This weekend's revelations regarding what has and has not been offered by the players and owners seems to show that free agency is the major (if not only) sticking point of the negotiations. Oddly, discussion in the public has primarily centered around other topics (namely the rate of growth), or when Mark Abbott did bring it up, his explanation was obtuse at best. So, what's the big deal with free agency?
There are plenty of strawmen that have been erected in the free agency debate. Such arguments as free agency will not bankrupt MLS because of the salary cap, while correct, are simplistic. I can't think of a quote from any owner or league official stating that free agency would resulting in the death spiral of salary increases that killed NASL.
What you have seen from Mark Abbott is "free agency wouldn't be good for the league" and similar quotes. That's it, no official league explanation. Now, plenty of people have made up explanations. Generally, they've made them up with logical flaws so that they can then immediately tear them down.
Here's why I would be opposed to free agency if I were an owner. Basic economics states that price increases when demand outpaces supply. While price cannot rise too high, due to the salary cap, the salaries for individuals in high demand will increase.
As has been noted since the being of these negotiations, the place where MLS needs to increase the salaries for those players at the shallow end of the salary pool. A $20,000 increase to Chad Marshall's salary is less than a 10% increase, while that same $20,000 would be enormous to someone making $35,000. But between the two-time defender of the year and an option off the bench, which player would be in higher demand and see that increase in salary because of free agency?
If the shallow end is not made deeper while the respect for American players abroad grows, those quality midlevel players will increasingly choose to go abroad. Because there is a limited pot of money to grow MLS, the broadest and quickest way to increase the caliber of play is to put that money toward the midlevel players. These players who fill out starting lineups and are the first options off the bench are the heart of all but the big four leagues. Attracting, retaining, and increasing the midlevel talent in MLS is the most efficient use of money to increase the quality of play. However under free agency, the midlevel player's salary does not rise because there is a larger supply of similar players.
Free agency would not kill MLS, it would; however, slow the growth of MLS by shifting resources toward top end players. When a team must give up something of value (draft picks, allocations, other players) in order to get a top player and upgrade a position, it artificially lowers the demand for top players that command this compensation.
MLS' flirtation with the designated player defies this view of MLS finance. The difference is that DPs were created to generate buzz and ticket sales through big name signings. Players like Marshall, Conrad, Kljestan, and Beckerman do not have the financial impact that Beckham or Blanco did. There is little to no gain for MLS in paying Jimmy Conrad an extra $30,000 per year. There is a bigger difference between the talent that you can attract for $60,000 versus $30,000.
If you want future salary cap increases to go to a handful of players while the majority of players see little to no increase, then free agency will give you that. If you want to see those cap increases to go toward recruiting and retaining better midlevel players for MLS, then free agency is the enemy. The owners and MLS leadership have chosen the second.
If I were a midlevel player, I would be hesitant of free agency for the same reasons. If I were Pat Onstad or Jimmy Conrad, I would be for it because of the reasons stated above. The real question is what do the actual midlevel players think? If the majority of players see free agency as benefiting a small portion of players, they may not wish to strike over the issue. Because there has been no public mention of the players having taken a vote authorizing a strike, many have wondered if the union has the votes to even authorize a strike. If not, the union really is out of ammunition, which could be the reason that they turned to the public this weekend.
