Re-starting Major League Baseball Part III: Transparency equals trust
In the past few days I’ve shared some thoughts about the motives of the owners and the MLB Players Association as well as the dynamics of their positioning in the negotiations. Today’s piece is perhaps the most important as it deals with the most critical aspect of any constructive negotiation: trust. And trust is in short order today, perhaps more so than at any time in the recent past. But I’ve personally lived through the crushing work stoppages of 1981 and 1994, which I do not want to see replicated at a time when we need the love and the spirit of baseball the most. And further, it is utterly avoidable.
The lack of trust is pervasive given the dynamics of a legally-sanctioned monopoly coupled with players who are sophisticated and acutely aware of their value to the monopoly of which they’re the engine of value. Team values rise as performance on the field becomes increasingly compelling and the prices of TV contracts, ticket sales and merchandise revenues grow. There are abundant revenues to share that should drive strong relationships between the players and the owners, but this hasn’t occurred given the way the business is structured. Opacity reigns. Showdowns between owners and the MLBPA are like shootouts at the OK Corral. Much if not all of this showmanship could be averted through an open-book approach to revenues that aligns partners’ interest (because come on, the owners don’t own anything without the players and the players can’t get paid to play baseball without the owners). It’s the partnership aspect that’s missing in the way baseball currently handles its finances, and it’s to the detriment of every party: the owners, players, fans, and those oft forgotten but important people who help make the engine run — stadium workers, those throughout the Minor Leagues, as well as businesses whose livelihood is reliant on baseball being played. Wouldn’t it be great if everyone could take a big step back and ask: what are we doing and why are we doing it? Is it really going to increase long term value if we’re being greedy and optimizing for the short term? These are basic negotiation questions that seem to lack purchase when emotions get hot and the pressure rises in the face of public scrutiny.
Consider the juxtaposition of these articles, Joel Sherman’s piece in the NY Post that carries a leak that, in fact, the MLBPA had left the door open for subsequent negotiations after March 26th should baseball not be played in front of fans, while Variety ran a story concerning the ground-breaking of a $2.5 billion project 50% controlled by the SF Giants ownership while they were claiming poverty and crushing losses associated with the MLBPA negotiations. The fact of the matter is that none of this really matters. Whether Sherman uncovered an inconsistency in the MLBPA’s statement or not, the fact remains that the owners, as a group, have more than enough resources as equity owners of the business to make good on the losses of playing games in the absence of fans. The truth is that they don’t want to bear these losses, and that they’re hoping they can be treated as equity owners in the good times and starved debtors in the bad times. But this belies the truth, one example of which is highlighted in Variety’s article. This is no way to run a league, manage relationships with key constituencies or to cultivate long-term goodwill. In fact, each action exemplifies the converse. And as I’ve said previously, much as the owners would like to claim poverty in these negotiations, do you want to know when they’ll have a rightful claim to poverty? When they’ve pushed the players to the brink where they won’t play. And it won’t be the players’ faults. It will be theirs and theirs alone in not providing an environment of trust. And then we’ll see permanent diminution in the value of their assets. And the country’s Greatest Game, which is already being challenged on myriad fronts (basketball, soccer, e-sports, etc.), will be no more. You can play chicken only so long until you become a turkey. And we’re getting pretty close to that point.
The answer lies in trust-building through openness, disclosure, alignment and partnership. I don’t care if the owners’ have the benefit of an anti-trust exemption: it is worthless in the face of the existential risk to the game. Economics, ethics and fairness can bring us all back from the brink, and it is within the power of the owners and the MLBPA to come to the negotiating table in good faith with a new frame, one where both sides are on the same side, not as opponents in a blood sport where everyone loses. Come on, people, you can do this.
Signed, A Baseball Fan.
