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The Economics of Professional Sports
By Matthew Dochter

For as long as people can remember there have been sports teams to cheer for; whether organized franchises or backyard games, sports has played an integral roll in the development of our nation. The four major professional sports leagues, the National Football League (NFL), Major League Baseball (MLB), the National Hockey League (NHL), and the National Basketball Association (NBA), all have a firm grasp on the nation. With this hold, they are an economic super power in the entertainment business. The players in their respective leagues have die-hard, loyal fans willing to do anything to see their favorite players and teams play. The market is vast as people fall into the trap of professional sports, so absorbed by the game that they do not realize what is actually happening. Professional sports are a black hole sucking in excessive amounts of money, money that is hard earned by average people. Player salaries are excessive and need to be toned down.

All four of these treasured sports have a long history with deep roots grown over decades. Up and into the 1970s, the salaries of players were kept reasonable and within the average American income. Only in recent decades have the players become greedy and more demanding. Salaries have increased at surprising numbers. For example, in 1967 the average wage for a player in the MLB was nineteen thousand. Today, that number has increased to nearly 1.4 million (Lahman). This represents a 7400% increase. This is the case in most of professional sports. At the same time, players in the NHL and NFL were being paid thirty-five thousand. Now, NFL players average 1.1 million and NHL players average just over one million. By far, the highest paid players of the four leagues is the NBA. Today, players are averaging 4.5 million (“Pro Basketball”). Even accounting for inflation, these numbers are far higher than what the inflated salaries of old would be in today’s economy.

Some may argue that athletes provide us with an essential aspect of our lives, entertainment. Yet other, far more important people are getting paid significantly less to do more for society than provide entertainment. These people provide life saving acts, put shelter over our heads, protect us and much more. Arguably the most important person in America is the President. He has the power to control all the major decisions in the country and is responsible for the safety of an entire nation of nearly 300 million people. What could be more important? Yet in comparison to professional athletes he only makes chunk change. His presidential salary is roughly four hundred thousand per year. He makes what a third string quarterback makes. The vice president, in perspective, is also underpaid. He receives only two hundred thousand for his services. If professional athletes are paid millions for what they do then the officials in government that actually provide a valuable service for our country should be paid on par with or more than athletes.

Another group of people who are absolutely necessary in our country are people who provide medical services. Without them, hundreds or thousands of people could or would die each day. Everyone from ambulance drivers to surgeons all provide essential services. And yet they are not paid what athletes are paid for providing a more valuable service. Emergency medical technicians (EMT) and paramedics only make forty thousand. The only medical people that even come remotely close to athletic salaries are doctors. Doctors’ salaries vary depending on the type of practice they are involved in. However, even the highest paying positions only make four hundred seventy-five thousand. The average over the various fields is only one hundred eighty thousand (“Physician Jobs”). Along with providing medical services, these people are on the cutting edge of technology in providing new cures and treatments. What athlete can say that?

The men and women who protect us at home, the police and fire departments, are also significantly underpaid for what they do compared to athletes. Police, men who put their lives on the line for us, only get paid between twenty and fifty thousand. Without the police complete chaos would erupt. Keeping peace and order is a critical task. Almost as critical are firemen. Without firemen the country would be consumed in ashes the moment one fire raged out of control. Professional firemen only get paid an average of fifty thousand to keep our country fire free. The moment I see an athlete fighting a fire or helping fight crime is the moment I keel over dead. And yet they get paid more than ten times what these brave men and women make.

Many athletes are paid more than entire departments are paid in a year. For example, Randy Moss of the Oakland Raiders is being paid 75 million over an eight year contract (Weisman). Shaquille O’Neil is making 20 million alone in 2005. Other NBA stars are not far behind (“Salaries”). This excess continues in the MLB where Mike Piazza makes eighty-two thousand per game (Scherer). That is more than most people make in an entire year, some even two years. There is no need for this excessiveness. Compared to other professions, professional athletes are making more than double what other, more important jobs are making. If we are going to pay these outrageous salaries to people who are paid for sheer entertainment, then the people who provide things we actually need should be paid even more than these athletes. What would happen if these people decided to strike because they wanted more money? Either athletic salaries need to be lowered or other salaries need to be raised; which would be easier?

Not only are athletes making more money but they are living in relative comfort and ease with their millions. Most Americans do not have that luxury. The national gross domestic product (GDP), which is one way to measure the standard of living in a country, is only forty thousand dollars (“World Factbook”). According to the Wikipedia, “The standard of living in the United States is one of the highest in the world by almost any measure. On measures such as the UN Human Development Index the United States is always in the top ten” (“Standard of Living”). If this is so then why do athletes need to make the money they do? Even though most of the country lives comfortably, “The United States also has more people below the defined poverty line than 26 other countries” (“Standard of Living”). If we did not pay so much to athletes, more money could be given to aid the poor. Last year the poverty numbers went up for the third straight year, increasing to about 35.9 million people (Connolly). Athletes do give to charities but in amounts that do not make a significant impact. If every athlete donated half of their yearly earnings to charities and organizations the amount of poverty in America could be drastically reduced. Thinking outside of the United States, there are hundreds of places that could use monetary aid. By donating, athletes could help a good cause while also downplaying their significantly unimportant role.

Not only are the excessive salaries of teams unneeded and pointless, they also cause problems for the teams themselves. By dealing out these large amounts of money to players, players develop a sense of their own value. They compare themselves to other players in similar positions and decide what is best for themselves and not the team. Their purpose, to entertainment, suffers as players negotiate and argue for more money. Many players end up leaving a team because of this. They go where the money is and have no sense of loyalty. This can and has caused a great number of problems. Most recently is the case of Voshon Lenard. He was suspended from the Denver Nuggets (NBA) for one game without pay for “conduct detrimental to the team” (“Nuggets”). Lenard has been in contract negotiations in order to be traded in favor of another team that would name him a starter hence, leading to more money.

Lenard is not the only player openly challenging his contract. In the NFL, Terrell Owens has openly and publicly asked for a new contract just one year after signing a seven year, forty-nine million dollar contract that included a signing bonus (“Terrell Owens”). Owens was jealous of Randy Moss’s contract and thought he was Moss’s equal and should be paid like he was. His greed led to open dispute with team officials, coaches, and players disrupting the season for the Philadelphia Eagles just one year after their impressive Super Bowl run. By attacking the team he effectively ruined its hopes of a return trip to the prestigious game. For his grievances he was suspended four games without pay and placed on the deactivated list for the rest of the year.

If salaries were standardized across the league, in every league, problems such as this would not occur. Players could not be jealous of how much another player is making because they would be making the exact same amount. In addition, salaries could be kept down to reasonable amounts. Initially, players would complain but after years of the cap it would be a normal thing. However, they are making too much of it as it is now and once a lower salary is standard and unmoving, players would have to accept it or not play at all.

Player salaries have a significant role in how sports are run. Players control the league, not the owners. Player unions can bring a league to its knees. Every major sport has had at one time a player strike or a league lockout. These are detrimental to the sport and cause a huge loss in the fan base. People do not want to see a league strike, they want to see their favorite players play. Some die-hard fans take it so hard they refuse to watch the sport when it resumes. There have been several instances of this in the last two decades.

Most recently was the NHL lockout, which cancelled the entire 2004-2005 season. The cause of this was the players’ union’s (NHLPA) unwillingness to let the owners run their business as they saw fit. The players wanted to renegotiate the collective bargaining agreement (CBA) that had ended the 1994 strike as did the owners. However, the NHLPA and the owners could not agree on terms. The players wanted more than the owners would give. “The fundamental reason that the only hockey on TV right now is the Central Collegiate Hockey Association…is because of greed. Players do not want to eliminate their highly cushy lifestyles (and guaranteed contracts) to kowtow to the owners” (White). The reasons were the same in the 1994 strike.

This is the reason for any strike. In 1994 the MLB went on strike to fight against a salary cap. Owners feared that with dropping profit margins that smaller teams would have to leave their home cities or be dismantled. The owners suggested a salary cap, which the players adamantly refused. The results of the strike were profound. When the next season arrived, opening day across the league was greeting by angry fans:
It took several years before the MLB regained its fan base.

Lockouts and strikes only hurt a league. Greed drives the players’ associations to fight for more and more money. The only result is a loss of fans and bargaining agreements that were not what the players wanted anyway. Everyone loses out. Players and even leagues, lose respect that takes time to regain. Some strikes such as the 1987 NFL player strike are easily resolved with no ill consequences, but others take longer to heal. The NHL will be reeling for years to regain its already small fan base. What have these strikes accomplished that was positive? They have only reasserted the greediness of professional athletes.

The high salaries teams are willing to pay to players have more effects than just those mentioned above. They have real economic and social impacts. As fans we enjoy going to see our favorite teams play, but with the ever-increasing salaries, the ticket prices also increase. The Yale Daily News says that, “Experts usually point to giant television contracts as the catalyst for the ever-increasing salaries, but indisputable evidence now shows that we as fans have been forced to shoulder a significant portion of the burden” (Corwin). Since 1993, ticket prices in the NFL have increased at a rate of 6.4% and 6.97% in MLB (Baade). There will be a point where most people will be unwilling to pay high prices to see a game. They will instead watch on television or listen on the radio and Internet. Both offer cheaper alternatives to going to the game. In turn, this fuels television networks and helps feed the enormous salaries of the players. It is a vicious cycle and needs to be stopped. By lowering player salaries, ticket prices can remain low and the average person can go to a game as they please. It would also reserve more profit for the networks and the teams that could be re-dispersed into the economy.

Along with the economical impact of high salaries comes a very pertinent social effect. Art Taylor, a professor at the Center for the Study of Sport in Society at Northeastern University in Boston, performed a survey of inner city children in Boston to determine the effects athletic salaries have on children. In the study he found that “66% of African American males in the seventh and eighth grades are sure they will play pro sports. Kids hear these salaries and they don't want to do a normal job. The effect of these salaries on kids is terrible” (Scherer). Children are more motivated to go out and play sports rather than their schoolwork. Only a small percentage of those who play college sports go on to play at the professional level. Kids should concentrate on getting an education so if and when they do not make it to the pros they have something to fall back on. If children saw that being a professional athlete was just as good as any other job more children would concentrate less on sports and rather on schooling.

Lowering professional athlete salaries would do more good than harm. In the eyes of the nation, athletes are considered gods and we need to knock them off their pedestal. They make more than enough to live on for the rest of their lives in one year and yet they still complain they are not making enough. If we put that extra money towards people who actually do something positive for society the country or even the world would be a better place for everyone. Imagine what Shaq could do with one years’ pay. These players will never even touch half the money they make and do not need to have it. They are a plague on society giving children false hope, alienating fans, and imposing the wrong ideals onto our nation.

If owners would lower the salaries of their players so much good could come of it. Money would be available for charity or, as in the past year, natural disasters. This could be a major source of funding for such things as bettering schools and education, working to fight poverty, or improving internal affairs like fire and police. Money is needed in all these areas and is not needed by the professional athletes who make millions. They may argue that they need it to support their families. I ask them this, “If you can not support your family on one year’s salary, maximum two, are you an idiot?” My answer is yes.



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