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Three Things to Like (and Hate) about the Nelson Cruz Trade


8 minutes ago, Major League Ready said:

... I am really doubting anyone was thinking the poor baseball players only make 5 times the average American family.

... If you are keeping track, that’s almost exactly 100 times what they were paid in 1970.  Average US income grew roughly 5X over the same 40 year period.

... and after they increased 100 fold, average salary went up over a million dollars per year.  To put that in perspective, their raise (not their income) after increasing 100 fold is equal to 12.5 times the average household income in Minnesota.  

The problem is you are comparing their income to the average income.  They aren't average.  Of the millions of people who play baseball, they are the top 800 or so.  In 1970, movie stars got paid big bucks. Top musicians got paid big bucks. Why? Because if the actors didn't like their pay, they could go to a different studio.  The musicians could sign with another label. But baseball players couldn't do that - they could either re-sign for what they were offered or hold out, which except for a few stars would have resulted in them being blacklisted by the sport.

Now, they can eventually earn a certain level of freedom, after 4-5 years of team control as minor leaguers and then another 5-6 years in the majors (3 years of arbitration?) 

 

9 minutes ago, Major League Ready said:

I am betting people at the time were thinking holy cow I wish my salary had more than quadrupled in just 10 years.  

What is stopping you? Are you not in the top .0001% in your field?  (Or does the market not widely differentiate between the to .0001 percent and the top 1% in your field as it does in theirs.)  Are you free to go to another employer?  

Maybe the market just won't pay that kind of money for the goods and/or services that you help deliver, or the part you play isn't as difficult to replace as the part they play in their business.

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23 hours ago, Mike Sixel said:

So the players are just required to work for one team forever? You realize they are people, right? Like teams would every pay fair value in that system. 

We have seen that system, so we don't have to speculate.  They wouldn't.

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3 hours ago, gil4 said:

I think your figure shows how much the salaries of the players were artificially suppressed 50 years ago, rather than an indicator that we should go back to the previous system. 

Not to argue too much with you, but 56 years ago my father bought a 3 bedroom house with a basement and garage in a very nice neighborhood for 19,500 dollars.  So when we look at the salaries of the era 50 years ago, remember what it bought compared to today (that same house today is over 300,000).  They made a comfortable living playing a game they would have killed to play at that level.  If we are going to feel bad for players, feel bad for the minor leaguers who never see any real money; yet they keep playing the game they love to play.  You can't suppress a salary that was never supposed to be that high to begin with.  Just my two cents worth.

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22 minutes ago, gil4 said:

We have seen that system, so we don't have to speculate.  They wouldn't.

They would with binding arbitration.  That was the whole premise from the beginning.  I guess the whole debate boils down to each ones definition of "fair" when we talk about a fair wage.  Maybe that is what makes it fun to debate.

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2 hours ago, Mark G said:

They would with binding arbitration.  That was the whole premise from the beginning.  I guess the whole debate boils down to each ones definition of "fair" when we talk about a fair wage.  Maybe that is what makes it fun to debate.

I'd rather see free than have someone's definition of fair imposed.

I do understand that some degree of competitive balance is in everyone's best interest (and most other sports do it better because of the way they divide the TV money), but the money also has to be divided between the risk-takers/investors and the earners.

I agree to an extent about the minor-leaguers.  The biggest offense I see there is they don't get to collectively bargain.  The MLBPA negotiates "on their behalf", but they can't actually be members of the union until they are in the majors.

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17 hours ago, gil4 said:

The problem is you are comparing their income to the average income.  They aren't average.  Of the millions of people who play baseball, they are the top 800 or so.  In 1970, movie stars got paid big bucks. Top musicians got paid big bucks. Why? Because if the actors didn't like their pay, they could go to a different studio.  The musicians could sign with another label. But baseball players couldn't do that - they could either re-sign for what they were offered or hold out, which except for a few stars would have resulted in them being blacklisted by the sport.

Now, they can eventually earn a certain level of freedom, after 4-5 years of team control as minor leaguers and then another 5-6 years in the majors (3 years of arbitration?) 

 

What is stopping you? Are you not in the top .0001% in your field?  (Or does the market not widely differentiate between the to .0001 percent and the top 1% in your field as it does in theirs.)  Are you free to go to another employer?  

Maybe the market just won't pay that kind of money for the goods and/or services that you help deliver, or the part you play isn't as difficult to replace as the part they play in their business.

I was not talking about myself.  You twisted the point which was they were not considered under paid in 1970 so one would think public perception is they were well compensated when their salary had grown 10X.  If they did not think so at 10X, I am sure public and player perception was they were paid well when it reached 20X what it was in 1970.  Then, after it reached this level of 20X what they were paid in 1970, their salaries grew another 5X and therefore more than 100X what it was in 1970.  

There are many holes in your position in terms of economic theory.  Every profession has people that are the very top of their profession.  Their salary is not determined by the ability of the company to pay.  Compensation for people living in a free market society are determined by one of two things.  Some get paid a minimum wage determined by law.  Employers pay the rest an amount sufficient to retain their services.  Some industries don’t pay as well as others so they probably don’t get the most skilled people.  However, employees in the most lucrative industries don’t pay employees based on ability to pay.  They pay an amount sufficient to attract these people from other industries.  

So. Let me ask you this  … If MLB paid every player on the 26 man roster $1M/year?  That would still be twice as much as the next highest professional BB league.  What percentage of their employees would they lose?  Maybe 2 to 3 tenths of one percent could play in a higher paying sport, right.  How many could make more in a different profession?   Perhaps more importantly, how many people here would stay in their position at ¼ the pay for the average and less than 5% of their current comp for top players?  The answer is none.  Of course, some industries pay more or less because of the relative conditions of employment.  You have to pay a laborer more to do certain dangerous / dirty jobs.  It's hard for me to conclude that MLB as an industry pays more generously than other industries even though their employees play a game for a living.  

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The salaries of MLB will continue to rise and rise. The difference though is that the teams can charge more for tickets, etc to help make up for some of the rise. Some would argue that players are overpaid and many are- especially after a free agent to be career year and those who bat .220 or win 8 games and make 10+ million or more the next year after earning next to nothing by baseball standards. But there are some free agents who do not sign to the highest bidder. Comparing baseball salaries to private industry is ludacris IMHO. This is free enterprise and not like the days when Babe Ruth who once asked for more money than the current President. When asked why, he said "because I had a better year". Or when Mickey Mantle had a great year and the Yankees wanted to cut his salary or maybe give him a puny raise. If you want to be angry about salaries and benefits, be upset that congressmen receive full pensions after just 1 term in office- and guess who pays for that?

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