Major League Baseball - Pros and Cons

The issue that our group is tackling is the use of illegal performance enhancing steroids in Major League Baseball. Major League Baseball is big business in the U.S., with 30 franchises valued at over 8.8 billion dollars. Player salaries range from the league minimum salary of three hundred twenty five thousand per year to ten million or more per year, and are based on the market value of each player when his current contract expires. It is in this hyper-competitive environment that a growing specter of foul play has erupted - the use of steroids. Anabolic steroids and other similar performance enhancing substances allow muscles to recover at a much faster rate than normal. This rapid recovery permits athletes to train harder, for longer periods of time, and with greater frequency. This unnaturally intensified training leads to the development of greater muscle mass and strength, which has a causal effect on physical performance. Another effect of steroids is that game-to-game muscle recovery is more rapid, which allows the player to be more fully recovered on an every-day basis, which is a huge advantage in a season where 162 games are packed into 6 months.

Many issues surround the use of such performance enhancing substances. One issue is the removal of a level playing field. In a business where competition is the business, any such illegal advantage can injure the integrity and legitimacy of the enterprise. A second issue is the fact that steroids cause numerous harmful, long-term side effects - some of which can be life threatening. Another issue is the fact that many of America's youth look up to these athletes. Like it or not, they are role models. If these role models are doing things that are illegal, immoral, and have a demonstrated health risk, what kind of example are they setting for our youth? Behind closed doors, it has been understood that some players were engaged in this behavior. The owners have attempted to address it, albeit without any real veracity, during labor negotiations. These negotiations have yielded very little results though, as the players are represented by a very united and powerful union (the MLB Players Association). The players association has historically fought any attempt at drug testing or screening, citing privacy concerns.

It is this backdrop of issues that prompted the U.S. Congress to begin to investigate Major League Baseball's internal controls and testing programs (or lack thereof). The action by the government was the final straw that caused this widely known, but little discussed problem to be brought to the light of public debate and discussion. This issue has the potential for wide-ranging consequences throughout professional baseball. Senior Management (in this case - team owners) could be affected in a number of different ways. Among these are: 1) loss of fan base, 2) loss of credibility and stature as "America's Pastime", 3) loss of revenues from corporate sponsors, 4) potential labor problems, 5) government involvement could usher in new rules, restrictions, and policies that would be enforced legislatively (loss of control).

The market implications are severe, especially given the fact that Major League Baseball has already lost a portion of the American public's entertainment dollars to a myriad of other