Sorry boys. You only have yourselves to blame.

Despite another year of record-setting revenues, Major League Baseball has just slogged through one of the coldest "hot stove" seasons in recent history. This situation has led to murmurs of collusion among players, agents, and the Major League Baseball Players Association (MLBPA). Are teams conspiring to hold down player's salaries? Nope. They don't have to.

The MLBPA agreed to let them do it.

The latest collective bargaining agreement (CBA) between MLB and the MLBPA instituted major changes in the competitive balance tax, more commonly known as the "luxury tax." These changes fail to keep up with baseball's vastly increasing revenue while encouraging teams to avoid the tax more than ever before. The changes can be broken down into two categories: payroll thresholds and penalties.

Payroll Thresholds

The payroll threshold is the amount of money each team can spend on player salaries before triggering penalties. In 2018 the payroll threshold is $197 million - a massive number. Or is it?

When the luxury tax was first introduced in 2003, the threshold was $117 million. At that time the average amount of revenue earned by each team was roughly $130 million. In 2018, it's estimated that the average amount of revenue earned by each team will be in the neighborhood of $350 million. In 2003 teams could spend 90% of the average team revenue on payroll without triggering penalties. Today teams can only spend 56% of the average team revenue without penalty.

Payroll thresholds have failed to keep up with ever increasing revenues. And the MLBPA agreed to this.

Penalties

Of course payroll thresholds mean very little if the penalties for surpassing them are light. In the current CBA, penalties have increased significantly. Every team that triggers a tax must pay a percentage of the payroll dollars that exceed the threshold as their penalty. In 2003, payroll above the threshold was taxed at 17.5%. The tax increased to 30% for a second offense and 40% for three or more offenses in consecutive seasons. That year, the Yankees' total payroll was $35 million over the threshold, resulting in a luxury tax payment in excess of $6 million for a first time offense.

In the current CBA the tax rates were raised to 20% for a first offense, remained at 30% for a second offense, and raised to 50% for three or more offenses in consecutive seasons. On top of that, new penalties have been added. Any team triggering the luxury tax shall forfeit their second and fifth highest picks in the next amateur draft and have its International Signing Bonus Pool (money that can be used to sign international players) reduced by $1 million. There is also a 12% surcharge for any team crossing the threshold by more than $20 million and a whopping 45% surcharge for crossing the threshold by $40 million. If the Yankees spend $35 million over the threshold this season like they did in 2003, their luxury tax penalty would be $22 million plus the loss of draft picks and international signing bonus money.

Luxury tax penalties have become oppressive. And the MLBPA agreed to this.

Collusion?

Is it any wonder teams are in no hurry to offer huge sums of dollars to free agents? Especially for a free agent class lacking in star power? The top spending teams are trying to cut payroll to avoid the new penalties. When the top spenders are taken out of the market, that means less competition for free agents. Less competition leads to fewer dollars offered in salary. That's simple economics, not collusion.

Now the question is why? Why would the MLBPA agree to changes which turned a soft spending cap into a very real salary cap?

Because the inmates are now running the asylum. Soon they may wish they had stayed in the background and collected their millions in silence.

The MLBPA let this happen

For nearly its first fifty years of existence, the MLBPA was led by men like Marvin Miller, Donald Fehr and Michael Weiner - economists and lawyers. These are men who knew the importance of seeing the big picture. Men who knew the importance of staying strong on financial issues and laughed when owners tried to buy players off by waving shiny trinkets in front of them. They understood what the players didn't understand. When it comes to negotiating a CBA, you don't receive anything without giving something up in return.

Players were happy to sign large contracts, but they felt like their voices were ignored. They were intrigued by the shiny trinkets. They already had plenty of money. What else were the owners willing to offer? Why didn't their union leader listen to them?

In 2013, MLBPA executive director, Michael Weiner, passed away. Tony Clark was elected by the players to assume his role. Clark is a former MLB player who served as a union representative during his playing days and was the director of player relations for the MLBPA before being elected executive director. He is neither an economist nor a lawyer. He promised the player's voices would be heard.

So when the current CBA was negotiated in 2016, Clark came to the table prepared to fight for what the players really wanted. He walked away with a number of new perks for the players:

Four additional days off during the season.
Full-time chefs to feed players in the clubhouse on game days.
Sports psychologists on call to counsel players as needed.
Extra seats on spring training buses.
Arbitration panels to consider reducing PED suspensions.

Lots of shiny trinkets.

Of course the owners expected the union to concede some points as well. These perks cost money. So the MLBPA agreed to major changes in the luxury tax. Why not? The players already have money, but look at all of the extra perks! The player's voices were heard.

So here we are today. Spring training is underway. The new season is right around the corner. Lots of sports agents are still trying find deals for their clients. Many free agents who have signed deals are not happy about the length or value of their contracts. After a 30-year absence, collusion has come back to rear its ugly head, right?

Sorry boys, not this time.

The MBLPA and all of its members have only themselves to blame.

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_{Cover photo credits: By Keith Allison [CC BY-SA 2.0], via Wikimedia Commons}

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_{Author: @chops316
Editor: @ats-david}

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