The Exploitation of the Minor Leaguer Continues in the States

Nike abuses poor, hungry, and young workers to make Air Jordans. Apple abuses poor, hungy, and young workers to make iPhones. And MLB abuses poor, hungry, and young workers to make star baseball players. 

Mother Jones recently published a terrific piece by Ian Gordon that details the story of Yewri Guillén: a young, talented Dominican, signed by the Nationals, whose life came to a tragic end. It's a story that every baseball fan should read, as it illustrates what can happen when a powerful organization within an even more powerful cartel chooses to exploit a powerless and poor youth with dreams. 

Here is an excerpt: 

There wasn't a certified athletic trainer, let alone a doctor, to evaluate Guillén at the Nationals' academy, a spartan training camp with cinder-block dorms. No one from the team accompanied him to Santo Domingo or intervened when he couldn't get into the Clínica Abreu. (The club didn't cover the costs of his treatment until after he was admitted to the Cuban-Dominican clinic.) And following Guillén's death, the club required his parents to sign a release before handing over his signing bonus and life insurance money—a document also stating that they would never sue the team or its employees.

Guillén's death is the worst-case scenario in a recruiting system that treats young Dominicans as second-class prospects, paying them far less than young Americans and sometimes denying them benefits that are standard in the US minor leagues, such as health insurance and professionally trained medical staff. MLB regulations allow teams to troll for talent on the cheap in the Dominican Republic: Unlike American kids, who must have completed high school to sign, Dominicans can be signed as young as 16, when their bodies and their skills are far less developed.

As the excerpt illustrates, the exploitation of the minor league player is most apparent in the Dominican. Of course, MLB teams have a long history of exploiting the minor leaguer. Ever since the days of Branch Rickey's farm system in the 1920s and 1930s--a system that at one point allowed the Cardinals to hold the property rights to over 600 players--teams have hoarded as many players as possible while paying them as little as possible. 

For the past few decades, teams have found the Dominican (and Venezuela) to be a source of cheap talent. Teams seemed to operate under the modus operandi of sign them all, pay them little, and let the kids sort themselves out. Although international signing bonuses have risen considerably since 2000, teams continue to follow abusive labor policies, as the article—and the death of a young prospect—demonstrates.

Yet the article fails to mention another important point: the exploitation of the minor leaguer continues in the States. 

Ian Gordon's article is fabulous, but it neglects to tell the rest of the story--the story of many minor leaguers playing in the states. Since MLB operates under an antitrust exemption, teams can actively collude to control the labor cost in the development of their prime commodity of baseball players. Our country's antitrust laws don't apply, so this collusive exercise of market power by the baseball cartel is legal. 

The result: strikingly low salaries that have barely budged since the 1970s. Even in the states, most minor leaguers make less than $10,000, placing many below the federal poverty guidelines. The business of baseball--including minor league baseball--has thrived in the past two decades. Minor league baseball players contribute much to this business, but they receive little of the spoils. 

Some might argue that signing bonuses make up for these low salaries, but this is faulty logic. For instance, Gordon's article points out the difference in signing bonuses for the Dominican signee versus the American signee. Yet his numbers are misleading. In fact, they are inaccurate. 

The article states that teams paid an average signing bonus of $232,000 to American players in 2011. However, teams do not publish the smaller signing bonuses paid to many American signees. In fact, most players drafted outside the top ten rounds sign for less than $10,000. Some players, especially college seniors, sign for as little as $1,000. Teams do not publish these figures.

Since these numbers are not reported, the data set used by Gordon was inaccurate. And even if a complete data set did exist, the high signing bonuses obtained by those at the very top would still skew the average signing bonus. A truer number would require both a) a complete data set, and b) the median instead of the mean. 

This point is significant, as it demonstrates the number of players pinching pennies while chasing a dream. I've said this before, but it's worth saying again: minor leaguers don't expect to be compensated like orthopedic surgeons; however, they do deserve sufficient wages to eat some meals at Applebees instead of McDonald's, to live two per two-bedroom apartment instead of six per two-bedroom apartment, and to sleep on regular mattresses instead of air mattresses. 

Yet when it comes to developing talent, teams are still operating in the 1930s. They hoard as many players as possible for as little money as possible. And since the antitrust laws don't apply, and since they ignore wage and hour laws, and since minor leaguers don't have a union, their power goes unchecked. To sum: yes, it’s true that the exploitation occurs at the grandest level in the Dominican, but it continues on minor league fields across the America. And even if the abusive practices are less extreme in the States, such behavior should still not be accepted. 

Further reading: my draft of Touching Baseball's Untouchables: The Effects of Collective Bargaining on Minor League Baseball Players (forthcoming in the Harvard Journal of Sports and Entertainment Law), http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2147490.