Players Will Whiff Owners Again

Some people never learn.

Major league baseball owners are pitching into the winds ofeconomic history with their ludicrous attempt to win back control ofthe national pastime.

The baseball strike that began on Aug. 12, the eighth workstoppage since 1972, merely confirms what most everyone alreadyknows: While major league baseball players are fighting for freemarket economics, the owners are using old-fashioned deception andpower politics to impose socialism for the rich. Given the wayhistory works, a grand slam victory for the players is likely.

The baseball strike centers on one issue only: owners' effortsto link a proposal to share revenues among themselves with a salarycap that would limit the amount of money teams could spend on playersalaries.

It's hard to muster sympathy for players. The median playersalary is $410,000 a year and the average is $1.2 million. Thirteenmajor leaguers earn more than $5 million a year, and player salarieshave increased more than 20-fold since 1975.

But big player salaries are possible only because baseballprofits are huge and asset values are rising through the roof. Ipersonally know a limited partner in the Chicago White Sox whoseoriginal, six-figure investment has appreciated in value more than10-fold. The Cincinnati Reds, located in baseball's smallest mediamarket, pulled down profits every year between 1984 and 1992. Andthe hapless San Diego Padres have attracted the interest of buyersonce the strike finally is settled.

Still, major league baseball owners want to limit player wagesto 50 percent of gross revenues, a huge reduction from themarket-driven rate of 58 percent. Yes, the National BasketballAssociation has a salary cap tied to 53 percent of general revenues,and the National Football League has a salary cap tied to 64 percentof general revenues. However, those salary caps are more generous tobegin with and are loaded with exemptions that allow salaries toapproximate market values. Just ask Horace Grant.

In their zeal to obscure the real issue, power, baseball ownerssay they need a cap for two reasons: Too many teams lose money, andthere is insufficient competition between large- and small-marketclubs.

Not true. The owners won't provide reliable statistics aboutwhich team actually is losing money. At first, they said 19 clubswere losing money. When it was revealed that the White Sox and LosAngeles Dodgers were among the 19, the owners revised the number ofmoney-losing teams to 12. Anyone care to guess the real number?

And for competition, just read the latest standings. As of Aug.12, the baseball team with the second lowest payroll, the MontrealExpos, had the highest winning percentage in all of baseball. Theteam with the second-highest payroll, the Detroit Tigers, was nearrock-bottom. One baseball franchise owned by a major media company,the Atlanta Braves, is a star performer. The other owned by a mediacompany, the Chicago Cubs, is a flop.

Conventional wisdom has it that time is on the owners' side.Nonsense. Like the Organization of Petroleum Exporting Countries,major league baseball owners are a cartel that has lost astranglehold of its market. That's the way history works. Theowners' efforts to win back some of that power won't work.

No matter how hard individual owners try, incentives in a cartelfor individual members to cheat eventually overtakes the incentivesto collude. It happened twice to owners in the 1980s and there's noreason to believe it won't happen again.

The Berlin Wall has come down since the last time baseball wasstopped by a labor dispute. You wouldn't know it listening to ownersplead for rich-man's socialism. History's on the players' side.

Mark N. Hornung is editor of the Chicago Sun-Times editorialpages.