Michael Barron April 15, 2012

April 15, 2012

APUSH, P. 2, Ms. Burns

Baseball first began being referred to as America’s “national pastime” by New York area journalists in the 1850s, when the first “base-ball” craze swept the metropolitan area. The potential for moneymaking became apparent, and the game quickly commercialized. The first true professional team was founded in 1869, and by the early 1900s, a championship known as the “World Series” began to be contended for the first time between the two separate major leagues, the National and the American. With increased profitability, labor disputes also arose. Players of the era occasionally attempted strikes to fight the rigid contracts and the vaunted but generally accepted reserve clause, but met little success. As the game’s popularity and discontent among the players both grew, the apparent formula for success also became clearer: If one team spent more money than all of the other teams, they would win more games, possibly winning a championship, or later, securing at least a playoff spot in the process. Subsequently, as the team won more games, they would attract more spectators, who would spend more money, ensuring the now-wealthier team’s success in the future. Larger market teams appealing to wider fan bases tended to be wealthier, and thus were more able often to contend as well as profit substantially, hurting smaller-market teams’ chances for both on-field success as well as revenue-generating ability. This glaring gap in performance and the building gripes of the players were legally facilitated in 1922, when the Supreme Court unanimously ruled in favor of Major League Baseball in the decision Federal Baseball Club v. National League, a ruling which granted professional baseball clubs an antitrust exemption, stating that baseball, despite its enormous moneymaking ability, was not a business, but an “amusement.” Although the immunity from Sherman Antitrust Laws granted to baseball presented the owners with huge advantages, the Federal Baseball Club v. National League decision also harmed, and continues to harm, the fundamental competitiveness of the sport, degraded the status of professional baseball players from employees to pseudo-slaves, and overall hurt professional baseball.

Regardless of how thoroughly professional baseball’s antitrust exemption ignores its status as a business, and not a mere “amusement,” the exemption is also questionable for an entirely different reason: the antitrust exemption made the use of the reserve clause contract system legal in baseball. The reserve clause in contracts gave teams the first rights to a player who had been playing for them whose contract had ended. This meant that after a player’s contract expired, he could only choose either to play for whatever salary his team offered, or he could ask to be traded or released at the team’s whim. Players possessed absolutely no control over how much they were paid or where they could play. Owners used the reserve clause because they realized if players were allowed to choose between competing offers, the salaries of the players would reach immense heights. The rule first officially appeared in Major League Baseball when it was instituted as a rule on December 6, 1879, although it had been regarded as an open secret long before.⁶ The owner of the Atlanta Braves, Ted Turner, described the system as a “legal monopoly.⁷” The system was, at best, legally questionable.⁸ Both the Toolson v. New York Yankees and Flood v. Kuhn revolved around baseball players, George Earl Toolson and Curt Flood, attempting to fight the reserve clause in their contracts, and both were unsuccessful. The Flood v. Kuhn decision is often remembered as paving the way for baseball players’ free agency, as it brought the reserve clause national attention and stimulated the players’ labor efforts. However, the decision’s only truly tangible legacy was that it made the Player’s Association aware that there was no way they could rely on the justice system to achieve a workable owner-employee relationship; they would have to improve relations solely through the use of labor negotiations.⁹ It was not until 1975 that the reserve clause was finally struck down, not in a Supreme Court decision, but by an arbitrator, Peter Seitz, who ruled in favor of pitchers Andy Messersmith and Dave McNally, when the two claimed that, as they had played without true contracts for a year, they could choose to play anywhere they wanted.¹⁰ This marked the beginning of free agency in professional sports. From that point on, once a player’s contract expired, they were free to play wherever they wanted. Shockingly, the reserve clause is still active in the MLB’s minor league system. Players entering professional baseball even today must remain with their original teams for seven years, with absolutely no control over their own destinies.¹¹ Due to the consistent obtuseness of the Supreme Court, high-level baseball players dealt with oppressive contracts for nearly 100 years, while minor leaguers continue to possess impossibly low negotiating power.

The most damning indicator of the harm the antitrust exemption caused professional baseball lies not in the reserve clause, but in the massive gap of talent disparity that exists between the richer and poorer teams. Due to the lack of antitrust restrictions, there is no salary cap for Major League Baseball teams. This means that owners can spend as much money as they can afford on players, leading to the richer teams more often than not outspending poorer teams for quality players, and subsequently outperforming them on the field. The most glaring example of this is the New York Yankees franchise. Under the ownership of the late George Steinbrenner, the Yankees had the highest payroll in the league every year since 1996.¹² In that same timespan, the Yankees won the World Series four times, made the World Series six times, and reached the postseason an astonishing 15 times out of 16 possible years.¹³ Compare that to a team that never finished with a payroll that rose out of the bottom third of the league in the same stretch, the Washington Nationals, formerly the Montreal Expos. From 1996 to the present, the Nationals franchise has made the playoffs zero times, and dating back to the founding of the Expos in 1969, the team has played beyond the regular season exactly once.¹⁴ In their history, the Yankees have won the World Series 27 times, and played in it 40 times. The contrast is clear: the team that spends more will almost always be more successful than the team that spends less. Dating back to 1988, the World Series has never not contained a team with a payroll in the top third of the league.^{15, 16} The massive amount of spending disparity simply makes it too difficult for the smaller-market teams to compete.

Baseball has been for over a century and will continue to be America’s national pastime. However, the status of the game as a truly competitive one with a high level of integrity must be called into question. This is not only because of the performance-enhancing drugs scandal that has embroiled professional baseball over the last decade and a half, but also due to the subtler problems that the antitrust exemption causes. Since the original Federal Baseball Club v. National League decision in 1922, and its upholding in both 1953 and 1973, professional baseball cannot possibly be seen as a fairly competitive sport. Instead, fans year in and year out are typically treated to a slugfest between the richest and second-richest teams in the league in the World Series. The “competition” has become little more than survival of the richest.

Works Cited

"Baseball Players and the Antitrust Laws." Columbia Law Review 53, no. 2 (1953): 242-258. http://www.jstor.org/stable/1118878 (accessed March 23, 2012).

Explicitly lays out the professional structure of baseball as it once was under the reserve clause.

Bryant, Howard. Juicing the Game: Drugs, Power, and The Fight for the Soul of Major League Baseball. New York: Viking, 2005.

The beginning of the book gives a concise and helpful history of labor negotiations in professional baseball, with a concentration on the labor strike in the 90s.

Eckler, John. "Baseball - Sport or Commerce?." The University of Chicago Law Review 17, no. 1 (1949): 56-78. http://www.jstor.org/stable/1597789 (accessed March 23, 2012).

An interesting perspective on the economic ramifications of baseball given when baseball was still unquestionably at the top of the sports world. Albeit old, it correctly answers the question that the Supreme Court undeniably and embarrassingly failed to address on more than one occasion.

"Federal Baseball Club v. National League - 259 U.S. 200 (1922)." Justia: US Supreme Court Center. http://supreme.justia.com/cases/federal/us/259/200/case.html (accessed April 17, 2012).

The original court decision giving baseball an antitrust exemption.

"Flood v. Kuhn - 407 U.S. 258 (1972)." Justia: US Supreme Court Center. supreme.justia.com/cases/federal/us/407/258/case.html (accessed March 23, 2012).

Decision made in 1972; the third and most recent time that baseball has been able to keep their antitrust exemption.

James, Bill. The New Bill James Historical Baseball Abstract. New York: Free Press, 2001.

Pretty dense book that is mostly statistical analysis of why one player was better than another, but there is an enlightening section on Curt Flood.

"MLB Salaries by Team." USA Today. http://content.usatoday.com/sportsdata/baseball/mlb/salaries/team (accessed April 17, 2012).

Gave useful salary information for every major league team dating back to 1988.

"Major League Baseball Statistics and History." Baseball-Reference.com. http://www.baseball-reference.com/ (accessed April 17, 2012).

Invaluable resource, giving postseason histories of baseball, minor and major, every year it has been recorded.

Morris, Peter. A Game of Inches: The Stories Behind the Innovations That Shaped Baseball: The Game on the Field. Chicago: Ivan R. Dee, 2006.

Gives deeper look into player labor negotiations and battles throughout baseball's professional history.

Rovell, Darren. "MLB - The early days of free agency." ESPN. http://static.espn.go.com/mlb/s/2000/1121/893718.html (accessed April 17, 2012).

An informative look at how baseball moved from the reserve clause system to free agency.

"Toolson v. New York Yankees, Inc. - 346 U.S. 356 (1953)." Justia: US Supreme Court Center. http://supreme.justia.com/cases/federal/us/346/356/case.html (accessed April 17, 2012).