Recession Takes Its Toll on Professional Athletes

As the recession takes hold, salaries everywhere are dropping, as workers from Wall Street to Main Street to K Street see their wages cut. So bad is the state of the real world that prices are falling in a field that many thought, like real estate­, could only go up in value: the salary of athletes.

While it is true that the Yankees signed three players for $423.5 million this offseason, now, more than ever, they are the exception to the rule. In the same offseason as Mark Teixeira’s 8-year, $180 million deal with the Pinstripers, previously established stars such as Bobby Abreu and Adam Dunn have had to settle for one or two-year contracts. Perhaps the most extreme example is Andruw Jones. Two years removed from a 41 HR, 129 RBI season, the center fielder could only score a minor league contract with the Rangers, after a plummet in his production last season. The upcoming NFL and NBA offseasons may prove to be no kinder to players.

It is tough not to feel bad for players caught in a situation not of their own doing, but I believe that the current adjustment is good for professional sports in the long run. Personnel costs are only one part in the greater adjustment in sports, a correction that will hopefully move leagues towards a more sustainable form of support, one not based off of tiered payrolls and public subsidies, but one where teams of all market sizes will be able to stand on their own.

Defenders of the status quo justify the prices that big-market teams pay by stating that it is the team’s own money, and they should be able to spend it as they see fit. Unfortunately, the money that teams dole out isn’t really entirely theirs to spend. True, the enormous revenue that the Yankees generate is due to the product that they put out on the field. But to focus solely on the revenue side of things is to miss the substantial public support the team receives on the cost side.

In completing the new Yankee stadium that is set to open in under two months, the city helped the Bronx Bombers with multiple issues of tax-exempt bonds, as well as the use of land spanning two large public parks.

The Yankees are not alone in receiving this support. Six MLB ballparks have been completed in the past five years. Of these, only Busch Stadium in St. Louis involved no direct public intervention. As a proportion of financing, the new stadiums for the Mets and Yankees actually involved two of the smallest shares of government backing. One stadium, Nationals Park in Washington, was entirely footed at the public’s expense. The system of public support is so built-in to the system that it is hard to see how some of the money could not make into escalating player salaries and general expenses. Flush with cash from one source or another, franchises are free to start arms races that lead to a vicious cycle: teams without the requisite revenues will have to ask for help to build more profitable stadiums, making subsidies an ever-bigger element of the landscape.

The current recession has the opportunity to break this chain of events. As Americans around the country tighten their wallets, the ammunition used to fuel the upward spiral of salaries, costs, ticket prices, and subsidies is spent. As municipalities across the nation face gaping budget shortfalls, cities won’t have funding on offer to their hometown teams. Cities, club owners, and fans will have to come to grips with the truth: shiny ballparks with major league teams are luxuries, not necessities, for most towns.

One cannot blame players for taking the money from publicly-backed owners while times were good. Indeed, it is almost hard to blame owners for taking public money when every city in the country saw a professional sports teams as the ultimate status symbol. But as the real economy gets serious in this severe downturn, it is time for sports to follow suit. Whether it’s baseball, football, or basketball, we all love our favorite pastimes, but it can’t be financed with money that we don’t have.