Michael Bindner's DC Blog

In this blog, I discuss DC politics and other issues of import to local government. I have posted several essays from my book, Musings from the Christian Left, on blog entreies dated June 2004.

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Location: Alexandria, Virginia, United States

Tuesday, June 01, 2004

Professional Sports Teams & the Entertainment Industry (Geocities Rescue)

Any discussion of egalitarianism eventually turns to the question of how to pay celebrities. There is a perception by the critics of equality that somehow egalitarians seek to remove excellence from the American way of life, making mediocrity a virtue. While this is true of some egalitarians, it is certainly not the view of the Christian Left. We like our sports stars and our headliners and believe they should be paid well for that winning season, best selling novel, double platinum record or box office smash. What we don’t particularly like, however, is the poor pay of emerging talent or the lack there of in big college athletics, or the fact that starving artists and actors have to turn to waiting tables or, for runaways in Hollywood or New York, prostitution. We also believe that professional sports teams, record labels and studios can get along without such highly paid executives and owners. It is amazing that it is still acceptable for old white men to own the efforts of 20 and 30-year-old athletes, considering the team they sponsor their property. The ownership structures of Cooperativism are offered as way to change this. Let us address athletics first.

Professional Sports Teams
Every few years, it seems the contract between the owners and players association of one of our professional sports leagues comes up for negotiation. When this occurs there is talk of a strike or lockout if negotiations aren’t going well. One year, the football players did strike and the owners fielded replacement players. I wondered at the time, and still do whenever a strike occurs, why the players don’t go out and field replacement coaches, mascots and owners? While the owners do own the broadcast rights, the equipment and the team logo, if the players truly wish to make a statement, and improve their bargaining position, they buy new gear, pick new team names and find a venue and someone to broadcast the games. It doesn’t take rocket science to organize and televise a sports event (except the part about launching the satellites to broadcast the games, but the networks make those arrangements, not the teams). Given the choice between watching replacement players or replacement teams, most fans watch the real players with the new mascots, at least I would. Am I suggesting that the players do this? Not exactly. I am suggesting something far more radical.

It is well past time to replace the ownership structures of both major and minor league sports. Player salaries are now high enough to establish Employee Stock Ownership Programs (ESOPs) or Worker Cooperatives for each team, with players on any minor league farm team included in the ownership structure. Cooperatives are preferable to ESOPs for some teams, because in cooperatives each member has one vote. ESOPs are better for teams with minor league components, giving the more experienced major leaguers a bigger proportional say. What is important is that each month of the season, each active player is paid an equal number of shares in the franchise. When a player is traded, shares in the old team are sold back to the team and shares in the new team are purchased with the proceeds.

Retired players keep their shares and their voting rights until sold back to the franchise. This provides stability and wisdom in the management of team affairs that otherwise does not exist if only active players had voting rights. Allowing retired players to hold onto their shares also allows them a long-term income from the franchise. It provides an incentive to players to keep salaries somewhat within reason, both in paying higher salaries to minor leaguers and in not making salary demands which bankrupt the team and jeopardize their own retirement security. Up front salaries are lower with a greater team ethic, with more team rather than individual rewards for a successful season, although stars are still paid incentive bonuses for individual excellence.

Non-player employees are given some share of the ownership and voting rights. Vendors and cleaning crew, in particular, are notoriously underpaid for their work. While they might not be entitled to share in the income from the broadcast rights, they are at least be entitled to a healthy share of the gate proceeds as a separate class of owner.

Some portion of the ownership of the team goes to the jurisdiction sponsoring the team, especially when the municipality provides the stadium. This forever ends the threat of moving the team in order to force the building of a new stadium, at least without the consent of the host city. Once upon a time, the Green Bay Packers were about to move and the municipality stepped in and bought the team, selling shares to the citizens. To this day, the favorite professional sports team of the Communist Party is the Green Bay Packers. A similar arrangement is possible for at least a portion of the ownership group of most teams to the extent that the municipality provides the venue. This public ownership portion may also include the stadium employees, although if this is done they still pay a just salary for their efforts and an owner’s share of the gate proceeds.

Changing the ownership structure of professional sports changes how they operate. If players are co-owners, the team effort is strengthened. A share of the ownership by the stadium crew only improves the experience of attending games (especially in the sanitary facilities). Anything is possible, even a better sense of geography in professional football, so that the Indianapolis team plays in a division with its neighboring teams rather than with southern teams. They might even recognize that Dallas is not on the East Coast while the Carolinas are. (Don’t tell me that a twice-yearly game between a Washington team and a Carolina team wouldn’t develop into a juicy rivalry).

Transition to a more cooperative ownership system occurs on a team-by-team basis or occurs all at once as the result of a labor dispute. Just suggesting it has an impact on relations between owners and teams. One place to start might be in the Washington area, where two groups are bidding for relocation of a baseball team from Montreal. Perhaps the structures I have outlined here are useful to any relocated team, assuring the municipality, the owners and the stadium personnel have the say in the team that they so richly deserve. Adoption of employee ownership by any team, or by an entire sport, is a powerful culture statement that the day of the plutocratic owner has ended and a new era of employee-ownership has arrived. A similar impact occurs if adopted in the entertainment industry.

Employee-owned Entertainment
For every star in the entertainment industry, there are many who do not make it, due to lack of talent, training or opportunity. The purpose of increasing equality in the entertainment industry is not to make everyone a star, or even to diminish the awards that stars get. It is to improve the opportunities of those who are trying to make it and to guarantee that everyone’s contribution is awarded justly, from talent to craft. It always saddens me when I hear stories of some platinum album holding musical group from the fifties, or even today, who unknowingly signed away their ownership to some producer, manager or record label. Charlie Chaplin, Mary Pickford and Douglas Fairbanks had it right when they created United Artists. It is too bad that they were so far ahead of their time.

When I first got involved in the D.C. statehood movement prior to the 30th Anniversary March on Washington, I met Faith Dane and Jude Crannitch. They were, and still are, pushing her Stars War idea to expand funding for arts education through tithing artists’ foundations and matching these tithes with government funds, bringing back the spirit of the WPA Arts and Theater Project of 1935. I don’t agree with all the details of the plan, but their concept is sound.

Instead of taxing artist foundations to expand arts education and apprenticeship, I propose a Business Income Tax credit to provide for entertainment industry funding of arts education and apprenticeship. This is similar to the credit provided to other industries for the education of their employees, although the credit for the arts includes more broad based education, as well as direct support of up and coming talent. These increased funds provide an avenue for young artists to hone their craft without making sacrifices or compromises that their mothers do not approve of.

The ownership of entertainment companies is also an area where Cooperativism provides a useful solution to the problem of inequality. Art and craft unions invest a portion of their pension funds in the acquisition of the stock of entertainment companies. Also, if personal retirement accounts are enacted as part of Social Security reform, entertainment workers are able to invest a part of their accounts into the stock of the record label or studio where they have a contract or have worked during the prior quarter. Each employee, whether a star or a grip, invests the same employer contribution in these funds. Over time, their employees slowly but surely control the big entertainment conglomerates and greater equality naturally results.

More broad-based ownership results in more equitable contracts for young talent and even leads to the righting of old wrongs that have not yet been redressed. Stars still make big money for bringing in the fans, although that money comes as a percentage of the grosses rather than as an up-front payment. There is also a bit more sharing of money and credit among cast and crew in an employee-owned Hollywood. Like professional sports, employee-ownership in the entertainment industry shows that the concept has truly arrived.

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