The Price of Freedom

By Richard Zoglin

Baseball owners are looking for a way to hold down costs, but the job would be a lot easier, in their view, if their employees were not free agents. Ever since players won the right to shop their services after six years in the majors to any team willing to bid for them, salaries have soared. But what would happen if the players were free starting from Day One? That, oddly enough, could depress salaries even more than the owners' much desired salary cap.

For the reason, one has to return to 1975, when an arbitrator (supported by later court rulings) struck down baseball's reserve clause, which tied players to one team for as long as the club wished. Despite the apparent victory, players' union chief Marvin Miller knew well the laws of supply and demand. If all players are on the market, he reasoned, most will be relatively cheap. If 20 left-handed hitting outfielders are available, teams that need one won't have to pay much. If only two are up for auction, the bidding will be fierce.

So even as militant players were demanding total emancipation, Miller played the great conciliator. Claiming that players recognized the need to foster team continuity and to compensate owners for the time and money spent developing young players, he worked out a compromise: only after they had played in the big leagues for six years could players become free agents. The agreement was good for baseball, Miller said, but he knew it was even better for the athletes. By regulating the flow of talent, Miller created the overheated, not-quite-free-market conditions that have made players wildly rich.

What would happen if the owners tried a version of Miller's hidden-ball trick and gave the players what they originally wanted: unrestricted free agency? Fans would no doubt be dismayed to find their teams dispersed and reassembled every season -- though most owners would probably still tie up top players with long-term contracts. But if Miller's economic analysis is correct, the scramble to pay huge sums to midlevel players would quickly subside, and payrolls might finally level off.