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What looms as just as stifling a factor on the market, certainly this year and likely for the foreseeable future, is the new collective bargaining agreement, which enables clubs to reset their competitive balance tax if they are able to stay under pre-determined payroll thresholds (this year $197 million). Whether they realized it or not, by bargaining this provision Tony Clark and the Players Association in effect established a salary cap for the owners. Marvin Miller must be rolling in his grave. Throughout all his rancorous (and ultimately successful) labor negotiations in the ’60s and ’70s, Miller’s pat expression was, “the owners are asking the players to protect them from themselves.”Well that’s exactly what’s happened this year with the Yankees and Dodgers both feverishly maneuvering to stay under the $197 million threshold. If the Yankees are somehow unable to stay under it, they will be taxed at 60% of their overage this year, and 90% if they go over it again in 2019. But if they do stay under it, their overage tax goes back to 20% in 2019. It’s a no-brainer, but in the meantime it has taken them out of the running for any of the frontline free agent starters: Arrieta, Darvish or Cobb.Without the payroll threshold restraint, you can bet the Yankees would have surely signed one of those three. With all their vast revenues, what do they care what their payroll is — especially next year with the extra $50 million payout each club is getting from MLB’s sale of BAMtech to Disney?
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Topic: Competitive Balance Tax (Read 13364 times)
