Posted by Jay Livingston
Owners of money-making operations can make more money if they pay their workers less. But they paying less is possible only if others are not offering to pay more. This often requires that the business form a cartel – an agreement among owners not to compete. That way, they can all pay their workers less than market value.
As Adam Smith pointed out long ago, businesses don’t really want competition. What’s interesting political conservatives who are not in business, despite their talk about freedom and capitalism and the free market, often want to shelter hugely profitable business from competition.
Thus it was that yesterday Claudia Wilken, a liberal judge appointed by Bill Clinton, told the NCAA it would have to start paying their workers. The NCAA and its affiliated businesses (sometimes known as “universities”) didn’t just pay their workers less. They didn’t pay them at all. Even better.
Of course, the NCAA claims that the football and basketball players are not workers creating a product that the NCAA sells for huge amounts of money. No, these are “scholar athletes.” And for years, the courts have gone along with this fiction. With yesterday’s court ruling as a start, that may soon change.
| The ruling, which would take effect in 2016, does not mandate that players be paid. But it could allow universities to engage in bidding wars for the best athletes, though the N.C.A.A. would probably try to prevent that by capping payments, which Judge Wilken said was permissible. [NYT] |
We’ve been here before. In sport, the courts have long been slow in recognizing what was obvious to everyone else. In 1922, the Supreme Court exempted major league baseball from the Sherman Anti-trust Law, ruling that baseball was an “amusement,” not a business. Another fiction. Even in 1969, when the Court admitted that baseball was a business, the conservatives on the Court still continued to allow teams to enforce the “reserve clause,” which prevented players from seeking a better deal with another club. If Mickey Mantle didn’t like the contract the Yankees offered, his only option was to retire. Dissenting were three of the Court’s great liberals – William Brennan, Thurgood Marshall, and William O. Douglas.
The reserve clause finally disappeared, not because of a court ruling but because the players had formed a union. In negotiations with the owners, the union was strong enough to force them to give up the reserve clause. College athletes have never been able to form a union. Recently, athletes at Northwestern voted to form a union. In April, the NLRB ruled that the athletes were employees and could unionize. Of course, those who were getting rich off the atheletes’ unpaid labor – the university and the NCAA – objected. Just last month, they filed briefs arguing against the NLRB decision.
Still, it may be hard for college athletes to form unions given the short tenure of each member. And I expect that the NCAA and its universities will, like admittedly for-profit corporations, do everything they can to prevent or bust the unions. So for now, the courts are the only hope for bringing any real pay, let alone competitive wages, to college atheletes. So for now the courts are the workers’ only hope. Yesterday’s ruling offered that hope.
So when it comes to money-making athletics, who’s for competition? Liberal judges and unions.
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