NFL Lockout Makes Sense

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The coverage on the impending NFL labor battle sounds a single theme. The story goes something like this: that if only these greedy and dumb billionaires (the owners) and greedy and dumb millionaires (the players) acted reasonably (in other words, if only they were as generous and smart as the rest of us), we'd have a new NFL labor agreement. If only for once these spoiled rich people would think of the good of the game and the needs of the fans, then all would be well.

Does that account seem sufficient? Is "greedy/dumb" the best explanation we can come up with for why the nation's most popular sports league seems about to shoot itself in the foot?

The common story seems a bit glib, even dismissive.

Before we conclude someone's acting irrationally, we observers should first see if we can come up with a rational explanation.

Why would the NFL owners and the players rationally choose to take the league into a labor crisis? Given that similar labor battles nearly put the NHL into a death spiral and forever blemished MLB's World Series, how can a work stoppage be desirable? What are these people thinking?

They are thinking rationally. At this point in time, it serves the interests of the NFL owners to lock the players out. A labor fight also serves the interests of the NFLPA. Believe it or not, a labor struggle might also serve the rational interests of the fan. That's what I'm rooting for. Let's not have any football in 2011!

1. Let's start with the owners. It's pretty obvious they believe the last collective bargaining agreement was flawed from the start, even as they voted to adopt it. Then-commissioner Paul Tagliabue's lengthy seventeen-year tenure had established immense credibility that he relied on in his final act in selling the labor deal to reluctant owners. In effect, Tagliabue's generous revenue-sharing deal with the players bought labor peace. He succeeded in avoiding the debacles that had recently plagued other professional leagues. But he also lit a time bomb that will soon burn to the end of the fuse.

2. Given their unhappiness with the last deal, the owners have to lock the players out at the outset of next season. It's the only rational move to make. Staging an NFL season involves huge outlays of money by the owners and their licensees. The itemized list is nearly endless, and includes salaries for players, team officials and staff, game officials and others, plus expenses for stadium use and other physical plant. Add in the costs for contracted licensees, including broadcast, merchandise and concessions companies, and the picture grows larger. For sure the NFL and its licensees makes some money back as the season goes along. But all the investments are made with an eye to the big payback, the Super Bowl playoffs, the tournament that caps the season and drives the television ratings and advertising revenue. Why would fans care about a regular season if there were to be no crowned champion? If the owners don't lock out the players, they will risk all their substantial investments on a Super Bowl tournament that may never happen. If the owners fail to lock the players out, they in effect give the upper hand to . . .

3. The players. The players association got the benefit of the "Tagliabue payoff" last go round and have long known this fight was coming. Their new chief, DeMaurice Smith, seems exactly the kind of combative and determined union leader who will push the players' side as much as he can. Imagine if the owners decide not to lock the players out for 2011, proceeding to invest in the coming season without the benefit of a labor contract. Smith would time a strike, or at least the threat of one, at the most propitious time. Much like the MLBPA struck and thus precluded a World Series in 1994, Smith could threaten to dismantle the single most compelling and lucrative day in the sports calendar, Super Bowl Sunday. The owners cannot give the union such immense bargaining leverage.

4. The NFLPA is generally thought to be a relatively weak professional athletes' union. The last time it called a strike, in 1987, member loyalty was erratic. Many NFL stars openly crossed the picket line. Player careers in the NFL are short and pay disparity is large; perhaps those factors account for what appears to be the differing interests of players and the endemic weakness of the players association. Or perhaps union leadership has been lacking. What DeMaurice Smith needs is a stronger union. The selection of Smith, along with some of the strident rhetoric that has come from prominent members, suggests that the NFLPA is trying to mimic the more aggressive leadership style of Major League Baseball's players union. Remember, most of the NFLPA's success as a union during the last century came in courtrooms, not at the bargaining table. To get to the courtroom, the NFLPA has to decertify and then litigate; in other words, the NFLPA in effect has been better off dead. But antitrust litigation is expensive and unpredictable; plus courts are today more agreeable to collective action by employers. The new union leadership should (rationally) want to avoid the courtroom; it should want to enhance member loyalty, improve internal discipline, and hammer out a new CBA from a position of strength. Nothing like a good fight to improve the zeal of the rank and file. At bottom, the NFLPA is spoiling for a fight, and rationally needs one for its own good.

5. And you, Joe Fan, you want a labor fight too. The NFL is a great product, but it's just so expensive to be a fan. It's crazily spendy to see games in person: the costs of tickets, parking, seat licenses, concessions, and the like keeps schoolteachers like me at home. But it's even pricey to watch at home, in a sense, as we free viewers "pay" with our impatient attention to games that feature increasing commercial interruptions, sponsor mentions, and product placements. The NFL even makes its tedious "replay reviews" a chance for commercial sponsorship. I watch very few games live any more, not when I can view a game on my DVR in about 30 minutes. The NFL is just getting too expensive. The game has to reduce costs, and one big cost, the major one actually, is player salaries. Don't think the owners (or the players) are just greedy. The owners are in a very competitive market, probably the most competitive market in contemporary America: the market for your leisure time. Any costs savings the owners can wring from the players will find its way into your pocket, making NFL games more accessible in person and more enjoyable at home.

6. Ssshhh, boom, bah
Player lockout, hurrah!
Cut those costs!
All is not lost!
Don't litigate,
Won't be a next year,
Try something new, dear!