Luxury tax squeeze could mute Rangers’ MLB trade deadline ambitions

While we've spent the last few weeks and months trying to decide whether the Texas Rangers should be buyers or sellers, depending on where they are in the standings, it's officially time to look at what they might do based on the unfortunate reality of the team's financial situation.

While MLB doesn't have a salary cap, the luxury tax is a de facto lid on what teams are allowed to spend without any repercussions. Over the last few years, Rangers fans have been fortunate enough to have an owner in Ray C. Davis, who has allowed Chris Young to spend well over the Luxury Tax's first level the last few years. However, with the club butting up against that line again, there may be a reason why Young has hinted Texas won't be as active as fans hope.

"I'm not sure there's anything externally that can upgrade or improve our team more than getting the best versions of the current players we have," Young said earlier this week. He might have simply been using "exec speak" and was playing things close to the vest. He might have also been signaling that the Texas Rangers really don't plan on adding much of anything at the trade deadline.

The regrettable thing about the Rangers and the Luxury Tax threshold is that the penalties increase when a team crosses the cap in consecutive seasons. They paid a 20% charge on each dollar spent beyond the threshold two years ago and a 30% charge last season. A 50% tax on all overages will be assessed if they do it again this year.

Per Baseball Prospectus, the Rangers are projected to finish with a $235 million payroll. The team has saved itself some money by trading Dane Dunning and not having to pay out a bonus to Tyler Mahle because of his shoulder injury, but with the threshold sitting at $241 million, Texas is still very, very close to paying a lot of money ... for paying out a lot of money.

It is entirely possible that Davis has told Young he's not willing to pay the penalty once again, especially with so many players like Jon Gray, Josh Sborz and Joc Pederson either just back or heading back right at the deadline. Front offices love to claim that getting guys back from the IL is just like adding at the deadline, but it might actually feel like that for Texas.

Considering Gray just had his first outing of the year for the Rangers, and Sborz (when he returns) will be in that same situation. Pederson played quite a bit early in the year but hasn't played since mid-May. He was also quite bad and if his injury reset allows him to come back sharper and playing better, he could be a real reinforcement.

Josh Jung was just called back up, and Jake Burger will be back at some point. All of that means the Rangers team that's been so red hot in July could look quite different on August 1, and that's without any trades.

While Texas Rangers fans rightfully would like to see Chris Young wheel and deal at the deadline, the reality of the situation is that the club might make some minor tweaks, rather than any kind of significant revamp.