Today, I'd like to pick up where we left off yesterday, discussing the issues in baseball's labor negotiations and the positions of the two sides.

While direct sharing of local revenue and the competitive balance tax are the primary mechanisms management has proposed to bring more money to the lower-revenue teams, they also have other propositions with similar goals. For example, even though players receive the same pension benefits regardless of salary, MLB would like teams to contribute to the pension fund based on their payroll rather than an even 30-way split.

Additionally, MLB would like to establish a fund using money from the national broadcasting and licensing contracts from which the commissioner can unequally distribute money. That money is now a part of the central fund and is distributed evenly among the teams. Players are open to a $40M fund, but management would like $85M in the commissioner's discretionary fund. I'm wary of putting any money indiscriminately in the hands of the commissioner, so hopefully the two sides will come to a compromise closer to the players' number.

Steroids
The union has offered a major compromise on the issue of steroids, agreeing to one or more survey tests for illegal steroids in 2003 with the purpose of determining if there is a widespread problem. Reportedly, if the tests show that less than 5% of the players are taking the drugs, then another set of similar tests will be taken in 2004 to confirm that reading, and the matter will be dropped. Players would still be subject to testing for cause, if specifically suspected of use. However, if the tests show that more than 5% of the players are using steroids, then they will be subjected to random unannounced tests for 2 years.

Unfortunately, management hasn't acknowledged the depth of the players' concession and still wants the ability to test for over-the-counter legal drugs such as androstenedione, creatine, etc. and recreational drugs. Considering the privacy issues involved, I think that management should certainly settle for what they've been offered. If teams still think there's a problem, then they can include an extra paragraph in the section of players' contracts prohibiting riding motorcycles, skydiving, and spelunking, since players incur added health risks when taking the drugs.

Arbitration
While the owners would like to be able to revoke contract offers after the two sides have exchanged arbitration numbers, such a provision makes little sense for the union, as it basically eliminates the benefits of arbitration for the players. Under such conditions, management could withdraw from any arbitration case they felt they might lose.

The main element of arbitration under negotiation is the status of the "Super Twos". Super Two status is given to those players time in the top 17 percent of service time between two and three years of service, allowing them to become arbitration eligible with slightly less than three years service time. This added eligibility is one of the few concessions the union has won since its formation. However, given the limited number of players affected by the provision, they're currently expected to let it go.

Minimum Wage The two sides have reportedly agreed to a $100,000 increase in the minimum wage, which will jump the base salary of players from $200,000 to $300,000.

The Draft
I'm at a loss regarding the position of both sides in terms of the amateur player draft. The union should have little interest in the draft, as I believe players do not become union members until they're added to a 40-man roster. While it's nice of the MLBPA to look out for their future members, the draft really isn't their concern except as it relates to the spending habits of teams.

Seemingly contrary to their interests, the union wants a significantly shorter draft, cutting down from 50 to 16 rounds. If there are fewer rounds to the draft, then teams will likely spend more signing players as nondrafted free agents, taking away from the money available to sign union members.

The union members should desire a long draft with set bonuses based on draft slot to hold down the costs associated with acquiring amateur talent, freeing up more money for their salaries. Owners should agree with the idea, as their costs are reduced. The only parties who suffer from such an arrangement are player agents and amateurs, neither of whom are represented by either negotiating team. Drafted players will have the opportunity to benefit from the union once they've earned their position in the majors and agents shouldn't factor into the equation.

Management has proposed a worldwide draft, which poses all kinds of logistical problems in terms of arranging for players from other nations to submit themselves to the rules of the draft. A worldwide draft should make high profile international players more widely available to teams regardless of budget. However, players will still be able to hold out if they don't like the contract offers, so the Royals won't necessarily be signing the Ichiro Suzukis of the world. Additionally, teams will still have to put money into their international scouting departments in order to take advantage of the wider player pool.

The players have taken a special interest in the fate of teams' international academies from which organizations currently develop and sign foreign players. Some franchises spend considerable sums on these academies while others invest very little. The union fears that if the academies are left intact in the hands of individual clubs, the attendants will be passed over in the now shorter draft and signed as nondrafted free agents. Therefore, they propose MLB consolidate and run the academies as a group project. Due to the money already invested by individual teams, owners disagree with this proposal.