Rob Manfred Might Have Just Made a Mistake

Editor’s Note: as Ben Lindbergh’s recent piece at The Ringer illustrates, reasonable people can disagree on the proper methodology and calculus for determining the players’ share of baseball revenue. What follows is a view based on one such interpretation.

Before he was commissioner of baseball, before he was even in baseball, Rob Manfred was a lawyer. A Harvard-trained labor lawyer, to be precise, who had a successful stint at the elite law firm of Morgan, Lewis & Bockius. In fact, he’s still a registered lawyer, with an active New York law license.

Yesterday, Commissioner Manfred held a press conference that might have made Labor Lawyer Manfred cringe.

Manfred’s comments made headlines in a few different ways, but I want to focus on a couple of areas in particular. First among them is Manfred’s claim that player salaries are growing in line with revenues. That’s a matter of some debate, a point that has been illustrated both on this site and others. Manfred went on to say that “players who are major league players will eventually be signed.” This is technically true, but also a convenient tautology from his point of view. Players who are given major-league contracts will, by definition, be major-league players. This doesn’t necessarily mean the players signed will be the ones most qualified for the position, or that the players who haven’t signed are less qualified than those who have.

Manfred then went one step further, contending that the players are “[d]rawing a line in the sand based on a perception that [their] market value is different than what the market is telling you your value is,” and that doing so “doesn’t make a lot of sense.”

Remember that Manfred was not a unanimous choice for commissioner. In fact, on the first vote, he didn’t have enough support to win outright. The opposition to Manfred came largely from owners afraid that Manfred wouldn’t be tough enough in negotiations with the labor union, perhaps owing to his background as a labor lawyer. It seems that Manfred, once in office, has tacked hard towards that very bloc of owners who opposed him.

From one perspective, this makes sense. Manfred, as commissioner, represents the owners. They are, in a sense, his clients. Manfred is experienced and intelligent enough to know how best to serve their interests. But this is a dangerous game he’s playing, perhaps more so than he realizes.

Nathaniel Grow has already done a fine job over the past couple of months laying out on this very site the limited leverage the MLBPA has in combating the current situation. After all, the union agreed to this CBA. As Nathaniel explained, the MLBPA’s best (and only) option may be the drastic step of disbanding the union and filing an antitrust suit. Before Manfred’s press conference, I thought the odds of a suit like that were pretty long, simply because of the risk involved to the union and its longstanding risk-averse behavior. But I’d say the odds of something like that happening went up significantly yesterday with Manfred’s press conference.

Here’s why. At its core, an antitrust suit essentially alleges anti-competitive behavior by firms which are supposed to be competing, thereby driving down prices artificially. And Manfred’s comments, viewed from a legal perspective, would support the MLBPA’s case.

Any antitrust case is really about whether or not the market at the core of the industry you’re suing about is competitive. So when Manfred says that the market is dictating what players are receiving, that’s an admission.  Think about it: if the numbers show that contract values are down, that players are receiving fewer years and less money, and that fewer players are signing, with all else equal, then something in the market must have changed. And here is Manfred, confirming that the market is to blame. Even worse, that line about the players’ demands not making sense is basically telling the players to accept this new reality because that’s just the way it is.

And that’s why Manfred’s contention about player salaries rising is so damning. If he were to admit salaries are falling, or rising more slowly than revenues, at the same time he’s blaming market conditions, he’d be opening a Pandora’s box of questions as to why that is. But by insisting that revenues are rising, Manfred is instead basically trying to cover up those changing market conditions. In the short term, maybe it’s a fine PR strategy.  In the event of a lawsuit, his claim, repeated over and over, becomes evidence of MLB’s intent. Actively papering over those market changes becomes evidence of possible intent behind those market changes and transforms the 2017-18 offseason from a one-year blip into evidence of possible anti-competitive behavior by MLB itself.

In fact, if I were MLBPA’s lawyers, I’d be making a record of yesterday’s press conference. I’d be making a video record and a transcript. Because if there is a lawsuit, that’s going to be Exhibit A at Manfred’s deposition and prominently featured at a trial.

So what could Manfred do differently? Actually, he could do a lot differently. He could admit the facts on the ground and concede both that salaries aren’t rising with revenues and that the current free-agent market is concerning. That would, at least, provide some evidence that MLB isn’t intentionally trying to create this situation, and it would have the added benefit of being true. Telling the truth is rarely a suboptimal strategy, and while it might give the union some short-term leverage, it would also mitigate the long-term damage caused by a pointless cover-up.

Alternatively, Manfred could just say nothing at all. Instead, though, he’s trying to talk tough. Perhaps it’s for more short-term leverage with the union. Perhaps it’s to get his pace-of-play reforms rammed down the union’s throat. Perhaps it’s to please the hardline owners he represents. But as a lawyer, he has to think big picture, and that includes the potential for a future lawsuit when the time comes to negotiate the next CBA. Instead, yesterday, a formerly elite labor lawyer came up very short.

We hoped you liked reading Rob Manfred Might Have Just Made a Mistake by Sheryl Ring!

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Sheryl Ring is an attorney and the Director of Fair Housing at Open Communities, a non-profit in the Chicago suburbs. You can reach her on twitter at @Ring_Sheryl. The opinions expressed here are solely the author's. This post is intended for informational purposes only and is not intended as legal advice.

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BobbyJohn69
Member
Member
BobbyJohn69

Pretty sure I read that average salaries ARE on the rise, though.

esenator
Member
esenator

But not in line with the increasing league revenue, which is what Manfred said.

BobbyJohn69
Member
Member
BobbyJohn69

So my statement is factually correct, that average salaries are increasing, but the rate of that increase is less than the rate of increase in league revenue.

Not sure how that gets me a boatload of down-votes, but whatever.

bunslow
Member
bunslow

Because no one ever claimed otherwise, but your first comment seemed to indicate that someone *did* claim otherwise — which they didn’t.

tramps like us
Member
tramps like us

you’re not sure? Because you’re being disingenuous. And then you feign ignorance. Because you’re arguing for a point that wasn’t ever claimed. Are player salaries growing in line with revenues? You don’t even recognize that question, but instead conflate it and say that player salaries are rising while leaving out the “with revenues” piece. When you’re so obviously dishonest in presenting an argument, you earn down votes. This ain’t rocket surgery.

evo34
Member
evo34

Settle down, beavis. If players wanted their salaries directly linked to revenues, they should have held out for that. If they want both the security of guaranteed money and the upside of revenue sharing, good luck with that!

Paul22
Member
Paul22

0.4% last year, 3.4% the year before. Maybe negative this year. This after a decade where the average growth was 5% except at the height of the Great Recession where even revenues fallened for a couple of years. Revenue growth is robust now so no excuse.

ThomServo
Member
ThomServo

Where are you getting that data? The data from statista shows 14% growth in the huge boom of 16, and 2% growth last year.

YR AVG$ %Change
15: 3.84
16: 4.38 +14%
17: 4.47 +2%

https://www.statista.com/statistics/236213/mean-salaray-of-players-in-majpr-league-baseball/