The Business of Baseball: Major League Baseball Is Preparing for Off-Season Negotiations, Which Include a New Labor Agreement, Economic Restructuring and Franchise Management. (Sports)

By Fisher, Eric | Insight on the News, November 26, 2001 | Go to article overview

The Business of Baseball: Major League Baseball Is Preparing for Off-Season Negotiations, Which Include a New Labor Agreement, Economic Restructuring and Franchise Management. (Sports)


Fisher, Eric, Insight on the News


For nearly a year, baseball commissioner Bud Selig has said there is plenty of time to reach a new labor agreement with the players association; just enjoy Barry Bonds, Cal Ripken Jr., Tony Gwynn and the pennant races and worry about labor later. And most of the country did just that.

Now, with a few days remaining on the current accord -- expiration coincides with the end of the World Series -- neither Major League Baseball nor the players association reports any significant progress in striking a deal, or even a formal timetable to conduct meaningful talks. Given the game's sorry labor history, which includes eight work stoppages since 1972, another stoppage appears likely.

On its face, that adds up to the same protracted millionaires-vs.-billionaires fight fans know all too well. The stakes, however, are greater this time than at any point in the game's history. Baseball's annual revenues, now soaring toward $4 billion, have never been higher. And since Sept. 11, the nation's tolerance for infighting within sports is virtually nonexistent.

"This is all very troubling," says Andrew Zimbalist, a Smith College economics professor who has written frequently on sports economics and consulted for the players association. "I started getting concerned [about the lack of progress] back in the spring. Now the deadline is right on top of us and, sadly, it's predictable that we're here."

The league and union did conduct some largely informal discussions during the summer, but neither Selig nor Donald Fehr, chief of the players union, is saying much about them. Last year's "Blue Ribbon Report on Baseball Economics," which lists meaningful revenue sharing, minimum payrolls and franchise relocation among its suggestions for repair, does provide some ideas. But the owners have not universally embraced the plan, and Fehr has called it too simplistic to be useful.

Several baseball insiders say talks have not moved into a formal, organized stage primarily because of a vast lack of cohesion among owners. Baseball's have-nots, such as Kansas City's David Glass, San Diego's John Moores and Pittsburgh's Kevin McClatchy, have trouble keeping up with the sport's economic titans. They want some type of salary control -- a cap, enhanced luxury tax or some similar mechanism. The haves, which include the New York Yankees and Los Angeles Dodgers, are comfortable paying their bills under the current structure.

In addition, most high-earning teams have little regard for the luxury tax levied from 1997 to 1999. …

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