Baseball strike in 1994-95 began 25 years ago
On August 11, 1994, there were nine games. Pretty typical for a Thursday, which is often a travel day. Fridays are almost always full slates. But on Friday, August 12, 1994 -- 25 years ago today -- there were no games at all. And there would be none for the rest of the season, with nearly 950 regular season games cancelled along with the playoffs and World Series. The 1994-95 Major League Baseball Strike had begun.
Most of us who were old enough to pay close attention to the strike at the time probably remember the response to the strike by fans, the media and the general public as, at best, a “pox on both your houses” kind of thing, with the players and the owners both being blamed for the disappearance of the National Pastime. Most people, however, blamed the allegedly greedy players almost exclusively. They were millionaires who wanted more money to play a kids’ game than any of the rest of us would see in our lifetimes, the story went. Why were they striking anyway? The owners said they were going broke! All the owners were asking for was a salary cap, just like football had, and football was thriving. If it worked there, why wouldn’t it work in baseball? Why ruin what had been a wonderful, historic season to date with a work stoppage?
If only it were so simple. If only it were about the players and the owners not seeing eye-to-eye on a competing set of proposals in a given round of negotiations. Then, perhaps, a strike could’ve been easily averted. The 1994-95 strike, however, was about far more than that. It was the culmination of nearly 30 years of acrimony between the players and the owners, fueled by distrust, deceit and resentment. Thirty years which had already seen numerous skirmishes and at least one protracted battle between the sides but which broke out into full-scale war in August 1994.
Today, and in the coming days, a lot of stories will be written about what happened in 1994. Indeed, later today we’ll have stories about the wonderful 1994 season that was, sadly, cut short, a look back at the players whose careers were cut short by the strike and a look at what was, perhaps, the worst decision in baseball history -- the hiring of replacement players in an effort to break the strike -- which, thankfully, was never fully carried out.
To start, though, we’d like to take a deeper dive. We’d like to give you a look at why the strike even happened in the first place. It’s not a story that began in 1994. Indeed, the 1994-95 strike was, in hindsight, the inevitable product of 30 years of labor battles in which one side grew in strength, from almost powerless to imposingly powerful, over time while the other side was initially dismissive, then caught off guard and then, out of panic, reacted in increasingly desperate and aggressive ways.
How did baseball get to the low point it reached in 1994? To understand that, we have to go back to where it all began.
In the beginning -- and for most of the entire first century of professional baseball’s existence -- the owners controlled basically everything. In the first decade or two of professional baseball players freely shopped their services around and made pretty decent money for the day, but in the 1880s the owners imposed the infamous Reserve Clause, making it part of every single player’s contract. The Reserve Clause gave teams rights to a player’s services in perpetuity, sapping players of any power they had and of any control they had over their professional lives. Owners dictated if players played, where players played, and how much money the players made. If they didn’t like it they could go get a job in a factory or something.
Not that the players completely laid down in response. They mounted a few efforts at unionization over the years. Indeed, in 1890 they even started their own competing league. That league lasted exactly one season and, for the next half century little came of their efforts.
In the 1940s, in response to some additional but ultimately aborted efforts to unionize by the players, the owners set up a pension system for the players. Pensions were, primarily, what those aborted efforts sought, so this assuaged them for a while. By the late 40s, however, it became clear that the pension plan was woefully underfunded so, in 1953, the players formed the Major League Baseball Players Association. Bob Feller was its first president. He was advised by a labor lawyer named Jonas Normal Lewis who personally opposed the notion of striking, supported the reserve system and worked for the same law firm that represented the owners of the New York Giants. That was less than ideal. So too was the fact that the early MLBPA had no office and players weren’t big fans of paying union dues, rendering the mostly powerless union mostly insolvent as well.
The union, nonetheless, carried on for the next decade and change, with Lewis getting fired and Feller stepping down in 1959. Their next leader -- Judge Robert Cannon -- was only a part time legal advisor. Worse, he was even more conflicted than Lewis in that he wanted to be the Commissioner of Baseball and openly lobbied for the job. To the extent this troubled the players it was counterbalanced by their unwillingness to own the idea of a strong union. The players -- thanks to (a) an extraordinarily successful century-long, owner-led propaganda campaign which convinced them they played a game for a living rather than worked in a profession; and (b) the larger anti-union sentiment which is frequently prevalent in American society -- were wary of hiring a straightforward labor guy to lead the MLBPA full time. Unions meant the mob and corruption and ugly strikes that would cost players paychecks, they thought, and they didn’t want any part of that.
By 1966, however, the players’ concerns about the pension being underfunded resurfaced and, their fears of what a strong union meant notwithstanding, they decided to hire someone full time. The final two candidates were legal advisor Judge Cannon and a former chief lieutenant in the United Steelworkers union named Marvin Miller. The players voted to give Cannon the job. Then he asked for too much money and, when the players balked, the owners offered to pay him the difference. One would think that would be a red flag but the players apparently still wanted him for some reason. They were saved from their own idiocy by Cannon backing out, so they hired Marvin Miller.
Marvin Miller changed everything. Entire books can be -- and have been -- written about his tenure. For now, though, let’s walk through it briefly:
- As soon as Miller took office in 1966 he renegotiated the pension plan in such a way that not only increased its value to players but which, due to (a) his pointing out that the owners had illegally withdrawn money from it in the past; and (b) the owners making ridiculous lowball offers before caving, galvanized the once-disinterested union membership behind him;
- In 1968 Miller negotiated the first Collective Bargaining Agreement which won the players a 42 percent increase in minimum salary and written procedures for the arbitration of player grievances before the commissioner. The next CBA, in 1970, gave the players even greater grievance arbitration rights, establishing neutral three-arbitrator panels rather than hearings before the commissioner. This would prove to be extraordinarily significant in just a few short years;
- From 1969-72, Curt Flood mounted his legal challenge against the Reserve Clause, objecting to his being traded by the Cardinals to the Phillies. While Flood ultimately lost that case, his challenge -- and Miller’s support -- emboldened other players to challenge the Reserve Clause, which would likewise be extraordinarily significant in just a few short years;
- At the beginning of the 1972 season Miller led the MLBPA on a 12-day strike -- the first strike in the history of Major League Baseball -- over pension payments and in an effort to obtain salary arbitration. The players won on both counts. They now knew the power of collective action and would be less wary of using it in the future;
- In 1974, Oakland A’s star pitcher Catfish Hunter used the arbitration procedure Miller had obtained for the players to challenge A’s owner Charlie Finley’s failure to make a contractually-obligated annuity payment. Hunter won and, because Finley had breached the contract, it was torn up and Hunter became baseball’s first star free agent in nearly a century. He’d sign with the Yankees for a then-enormous five-years and $3.5 million with a $1 million signing bonus. If the players doubted the value of free agency they knew it now;
- Later that year Miller convinced two pitchers -- Andy Messersmith of the Dodgers and Dave McNally of the Orioles -- to play out their contracts and not sign new ones, after which they sought an arbitration ruling that they were, in fact, free agents. In 1975 they won, with the Seitz Decision ending the Reserve Clause and ushering in the age of free agency. Baseball players’ indentured servitude was over;
- In 1981 the owners attempted to claw back the gains players had made as a result of free agency by seeking a Collective Bargaining Agreement provision in which teams that signed free agents had to pay compensation to the player’s former club. The players, not willing to give back that which they had gained, struck again in response. The strike began on June 12, 1981 and play resumed on August 9, 1981. The owners did not get their compensation provision.
Miller stepped down in 1982. In his 16 years at the helm, he navigated the players through two strikes and three owner-led lockouts (which did not cause the cancellation of any games), with the players prevailing in every single way that mattered. During his tenure as the Executive Director of the MLBPA, pensions were fully-funded, per diems were dramatically increased, free agency was achieved and players’ average annual salary rose from $19,000 in 1966 to $326,000 in 1982. There had been no run of unmitigated success like that which Miller oversaw in this history of sports labor. Many, in fact, have argued that Miller made the MLBPA the most powerful and successful union in the country, bar none.
In the face of such staggering losses, it was only a matter of time before the owners pushed back.
The Seitz Decision and unfettered free agency caused salaries to skyrocket and caused owners to soil their BVDs. Some, such as George Steinbrenner of the Yankees and Ted Turner of the Braves, took full advantage of the new state of affairs and spent big money to attract the best free agents to their teams. Others pinched pennies or traded away players before they could reach free agency regardless of the consequences for the team. Most owners saw it as a mortal threat, though a threat they had no idea how to combat. Then in 1984 they got some seriously bad advice.
Peter Ueberroth, fresh off his triumph of putting together the Los Angeles Olympics, was elected commissioner in 1984. Not long after his election he held an owners meeting during which he called the 26 men in the room “damned dumb” for trying to improve their teams via free agency and implored them to focus on the bottom line as opposed to winning baseball games. Later, at a general managers meeting, Ueberroth said that it was “not smart” to sign long-term contracts. The message was clear and soon after that a system was set up by clubs in which they secretly agreed to (a) limit position player free agent contracts to three years; and (b) limit pitcher free agent contracts to two years. They would later create an information bank in which all clubs would report on their ongoing negotiations with free agents in order to keep teams from attempting to outbid each other.
While some owners were at least a little uncomfortable with this, others, such as Brewers owner Bud Selig and White Sox owner Jerry Reinsdorf, were enthusiastic and helped marshal support for the scheme among the ownership ranks. Eventually everyone went along with the plan.
The agreement among the clubs was secret because it violated the Collective Bargaining Agreement which had specifically barred coordination among clubs and coordination among players (outside of union activity) in contract negotiations. Ironically, that prohibition was insisted upon by the owners and placed in the CBA in 1968 in the wake of Sandy Koufax and Don Drysdale coordinating a holdout against the Dodgers before the 1966 season. Players had never violated it, but the owners set out in the 1985-86, 1986-87, and 1987-88 offseasons to do just that.
In practice it was pretty crude. For example, when Bob Boone became a free agent after the 1986 season he had a meeting with the Oakland A’s. The A’s GM Sandy Alderson called Mike Port, the GM of Boone’s old team, the California Angels, to tell him that Boone was looking to come to Oakland. Port told Alderson not to sign Boone and Alderson cut off talks. Boone would struggle all offseason to find work, got no offers, and with no other choice returned to the Angels. Similar things happened to several players. Offseason sports reports were filled with footage of unhappy players leaving unproductive meetings with uninterested teams. Sports Illustrated famously ran a cover story about how strange it was that nobody wanted to sign Kirk Gibson, who was at the time one of baseball’s best players. Many other of the game’s biggest stars, including Carlton Fisk, Tim Raines, Paul Molitor, Jack Morris, Jack Clark and Andre Dawson, were unable to interest any teams other than their current ones. As a result, between 1985-1988, player salaries dropped 16 percent while owner profits went up by 15 percent.
The players, now led by Miller’s successor, Don Fehr, filed grievances in the wake of all three offseasons -- known as “Collusion I,” “Collusion II,” and “Collusion III” -- that, eventually, resulted in findings of CBA-violating collusion on the part of the owners in all three instances. Massive financial awards were made in favor of the players and players who were affected by collusion were immediately given what was called “new-look free agency” which allowed them to shop themselves on the open market without having to give up the security of their current deals. More substantially, the arbitration cases led to a settlement in which the players would receive over $280 million in damages.
Beyond the direct and immediate consequences of those rulings, however, the most significant result of the owners’ collusion of the mid-to-late 1980s was the massive erosion of trust in the owners on the part of the players. To be sure, it was a trust which was always tenuous at best, but thanks to the owners’ massive, coordinated and fraudulent scheme, by the time the 1990s rolled around, their word wasn’t worth spit as far as the players were concerned.
As a result of the Collusion fiasco, Ueberroth was forced to step down prior to the 1989 season. He was replaced by National League President Bart Giamatti who, tragically, died on September 1 of that year. Giamatti was replaced by his deputy commissioner, Fay Vincent. Vincent was not a baseball man by experience and, despite his ascent being approved by the owners, he did not have their full trust. And he’d lose what little of it he did have a few short months into his tenure.
The Collective Bargaining Agreement expired in December of 1989. During negotiations an increasingly powerful Bud Selig, who led a faction of owners of smaller-revenue clubs, helped craft a proposal aimed at legally, but aggressively, reining-in escalating player salaries. It sought to institute pay-for-performance, a revenue-sharing system, and a salary cap. The players, still dealing with the fallout of collusion, considered the proposal a dead letter. Owners of large revenue teams were less-than-keen on the idea as well, being far less interested in sharing their money with smaller revenue clubs.
With no agreement, a lockout was instituted by the owners in February, which wiped out most of spring training. Eventually Vincent stepped into negotiations, using the Commissioner’s “Best Interests of Baseball” powers, with a compromise proposal that contained no salary cap, increased the rookie and minimum salary scale and promised to merely study the concept of revenue sharing. It was yet another win for the players, who agreed to it readily. The owners agreed to it as well because even if it was less-than-ideal, they were too spooked to lose the 1990 season to a protracted work-stoppage that, thanks to total solidarity on the part of the players and division among the ownership ranks, they were not likely to win.
But they were not happy about it. Bud Selig was particularly unhappy with it. And two years later he launched a coup that forced Vincent out of office, ushered himself into office and changed baseball -- and baseball labor relations -- forever.
The coup’s genesis was the owners’ demand -- led by Selig -- that Vincent relinquish the Commissioner’s power to involve himself with labor relations. The idea, of course, was to keep Vincent from interceding during the next round of CBA talks, to take place in 1994, as he did in 1990. Vincent refused, citing Major League Baseball bylaws which prohibited the owners from stripping the Commissioner of power during his tenure. In response, Selig called for a vote of no-confidence in Vincent and the owners did just that, voting against Vincent 18-9-1. Vincent resigned in response and Selig was made acting Commissioner. He thus had full power to direct the owners strategy heading into the new round of labor talks and he made it his mission to do what no one could do: break the union and beat back three decades worth of escalating player salaries by imposing a salary cap.
Selig and the owners set the stage for the coming labor battle in the runup to 1994 by going on a media offensive in which they claimed that most baseball teams were losing money and that baseball would go bankrupt and go out of business if player salaries weren’t capped and if there was not greater revenue sharing among the clubs. Their case was totally unsupported, as baseball’s owners refused to share detailed financial information with the press, with the public or with the union, relying instead on anecdote and cherry-picked data. The public and most of the press bought it however, and a narrative was formed that baseball was in dire financial straits and that the greedy players didn’t care. All they wanted, many believed, was to make their millions.
The owners, likely emboldened by the way in which their preferred narrative was taking hold, got increasingly aggressive. In January of 1994 they approved a new revenue-sharing plan keyed to a salary cap and simultaneously gave full negotiation power to Selig. They formally proposed the salary cap system to the players in June. The plan also eliminated salary arbitration and gave the owners rights to keep free agents who attempted to sign with another team as long as they matched the best offer. While the owners claimed that, in the aggregate, players would end up seeing more overall money under this plan than they had before, they refused to show their work or share detailed financial information, asking players to take them at their word. Their word which, again, was worth nothing due to the recent lesson of collusion.
The players rejected the owners’ offer. With the Collective Bargaining Agreement having expired the previous December 31, the players could strike at any time, but Don Fehr signaled that they’d hold off until September and keep negotiating. Around the same time owners -- seeking to pressure the players -- decided to withhold $7.8 million that they were required to pay per previous agreement into the players’ pension and benefit plans. Fehr attempted to get Congress to intervene by stripping baseball of its antitrust exemption, but Congress refused. With the owners intransigent and no legal recourse, Fehr set a strike date of August 12. That date came and the strike began.
And it dragged on and on.
We’ll talk later today about all that was lost as a result of the strike, but as you no doubt know, it cost the remainder of the season, the postseason and the World Series. By most estimations it likewise cost somewhere in the neighborhood of $580 million in ownership revenue and $230 million in player salaries. Off the field negotiations barely occurred and when they did they were unproductive. In December, the owners voted 23-5 to unilaterally impose a new Collective Bargaining Agreement complete with a salary cap. That obviously did not help matters, nor did President Bill Clinton ordering the sides to go back to the bargaining table.
In January the owners revoked their imposition of a salary cap and unilaterally re-imposed the terms of the expired Collective Bargaining Agreement, but they did it with a twist: the owners voted to hire replacement players -- scabs -- with Selig declaring that, “We are committed to playing the 1995 season and will do so with the best players willing to play.”
Later today we’ll have a post dedicated to the curious -- and rather pathetic -- sight of scab ballplayers reporting to spring training in February and all of the complications and absurdities that did and would’ve continued to occasion. For now, though, know that it caused the players to sue Major League Baseball in federal court on March 27, 1995 for violating labor laws. Four days later current Supreme Court Justice Sonia Sotomayor -- then a Judge of the United States District Court for the Southern District of New York -- issued a preliminary injunction against the owners, preventing them from playing the 1995 season with replacement players. The Court of Appeals refused to stay the order. The owners, now with no way to play the 1995 season without union ballplayers, caved and ended their replacement player gambit. The players, armed with new leverage, agreed to go back to work.
The sides played without a Collective Bargaining Agreement for some time, but one was eventually put in place. It took some time for the game to recover -- attendance suffered in 1995 and fan protests were common -- but within a few short years baseball was back to breaking attendance and revenue records, fueled in part by a massive uptick in offense and the breaking of home run records. Though labor acrimony would continue through the 2002 Collective Bargaining Agreement negotiations, baseball has not seen a work stoppage since.
The players came out on top in the 1994-95 strike, just as they had in 1990, 1981, 1975, 1972 and in basically every other labor skirmish they had with the owners from the day they hired Marvin Miller. But, as anyone who follows the business of baseball these days knows, Bud Selig would, ultimately, get the last laugh. Or at least the current one.
The labor peace that has existed since the signing of the 2002 Collective Bargaining Agreement is, in large part, a function of the owners changing tactics. Rather than trying to crush the union and impose salary controls in one fell swoop, they have slowly chipped away at the gains achieved by the players. And they’ve done a very good job of it.
They started by instituting a revenue sharing system that, while not dramatic or as far reaching as that of other sports, has largely quelled the constant battles between high-revenue and low-revenue clubs which had, for many years, sowed divisions between them and made confronting the players more difficult. They likewise managed to institute a robust luxury tax which penalizes teams for going over certain payroll levels, imposed limits on signing bonuses for draftees and international amateur free agents, neither of whom are represented by the MLBPA. Finally, they got players to agree to a qualifying offer system which ties draft pick compensation to free agent signings.
The Luxury Tax works like a defacto salary cap. The draftee/international amateur bonus limits are explicit caps. The draft pick compensation for free agent signings is not all that different in effect from the free agent compensation system owners sought in 1981. While the owners could not kill free agency, they have increasingly turned away from signing all but the most elite and the youngest free agents, making free agency far less valuable than it once was.
Which is to say: in the past 17 years the owners have gotten a great deal of the things they failed to get in the previous 36 years, and they have done so pretty quietly.
Meanwhile, the owners have massively increased their revenues, largely via streams of money to which players either are not entitled -- such as side deals on the business side of things -- or via sources to which players did not make a timely claim such as MLBAM and baseball’s digital properties. Players still make a great deal of money, but the owners’ revenues have gone up far more than salaries have. We’re not back to pre-1960s levels of ownership dominance or anything like that, but the owners are far more firmly in control of things than they have been for a long time. Increasingly, the players are chafing at this. There is increasing dissatisfaction about the state of labor affairs on the part of union membership and there is talk, for the first time in pushing 20 years, that the next round of labor negotiations could result in a work stoppage.
It’s too soon to say whether or not a work stoppage, be it a lockout or a strike, will happen. But if it does happen, knowing what came before it will be essential to understanding what the heck is going on.