Baseball

Baseball's Monopoly Status

Baseball is once again back in the news because of a report, by a former Senator no less, that about 100 players in the recent past, most of whom are still playing, took illegal steroids or other performance enhancing drugs.

They're are always calls for Congressional investigations every time this happens, and much like the tobacco warnings, all that happens is a collective mea culpa followed by a few surface changes. I am well aware the Congress never accomplishes anything with these spectacles and that they are mostly designed for PR purposes, but I always wondered what business it was of Congress.

The answer is that baseball is the only professional sport that has a monopoly. The somewhat confusing history of how this arose is in the article above, but there it is. Baseball is exempt from the Sherman anti-trust act and is not considered interstate commerce by the Supreme Court - although in the past the court has ruled that the gallon of milk that travels 2 miles from the dairy to the local store and then to your house without leaving your county is interstate commerce. Baseball players can engage in both collective and individual bargaining in contravention to federal labor laws. And, to boot, most baseball stadiums are funded by state and local (and perhaps federal) development money - because as we know, the American economy would come to a grinding halt if we couldn't watch steroid-fed overpaid 20 year-olds hit a little ball around.

So, at last, here is my point. Who cares if these idiots are shortening their lives and shrinking their privates for several million dollars? My problem is that no one else can start up a baseball league to compete. If you want to see baseball clean up its act, give it some competition. Nothing will make baseball start regulating itself faster than the threat of lost revenue with a direct competitor. Right now, their scandals cost them some revenue, but they can always bounce back. Why? Because they are a monopoly.

Eliminate the monopoly, open baseball up to competition, and the problems will start to disappear as the threat of lost revenue appears. Competition may even drive down the salaries and open up the number of baseball jobs to potential players. Someone might take steroids to go from having no job to earning $5 million a year, but a lot fewer players will take steroids if it is the difference between a job that pay $200,000 per year and a job that pays $300,000 a year. Two or three competing baseball leagues (and the money is obviously there to sustain it) mean a lot more jobs for players and lot more competition for the fan's dollars.