Baseball Salaries

Topics: Major League Baseball, Baseball, Alex Rodriguez Pages: 9 (3194 words) Published: April 16, 2001
This paper addresses the issue of the extreme increases in salaries of major league baseball players. It looks at the effects of these increases on all areas of the game, from competitiveness, to fan appeal, to financial issues. It also looks at the different perspectives of all involved, including the owners, players, and the fans. Also shown in the paper are the possible solutions to the problem of baseball salaries, along with some of the possible negative outcomes in the future if nothing is done

Baseball's Skyrocketing Salaries

It can no longer be said that baseball is just a game. Actually, it has been many years since that statement could be considered true. Only recently, however, did the entire nation, not just sports fans realize the extent to which this fact is true. Athletes, for the most part, have always been paid better than the average American; but now, with Alex Rodriguez's new contract, he is truthfully worth just as much as the entire franchise that he plays for.

Baseball salaries have skyrocketed out of control, and something must be done before the integrity of the game, and eventually, the game itself is destroyed. There are many reasons why this will happen, and this claim will be supported by the viewpoints of all involved, players, owners, and fans. Many of the cold, hard facts related to this salary increase will be shown, along with exactly what has caused this exponential increase in pay.

While the outcry against the outrageous contracts that the players receive only recently become national news, the anger towards the players for this dates back to the beginning of the game. However, since the creation of free agency in 1976, the increase in pay has become out of control. In order to see this, one only has to look at the first two years of free agency, where salaries doubled (Bodley, 2000, par. 17). Additionally, the average salary is currently forty times higher than it was in 1976 (Fisher & Heller, 2001, par. 4).

Baseball was the first sport to have free agency, and as it currently stands, the last to control it. All other major sports, basketball, football, and hockey, have plans in place in order to keep a check on salaries. As a result, they are not facing the crisis that Major League Baseball will soon have to deal with. These sports all have a form of a salary cap or some revenue sharing between the small and large market teams. Baseball's one attempt at this, a luxury tax for teams with high payrolls, has done nothing to curb the extreme growth of salaries.

It is also interesting to examine the roots of free agency, which in the beginning was a good idea. In December 1975, Peter Seitz, at the time baseball's arbitrator supported a grievance that two players had filed (Chass, 2000, par. 4). He ruled that when a player's contract to a team expired, the player was free to choose from all interested teams. In theory, this is a good idea that is fair for players. They weren't property of their original teams after contracts expired and were free to pursue other options, just as in the same way a businessman could look for a new job. However, there was no system in place to stop a bidding war between teams if the money was available. It also failed to take in to account the human ego. If a player sees a person with similar statistics getting paid more, then that player will demand the same amount of money, and this cycle continues endlessly.

Salary arbitration is another cause of the salary inflation, which on average has resulted in a 100% increase of the average salary in recent years (Chass, 2001, par. 18). In short, salary arbitration occurs when a player and a team renegotiate the contract with a neutral third party officiating. If a player has a good season, and feels that he is getting underpaid, he can file for arbitration. Players win most of these cases, all they have to do is find someone with comparable statistics who is getting...

References: Abrams, R.I. (1998) Legal Bases:Baseball and the Law. Philadelphia; Temple University Press.
Bodley, H. (2000, December 13). Economists Concerned for Baseball. USA Today, 7 paragraphs. Retrieved February 24, 1999 from Friends University Library on-line database
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Chass, M. (2000, December 23). Baseball 's Transfer of Power. New York Times, 9 paragraphs. Retrieved February 24, 2001 from Friends University Library on-line Database:
Chass, M (2001, January 7). Salary Arbitration and the Road to Riches and Ruin. New York Times, 21 paragraphs. Retrieved February 24, 2001 from Friends University Library on-line Database:
Feinstein, J (2000, December 15). Can Baseball Survive the $250 Million Man? Wall Street Journal, 13 paragraphs. Retrieved February 24, 2001 from Friends University Library on-line Database
Fisher, E., Heller, D. (2001). Financial House of Cards. Insight on the News, 25 paragraphs. Retrieved February 24, 2001 from Friends University Library on-line Database:
Fuhr, J. (1999). Stee-rike Four! What 's Wrong With the Business of Baseball? Atlanta Economic Journal, 27(2), 38 paragraphs. Retrieved February 24, 2001 from Friends University Library on-line Database:
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Ozanian, M. (2000, June 12). Too Much to Lose. Forbes, 12 paragraphs. Retrieved February 24, 2001 from Friends University Library on-line Database:
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Sullivan, R
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