More on the draft

by
June 9, 2009

For those who have missed it, there’s an extremely lively conversation going on in this thread about the pros and cons of abolishing the draft. The only thought I have on it that has yet to be voiced (at least I don’t think it’s been voiced) is that while there is a lot of surface appeal to the argument that goes “well, in any other business employee X can go out and negotiate the highest salary,” it misses something. What it misses is that in that scenario, employer X has different incentives than would a baseball team faced with total free agency, and that’s that, unlike a baseball team, employer X would benefit quite a bit from competitor Y’s having to shut its doors and going out of business due to its inability to attract and/or pay top talent. Baseball needs the competition to say viable.

I remain kind of where I was on this when I posted the item yesterday: (a) philosophically predisposed to favor freedom over baseball’s version of servitude; but (b) wary of radical change; and (c) ultimately unsure as to how it all plays out. The pragmatist in me thinks that all weighs in favor of subtle tweaks over revolution, even if the concepts behind such a revolution are more intellectually satisfying. If that bothers you, well, that’s just how a thirty-five year-old/father of two/Midwesterner/lawyer tends to approach things. If I’m going to go all-in on anything this week it’ll be to get the Astros to let in outside food.

A final bit of draft business before things get going tonight: read this post on the economics of the draft from Steven at Fire Jim Bowden. Good stuff for anyone who really wants to jump into that previous thread.


2 Comments
Oldest
Newest Most Voted
Inline Feedbacks
View all comments
Michael
14 years ago

The problem with the “in any other business” argument:

In any other business, you CAN’T negotiate any salary you want. Businesses already know what your job is worth, via industry-wide salary grades.

(Imagine if MLB got caught circulating a memo stating the recommended salary for a “Third Baseman III”? Off to labor arbitration they’d go, to see how much they’d pay in collusion damages.)

There are also likely thousands of businesses competing for services, rather than 30. Far from enabling to-the-moon salaries out of the box, this means a talented worker has to essentially come up through “the minors” before he has a chance at a higher pay rate.

For example, as an attorney, you know how that path works in your field: you don’t get plucked out of law school and made a partner, no matter how high in your class you graduated. You’ve got to prove yourself in real, professional lawyering situations at lower pay grades.

So the “free market exists everywhere else” argument doesn’t really hold water. By their limited nature MLB (and all top pro leagues) can never truly be “free markets” in the first place, because for the market as a whole to flourish, a free market requires more than 30 options.

In fact, what people seem to actually be arguing for is a European-style relegation system for teams, where the best are allowed to stay at the top with the perennial titles and full bankrolls the Premier division offers, while the Nats would find themselves playing in the Eastern League by now. THAT’S what a real free market would look like.

0
Millsy
14 years ago

I think there’s a real misconception, too, that X veteran is ‘worth’ $4 million in production, but paid $6.6 million in salary because X rookie is ‘worth’ $3 million in production but only paid $400,000 in salary due to rookie and arbitration rules.  I don’t think it really happens that way, and it’s my guess that the owners see more of that surplus than the veteran players do.

Price of unit talent may decrease somewhat with the introduction of a larger supply in the ‘free’ market in MLB.  But there is inherent risk with the new talent.  Prospects will continue to be paid less than veterans until they’re able to prove their ability, as Michael mentions above.  I don’t think it would have that detrimental of an effect on veteran salaries in MLB.

0