Should professional sports players be subject to labor restrictions and draft regulations?

Tommy Craggs of Deadspin has an excellent new post up on why Scott Boras, the most hated agent in sports, is not actually that evil. Currently, teams take turns selecting players they like, which means that the player can only sign with that team, has to live where the team tells him, can get traded to another team at any time and have to move, etc. This limits players' ability to earn wages fitting their ability, because if they don't like the offer given to them, they can't start talking to another team. Boras has been more effective than any other agent at finding ways to make his players' salaries more closely track their actual earning potential, either through making them eligible for free agency earlier, or by squeezing teams for more money than they usually give. This has made Boras the enemy of every GM, and disliked among the public. Given that Boras has made many teams shell out significantly larger amounts of money for their draftees than they would normally have to, it makes sense that he is disliked by most fans, but it is a shame, from a libertarian perspective. The draft system is another example of a place where America has less economic and political freedom than Europe; in Europe every player is a free agent, and can sign with any team at any time. Consider a talented 18-year-old player. He's probably spent every day for the past eight or nine years working hard on his baseball skills, in the batting cages, taking grounders and fly balls. His parents have put in a ton of money so he can play on traveling teams all summer and have good coaching. The result is that this kid is five-tool fierce, dominating the local high school league, hitting towering home runs, etc. Everyone thinks he's on pace for the major leagues. All of the effort and time he's put in are worth something. But because of the draft, he must negotiate a take-it-or-leave-it contract with exactly one MLB team, and put in time in the minors before breaking the majors, becoming a free agent and being eligible to get paid his share. The problem with the current system is he can get hurt at any time and not be able to play, and get dumped out of the baseball system with no money - there's no insurance against this, but there would be if young players got paid more. If we allowed players full freedom to sign contracts with teamsĀ  our sports leagues would closely resemble Europe's. Players' earnings would increase, at every level, but especially among talented youth. The teams with the highest revenues (the Yankees, Red Sox, Braves) or teams with deep-pocketed owners would gain a huge competitive advantage, as they can afford better players at every level of development. In the English Premier League, the top four teams, Manchester United, Chelsea, Arsenal, and Liverpool, dominate the standings every season; we should expect a similar result in the MLB. Teams in small markets and teams with stingy owners would suffer, especially because we have such a good statistical understanding of baseball now that there are hardly any more inefficiencies to exploit. For fans 20 of 30 teams in the MLB, a World Series title would be something that occurs once a century, if that. Teams would also construct baseball academies in the United States as alternatives to high school and college, and sign young players to stay there, to take classes but mostly to play baseball. Most MLB teams already have academies in the Dominican Republic, which is one of the few areas where all players are immediately eligible for free agency (Boras considered moving one of his clients to the Dominican to make him eligible). All good Premier League teams fund youth academies to develop young talent; every good player in England goes through the academy system, not the regular high school system. Furthermore, we should expect some teams and owners to go bankrupt. Spending enough on players to win the World Series would surely require owners to make a loss on their investment. While some owners go bankrupt now, their ability to do this is limited by the salary cap, revenue sharing and other factors. The net result is that players would have more freedom to pursue wages that pay them what they are worth, which they deserve, like anyone who puts in years worth of time and energy to become good at something. But the competitiveness of the MLB would probably decrease, and because the league has only a few rewards in place (making the playoffs, the pennant, the World Series) this would spell mediocrity and more frustration for smaller teams' fans. But the MLB should make this tradeoff, because it's not fair to the players to have their wages held down. So we should praise Boras.

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2 thoughts on “Should professional sports players be subject to labor restrictions and draft regulations?

  1. D

    I disagree with almost every conclusion that you come to, but don’t particularly feel like discussing every point. That said, here are a few things that concern me.

    College and high school athletes are certainly not a finished product, and they should be paid as a project unless they have truly shown their worth at the next level. Even in the NBA, where talent is most easily scouted and calculated, NBA rookie contracts prevent teams from grossly overpaying untested athletes. Now you could argue that the athletes deserve to be paid as much as possible, but consider the business world scenario. While top level college graduates (Harvard, Yale, etc.) receive higher initial pay than their counterparts at many less respected universities, they never enter their company at the top of the salary food chain. Instead, they are given a contract and then raises as they perform at a certain level, or can leave for a contract of greater worth with a different company.

    It is understandable that players may receive larger contracts based off of early performance, but in what insane world does JaMarcus Russell deserve a contract larger than any other QB in the league (whoops, lets add Stafford)?

    If you want a league dominated by the Yankees, Red Sox, and Dodgers than go ahead. If you want to watch college athletics completely fall apart before your eyes, then go ahead and remove the draft and allow teams to take kids into their “universities” instead. My preference is to have and watch sports leagues that are always competitive and value smart drafting decisions, rather than having the highest bidders simply take over our sports.

    Finally, if you think Europe has a very small top-end competition pool, what do you thin would happen in the US if all sports went with this method? My guess is that the money would go to the most popular sport in the country, and I can tell you right now, it would not be baseball.

    With all that said, this discussion really comes down to a personal preference rather than a solid conclusion. And for what it is worth, I do believe that Boras and and other power agents throughout sports have a role and I respect them for that, so while I disagree with most of the points that you have concluded at, I do praise Boras for doing his job better than anyone else. Because he is a proven commodity with years and years at the highest level, and his performance has earned his payout.

    Good writeup!

  2. Pingback: The NFL oligarchy – Kevin Burke

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