement that just expired was first approved.

However, you may have to go back even further, to December 2011, when the previous Collective Bargaining Agreement was put into place, to get a clearer picture.

This was the agreement that capped draft spending via the pool system. While it’s not technically a hard cap—teams can spend over their pool, but not one has yet to do this because the penalties are too onerous—it allowed for much more certainty, not only as far as costs, but in which players would be picked. Now that the best players couldn’t set their own market, teams were much more likely to select them, as they now knew they could afford to sign them. While drafting and signing the best players may seem obvious, this idea laid the groundwork for other behaviors that will be touched on later.

Along with this big change was the instituting of the Qualifying Offer, which tied the potential loss of a high draft pick to players that teams made the offers to, dragging down the market for a select group of free agents.

At the time, union head Michael Weiner lauded several victories players received in exchange, such as an increase in Super 2 eligibility from seventeen to twenty-two percent of players between two and three years of service time. Also mentioned was the elimination of the compensation system that was in place for free agents at the time, which attached more draft-pick compensation then the new Qualifying Offer in its place.

Inside the industry, the 2011 agreement was seen as a major win for owners, as Evan Drellich pointed out in 2016 when talking about impending negotiations:

“But you have to give up something, whatever it might be, to get something. Unless, of course, we’re talking about baseball’s owners in 2011.”

The union made an effort to win back some ground in 2016, but they made their stand against the inclusion of an international draft, possibly wanting to avoid the mistake they made in 2011 by suppressing draft signing bonuses. However, what resulted was just as bad, if not worse, in a hard capped pool system for international free agents.

Not only that, but while the Collective Balance Tax (CBT) remained fairly stagnant as far as spending levels went, the penalties for exceeding it increased significantly. These changes, along with additional penalties to international and draft spending tied to the tax, further disincentivized teams to spend up to and over the line, creating what many clubs treat as a hard cap in all but name only.

While the union attempted to push against some of these changes, they either didn’t have the stomach for a fight or simply didn’t deem one necessary, as they seemingly didn’t anticipate the way teams were beginning to operate in the market or were now valuing players.

Through the ever-growing acceptance and burgeoning use of analytics among most teams at the time, the market for older, more expensive players was shrinking. In its place, teams were finding more value in younger, cheaper talent, whether that be through the draft or players coming up through their minor league systems. Teams were running more efficiently than ever before, and with the success of the Houston Astros and Chicago Cubs—who bottomed out, only to build back up and eventually win the World Series—other teams were following suite, with the strategy unofficially deemed “tanking” that is viewed as toxic in many ways for the game and its wellbeing.

This is not meant to serve as an all-encompassing explanation of the previous two CBAs or an attempt to keep score as to who won and who lost—this is why I included as many links to supplemental reading as I could, in an effort to provide further context to those seeking it. Rather, it was an intentional selection of past changes that are at the forefront of current bargaining. They are hot button issues on the side of the players, as they all have to do with spending, or more accurately the lack thereof.

It seems the players will have to show more resolve this time around in hopes to regain some of the ground they believe they have lost. The fact of the matter is, they proposed many of the same changes in 2016 as they are now, but the league countered and none of them were instituted. In theory, why would they so easily accept changes that they deem detrimental if they are happy with the system currently in place, especially if the union willingly—to a point, of course—granted them in prior agreements?

Just what exactly are these changes the players are looking for? Luckily, we don’t have to speculate, as The Athletic laid them out word-for-word from a pamphlet distributed to union membership back in November to ready them for the coming negotiations and the possible lockout.

I’ll break them down in greater detail tomorrow, examining the four main tenets, what changes the union hopes to make to accomplish them, and just how likely they are to actually happen.