Is a salary cap the right move for baseball?

There is just something special about the game of baseball and the unique nature of the sport. Whether it’s the phenomenon of hitting a 100 mph fastball or the exclusive 162-game regular season, Major League Baseball has always drawn a large crowd of fans who become deeply invested in their teams.  

The more fans that a team acquires, obviously, the more revenue that team has the potential to make. Signature brands like those of the New York Yankees and Los Angeles Dodgers generate billions of dollars of revenue each season. The biggest distinction between the MLB and other major American sports is the way teams are able to spend their money.  

In the NFL, NBA and MLS, a salary cap was implemented in the late 20th century to prevent large market teams from having an inherent advantage over teams playing in smaller revenue markets. Even the NHL incorporated a salary cap in 2005, leaving just one major American sports league as the sole outlier.  

20 years since the NHL implemented a salary cap, there still appears to be little to no hope that the MLB will ever consider administering one. The controversial topic of a salary cap has long been discussed in the baseball universe. In fact, this very topic is what led to the first major strike in American sports, when the MLB cancelled nearly 1,000 games, including the 1994 postseason.  

In early 1994, the owners of all 28 professional baseball franchises met and discussed the most significant ongoing concern that some had with the league’s format: the increasingly large gap in performance between the large market and small market clubs. The owners proposed a salary cap, which would increase equity among all teams by preventing large market teams from exceeding a set payroll limit. 

On January 18, the owners approved a plan that focused on creating a salary cap, and it was passed along to the players’ association for approval. What ensued was a hostile dispute emphasizing the blatant mistrust between both sides. The players protested that a salary cap would diminish their value as free agents and that the owners only proposed this plan to take back control over the cost of players in contract negotiations.  

After free agency was made legal in 1972, the common consensus among owners was that the players had an overflow of power regarding their salaries. Players felt disrespected when the owners attempted to reclaim this power through the form of a potential salary cap. The players’ association refused to compromise on this, insisting that any form of a salary cap would restrict their ability to earn compensation.  

If a salary cap were implemented, the team would take a higher percentage of the revenue, ensuring that players league-wide were compensated somewhat similarly to one another. As it stands, with no salary cap, players can earn as much income as their team’s market revenue will allow. The players wanted to do anything they could to avoid their earning potential being limited.  

As a result of both sides’ unwillingness to come to an agreement, the 1994 season was cut short when the players officially went on strike on August 12. The MLB resumed play in April of 1995, and after a tedious battle from the players, they managed to avoid the possibility of a salary cap in baseball.  

Fast forward 30 years, and the concept of a salary cap in baseball remains somewhat of a Pandora’s box scenario. No matter how badly some small market teams, notably the Athletics, have struggled in recent years, MLB owners are skeptical to even approach the subject. As free agency signings become increasingly absurd each off-season, the question of whether a salary cap is viable has reestablished itself as a hot topic of debate in baseball.  

The question appears to be more prevalent than ever following two consecutive off-seasons consisting of record-breaking contracts. Prior to 2024, Mike Trout had the only contract worth over $400 million. Shohei Ohtani and Juan Soto both signed for over $700 million in the past two years.  

Prior to 2019, Giancarlo Stanton was the only player in MLB history to ever sign a contract for more than $240 million. Since 2019, there have been 17 separate players to sign long-term contracts for more than $240 million. Prior to 2016, Max Scherzer was the only player in MLB history to sign a contract worth $26 million per year or more.  

Since 2016, there have been 24 separate players to sign contracts worth more than $26 million annually. 34 of the top 50 highest-paid players in league history signed with one of these seven teams: the Padres, the Tigers, the Rangers, the Yankees, the Mets, the Dodgers or the Angels.  

It is clear the rapid increase in player salary is alarming and poses the question of what is going to happen if the league does not set a spending limit. The two biggest brands in the sport, the Yankees and the Dodgers, dominated their respective leagues in 2024 and met in the World Series.  

After falling short in their first World Series appearance since 2009, the Yankees bolstered their pitching staff by re-signing Gerrit Cole, signing Max Fried to a long-term deal and signing stellar reliever Devin Williams. Despite failing to lock up Juan Soto to a long-term deal — he ended up down the road in Queens in an equally large television market — the Bronx Bombers added two former National League MVPs to their lineup in Paul Goldschmidt and Cody Bellinger.  

After winning their first World Series title since 1988, the Dodgers broke the bank this offseason, signing two-time Cy Young-winning ace Blake Snell, superstar pitching prospect Roki Sasaki and highly sought-after defensive phenom Hyeseong Kim. They also signed Michael Conforto, along with shut-down relievers Tanner Scott and Kirby Yates, while extending Teoscar Hernandez, Kike Hernandez, Blake Treinen and Clayton Kershaw. That’s right: they were not even remotely close to being done when they shocked the world by signing Shohei Ohtani, Yoshinobu Yamamoto and Tyler Glasnow in 2024.  

The 2025 Dodgers have undoubtedly assembled the deepest roster in the history of the sport, a lineup some are referring to as “The Avengers” of the MLB. With three MVPs in Ohtani, Mookie Betts and Freddie Freeman heading the top of LA’s lineup, the nickname feels quite fitting. The intimidating starting lineup is nothing in comparison to the monstrosity of a pitching staff that Dave Roberts and company have assembled.  

Snell, Yamamoto, Sasaki, Glasnow and Dustin May have begun the season as the five primary starting pitchers for the Dodgers. This alone is likely the best rotation we have ever seen. Considering we have yet to see Ohtani pitch in Dodger blue, one can only assume that things are going to get even better for LA as the 2025 season progresses.  

Though the Dodgers are seemingly still figuring everything out with their star-studded roster, it is unlikely that anyone in the National League is going to be able to compete with the Dodgers for years to come. With the team deferring eight contracts over the next 20 years by over $1 billion, the Dodgers have placed themselves in prime position to win multiple championships in the upcoming decade.  

Even with all the deferred contracts, LA still entered opening day with a payroll of over $350 million. Due to its spendy habits, the team owes $143 million in Competitive Balance Tax this year, but nobody in the Dodgers organization seems concerned. With the success the team is bound to have, they will earn back that money and easily turn it into a profit that allows them to repeat the cycle by signing even more free agents.  

The Dodgers and Yankees have evidently broken the system and it is a likely possibility that the two teams will meet in the Fall Classic multiple times over the next decade. The public has become increasingly dissatisfied with the ongoing payroll disparity in the MLB. There is over $300 million in difference between the Dodgers payroll and the Miami Marlins’ payroll, for instance. Only nine teams opened the season with a payroll more than half the size of the Dodgers’.  

My thoughts on this? While I have always considered baseball to be the most difficult sport to win consecutive championships in, I think the current landscape of MLB salaries is less than ideal. The format clearly favors the teams who are fortunate enough to be big spenders, and it has created an uneven playing field when it comes time for free agency.  

If a salary cap were implemented, the Dodgers and Yankees would be unable to sign all the best free agents, making the playing field among all teams much more even. The fact that the Dodgers currently sit in third place in the NL West and, according to ESPN, still have a 91% chance to win the division, is eye-opening. Though the players have fought for decades to avoid a salary cap, enough is enough; it is time for a change. Action must be taken if the MLB wants to continue to increase its ratings.  

Liam Bradford can be reached at [email protected]