The Mises Institute monthly, free with membership
Volume 13, Number 2
This past baseball season promised to be the most exciting in my lifetime. Then the players' union opposed the owners' demand for a salary cap and refused to work. Baseball struck out. In the battle over blame, the most curious call is the union's for a "free market." The most often-cited remedy is to remove the owner's antitrust exemption.
Both points neglect a central feature of baseball: it is a business. As in any firm, the rules are made by the owners and managers, and the players are employees who can leave anytime to play for another league. By sticking around, they implicitly agree to submit to the rules of the firm.
The players' union doesn't like this. As unions do, it decided to wreck the game and punish consumers. In fact, the whole debacle teaches baseball fans the lesson of unionism. Unions destroy industries, which is why unionism is the antithesis of capitalism.
Some may wonder, isn't the owners' greed at least partially to blame? Well, when it comes to greed, everyone's got some. The owners, the players, the politicians, and even us fans. The difference under capitalism is that ownership implies rights and good ownership results in profits. And profit they did; the structure of the business called baseball was so good that it became the national pastime.
The owners suggested salary caps. It's not the ideal solution--eliminating free agency would better solve the problem--but it's a good start. Free agency and the outrageous salaries that it produces are what undermined baseball as a game. Baseball is not viable in the long run with multimillion dollar salaries, bid up by players searching for the team willing to pay the highest salary, with players jumping from team to team. It's contrary to what the owners know the game was about.
The football and basketball players told the baseball players not to accept the salary caps. They claimed to know because they face such caps. Well, they should also know that if baseball is on strike or harmed in the long-run, it means more money for football and basketball.
For baseball to be a sport, it has to be a team sport, where the players stay put, become part of a team, and become part of their community. Who are the most beloved players? Ozzie Smith, Ryne Sandberg, Ken Brett, Johnnie Bench, Cal Ripken, Don Mattingly, Tom Seaver. They are the players who stuck with a team--through thick and thin. It wasn't loyalty that kept them there, however, it was signed contracts. Unrestricted free agency, and its profit-killing perception of disloyalty, needs to be ended.
Would eliminating the antitrust exemption help? Absolutely not. Baseball's antitrust exemption merely allows Major League Baseball to refuse to play any team who wishes to play. In other words, the 9th Street Gang can't demand to play the Atlanta Braves. By "restricting output," MLB maintains standards and attempts to offer its customers the best possible game.
Even though it only allows a few new teams to join the league, by no means does MLB have a monopoly. Anyone can start his own baseball league. There is minor league professional ball, semi-professional, and amateur baseball. Plus, baseball has to compete against other sports and other activities.
Let's expand the antitrust exemption to other groups as well. Women's clubs should have the right to keep out men. A synagogue should have the right to keep out Nazis. Blacks should have the right to keep whites out of the NAACP. Microsoft should have the right not to sell their software to competitors. People have forgotten that freedom of association--whether in business or in prayer--also means freedom of non-association.
Thankfully, baseball fans have clearly identified the overpaid baseball players as the main villains. Now, they should redirect their ire to the players' union. Bring in the scabs from the minors and semi-pro ball for next season! Maybe the Red Sox or the Cubs will finally win the World Series.
Mark Thornton is the O.P. Alford scholar for the Mises Institute and teaches Economics at Columbus State College