OK, so we all know that a labor dispute between millionaires and billionaires, as the halting negotiations for a new agreement between the NFL’s players and owners have been described, is a different sort of animal than your typical fight between union workers and company managers. But I didn’t realize just how weird the situation was until I read the argument by NFL Commissioner Roger Goodell, in an op-ed published in The Wall Street Journal yesterday.
As you read the following section of the op-ed, keep in mind that Goodell represents the owners (i.e., the capital side of the equation):
In the union lawyers’ world, every player would enter the league as an unrestricted free agent, an independent contractor free to sell his services to any team. Every player would again become an unrestricted free agent each time his contract expired. And each team would be free to spend as much or as little as it wanted on player payroll or on an individual player’s compensation.
Any league-wide rule relating to terms of player employment would be subject to antitrust challenge in courts throughout the country. Any player could sue — on his own behalf or representing a class — to challenge any league rule that he believes unreasonably restricts the “market” for his services.
Under this vision, players and fans would have none of the protections or benefits that only a union (through a collective-bargaining agreement) can deliver. What are the potential ramifications for players, teams, and fans? Here are some examples:
• No draft. “Why should there even be a draft?” said player agent Brian Ayrault. “Players should be able to choose who they work for. Markets should determine the value of all contracts. Competitive balance is a fallacy.”
• No minimum team payroll. Some teams could have $200 million payrolls while others spend $50 million or less.
• No minimum player salary. Many players could earn substantially less than today’s minimums.
• No standard guarantee to compensate players who suffer season- or career-ending injuries. Players would instead negotiate whatever compensation they could.
• No league-wide agreements on benefits. The generous benefit programs now available to players throughout the league would become a matter of individual club choice and individual player negotiation. (italics original)
He goes on, but you get the point. How strange is it to see the owners (capital) arguing against the players (labor) in favor of such matters as higher minimum payrolls and salaries, and reminding them of “the protections [and] benefits that only a union…can deliver”? What gives?
The key point, I think, is the part about antitrust protection for the league. As I understand it, the NFL, unlike major league baseball, gets its antitrust protection via its collective bargaining agreement with its players. That’s why the players’ move to decertify their union was important. And the reason antitrust is an overriding concern for the owners is that we don’t consider a sports league like the NFL in the proper market.
NFL teams compete with each other on the field. But the NFL as a league competes with MLB, the NBA, the NHL, college sports, auto racing — as well as movie theaters, music concerts, monster truck rallies, rodeos.
That is, the NFL is one competitor in the marketplace for entertainment dollars. As well as, via its contracts with TV networks, advertising dollars.
The Atlanta Falcons competed with the Green Bay Packers in the playoffs last year — OK, “competed” may be too strong a word, given the way the game went — but the Falcons and Packers don’t compete with one another for your entertainment dollars. Instead, the Falcons compete with the Braves, Hawks, Thrashers, Bulldogs, Yellow Jackets, other entertainment events at the Georgia Dome, Philips Arena and elsewhere in metro Atlanta.
As an aside, this reality is one reason a new sports stadium does not necessarily contribute to large-scale economic growth beyond the construction jobs needed to build it. Any additional fans attracted to the venue probably would have spent the same amount of money elsewhere if it weren’t built.
There is, however, one similarity between the NFL’s bizarre dispute and more standard-issue labor negotiations: If they’re not careful, each side will be tempted to make a short-term deal that hurts their long-term interests.
– By Kyle Wingfield