The Business of Baseball: Tanking, Rebuilding, and Labor Relations

One of the narratives taking MLB by storm is the idea of tanking or losing intentionally in order to get better in the future. It was popularized in the NBA, and the Chicago Cubs and Houston Astros were deemed guilty of doing it. Because they tanked much of the baseball media decried the concept as ruining baseball or at the very least a shameless ploy, Since baseball is a copycat sport and the Cubs and Astros won World Series Championships, other teams are losing on purpose in order to build their teams via high draft picks and acquisition of prospects.

With a slow off-season that once promised young and elite players like Bryce Harper and Manny Machado mega-deals upwards to $500 million, there was a bit of a let down. Only a few teams were in on those two players, and they did eventually sign for very lucrative contracts, even if it did take until the start of Spring Training. During this offseason, players and media alike articulated exaggerated statements of tanking. They made statements like one-third or 80 percent of teams were trying to lose. Statements like these are couched in this way more for framing the pro-labor message than for accuracy. Messaging that is exaggerated and inaccurate only works for the base of each side (players vs. owners), and hinders credibility in the public sphere.

Right now the Detroit Tigers, Baltimore Orioles, Chicago White Sox, Kansas City Royals, Texas Rangers, and Miami Marlins are in obvious losing cycles. Four of the six have been to playoffs fairly recently with World Series appearances and one with a World Series Championship. The San Francisco Giants, Arizona Diamondbacks, Toronto Blue Jays, Seattle Mariners, Minnesota Twins, and Los Angles Angels are teams in the middle that are either hoping to be coming off rebuilds (Twins), entering potential losing cycles but were winners (Giants, Diamondbacks, Blue Jays), or have been trying to win but stay in the middle of the pack (Mariners, Angels).

The problem is that the facts tend not to support the assertion that 66-80 percent of teams are trying to lose. MLB is not the NFL or the NBA. High draft picks generally do not turn into quick to the professional ranks talent (Harper and Stephen Strasburg are more anomaly than norm and others that do see quick success often fall back to Earth like Kyle Schwarber and Cody Bellinger) like they do in the NFL and NBA. It would be foolish to rely on that line of reasoning. Drafting well is important, but is not likely the most important method of acquiring talent, even for losing teams. Acquiring prospects can be a means to winning in the future, but prospects are unproven, and baseball might be the most difficult sport to identify and develop talent. The means to building a contending team revolves around much more than just acquisition, i.e., analytics, player development, scouting, culture, biomechanics, communication, and so on.

Teams could theoretically tank so as to eliminate veterans from their payroll via trade and release. The problem is that teams entering a cycle of losing tend to trade away veterans to accumulate prospects to build financial flexibility so as to attack the market when the time is right. Are we saying the same thing? Yes and no! Yes teams who are in losing cycles do eliminate opportunities for veterans (although Curtis Granderson and Neil Walker signed with Miami to provide veteran presence). But overall no. This has taken place for a very long time. The reason for doing it is generally not nefarious. It is actually about acknowledging the present situation and setting the team up for success in the future. That is far from tanking, and one of the best examples of a team doing this in recent memory is the Milwaukee Brewers. As an aside, players could have taken the issue on in the past CBA, but did not.

In 2011 the Brewers were at the apex of a winning cycle. In their effort to try and win they traded for players like Zack Greinke and held on to Prince Fielder as they made a run to the NLCS and the NL Central title. A smaller market team going into that year could have been tempted into trading such a valuable asset as Fielder in the last year of his contract. He would have fetched a significant number of prospects, but Milwaukee held on to him and they almost went to the World Series. Even as 2011 ended and 2012 began, the Brewers were likely confident in their chances to contend again.

In attempt to replace Fielder’s production, the Brewers signed Aramis Ramirez and returned virtually the same team from the previous year. Offensively the Brewers scored more runs than any other team in the National League. Yet they finished third in the NL Central and failed to make the playoffs. Over the next few years, Milwaukee would be competitive, trying to win, but falling short.

In 2015 a decision was made to tear it down and the rebuild began, or as the narrative of today suggests, the Brewers began tanking and trying to lose. There were some that suggested that the Brewers would model the Astros. They fired Ron Roenicke and hired Craig Counsell to manage the club. They traded veterans like Carlos Gomez and Mike Fiers for four prospects (how did that one turn out again?). They signed David Stearns as the new General Manager. More and more trades, acquisitions, and mindset changes took place. The result was a 73-89 finish in 2016.

2017 began the sea change. There was virtually no one high on the Brewers’ chances (except the illustrious readers of BCB) going into that year. Yet the Brew Crew held first place in the NL Central for much of the season, and were eliminated from playoff contention on the next to last day of the season. Shrewd acquisitions and trades by David Stearns and Doug Melvin brought in Josh Hader, Travis Shaw, Corey Knebel, Eric Thames, Domingo Santana, Keon Broxton, Junior Guerra, Hernan Perez, Zach Davies, and Chase Anderson. The search for young, controllable talent became the motto of the Brewers front office, and they succeeded in that endeavor. And if not for the injury to ace Jimmy Nelson, Milwaukee likely captures a wild card birth.

Even this type of rebuild, one that is quick and intelligent, gets rebuked among some. The reason is there are more and more young players throughout baseball. As a result, veteran players that play around replacement level aren’t finding employment, or at least are having a more difficult time of it. With the hiring of Stearns and the recognition by Melvin of a coming losing cycle, the Brewers were quick to see this reality and pounce on it, and continue to pounce on it (Christian Yelich trade as well as Lorenzo Cain, Yasmani Grandal and Mike Moustakas signings). As a result, what was supposed to take 3-5 years took one measly year.

What is happening in MLB right now has little to do with tanking or competition. It has to do with baseball labor relations. It has to do with arguing, in an exaggerated and inaccurate fashion sometimes, from a point of reference to win an argument or to acquire support from a base (MLBPA - players vs. Commissioner’s office - public opinion). That fight is happening and will continue to happen for the next three years. The emphasis will continue to be that teams are modeling the Astros and Cubs of 2011.

In Milwaukee’s case, the front office is and always has been trying to win (at least since the hiring of Doug Melvin), and they are only reacting to the landscape they see in front of them. The results of 2015 illustrated a need to have a team that performed the way it did in 2016. But 2016 was about getting to 2017 and 2018. Now there are expectations higher than they have been in recent memory. Other teams are envious of Milwaukee’s success, and in counterpoint to much of the rhetoric coming out about tanking, the Brewers are probably more in line with the model that teams would like to emulate. That is a good thing for MLB, but doesn’t get the headlines or meet the political needs of the MLBPA.

As a writer who is sympathetic to the players, but also has a great deal of business experience, the MLBPA should be concentrating more on setting an agenda and framing messaging around service time manipulation, arbitration improvements, player compensation early in career, elimination of draft pick compensation attachment to contracts, salary caps and/or ceilings, increasing the number of roster spots on MLB teams, and minor league salary increases.

Focusing on accusations of tanking, collusion, replacement level players not getting major league contracts, and big time free agents taking longer to sign as symbolic of labor strife makes those that articulate such messages as less than credible, just provocative. In the fight for public opinion, the owners will take advantage of that. On the other hand, provocative statements from players and the union are coming from a sense of unfairness that is based in accuracy and had better get the attention of the Commissioner’s office and ownership, or else we might have 1994/1995 again. And unlike some writing about these topics, I am old enough to remember the repercussions of that time.