Anthony Rizzo Speaks Up on the Luxury Tax, Team Spending Restraint, the CBA, and More

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Anthony Rizzo Speaks Up on the Luxury Tax, Team Spending Restraint, the CBA, and More

Chicago Cubs

Although a storm was likely brewing long before then, the combined effects of the 2018 and 2019 ice cold offseasons were obvious and immediate. The tension between the players union and the league grew with each passing day, and became even more tangible after the union was forced to create a free agent spring training camp for the 100 or so players yet unsigned (remember that?).

Fortunately, there was no need for the free agent camp last spring, but still many high-quality free agents with impressive resumes received smaller than expected contracts and many others went unsigned well into the regular season (Dallas Keuchel, Craig Kimbrel for a couple examples).

This offseason, free agency moved much more quickly, and the market is still strong for the top-of-the-mountain contracts, but a number of teams have clearly limited their outlays on new contracts strictly for financial reasons.

The primary driver of those limitations and player distress about spending? The Luxury Tax.

Although MLB has long employed a luxury tax (“Competitive Balance Tax”), it wasn’t until the 2016 CBA that things really went sideways, as Theo Epstein recently indicated.

The new CBA, with its harsher luxury tax penalties (including, potentially, draft picks) and multiplying forces for repeat offenders (both in the tax and the loss of revenue-sharing funds) acted more like a strict salary cap than I think all but a few players in the association could’ve imagined. For at least a couple years now, the luxury tax has been used as a method to limit the sort of rise in overall payrolls that would match the rise in league revenues (that’s ultimately the heart of the players argument: if teams are making more money than ever, so should the players).

And we’ve seen the impact – particularly the aversion to being over the luxury tax multiple years in a row – right here in Chicago, as well as with the recent Mookie Betts trade.

If a big market team like the Boston Red Sox, who just won the World Series two years ago, can trade away one of the best young players in the game, Mookie Betts, in a deal that attaches a bad contract (David Price) as part of an overall effort to get under the luxury tax, there’s an issue here that is going to impact players all around baseball.

And one veteran Chicago Cub took to the mic to voice his concerns.

“I think the luxury tax wasn’t meant to be a salary cap, and teams are treating it like that,” Anthony Rizzo told the Sun-Times. “Are you sacrificing winning a championship to be under the tax threshold? Who knows? We don’t know that.”

Rizzo got more specific, pointing to his own team’s inaction: “You’ve seen it the last two years with us: We haven’t gone out [and signed big free agents]. But the few years before that, we’ve gone out and signed megadeals.”

The substance of Rizzo’s comments isn’t particular new, his willingness to speak up on the matter is. As a veteran not only on the Cubs but of the league as a whole, speaking with as much weight as any player (certainly in Chicago), Rizzo’s perspective is an important one. Frankly, I’m glad to see he feels empowered to comment publicly at a time when the CBA is no doubt already being negotiated behind the scenes, and is clearly also being negotiated in public.

What’s less comforting, however, is the lack of optimism and the bluntness of his tone: “Listen, right now more than ever in baseball, players are being treated like commodities. We want to win because that’s what we’re bred to do – be baseball players and win …. How much this game is making, it’s not [out of line] for us players to speak up.”

Player concerns about how the last CBA changed the financial landscape in negative ways are well-founded. There’s no denying, for just one example, the effect the luxury tax has had on teams offseason plans *and* there’s really no questioning whether those actions are strategically sound given how the CBA operates: They are. In a lot of really unfortunate ways, the Cubs are right to not exceed the luxury tax, given what it would mean for next season and beyond. But that’s exactly the problem. Whether it was expected or not, the current luxury tax rules have led to outcomes that harm players and do not necessarily enhance the product on the field for fans.

If there’s any hope of avoiding a strike in a couple of years when the CBA expires, the owners must remain open to significant changes, even at the expense of short-term dollars. That may require more flexibility on their part than they’d like to concede, but we’re reaching a critical point and they need to see the bigger picture for the long-term health of the sport – isn’t that ultimately good for all sides, financially or otherwise? Nobody needs to be pennywise, pound foolish on this.

As Rizzo put it when talking about these issues: “There’s Billions and then there’s Millions. There’s a big difference between the ‘B’ and the ‘M.'”

Author: Michael Cerami

Michael Cerami covers the Chicago Cubs, Bears, and Bulls at Bleacher Nation. You can find him on Twitter @Michael_Cerami