Steve Berman of The Athletic — known to some as Bay Area Sports Guy – reported overnight that Major League Baseball is likely to hand down discipline to Giants CEO Larry Baer today. Possibly as early as this morning.
As you’ll recall, on March 1, Baer was caught on video having a loud, public argument with his wife during which he tried to rip a cell phone out of her hands, which caused her to tumble off of her chair and to the ground as she screamed “help me!” After a couple of false-start statements in which he seemed to dismiss and diminish the incident, Baer released a second solo statement, apologizing to his wife, children and the Giants organization and saying he would “do whatever it takes to make sure that I never behave in such an inappropriate manner again.”
On March 4, Baer stepped away from the Giants, taking “personal time” and relinquishing his CEO role, at least temporarily. Given Major League Baseball’s domestic violence policy, which does not require criminal charges to trigger discipline — and given how bad a look it would be for Major League Baseball not to take any action against Baer when it is certain that it would take action against a player in a similar scenario — it was only a matter of time before the league added to whatever discipline Baer and the Giants had decided to do on their own accord.
At the time of the incident I detailed Major League Baseball’s history of disciplining owners. As discussed in that post, it’s a tricky business, as owners don’t typically rely on salaries from their team and thus it’s hard to distinguish a suspension from a vacation. The examples cited there, however, at least begin to outline the tools at MLB’s disposal in taking action against Baer, and the league has no doubt been thinking about how to approach the matter for the past month.
We’ll see what they came up with some time today.
Jorge Castillo of the Los Angeles Times reports that the Cubs, Red Sox, and Yankees exceeded the competitive balance tax (more colloquially known as the luxury tax) threshold for the 2019 season, set at $206 million. It will rise to $208 million for the 2020 season and $210 million in 2021.
Teams that exceed the CBT threshold pay a penalty on the overage, which is compounded depending on how consistently they have exceeded the threshold. The base penalty is 20 percent. If a team has exceeded it in a second consecutive year, the penalty rises to 30 percent. Three or more consecutive seasons yields a 50 percent tax on the overage. Furthermore, teams that exceed the CBT threshold by $20-40 million see an additional 12 percent tax. Above $40 million brings a 42.5 percent penalty which rises to 45 percent if the team exceeds the CBT by more than $40 million in a consecutive year.
The luxury tax has acted as a de facto salary cap. Front offices typically have gone out of their way not to exceed it, especially in recent years. The Cubs, Red Sox, and Yankees are each widely believed to be looking to stay below $208 million in 2020.
In pursuit of payroll efficiency, the Cubs are believed to be willing to listen to offers for catcher Willson Contreras, third baseman Kris Bryant, outfielders Kyle Scharber, Albert Almora, and Ian Happ, as well as pitcher José Quintana. The Red Sox are believed to be pursuing trades of outfielder Mookie Betts and/or J.D. Martinez. Outfielder Jackie Bradley Jr. is also believed to be available. The Yankees, meanwhile, haven’t been linked to any of the top free agents. Accounting for projected arbitration salaries, their current 25-man roster is above $190 million already.
As we have been discussing the ongoing labor tension in baseball lately, one wonders if the CBT threshold might also be changed within the next collective bargaining agreement. It has served ownership well, giving them something to point at as a reason not to invest as much into putting together a competitive and entertaining product for fans.