Why this year’s World Series won’t prevent a labor dispute that imperils the 2027 season
By Chris Isidore, Hannah Keyser, CNN
Milwaukee (CNN) — The Milwaukee Brewers play in Major League Baseball’s smallest media market and their payroll is the 19th highest of the league’s 30 teams. Their World Series win this week would seem to puncture the claim that baseball needs a dramatic economic overhaul to be fair for the proverbial little guys.
And yet, all indications are that the owners still intend to wage what is likely to be a contentious war in the upcoming labor negotiations, which will ratchet up in about a month and could wind up wiping out a significant portion of the next season.
But commissioner Rob Manfred told reporters just before the start of the World Series that the small-market Tampa Bay Rays, who have the 27th highest payroll, and the Brewers meeting in the Fall Classic didn’t change his position going into negotiations one bit.
“I think that small markets operate at a disadvantage economically. They just don’t have the resources that our bigger markets do,” Manfred told reporters before the start of the World Series. “The best evidence (is) the Brewers have been a well-run franchise forever. It’s been 40 years since we’re here. Once every 40 years is not enough.”
The players’ union has made clear that a salary cap is the hill they’re willing to fight and die on, even if similar unions in other major North American leagues have already agreed to caps. They see a cap, which would limit each team’s total payroll, as an attempt to limit salaries and increase owner profits and team valuations, more than any attempt to promote competitive balance.
“The results of these playoffs obviously further undermine their argument for why they (say) they want it,” said Bruce Meyer, the union’s executive director. “But again, that’s not the reason why they want it. The fact that they’re doubling down on the cap now in the wake of what’s happening with this World Series just illustrates that it’s not about competitive balance. It’s not about teams ‘not having hope.’
“It’s about, again, their desire, which they’ve had for decades, to have a system that artificially suppresses player salaries.”
Why owners are going for a cap now
The need to help small-payroll teams compete never seemed less important than at this moment.
The Brewers and the Rays held off the deep-pocketed Los Angeles Dodgers and New York Yankees, respectively, in the earlier rounds of the postseason. One of the most expensive rosters in any sport, the New York Mets, finished last in their division.
The last two championships were won by the Dodgers, a financial behemoth whose quest for a three-peat this season convinced some fans that the playing field has become critically uneven. MLB has leaned into this line of thinking with commercials that promote the appeal of a salary cap.
But Manfred basically admitted the reason for the fight right now is not because the competitive balance has become a bigger problem, but because the owners are more unified than in the past.
“We have an unprecedented level of unanimity among ownership that this is something that we need to do, that we need to get ourselves in a position to operate like all the other major professional sports in North America,” he said in response to a question about the timing of this negotiating priority.
“And our fan polling has moved hard in the direction of the fact that we have a problem, and that our fans see a salary cap as the answer to that problem,” he added.
Despite the lack of a salary cap, baseball’s competitive balance seems in line with other major American sports, if not more competitive. The Brewers are the 10th different baseball champion in the last 13 years, although the first champion to represent a market from the bottom half of MLB since the Kansas City Royals won in 2015. Over that same period, the National Football League, with a hard cap, had only seven different teams win the Super Bowl and the National Basketball Association had nine win the Finals.
Four of baseball’s champions during that period, including the Brewers, had never won a series, and four more had gone at least a quarter-century since their most recent title.
Spending more money on better players still means something. The champions — and the teams with the best records — are more likely to be the team that spends more, said Andrew Zimbalist, a retired professor of economics at Smith College and a leading expert on the business of sports.
“This year is not extraordinary, but it’s anomalous. It doesn’t usually happen this way,” he said.
Zimablist said the amount spent on payroll is responsible for only about 25% of the difference in win-loss record between teams during the season. That’s not enough to be determinative, but it does have an impact, he said.
That said, Zimbalist doesn’t think that competitive balance is the motivation for the owners’ demand for a salary cap.
“If an owner says to me, ‘Andy, I don’t care about profits. All I care about is competitive balance.’ I’m going to say, ‘Sorry, dude, I don’t believe you,’” he said. “I think it’s obvious that the owners are looking to have more stable profits.”
A lockout looms
The near-universal expectation is that owners will lock out the players on December 1, the day the collective bargaining agreement expires. A lockout is essentially the same as a strike, but one waged by management rather than by unionized workers.
An immediate lockout can increase the likelihood of an agreement being reached before the season starts in late March, avoiding the loss of broadcast rights fees and ticket sales.
That scenario played out in 2021-2022 when owners locked out the players early — the fight dragged on through the winter and what should have been the start of spring training. It wasn’t until Opening Day was imperiled that a deal was reached to delay the start of the season by about a week, but the full schedule ended up being played.
Manfred said he remains confident a deal can be reached early enough to not disrupt next year’s season. And he acknowledged the sport risks losing fans, who came to games in near-record numbers this year, if games are lost.
The last work stoppage to cost games occurred in 1994 and 1995 and was the most severe in baseball history. It led to the cancellation of the postseason, including the World Series. It clearly angered fans: Average per-game attendance did not return to pre-strike levels for 12 years.
That was also the last time the league formally proposed a hard cap.
Before that work stoppage, every labor negotiation dating back to 1972 resulted in some games being lost.
Early season games typically have lower attendance and lower television ratings, and that reduces the cost to owners if games are lost at the start of the year. That’s why Zimbalist and other experts expect the lockout to last into the spring and perhaps early summer, wiping out a third of the season or more. Perhaps a lot more.
Zimbalist said some owners have told him privately that they’re willing to lose an entire season to get the players to agree to a salary cap, which is what happened in the National Hockey League when it lost the entire 2004-2005 season to a lockout.
One possible deadline that could stop the lockout from going that far relates to the league’s broadcast contracts. If too many games are lost, networks would gain an extra year on their existing agreements, which baseball would not want to happen.
Most work stoppages happen when one side or both underestimate what the other side is willing to absorb to get their demands, said Victor Matheson, professor of economics at Holy Cross who specializes in sports business.
The two sides’ negotiation positions feel like that’s the case this year, he said, pointing to a potentially long and costly work stoppage, right as the popularity of the sport is on the rise.
“I just didn’t think that they would either side would be willing to kill the goose that’s laying the golden egg right now,” he said. “But I am deeply pessimistic.”
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