NFL agreement not victory for free markets

Freedom New Mexico

As football fans, we’re pleased to see the National Football League’s players and owners reach a new labor agreement that saves the 2011 season. But, as defenders of free-market principles, we admit that the NFL labor agreement has us puzzled.

That’s because this labor dispute doesn’t fit neatly into the traditional battle lines between businesses and labor unions. In April, NFL Commissioner Roger Goodell, who represented league owners, attacked the players’ proposals in a Wall Street Journal opinion piece.

“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,” he wrote.

Wait a second. This union lawyer’s world sounds pretty good to us and eerily like a free market. The average career for an NFL player lucky enough to make an opening day roster is just six years. Why should players be forced to enter a draft that assigns them to a team, limits their compensation and prevents them from selling their services on the open market? If any other industry or profession required the country’s graduating college class to enter a similar “job” draft, it would be viewed as the antithesis of free-market capitalism.

Owners support maintaining a draft because it helps reduce their payroll costs. Among the owners’ major victories in this labor agreement are new restrictions on rookie compensation. St. Louis Rams quarterback Sam Bradford, last year’s top draft pick, signed a six-year deal worth $78 million. This year, most analysts predict that the top pick, Cam Newton, will earn around $22 million over four years. Under the league’s new revenue-sharing agreement, an increased portion of this payroll savings will go directly into owners’ pockets. The new agreement gives owners 53 percent of the NFL’s $9.3 billion in annual revenue, an improvement over the league’s past 50/50 split.

With an increased percentage of NFL profits, owners have no excuse for crying poor the next time they ask taxpayers to build a new stadium. Doug Bandow, a senior fellow at the Cato Institute who has written on the economics of stadium subsidies, pointed out the owners’ hypocrisy.

“Wealthy sports moguls complain about the market for players, but they are among the biggest dependents on government welfare around,” he told us.

In March, members of the NFL Players’ Association even took the extraordinary step of decertifying their union and filed paperwork to become a trade association. While union decertification was largely a procedural maneuver to increase the players’ legal options, we can’t help but embrace the concept. Again, it was NFL owners who demanded the players re-form a union in order to finalize any labor deal.

We’re ready for some football. We just don’t see this deal as a win for free markets.