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Home > Terence Moore > Archives > 2008 > June > 03
Tuesday, June 3, 2008
If anything, pro athletes are underpaid
The Atlanta Journal-Constitution
Matt Ryan was the wrong choice. If you have the opportunity to draft the next Warren Sapp in Glenn Dorsey with the No. 3 pick overall in the NFL draft, you do it. Instead, the Falcons did the historically risky by taking a quarterback that high in the first round.
That said, nobody is overpaid. In fact, most folks are underpaid. Others are within several pennies of what they should be making, including shortstops, point guards, defensemen and even quarterbacks making something like $72 million.
I was an economics major in college, so trust me when I say Ryan isn’t overpaid, OK? Neither is any professional athlete, and there are many reasons why.
Here are just five of them.
USA, USA, USA
We’re talking about supply and demand, free-market system, survival of the fittest, rugged individualism. All the American things that have generated cringing through the decades from Lenin to Mao to whoever invented the salary cap.
In this country, whatever somebody is willing to pay you, then that’s what you’re worth — and likely more. The economic structure in professional sports is just a microcosm of this process, where attendance records and ticket prices have kept rising this century in the NFL, the NBA and baseball.
That’s why, with the Falcons playing before a stuffed Georgia Dome for the past six years, Michael Vick ($130 million) was Matt Ryan before Matt Ryan.
No soup kitchen here
The next owner of a professional sports franchise to go bankrupt after paying a bunch of money to one of his players will be the first. Owners give all of that money to certain players, because owners have all of that money to give.
Such is especially true in the NFL, where Forbes magazine estimated this year that five franchises are worth more than $1 billion. According to Forbes, the Falcons are ahead of only Minnesota in total value in the league, but the Falcons still are worth around $796 million.
Not only that, Arthur Blank, the co-founder of Home Depot whose worth is placed at $1.3 billion by Forbes, bought the Falcons in 2002 for $545 million.
You do the math.
It doesn’t work that way
Essentially, this is how the average fan thinks when — oh, say — a quarterback who hasn’t played a second in an NFL game gets something like $72 million.
How can they pay that guy all of that money when you have school teachers barely making it? The same goes for nurses, law-enforcement officers and others around the minimum wage with oil prices soaring by the millisecond.
Sorry to deliver the truth, but if that quarterback we just mentioned didn’t get $72 million, it wouldn’t translate into higher salaries for school teachers, nurses or police officers and relief at the gas pump for the weary. It would translate into more money in the pocket of that owner.
A bleacher seat or the mortgage
Here’s Part II to our previous point: The average fan also thinks that, if an owner doesn’t give something like $72 million to a quarterback who hasn’t played a second in an NFL game, such a scenario would lead to friendlier ticket prices.
Not.
There have been a slew of studies through the years to show there is no correlation between the rise of players salaries and the rise of ticket prices.
Owners traditionally will raise ticket prices no matter what. And get this: Despite Ryan’s supposedly outrageous contract, the Falcons even lowered ticket prices for next season in the upper parts of the Georgia Dome.
Just wait
These things work themselves out. We’re back to the free-market system. For instance: Blank just put a $72 million bull’s-eye on the back and front of Ryan’s jersey. That means before the Falcons’ season reaches Halloween, Ryan has to start, and he has to play well.
If Ryan becomes a pumpkin, that means he wasn’t worth all of that money, but only to Blank. It’s nobody else’s business, because it’s nobody else’s money.
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