Time was when MLB players had been bound to one team for life unless that team traded them or decided they were no longer worth even the relative pittance they were paid. It was all owing to something called the “reserve clause.” It began as an informal and then formal agreement among teams not to sign away each other’s players, but then it evolved into a sort of continual club option that achieved the same end — freedom for teams but not for players. Needless to say, players had precious little leverage when it came to negotiating salaries, and teams were in essence bound to pay them just enough to prevent players from saying the hell with it and selling shoes or working a mill job full-time.
Arbitrator Peter Seitz changed all that in 1975 when he ruled in favor of pitchers Andy Messersmith and Dave McNally and the case brought before him on their behalf. In broad terms, team owners read the reserve clause as granting them the right to unilaterally renew a player’s contract in perpetuity. The players and revolutionary union head Marvin Miller, however, came to interpret the clause, which was part of every uniform player contract, as allowing owners to impose contract terms for only one year, after which point the player would become a free agent. Miller’s parsing was in keeping with the plain language of the clause, so in an objective sense it wasn’t surprising when Seitz came down on the side of the players.
What came to be known as the Seitz Decision did not eliminate the reserve clause. Rather, it compelled both sides to negotiate the parameters of it and in effect reconceive one of the structural pillars of the professional game. Not long after the Seitz Decision was handed down, owners locked out the players amid claims that free agency would destroy Major League Baseball (spoiler: it would not). That lockout raised the stakes of what was already one of the most important player-owner discussions in the history of such a thing.
We already know what happened. Players won the right to become free agents after a set amount of major-league service time — six years under the system that prevails now and has for some time. Long-standing familiarity with the six-year model has imbued it with a sense of inevitability. How else could it have been? That, however, is very much not the case. At the time, the structure of free agency was a tabula rasa, and into that uncomfortably blank space barged, for a moment, Charlie O. Finley.
Finley was the buccaneering owner of the Oakland A’s who regularly cast aside notions of tradition and even propriety in order to make another buck off his squad. While Finley was indeed a shrewd businessman, he was also regarded as a bit of a clown by other members of his guild for doing things like paying his players bonuses to grow facial hair, proposing fluorescent colored baseballs, and using a mechanical rabbit to deliver those baseballs to the umpire. Because of all that, it was easy for owners to dismiss it when Finley said, “Make ’em all free agents!”
Miller recoiled at the idea. “My main worry was someone would listen to him,” Miller was quoted as saying in John Helyar’s book Lords of the Realm. “It would have been an impossible box. You could not have said you were opposed to freedom.”
Miller feared a system in which the market would be flooded with players. According to his thinking, a trickle of free agents would be more likely to put upward pressure on the top salaries, and it would also satisfy ownership’s desire to maintain some level of control over players’ careers. Little wonder, then, that such a structure prevailed in the end.
But what if the other owners back in 1975 had listened to Finley and adopted his daredevil proposal? It would in essence mean a recognized ban on anything but one-year, non-renewable contracts in MLB. Japan’s major league, Nippon Professional Baseball (NPB), does not permit multi-year contracts. However, informal, “handshake” agreements on longer commitments abound in NPB, which means it’s a highly flawed guide to what things would be like in MLB. For the sake of discussion, let’s assume that such off-the-books maneuverings would be strictly forbidden and rooted out in MLB (as difficult as that might be in practice).
It says here that’s a tantalizing prospect — the idea of every player becoming a free agent every offseason. For the journeyman types that populate roster fringes, this would be nothing new, but for any player good enough or promising enough to merit a multi-year contract, whether via free agency or signed during his team-controlled years, this would be an entirely new existence with an entirely fresh suite of considerations. For the fan, it would be absolute madness, probably enough to leech the vigor from even the most devoted rooter.
Now let’s dig into what MLB might look like should what we’ll occasionally refer to as the “Finley Model” were to become the agreed-upon economic structure for players and owners. Even though said economic structure may be revisited during the upcoming collective bargaining agreement negotiations thanks to the players’ mounting dissatisfaction with it, there’s at best an infinitesimal chance that something like this would emerge. So consider this more idle thought experiment and any kind of realistic prescription for MLB’s future.
Questions and considerations forthwith…
A Finley Model offseason would be wholly insane
That hot stove season, in which free agent signings, trades, and managerial and front office turnover occur in abundance, is already a frenzied and engaging time in baseball. Make every player a free agent, however, and the hot stove becomes an annual core reactor meltdown.
It’s obvious from the premise, but it bears indulging in the specifics. This offseason, imagine that the likes of — contemptibly long list forthcoming — Mookie Betts, Mike Trout, Ronald Acuna Jr., Gerrit Cole, Juan Soto, Aaron Judge, Alex Bregman, Anthony Rendon, Freddie Freeman, Luis Robert, Jacob deGrom, Bryce Harper, Fernando Tatis Jr., Randy Arozarena, Manny Machado, Jose Ramirez, Tim Anderson, Shane Bieber, Nolan Arenado, Matt Chapman, and so many others all being free agents. That’s to say nothing of this year’s crop of actual free agents, which is headlined by Trevor Bauer, J.T. Realmuto, George Springer, DJ LeMahieu, and Marcell Ozuna. Then there are the middle class of free agents and roster fillers and even “graduated” prospects who didn’t quite move the needle in their rookie seasons but boast high ceilings (Dylan Carlson, for example).
The specifics can overwhelm, and they should overwhelm when the new reality is — as of the final out of the World Series — every team having exactly zero active roster spots filled for the subsequent season. Do the big names go first, or do most teams chip away at the margins while waiting for the superstar market to be set by some other club? You can come up with a raft of market-related unknowns such as that one, and each offseason may provide a different answer to each question. The only thing certain is that the roster churn, speculation, rumors, headline-grabbing deals, and fans and media appraisals of those decisions would flow at rates never before imagined.
Fan loyalty would be tested
Having a favorite team necessarily means developing an affinity for most and perhaps all of that team’s core contributors. The current system provides plenty of time to cultivate those fond feelings, at least in the absence of trades. Strip that away with universal one-year pacts, and fan loyalties would be greatly tested. “Tested,” though, is perhaps too mild a descriptor, at least if the results of this poll are any guide:
As you can see, almost two-thirds of fans think the Finley Model would decrease their interest in the sport, while not even one in five think it would make them bigger fans. Consider that to be a ringing condemnation of this idea from the consumer standpoint. But let’s go with it, anyway.
A key consideration is what becomes of those squandered team loyalties. Do they get offloaded onto individual players? That is, do we see an emerging demographic of Mike Trout or Mookie Betts fans instead of those loyal to specific teams? Do fans simply become followers of the sport in general instead of tethering their energies to one club? Or do those fans drift to other sports and other pursuits?
Another possibility is that rooting for an MLB team takes on the model of minor-league fandom. Minor-league teams necessarily endure heavy roster turnover from year to year, but they retain their fan bases, generally speaking. Perhaps this dynamic would take hold in MLB, with the local ties strengthened and promoted even more than they already are. Perhaps, though, team ownership would be incentivized to do everything they can to bring back their core players each year so that their customers have at least some continuity from season to season.
The ‘hometown’ pull might become stronger
Professional baseball players are famously not fond of the peripatetic lives they live in the minors, and of course those who settle in as journeyman at the highest level continue to endure the regular upheavals of uprooting their lives each winter and spring (albeit with better compensation and working conditions than those of minor leaguers). Few relish this sort of existence, and it becomes even more unsatisfying as players start their own families.
As such, players under this “one and done” system would probably be especially amenable to re-upping with their teams from the season prior. Add in the possible desire for ownership to achieve some semblance of carryover, and you’ve got incentives on both sides to keep the relationship going. This won’t always be the case, of course. A few wandering spirits may relish the idea of new places and new faces each season, and some players of course want to get out of their current situations. For the most part, though, players prefer to focus on their craft rather than devote themselves to the tedium of housing searches and change of address forms.
The other consequence of all this is that teams other than the incumbent squad might typically have to pay a premium in order to lure a player away (assuming his old team wants him back). That, in turn, means that year-to-year player turnover might not be quite as extreme as you’d think. Note, however, that this wouldn’t really dampen the intensity of the offseason. The unknown creates the intrigue, and each player’s status is indeed unknown until he inks that contract to return to his former team or packs up for points north, south, east, or west. One-year contracts make the unknown a truly dominating presence in the MLB offseason, and even if star players don’t sign elsewhere as often as you’d expect, the possibility that they could keep things taut.
But some players might prefer such a system
Reigning NL Cy Young winner Trevor Bauer is central to this discussion. In early 2020, Bauer claimed he’d never sign a long-term contract and would instead go year-to-year for his entire career. He’s since walked back that pledge, and it’s entirely possible he’ll wind up signing a multi-year pact this winter. Even so, here’s part of what he said on his YouTube channel at the time about the appeal of signing only one-year contracts (transcription via Redleg Nation):
“I want to be able to be happy playing the game that I love. So I want to end up in situations that make me happy and make me fulfilled. That can be situations like the Reds have, where there’s just a really great group of people that just make me fulfilled as a person.
“That can be situations like jumping into a team that’s going to go on a playoff run and hopefully win a World Series. That can be a team that would let me pitch every fourth day or treats me with respect in a way that no other team has. Or whatever the case is – there’s certain things that are more important to me than money. And I want to be able to control where I play and when and the situations I’m in so that as I change too, and things become more important to me, or less important to me as I evolve that I can tailor fit my situation to reflect that.”
Those are compelling arguments for having year-to-year freedom, assuming you’re a player who’s wanted by multiple teams on a year-to-year basis. However, players of or approximate to Bauer’s caliber can choose to sign one-year contracts under the current system. In other words, they don’t need the Finley Model to set such a structure and force it on all other players. Consider Bauer’s thoughts at the time to be an endorsement of the freedom that exists presently and not the Finley Model.
Player-owner balance would be recalibrated
For the most vested of parties — i.e., owners and players — the central matter is what such a system would mean for player salaries. Would the players’ overall share of revenues go up, or would owners claw back even more? Divining an answer to that hypothetical question isn’t easy, so we turned to Matt Swartz, an economist and consultant to an MLB team.
Swartz tells CBS Sports that he believes the Finley Model would reduce player salaries. According to his thinking, what drives up salaries are teams that believe they’re a free agent or three from making the playoffs. Teams that have, say, at least a .500-ish roster foundation going into each offseason have realistic designs on the postseason. Those, generally speaking, are the teams that try to buy “wins” on the market to take their playoff odds from varying shades of solid-average to outright strong. “Half of the league is always close enough to the playoff bubble that they will bid up the salaries of players,” Swartz says. “That is clearly the equilibrium, in the sense that it keeps working out that way.”
That contention-worthy baseline enjoyed by roughly half the league, however, depends largely upon cheap, homegrown talent, and under this system there would be no such thing. They’re all free agents, you’ll recall, and their salaries will be determined by market conditions and not service time. That, according to Swartz’s thinking, would reduce the number of teams that wound up with playoff-caliber roster foundations. He elaborates:
“When I think through what would happen in a situation where everyone is a free agent, I try to think about what a stable equilibrium is. A stable equilibrium is going to be such that no team is going to respond differently to incentives and make itself much better off. It is hard to imagine the current talent distribution being such that we end up with a lot of teams with .500 talent levels. I can envision a situation where the large-market teams sign the top players first and the small-market teams realize that they are not close to competitive and never bid on players. Pulling together 75-80 win teams just doesn’t seem logical for them.
“As a result, I would guess you end up with 20 very bad teams in the current playoff structure and all the top players going to 10 playoff-caliber teams that easily make the playoffs. At some point, wins start becoming less valuable because all they do is give you a marginally better chance at the playoffs among the large-market teams. So they start paying enough to keep those guys away from the bottom 20 teams, but not all that much to make the difference in between having the best catcher as opposed to the 5th- or 10th-best catcher.”
MLB owners and the corners of the sports media that reliably represent their interests have long insisted that baseball has a competitive balance problem. Those concerns have been wildly overstated in the service of tamping down player salaries. With a one-and-done structure in place, though, they might finally get their “wish.” That’s because it’s entirely possible that the teams with the deepest coffers would be the ones competing for the premium talents each season.
The obvious solution, as Swartz points out, would be to expand the playoffs. Going from 10 teams to 16, as MLB did during the one-off 2020 season, would necessarily expand the pool of contenders and thus the pool of spenders. As well, built-in incentives that, for instance, presented the top teams with a bye or some other competitive advantage in the postseason would provide additional positive spending cues. “That way the largest market teams would have a real incentive to bid up on players to keep them away from the mildly large-market teams,” Swartz says. ” Failing that, I think the all-players-free-agent structure sets a model that encourages a handful of surefire playoff teams to keep all the best players.”
Along similar lines, MLB would need to decide where it stands on player-to-player recruitment. Is it permissible for free agents to lure other free agents to sign with the same team? Or would that be considered elicit tampering? Some of this goes on in the NBA, but in MLB there would be no hard salary cap to navigate, which would in theory make it easier (assuming there’s team willing to sign all co-conspirators). Given the challenges of policing tampering violations, there’s a case to be made that laissez faire should prevail in this particular area.
Teams could reset luxury tax status more easily
The Competitive Balance Tax (CBT), or luxury tax in common baseball parlance, is a levy on payrolls that exceed a certain threshold. That threshold is based on average annual salaries, and going over brings with it penalties — penalties that increase in severity based on how much the team is over the line and how many years in a row they’ve been in “violator” territory. While those penalties aren’t especially steep in light of how wealthy MLB teams are, owners tend to over-respond to the incentives built into the CBT and use them as an excuse to tamp down on payrolls. In that way, the CBT threshold serves as a soft, stretchy cap.
Most seasons, a handful of teams go over the CBT, and a smaller subset achieve repeat offender status. Every now and then, those repeat offenders prioritize getting under the line for a full season so they can reset their penalty schedules. In recent years, we’ve seen the Yankees and Dodgers do just that, and of course the Red Sox traded away their franchise legend Betts in the service of resetting their CBT penalties.
Under the one-and-done system, however, it becomes quite easy to get under the CBT, at least as it currently exists. The biggest hurdle toward reducing payroll is usually the long-term contract, which counts against a CBT figure on an average annual value basis. Multi-year commitments, often backloaded so that the highest salary years occur toward the end of the contract, can be hard to trade, even when the player is still highly productive. That becomes a challenge for teams more concerned with reducing costs than winning baseball games (a phenomenon that is far too much with us these days). Under this structure, though, there’s no such thing as a long-term contract, and all a team that wants to get under the CBT needs to do is simply devote a sufficiently lower dollar figure to payroll in the following season. Allowing one’s high-salary players to walk and sign elsewhere is of course far easier than trading them away along with their future commitments. This might mean we see more “pivots” in which teams vacillate between contending and non-contending status without committing to a full rebuild.
Speaking of rebuilds, they’d essentially be nothing more than drastic cost reductions. Trading for prospects and self-immolating in the name of improved draft position are hallmarks of the current rebuilding approach, but those things wouldn’t be part of the MLB landscape under the Finley Model. Here’s where we talk more about that.
The minor leagues would be drastically restructured
Consider that the Finley Model would in essence strip away all incentives for teams to develop prospects. Right now, teams in most cases get three years of major-league service time from their young players before they realize any appreciable jump in salary and at least six full years of service time before they’re eligible for free agency. Under this system, however, teams would get one year from their farmhands-turned-rookies before they hit the market alongside every other MLB player. That lone year is far from enough to motivate teams to invest in player development at levels even approaching what happens in reality. Or, as one MLB team quantitative analyst puts it, “[T]he entire player development department would disappear, likely leading to a much inferior product on the field as teams no longer have incentives to train a 19-year-old to throw a curve or hit 95+ fastballs.”
The draft, too, would likely disappear, at least in its current form, as teams would control their draftees for such a limited amount of time. Obviously, the prospect who’s ready to ascend to the majors directly from the amateur level is vanishingly rare, so some kind of developmental framework would need to be in place. In this instance, some kind of centrally controlled minor leagues would probably emerge. It might look something like the G League Ignite team of the NBA writ large — i.e., entire circuits of teams made up of promising amateurs, former major leaguers trying to revive their careers, and roster fillers run by the league as opposed to being overseen by MLB organizations.
Needless to say, such a structure presents a host of challenges and concerns. Chief among them is that MLB teams would not be able to implement their preferred developmental methods at the lower levels. Instead, each prospect would grow their skills under some kind of centralized approach. Maybe the draft then becomes an annual event drawing from that large pool of prospects, and teams would draft just those players deemed ready to help the major league team immediately (and for only one year before becoming free agents). Or maybe prospects are just lumped in with all of the other free agents. In that case, they’d trickle in as teams determine they’re ready for the highest level or return to the developmental program.
Whatever the specifics, it’s likely that such a momentous change in the way prospects are developed would damage the game at a fundamental level.
The trade deadline would be … dead, probably
Here we delve into an even murkier unknown. Do contractual no-trade provisions crop up? It’s likely players would want them, and without question a certain class of player could command them through negotiations. Likely, those clauses would become firmer than they are right now. That’s because right now no-trade clauses are more negotiating levers rather than unmanageable obstacles. When a player with such a clause is approached about a trade, he’s often willing to waive his clause in exchange for his new team’s willingness to exercise a pricey option or sign him to an extension. Under a salary structure that includes no options and expressly forbids extensions, however, the no-trade clause becomes exactly what it sounds like — a means to prevent being traded, full stop. Perhaps the lure of playing for a contender is enough to prompt the player to waive his clause, but that’s about the only foreseeable incentive.
All of that, however, elides a larger point — there are no longer any trade-able prospects. As explored above, one likely upshot of the Finley System is that prospects are developed centrally and on unaffiliated teams, which means they don’t “belong” to any one team. Thus they can’t be traded. Thus the “veterans for prospects” dynamic that’s present in the vast majority of trades isn’t there. Instead, the trade becomes merely a way to offload salary obligations. Yes, salary considerations motivate a lot of trades presently, but in the Finley Model they become the sole motivator for the seller team. In other words, these trades would be interesting from the standpoint of the buyer, who gets a productive player or two, but crushingly banal for fans of the seller team, who gets lower-cost roster filler.
As for offseason trades, they’d go away entirely, assuming newly signed players weren’t allowed to be traded for a significant period of time.
Analytical work would become even more important
On the one hand, front office quants would be tasked with advising the higher-ups in baseball ops on how to fill every roster position. On the other hand, they’d have to concern themselves only with projecting performance for the upcoming season. Teams these days don’t hand out long-term contracts, whether in the form of extensions or free agent signings, without a reasonable degree of confidence that the player in question will provide a healthy return on investment at the front end of that contract. That confidence, though, is relative.
For all our advances in the field of analytics, there’s still an element of blind soothsaying about it. Ascertaining how even a consistent high performer like Mike Trout is going to produce five or six or 10 years out is so challenging as to border on the impossible. With this hypothetical system in place, however, such onerous responsibilities would go away. All that matters is the season to come, and it’s far easier to formulate an educated guess about that.
What’s far more onerous is the overwhelming amount of roster churn involved. The quantitative analyst for an MLB front office introduced above tells CBS Sports that such a system would drastically expand the role of analytics in the game, and that’s the case even after you remove the challenges of projecting long-term player performance. “As it stands now, even with a robust team of scouts, it is impossible to get recent reports and on all available players,” the analyst says. “If we increase the number of available players by an order of magnitude, then analytic scouting reports — which can be done in huge batches — will become the core foundation of all in-person scouting that follows.”
While that’s probably a good thing for aspiring front office employees — MLB teams would likely expand their analytical staffs by quite a bit — such an over-reliance on statistical outputs would perhaps not be such a positive. The analyst we spoke to envisions “fewer out-of-nowhere players (guys who make changes but don’t have data yet to show the changes) and more disaster clubhouse fits (as scouts struggle to keep up with crucial makeup investigations)” on every roster. Suffice it to say, that would be detrimental to the quality of baseball at the highest level.
So where does that leave us after our walking tour of the Finley Model? As fans, we should take our cues from Marvin Miller and be grateful that Finley’s fellow owners weren’t willing to listen to him. Yes, the offseasons under the Finley Model would be transactional orgies, but that would hardly make up for the many ways in which the game would be defaced by such a system.
So … as you were.