An Economist's Perspective On the NFL's Labor Issues


I've mostly stayed clear of writing too very much about the impending NFL lockout to this point. Not because it isn't newsworthy, or because I don't understand it, but just because I feel like there's an unending stream of national perspective gushing out, to the point you really don't need yet another voice added to the chorus. 

However, when something really great comes to my attention I will always try to pass it along, and so I would like to direct you to a two-part series on the potential lockout recently posted by S.M. Oliva of the Ludwig von Mises Institute. No, I had not heard of the Mises Institute before having this piece brought to my attention via the Twitter, but if all their work is half the quality of this I'm going to have to bookmark the site. (They're apparently named after an Austrian economist known for taking a hard-line stance on the gold standard and laissez-faire values. Sounds like fun, right?) 

A few thoughts on the article after the jump. 

Part one is an overview of the problem, as well as a bit on the proposed rookie wage scale which the owners have rolled out as one of their chief concerns. Part two covers the more important issues, those at the real core of the debate, largely having to do with the economic realities of stadium financing and television contracts. 

Here's the gist of it: the rookie wage scale is a red herring thrown out by ownership to try and distract from their real concerns, and I agree. While it would probably be beneficial to the league to have a rookie scale in place, it also seems awfully anti-free market to me. After all, what other industry on Earth not only forces you to accept a job offer from only one employer, but then demands you accept whatever offer they make, regardless of what leverage you may -- or may not -- have? If I had gone to journalism school (which I did not, largely explaining the amateurism you're reading right now), upon graduating I would have been free to apply for and take a position with any paper, new service, television network, or anything else I wanted. I also would have been free to negotiate salary. Of course, being an entry-level J-school grad wouldn't have given me a ton of leverage to negotiate with, but I still could have used whatever little leverage I managed. I get another offer, well, one of these two jobs is just going to have to prove they want me more, that sort of thing. 

In the NFL, though, coming out of college you're drafted by a team, allowed only to negotiate and sign with them. You can't choose your employer, can't field offers from other teams. This is who drafted you, this is where you have to go. Don't like it? Enjoy that Canadian half-size arena football thing. As it stands now, though, the players can at least negotiate their contracts with the teams who drafted them and try to get the best salary they can. With a rookie wage scale in place, even that would be denied. "Sorry, kid, we decided it was best for the league if we don't allow you to try and make as much money as you can. Sure, it's a pretty basic freedom, but hey, we're the NFL. You'll take it and you'll like it." 

Just seems kind of un-American to me, at least by the standards of what I've been told are American values by people who seem to value that sort of thing. 

As for the rest of it, well, suffice to say I've always been puzzled by the fact the NFL -- and most sporting leagues, for that matter -- are essentially communist enterprises in function (with a healthy dose of monarchy thrown in), yet they are so widely embraced by the sort of Tea Party-loving solid American citizens who scream Socialism over virtually every other facet of society. After all, the Communist slogan of, "From each according to ability, to each according to need," sounds a lot like revenue sharing, doesn't it? (And for the record, this is why I stay clear of issues like this. The discussion gets ugly in a hurry.) 

The labour dispute is neatly summed up in one sentence in part two: 

"The owners overspent on unnecessary stadiums, and now they want the players to work more for less pay to help pay down the debt. That's your entire labor dispute in one sentence. The league expects -- nay, demand -- the NFLPA to act like a local government in a stadium dispute and simply give the franchise operators what they want for little or nothing in return. Maintaining the "owners'" social standing is of paramount importance."

I would argue there are a few other things contributing to the crisis, but that's a pretty solid summation of what the owners are looking for in this whole process. They want more profits than they're currently making, and the best way to get those profits is to lock the players out and force them to give back a huge chunk of money they're making now. 

Helping the owners out, of course, is the hatred of labour so prevalent in our society; I recently read a comment on a football blog to the effect of, "The sense of entitlement these unions have is sickening." So the owners want to make the players work more, take less pay in return, are threatening to shut the whole enterprise down unless the players bend over and take it, and the union is somehow to blame because it's a socialist un-American commie pinko entity with entitlement issues. Well, if you consider thinking you're entitled to get paid for your work 'entitlement issues', then I suppose that's sort of true. 

Now, back to your regularly scheduled programming. 

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