Submit chat questions for Craig Goldstein (Wed Sep 23 at 1:00 pm EDT)

I have to confess, I’ve become bad at responding to comments. Part of this is laziness, but another large part is due to the classic internet truism that one should never read the comments, and I have found that not focusing on the mean things people say about me does help me keep the ol’ self esteem up and running. That said, I’ve found that the commentary at Baseball Prospectus, almost on a whole, has been thoughtful and civil: not a crying Jordan or “delete your account” as far as the eye can see, regardless of how much I might deserve it. So I thought, why not show the same kindness back and try to answer a comment, however best I can.

So, to that end. Last week, before the insanity of the trade deadline and even before the Colin Rea-Luis Castillo swap could prove my point for me, I wrote about the exchangeability of minor-leaguers, particularly the lack of protection they received from the MLBPA and the unique role they played in allowing for a surplus labor army for baseball itself.

Two comments on that piece spurred my interest. First was a correction from the charming and intelligent Jason Wojciechowski, noting that I was incorrect or, at least, unwise to say that minor leaguers were represented by the MLBPA. He’s right, too; before they are major leaguers, minor leaguers do not have standing with the union. In a perfect world they might, but this is a systemic problem with the union, and one I should have noted, despite how much I admire MLB’s incredibly strong player power (paging Jonathan Lucroy).

Another comment followed from Jason’s, however, which is somewhat less easily answered. SChandler admirably took up the mantle of free-market enterprise (admirable not because free-market enterprise is especially admirable, but because they knew that it would be an unpopular position). Playing advocate for the system, SChandler asked:

What do you all not understand about free market enterprise…you say that ownership could pay minor leaguers what they deserve. What exactly is that figure? I contend that the market has set the price. If minor leaguers think they are unfairly treated, they are not slaves and don’t have to continue.

I’m not bringing this comment up to rip it, though I do disagree with its premise and conclusions. On the contrary, I think it’s a very important point because a plurality of fans and, more importantly, team owners ostensibly agree with it. So, to flip the initial question around, let me ask again: What is it that I understand about free-market enterprise that I don’t like?

There are three things, as it happens, and each (fortunately) corresponds with a sentence of SChandler’s comments. So first, one thing that is problematic about free-market enterprise is that it infuses morality into the concept of payment, which we see here in the word “deserve.” I also used the word “deserve” in my original piece, but I was trying to imagine it more aspirationally—still I’ll take my lumps, as minor leaguers don’t “deserve” a specific pay, but are owed a fair pay. This is a fine distinction, but an important one, as it reflects the quick double move made in free-market negotiations of salary between labor and management. Management will point to their wealth and say “I earned this and deserve to keep it, morally” and then will pivot and say “the market, an amoral system of logic, has determined what labor deserves.” “Deserve” here looks like a moral right and an idealistic impossibility in the same breath.

So instead of “deserve,” let me put it this way: Minor leaguers have a salary that would account for their time, commitment, and future value, and that salary starts somewhere north of a living wage, not south. I don’t have the algorithms and actuarial charts in front of me to determine an exact number, nor am I sure that would produce a truly just amount, but that would be where to start. The place one should not start, and here’s the second point, is the market. And the reason we should not start with the market is that the market is rigged to pay out the house first. And naturally so—free-enterprise privileges those who have money to risk, lose, and otherwise invest in making future money. Again, I think if you’re okay with a group of more wealthy citizens controlling the movement of money, then free-market enterprise will work out wonderfully for you. I’m not, and nor, do I think, are most people who aren’t making somewhere north of living wage. But that’s admittedly a guess.

Finally, and tying back to baseball after a somewhat non-basebally column, minor leaguers are not, as SChandler points out, slaves to baseball. They could quit and try and find employment elsewhere. The problem is that in order to find something else to do, they would need to quit baseball. Before the massive edifice of the MLB was solidified, players had more options in offshoot leagues that would pitch tents and close house after one, two, five seasons. The risky early days of baseball were more like the true chaotic free enterprise libertarians long for, with clear entrepreneurial opportunities rising and falling, and the risk in the market palpably close for players and owners alike. And then? Well, then MLB consolidated it and became the only game in town for 100 years.

So yes, some minor leaguers might be able to hoof it to Korea or Japan. And I suppose if they washed out completely they might pitch for Independent Leagues for peanuts. But apart from literally leaving the country, players have one option and one option only if they want to pursue the career path that might offer them life-changing (or even life-sustaining) money: stick with the bad pay in the minor leagues. This goes doubly for top 100 prospects, who are effectively choosing to risk five years of middling-to-poor pay and no rights for the chance of making tens of millions in the future. And I’ll agree, that seems like a perfectly reasonable risk…except the risk is always, always on the side of labor.

MLB is a de facto monopoly—the endgame of free-market enterprise. No capitalist worth their salt as a profit-maker would want anything less than total market saturation, and the end of the road of total market saturation is a no-risk business model. Teams do not lose money, despite rising salaries. MLB certainly does not lose money, despite its misgivings about minor league salaries. The quid pro quo fantasy of free-market enterprise—I’ll take a risk on you and you’ll take a risk on me—is replaced by a coercive contract system: You can take a risk on yourself for four years, and I’ll profit either way.

So, if there’s something wrong with free-enterprise, it isn’t something that’s meant to be fixed through revision or reform—it’s an active feature of the system. That is what I understand about the free-market that I don’t care for, and it’s why I (and why the minor league community should, darn it!) admire the alternatives of the left.

Thank you for reading

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I love that you responded to a snarky comment with a well thought out article.
Trevor, thank you for a thought provoking article.

I'd like to point out that I have a bit of an issue with the very premise of SChandler's comment (and therefore, indirectly, your response to it). The allocation of baseball talent is not a 'free market enterprise' to begin with. If it were a free market, aspiring players would be able to offer their services to all 30 teams. They cannot. Their labor rights are allocated exclusively to a single team via the draft.

Once a player is drafted, they have 4 years until they need to be added to the 40-man roster. Even after they reach the majors, another 6 years must pass before they qualify for true free agency (usually 7, because teams have figured out to keep players in the minors until June). So for most players, the first 10 years of their career have little to no resemblance to free market economics. And the careers of most players last 10 years or less.

I fully understand that there is a counter-argument to be made that some manipulation of the free market is necessary to make MLB work - it would be difficult to sustain a healthy league if the Yankees and Dodgers could allow other teams to pay for and develop players, only to sign them away for top-dollar once they were ready to produce in MLB.

So this, to me, is the real issue: MLB and MLBPA have already manipulated the free market to enhance competitive balance and maximize profits. And I think most people would agree that they have been quite effective on both those fronts. So as long as you're manipulating the free market anyway, why can't you allow that manipulation to also carve out some space for your entry-level workers?

I wanted to reply because I didn't think a + was enough. I think you covered the big points very well.

I don't understand[1] how this can be perceived as a free market. Is it because there is an agreement between MLB and MLBPA? But then it has to be acknowledged the MiLB players are not "recognized" by the MLBPA. What official statements has the MLBPA made about representing minor league players?

[1] I mean I literally do not understand. I could be missing something or misunderstanding the concept.
This is, imo, the most insightful response I read. To the extent there is a true market for labor, is the trend toward greater numbers of Latino players (where it makes great sense to play the lottery) and well-off traveling team members (and fewer US-born minority players) an expected outcome?
Nothing about the labor situation in professional baseball is a free market -- the artificially low wages etc are product of gov't protection of and intervention in a free market.

I'm happy to introduce you to my distaste for gov't intervention.
This nearly 100%. I don't understand why people don't seem to get what the 'free' in 'free' market means. Free means free to enter or leave the market. Free to compete. BOTH sides in any transaction have to have that condition - or the market is rigged and potentially exploitable - and not free. Minors baseball is NOT free on every single measure. Players are not free to sell their skills to another team for higher pay. New teams/leagues are not free to enter the market. MLB has rigged both of those markets - and has corrupted government itself so govt itself is now complicit with a rigged market.

I do think MLB is the (maybe the ONLY) economic example of why there is a valid reason for anti-trust laws - ie not ALL monopolies are purely a result of govt tilting the playing field for their cronies and rent-seekers. But it is ironic that MLB has uniquely been deemed by govt to be exempt from those laws.
I don't think the anti-trust exemption has much of anything to do with the labor market - none of the other major sports leagues have the exemption, but they all have player drafts, salary caps, and many of them even have rookie-contract salary maximums. These sports have monopoly power, and that is what allows them to set up constraints to the free market.

I'm not absolving MLBPA here - they could go to bat for minor league players if they wanted to (see what I did there?), but they have routinely put minor league players' needs on the back burner to get what they want elsewhere.

If anyone wants MLB to operate more like a free market, ironically this would require more government intervention not less. See: collusion. Personally, I think that would cause more problems than it solves.

The two main other sports don't have an anti-trust exemption - but their farm system (NCAA) effectively does.
I'm a little confused by what you're upset with the government about. Are you upset they have minimum wage laws that require a minimum "working" wage to be paid? Or are you upset that the government isn't properly enforcing its own government law about minimum wage? And the government didn't create MLB's CBA, so isn't MLB (as agreed upon with the MLBPA[1]) basically its own society with its own "government" as if the actual government didn't exist?

[1] Which doesn't really represent the MiLB, which is noted
Actually if MLB itself had the possibility of facing real competition, then minors baseball players would probably have lots of opportunities to play baseball at higher wages than 'legal minimum'. It is no accident that before MLB killed off competition with its anti-trust exemption; there were twice as many professional baseball teams in the US as now - with 1/3 the population. They would never get rich playing baseball - but nor would owners. Taxpayers and fans would be the beneficiaries. Competition works. Monopoly kills off jobs/opportunities - and it doesn't provide 'working wages' either.

Minimum wage laws are only necessary if there is a monopsony (monopoly/cartel on the buying side).
"""Minimum wage laws are only necessary if there is a monopsony (monopoly/cartel on the buying side). """

Market failures occur even without monopsony and may be more common than neo-liberal economists like to admit.
Great article. Perhaps one way to get around the concept of "deserve" is instead to talk about the value that is produced and who gets to keep that value.

One of the critiques of certain "free" markets is that their degree of freedom depends on your perspective. The entire structure of major league baseball and its affiliate system is predicated on the sport getting special permission from the government to behave monopolistically. This creates an entire power structure that advantages owners and disadvantages labor.

The top 1% of the professional baseball labor pool has unionized separately from the rest of the labor pool. This nominally allows them to negotiate with ownership to get labor a larger piece of the total value-produced pie. But in the process, they have also succeeded in maximizing the size of their slice from the overall labor pie.

If minor leaguers were part of the MLBPA, I don't know whether the players would collectively get more/less/same amount of of the total revenue from the sport. However, I know with certainty that minor league players would be getting a much bigger slice of the labor pie.
While I agree that minor league players should be paid more, I'm not sure what a living wage is. Do players near metropolitan markets get paid more than players in small towns? You also have to take into consideration the amount of the signing bonus received. No way a player receiving a $1.5M signing bonus needs to be paid a higher wage during the season.

Baseball is similar to the Movie/TV industry (not shocking since they are both entertainment). Millions of people want to reach the top, but only very few actually are able to make a living. I never hear anyone say that struggling actors/actresses should be paid a living wage while they are waiting tables between auditions. The bottom line is that a minor league player is free to quit and try to do something else to earn a living. If enough quit and the quality of play in the minor leagues drops, then MLB will be forced to raise in season pay.
Good point on the actor argument, but my counter-point is that actor's aren't required to travel and work in other states/regions. They are also free, to my understanding, to work with any play, show, etc and aren't picked by one play and have to work there for 3-10 years at greatly reduced to reduced wages.

But I've never heard this point before so my thoughts might change after thinking on it some more.
"I never hear anyone say that struggling actors/actresses should be paid a living wage while they are waiting tables between auditions."

Then you aren't paying attention.
Struggling actors/actresses should be paid a living wage while they are waiting tables.

Even people who are not struggling actors/actresses should be paid a living wage while waiting tables.

Forevermore, you'll have to concede that you've heard someone say it.
Dodger 300,

I have heard the calls for living wages to be paid to waiters and waitresses when they have chosen to make it their career. I believe that there is a difference between someone waiting tables for a living and someone waiting tables until another job comes along. Why should a restaurant pay a living wage to someone who will quit as soon as they land a part? Maybe the entertainment studios should start paying actors and actresses to audition.

My big problem with the concept of a living wage is that the wage varies depending on the size of the employees family instead of their quality of work. I can't imagine receiving a raise because my wife and I had another child.
Good article Trevor. I still disagree with your conclusion, but there is nothing wrong with friendly disagreement. If my comment that instigated this article seemed "snarky" I apologize. It was not intended that way.