From Free Market to Free Agency

 American history  Comments Off on From Free Market to Free Agency
Jul 302008

Someday, I’m going to write a book entitled “Yesterday’s Solutions,” giving truth to John Kennedy’s observation that today’s problems are the result of yesterday’s solutions.   Whenever we act to fix the difficulties of today, we invariably set in motion factors that will create problems for the future.   C’est la vie.   Anyway, a prime example of this is how efforts to break market monopolies in the late nineteenth century ultimately led to an act of Congress granting free agency to baseball players.

In the days of the robber barons and industrial monopolies, men like Cornelius Vanderbilt, Andrew Carnegie, and John D. Rockefeller compiled great amounts of wealth and power by developing huge monopolies and driving the competition out of business. This is the necessary end of the free market.  Collusion protects from competition. But, it also creates artificially high prices and reduced wages.   In order to check the growth of monopolies, Congress passed the Sherman Anti-trust Act in 1890. In theory, it would encourage competition and limit the power of Rockefeller, J.P. Morgan, and others to control the American economy and influence the way people lived because of that.

At that time, baseball clubs were loose conglomerations locally owned.  Some team owners organized to found the National League; others formed the American League.  There were other, smaller leagues and independent teams all over the country then.  Slowly, the NL and AL started forcing others out.  Through purchase and influence, they brought many of these teams under their umbrellas as “farm teams” – what we now know as the minor leagues that feed the majors.  There were still competing leagues at the time of the first World War, but these outsiders were dwindling and could little compete with the growing influence and money of the NL and the AL (which ultimately combined to form Major League Baseball [MLB]).  In the early twenties, one of these competitor leagues, the Federal Baseball Club of Baltimore, Inc., sued the NL and AL, claiming that since they were engaged in interstate commerce – travelling back and forth between states to play games among the teams in the league – they were subject to the Sherman Anti-trust Act.  In 1922, the U.S. Supreme Court ruled that Congress did not intend for the anti-trust legislation to cover baseball, and MLB was exempt from this. Baseball was legally a monopoly (Federal Baseball Club of Baltimore, Inc. v. National Baseball Clubs, 259 US 200 [1922]).  Justice Oliver Wendell Holmes wrote: “But the fact that in order to give the exhibitions the Leagues must induce free persons to cross state lines and must pay for their doing so is not enough to change the character of the business…the transport is a mere incident, not the essential thing.  That to which it is incident, the exhibition, although made for money would not be called trade of commerce in the commonly accepted use of those words.”  Or, to put it another way, when you said commerce back then, people thought of buying and selling goods – not paying for entertainment.  Baseball was not commerce, then, and the Federal league, which could not compete with MLB in salaries in order to attract quality players, eventually folded.  The baseball monopoly reigned.

Thereafter, professional baseball grew in popularity.  The advent of radio and TV meant that the games could reach audiences at home.  And, while ever-growing numbers of viewers tuned in to enjoy a game, advertisers pitched products to them.  The public followed celebrity star players and trading cards allowed fans a commercial venue for their hero-worship.  Popular sales of baseball caps, touting one’s team, established these as a ubiquitous part of American fashion.

Forcing other leagues out of business or co-opting them was not MLB’s only attempts to stave off competition during the early years, however.  It also had taken steps to limit the wages of players and their bargaining power.  The owners colluded to include a “reserve clause” in every player’s contract.  This clause stated that once a player’s contract ended, the club for which he played retained rights to the player for another year.  The club was not obliged to pay the player during that year unless he played for it, and he could not go play for anyone else during that time.  Because players wanted to play and to earn money, they would end up signing a new contract with the same team (the clubs rarely allowed players the year off – mostly forcing them into new contracts in order to play).  Thus, the teams could retain control of the players perpetually, and, since the players couldn’t go to another team, the club did not have to offer them fair wages.  They could re-sign players at lower salaries than the players could get if the teams had to bid against one another for a player.

This practice continued for a long time, and in the early 1950’s a player sued, claiming, again, that the Sherman Anti-trust Act applied to MLB and the reserve clause was the fruit of that monopoly.  The player, George Toolson, was stuck in the minor leagues under the Yankee organization.  The Yankees wouldn’t move him up, but they wouldn’t let him go elsewhere either.  He figured if he could get out of the reserve clause in his contract, he could go to another club that might play him in the majors.  In 1953, the case ended up in the U.S. Supreme Court (Toolson v. New York Yankees, Inc., 346 US 356 [1953]), where the Warren Court (under Chief Justice Earl Warren) reaffirmed that the Sherman Act did not apply to baseball.  Perhaps the author of the court’s opinion was ashamed of his logical inconsistencies, for he didn’t even sign the decision.  It said that the law was intended to target large corporations like U.S. Steel and Standard Oil – not baseball clubs.  Further, it had been thirty years since the Court had first determined that baseball was exempt and Congress hadn’t taken steps to address any oversight during that time.  This proved that Congress did not intend for the law to apply.  In dissent, Justices Harold Burton and Stanley Reed noted that baseball was no longer local.  It had become the national pastime – broadcast over radio and TV.  The minor league system criss-crossed the country and clubs belonging to the league existed throughout the U.S., Canada, and even Mexico.  National advertising was part of the sport and fed it.  Undoubtedly, the clubs were engaged in interstate commerce and were therefore subject to the Sherman Act.  Unfortunately, theirs was the minority opinion. Under the majority decision, baseball still wasn’t interstate commerce.

In 1972, the Court revisited the issue again and reaffirmed the previous decisions (Curt Flood v. Bowie Kuhn, et al., 407 US 258 [1972]).  Player Curt Flood wanted free of his reserve clause, but the courts were against him.  In an unusual move, Flood was able to sit out a year – forgoing his $100,000 annual salary (which was a lot of money then) – and then sign with another team.  Ironically, in the interim between the Supreme Court decision in 1953 and this one in 1972, football players had sued the National Football League, and the Court decided that football (and, ultimately, basketball, boxing, etc.) was interstate commerce and subject to the Sherman Anti-trust Act (Radovich v. National Football League, 352 US 445 [1957]).   Baseball, the Court said, was the only exception to the rule.

Baseball players ultimately got their “free agency” in 1975.  In 1973, the National Labor Relations Board ruled that it had jurisdiction over disputes between ballplayers and owners (baseball players belong to a union) and would apply labor laws to such cases.  Two years later, arbitrator Peter Seitz determined that the reserve clause only applied for one year – not in perpetuity.  If a player remained with a team for a year after his contract expired, he was free to go to another team.  Thereafter, negotiations between players whose contracts had expired or were expiring and competing clubs became de rigueur and public.  Players could use these to negotiate better terms with their home team or to get better pay and benefits to move to another.  Wages in the majors rose and competition replaced collusion among the clubs regarding players’ salaries.  Finally, in 1998, Congress made the unnecessary and symbolic move of passing the Curt Flood Act of 1998, which simply stated that baseball players had the same rights as players in other sports (which were subject to the Sherman Act) in their relations to their teams.  Congress did not go so far as to remove the exemption from the Sherman Act from baseball clubs completely.  MLB still retained its monopoly in the market – so you won’t be seeing any new Federal Baseball Clubs popping up anytime soon.  In the last year, there’s been some noise about removing the exemption so that franchisees can relocate teams without the permission of MLB and so that MLB cannot simply do away with a team at will.  In hockey, basketball, and football, such powers do not belong to the leagues, but it remains to be seen whether or not baseball will ever be completely stripped of its monopoly status.  Even in these days of deregulation and pro-competition, the sport seems stuck in an economic time warp.


(In the interest of full disclosure, I should tell you that my grandfather was a pitcher subject to the reserve clause, and he bounced around the minors and every farm team he could find to make a living during the days of artificially deflated wages.)

 Posted by at 7:31 pm

A Great Crime

 American history  Comments Off on A Great Crime
Jul 222008

Reading most books on the Civil War, you’d be hard pressed to find any information on battles that took place west of the Mississippi River. Hell, you probably wouldn’t find anything about battles in Texas – even though that state was a member of the Confederacy. Occasionally, there’s a mention of Pea Ridge, in Arkansas, but, generally, Civil War histories focus on the war in the east. The assumption is that Kansas, Arkansas, and even Texas took sides but didn’t see much action. Western states and territories, then, certainly didn’t participate. Of course, that conception is incorrect. Places as far away as Alaska saw skirmishes. The national conflagration was truly national.

Intrinsic to this narrow view of the War of Northern Aggression is a failure (yet again) to include the Indian nations in American history. Once more, this is white men’s history (and to a lesser degree that of black men). At least when we write about colonial battles or the Revolution, we make some effort to include Native Americans. We acknowledge their participation in these and recognize that alliances between the various tribes and the colonists and European powers were part and parcel of these disputes. That is not the case with the Great Rebellion. Reading most of the popular historiography on this topic, you’d think that the nations did not take sides. Historians and popular authors do not ignore European countries in this way. In most accounts, you’d read about attempted alliances with Great Britain or France. The same is not true for the Seminole or Cherokee states.

The Indian nations did, in fact, take sides in the Lost Cause. If you think about it, that makes sense. The tribes that were forcibly relocated by the federal government to reservations or foreign territories like Oklahoma were certainly bitter and had good cause to fight the Union. When the Confederacy promised them their new lands in perpetuity and forswore expansion, it was an appealing offer. The Creeks, Cherokees, and other nations had proof that the federal government would not honor its promises to them. The Confederacy offered an attractive alternative. Yet, some Native Americans saw benefits to allying with the North. They felt bound by their previous commitments (despite the fact that the U.S. did not abide by these) or hostile to southerners who were their former hated neighbors, and some saw this as an opportunity to re-negotiate terms with the federal government. Though some initially sought neutrality (the Cherokee leadership advocated not getting involved in this “white man’s war”), the Indians, too, ultimately took differing sides, and for some of the tribes, the War Between the States became a civil war for them as well. They too fought brother against brother – Harjo versus Harjo; a conglomeration of Creeks, Shawnees, Delawares, and Comanches under Opothle Yahola versus a similar confederacy under Chilly McIntosh.

Of course, in the end, it was worse for the Indians – loyal and not – who had suffered starvation, destruction, injury (including mass amputations), and even death, than for many white southerners who rebelled, when the federal government used its victorious position to further decimate the nations. While Reconstruction was beginning back east, the Seminoles were still hammering out a concession treaty in February 1866, and the “Treaty of cession and indemnity” between the Creeks and the U.S. wasn’t finished until August of that year, just in time for twenty more years of “Indian Wars” and white encroachment. As punishment, of course, all of the Indian nations ceded lands to the U.S. – often for inequitable financial considerations (in addition to having to accept emancipation and naturalization of their slaves). Unfavorable terms were especially bitter for Indians who fought for the Union. All were lumped together, however, when Commissioner of Indian Affairs D.N. Cooley announced at the negotiations that the tribes had “forfeited” their lands when some rebelled. Not without compassion, he then invited the “President’s errant children” to justify their “great crime” in a bid for leniency. Funny, we don’t even remember their trespass today, but the nations still live with the negative effects of treaties resolving their participation in this white man’s war. So, whose is the great crime?


 Posted by at 2:40 pm

Happy Centennial, Big Brother!

 American history  Comments Off on Happy Centennial, Big Brother!
Jul 152008

The FBI has been with us for a hundred years now.  Originally, it was intended to focus on civil and criminal investigations — like a federal detective force, ferreting out kidnappers and thieves.  However, it wasn’t long before the agency shifted to “information-gathering” for domestic security purposes.  Now, we’ve added the Department of Homeland Security (DHS — not to be confused with Departments of Human Services [DHS]) to the mix — because, apparently, communism is a Red Menace but terrorism is a bureaucracy-builder.  The news today is full of debates on the limits that should be placed on domestic surveillance by the FBI (and DHS).  Clearly, the debate over whether or not there should be domestic surveillance is over.  Now, we’re trying to draw a moral line in shifting sands.

The historical question behind this security angst is:  When did we get to be so afraid?  Or, has our nation always leaned toward the paranoid?  What prompted such responses?  Are Americans “pro-active” or chicken-shits?  For more than a hundred years — just a little longer than we’ve had the FBI — the federal government had no mechanism for snooping on citizens, and our country survived just fine.  The “Red Scare” put an end to that though.  The threat of communism — without actuality of attempted overthrow — was enough to make all citizens suspect.  So, in the days before WWI, the FBI began fighting prospective security dangers.  Its abuse of powers ultimately led to a ban in 1924 on wiretapping and investigating individuals because of their political leanings.  The FBI continued to monitor “subversives,” of course, despite the ban.  Over the years, it spied on Americans as diverse as Martin Luther King, Jr., Walt Disney, and Elvis Presley.  Now, you can request these files under the Freedom of Information Act, if you feel like a little absurd reading.  Here’s one I like to give my students:

Hoover letter link

Obviously, this is a letter from J. Edgar Hoover to President Eisenhower’s staff dated September 1955.  Notice that the document was so sensitive, it had to be hand delivered.  In it, Hoover indicated that communists were inflaming tensions over fourteen year old Emmett Till’s murder in Mississippi that year.*  The commies were stirring up the NAACP, “Negroes,” and the religious community, Hoover reported.  Bad communists!  You know, if it weren’t for them, Americans would never be incensed over the brutal mutilation of a black boy.  Hoover claimed the communists’ purpose was “rabble rousing,” but one look at a picture of Till will convince you that public reaction was motivated by human decency rather than politics. (  Note that none of the agitation Hoover described was illegal activity or advocation of the overthrow of the government.  Only the FBI could take such a tragedy and turn it into a justification for anti-communism.  Well, the machine must be fueled.

So it is today, as we face a “war” on terrorism and struggle to find boundaries for domestic surveillance sans actual criminal activity.  I know we can’t go back to the days before the FBI, but I think it’s important to remember that we survived the War of 1812 and the Civil War — actual, substantial threats to the federal government — without a permanent spying bureaucracy.  I always wonder why we need it to fight potential dangers instead then and marvel again at our progressive notion that we can eliminate the risk in life.  This year, at least, we can have some birthday cake with that naivete. 

*Till, who was from Chicago, was visiting relatives in Money, Mississippi that summer.  He allegedly whistled at a white woman in a local store there, and for this he was dragged from his bed in the night, beaten, shot, and then dumped in the Tallahatchie River with a fan hung around his neck by barbed wire to weigh him down.  When his mutilated body was recovered, Till’s mother insisted on publicly exposing the matter and photographs of the dead boy ran in Jet magazine for all to see.


 Posted by at 7:13 pm

The Patriot Paul

 current events  Comments Off on The Patriot Paul
Jul 072008

Every day, on my way in to work, I pass a billboard with a giant picture of Sean Hannity and an American flag on it.  At the bottom is a caption that reads:  “A Great American.”  I wonder:  What did he do to become a great American?  Does hosting a radio show qualify you?  Is that it?  And, what does it mean to be a great American anyway?  Do you get special privileges for that?  Are the rest of us just okay or even lousy Americans?  How can you be bad at being what you are?  Is the billboard implying that Hannity is some kind of patriot?  Is being a great American the same thing as being a patriot?

You hear a lot these days about individuals being patriots.  John McCain is.  We wonder if Barak Obama is.  People say soldiers are.  I wonder again:  Does being a patriot make you better than the rest of us?  How do you become a patriot?  If you serve in the military and hate it, are you still a patriot?  Do you automatically lose your patriotic status if you sue the government or cheat on your taxes?  Do everyday Joe Schmoes have a chance in hell of being a patriot, or do we forfeit that as part of our lives of quiet desperation?

The dictionary says that a patriot is someone who helps consolidate or expand the power of the government.  When I talk about that with my students, it gives them pause.  Like most Americans, they’re raised with a great love for the symbols of our country and faith in our professed values, but they also are wary of big government.  In light of that, they have to wonder:  Do I want to be a patriot then?  Is that a good thing?  I think most Americans are this way.  They’re advocates for the emotional boosterism that seems to suit the national character.  But, you couldn’t be a good American if you weren’t hostile to Big Brother.  That’s one of our founding principles.  This is why we teach our kids to love the Bill of Rights and you see prominent citizens on TV going on about their 2nd Amendment entitlements or the freedom of the press.  Being somewhat unpatriotic, then, seems to be part of being a great American.

So, it seems to me that we need some new way to identify what a patriot is and who qualifies as one.  I think a patriot is someone who believes in the ideals we propone (freedom, democracy, etc.) and who works to leave our country better than what it was when s/he found it.  In this way, patriots are philanthropists and civil servants, social critics and ambassadors, activists and good neighbors.  They are not businessmen or consumers or do-nothings.  It’s a status earned — not a frivolous label.

In light of this, and in honor of our nation’s birthday, I would like to celebrate someone I think is a great patriot:  Alice Paul.  Few Americans have suffered so much on behalf of their fellow citizens.  She intentionally starved herself and endured forced feedings by a tube shoved down her throat.  She was repeatedly arrested and sacrificed much of her personal life for her cause.  Because of her work and dedication (and that of other suffragists), women gained the vote in federal elections in 1920.  Paul continued to work thereafter for the passage of the Equal Rights Amendment and democratic opportunities for women in our country.  I think what made Paul so special and rare though was that she worked to give women the chance to make their own choices in life, even if she did not agree with them.  She said: “I think if we get freedom for women, then they are probably going to do a lot of things that I wish they wouldn’t do.  But it seems to me that isn’t our business to say what they should do with it.  It is our business to see that they get it.”  That kind of true dedication to free will and democracy is rare in a country that likes to legislate what their neighbors drink, what they use for birth control, the way they school their children, and so on.

The truth is, most Americans don’t really have that kind of trust in their countrymen.  We want to control our neighbors by statute and by suit.  We often fail to really love freedom so unfailingly that we’re willing to be laissez faire with what our fellow citizens do with it.  Paul was personally conservative, but she didn’t feel the need to force her own morality on others.  Now that’s dedication to American ideals!  I don’t know that most of us would starve ourselves to give our compatriots any benefit today.  You can’t get us to give up our gas-guzzling SUV’s and wasteful consumerism to assure that our neighbors don’t go hungry.  We’re obsessed with the “deserving poor” and definitely would not take on the whole of the federal government like Paul did in order to aid our peers.  I can’t imagine a greater act of patriotism, and I am grateful.  So, this holiday, I pay tribute to that Great American Alice Paul.

Feel free to nominate your own patriot for celebration.


 Posted by at 8:44 pm