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The competitive balance tax is ruining the offseason

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Last week, SB Nation’s Grant Brisbee wrote a terrific article explaining how baseball’s competitive balance tax has led to a slow, boring offseason. For the uninitiated, baseball teams pay a 17.5 percent luxury tax for going over the threshold. If those teams stay over for a second, third, and fourth consecutive year, those penalties rise to 30, 40, and 50 percent, respectively. Those thresholds for 2017-21 are $195 million, $197 million, $206 million, $208 million, and $210 million, respectively.

The Associated Press reported that the Dodgers were billed $36.2 million in luxury tax, while the Yankees had to pay $15.7 million. That was followed by the Giants at $4.1 million, the Tigers at $3.7 million, and the Nationals at $1.45 million.

Teams are now making trades to ensure that they don’t inch any closer to the penalty. Brisbee cites the recent trade between the Rays and Giants that saw Evan Longoria head to San Francisco while Denard Span, Christian Arroyo, Matt Krook, and Stephen Woods went to Tampa Bay. The Rays agreed to pay down $14.5 million of the $88 million remaining on Longoria’s contract, which helps the Giants avoid the CBT, as did accepting Span and his remaining salary in the deal. The Matt Kemp trade between the Dodgers and Braves was another example of teams making a trade primarily to avoid the CBT. The Braves got Brandon McCarthy, Scott Kazmir, Charlie Culberson, Adrian Gonzalez, and cash. The Dodgers got Kemp. The Braves then immediately designated Gonzalez for assignment. The salaries were essentially a wash, but for the Dodgers, they spread the money they owed over two seasons instead of one, greatly improving their ability to stay under the CBT.

So, the CBT is making trades boring and unsatisfying. If you’re a Braves fan, maybe you were excited to see a star player in Gonzalez, even if he’s injury-prone and at the end of his career. Instead, he was simply dropped off at the curb right after the trade and all the Braves have left from the deal are second- and third-tier retreads. If you’re a Rays fan, perhaps you wonder why the club gave up Longoria, the best player in franchise history. Due to the esoteric rules, it’s more difficult than it’s ever been for a casual fan to understand why a trade was made.

But it’s not just trades that are affected by the CBT. Free agency has been greatly affected as well. As Brisbee points out, only a handful of free agents have signed big contracts since the offseason began. First baseman Carlos Santana got $60 million over three years from the Phillies. Shortstop Zack Cozart signed a three-year, $38 million deal with the Angels, and pitcher Tyler Chatwood inked the same deal with the Cubs. The Angels also signed Shohei Ohtani from Japan, but he’ll get a relatively meager $2.315 million signing bonus and then go through the arbitration process. First baseman Yonder Alonso agreed to a two-year, $16 million contract with the Indians. Most of the other players to have signed by this date are relief pitchers: Jake McGee, Bryan Shaw, Brandon Morrow, Tommy Hunter, Juan Nicasio, Pat Neshek, Joe Smith, Anthony Swarzak, Steve Cishek, Luke Gregerson, etc.

There just hasn’t been that much money going around in free agency this offseason and part of the reason why is teams wanting to avoid getting close to or exceeding the luxury tax and also wanting to avoid having to give up draft picks as compensation for signing players. Lots of really good players are still free agents and we are almost into 2018. Those players include Yu Darvish, J.D. Martinez, Jake Arrieta, Alex Cobb, Eric Hosmer, Mike Moustakas, Lorenzo Cain, and Lance Lynn. With the exception of Darvish and Martinez, the players on that list rejected qualifying offers and will require draft pick compensation.

Brisbee suggests that when the next collective bargaining agreement is negotiated, players will be “desperate to ditch” the CBT while owners will fight to keep it. It is quite possible that, in an effort to get rid of the CBT, the union will make concessions elsewhere, perhaps on international players or minor leaguers (who don’t have union representation). As of right now, though, we’re enduring one of the most boring offseasons we’ve had in quite some time.

Whitewash: Rob Manfred says he doesn’t think sign stealing extends beyond the Astros

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Rob Manfred said today that he believes the sign-stealing scandal which has taken over the news in the past week does not extend beyond the Houston Astros. His exact words, via Jeff Passan of ESPN:

“Right now, we are focused on the information that we have with respect to the Astros. I’m not going to speculate on whether other people are going to be involved. We’ll deal with that if it happens, but I’m not going to speculate about that. I have no reason to believe it extends beyond the Astros at this point in time.”

This is simply incredible. As in literally not credible.

It’s not credible because, just last week, in the original story in The Athletic, it was reported that the Astros system was set up by two players, one of whom was “a hitter who was struggling at the plate and had benefited from sign stealing with a previous team, according to club sources . . . they were said to strongly believe that some opposing teams were already up to no good. They wanted to devise their own system in Houston. And they did.”

The very next day Passan reported that Major League Baseball would not limit its focus to the Astros. Rather, the league’s probe was also include members of the 2019 Astros and would extend to other teams as well. Passan specifically mentioned the 2018 Red Sox which, of course, were managed by Alex Cora one year after he left Houston, where he was A.J. Hinch’s bench coach.

Add into this the Red Sox’ pre-Cora sign-stealing with Apple Watches and widespread, informed speculation on the part of players and people around the game that many teams do this sort of thing, and one can’t reasonably suggest that only the Houston Astros are doing this.

Which, as I noted at the time, made perfect sense. These schemes cannot, logically, operate in isolation because players and coaches change teams constantly. In light of this, players have to know that their sign-stealing would be found out by other teams eventually. They continue to do it, however, because they know other teams do it too. As is the case with pitchers using pine tar or what have you, they don’t rat out the other team so they, themselves, will not be ratted out. It’s a mutually-assured destruction that only exists and only works if, in fact, other teams are also stealing signs.

So why is Major League Baseball content to only hang the Astros here? I can think of two reasons.

One is practical. They had the Astros fall in their lap via former Astro Mike Fiers — obviously not himself concerned with his current team being busted for whatever reason — going on the record with his accusation. That’s not likely to repeat itself across baseball and thus it’d be quite difficult for Major League Baseball to easily conduct a wide investigation. Who is going to talk? How can baseball make them talk? It’d be a pretty big undertaking.

But there’s also the optics. Major League Baseball has had a week to think about the report of the Astros sign-stealing and, I suspect, they’ve realized, like everyone else has realized, that this is a major scandal in the making. Do they really want to spend the entire offseason — and longer, I suspect, if they want a thorough investigation — digging up unflattering news about cheating in the sport? Do they really want to be in the bad news creation business? I doubt they do, so they decided to fence off the Astros, hit them hard with penalties, declare victory and move on.

Which is to say, it’s a whitewash.

It’s something the league has tried to do before. They did it with steroids and it didn’t work particularly well.

In 1998 Mark McGwire, that game’s biggest star at the time, was found to have the PED androstenedione in his locker. It was a big freakin’ deal. Except . . . nothing happened. Major League Baseball planned to “study” the drug but most of the fallout was visited upon the reporter who made it public. It was accompanied by some shameful conduct by both Major League Baseball and the baseball press corps who eagerly went after the messenger rather than cover the story properly.

Four years later Ken Caminiti and Jose Canseco went public with their PED use and said drug use was widespread. MLB’s response was slow and, again, sought to isolated the known offenders, singling out Caminiti as a troubled figure — which he was — and Canseco as a kook — which he kind of is — but doing them and the story a disservice all the same.

The league eventually created a rather toothless testing and penalty regime. Congress and outside investigative reporters filled the void created by the league’s inaction, calling hearings and publishing damning stories about how wide PED use was in the game. Eventually Bud Selig commissioned the Mitchell Report. Some ten years after the McGwire incident baseball had at least the beginnings of a sane approach to PEDs and a more effective testing plan, but it was pulled to it kicking and screaming, mostly because doing anything about it was too hard and not very appetizing from a business and P.R. perspective.

And so here we are again. Baseball has a major scandal on its hands. After some initially promising words about how serious it planned to take it, the league seems content to cordon off the known crime scene and refuses to canvass the neighborhood. Sure, if someone gratuitously hands them evidence they’ll look into it, but it sure sounds like Rob Manfred plans to react rather than act here.

That should work. At least until the next time evidence of cheating comes up and they have to start this all over again.