What does the US sugar quota have to do with the payroll inequality in the MLB?

Ok I admit that's a heady title, but bear with me. Before we analyze the US sugar quota and its parallels to the current large payroll inequality in baseball, let's make a few announcements and take a look at some recent Indians news. First off, I'm going to start posting more consistently in a segment called "Saturday Morning Musings." In these segments (this post represents the first one), we'll trudge through the week's events and analyze what has been, what could be and what could have been every Saturday morning. Fun, fun.

Furthermore, the Indians made a pair of signings this past week inking righties Austin Kearns and Shelly Duncan to minor league deals. Nothing exhilarating, but there's nothing wrong with bringing in some fresh blood on minor league deals to compete for the honor of being the final righty bat off the bench. In case you're interested take a look at '09 stats of the 4 righties competing for the 25th roster spot:

Austin Kearns: slash line- BA: .194/OBP: .336/SLG: .305, 3 HR and 17 RBI in 174 ABs

Shelly Duncan: .200/.200/.200, 0 HR and 1 RBI in 15 ABs (admittedly a very small sample)

Andy Marte: .232/.293/.400, 6 HR and 25 RBI in 155 ABs

Chris Gimenez: .144/.256/.243, 3 HR and 7 RBI in 111 ABs

*Cough* I guess my money's on Marte after he posted an "excellent" OPS+ of 85 (at least relative to the others).

Anyways, onwards to some prospectin'. Baseball America released their Indians top 10 list Wednesday. Here's how it shook out in case you missed it:

1. C Carlos Santana

2. 3B Lonnie Chisenhall

3. LHP Nick Hagadone

4. OF Nick Weglarz

5. OF Michael Brantley

6. RHP Jason Knapp

7. RHP Carlos Carrasco

8. RHP Hector Rondon

9. RHP Alex White

10. 2B/OF Jason Kipnis

After the top 2 (Badler considers Chisenhall an impact player like Santana), things start to get strange. Baseball America and Baseball Prospectus place a lot of weight upon a player's potential upside and thus Hector Rondon has suffered accordingly. Weglarz appears a little high. Although his plate discipline is excellent (18.1 BB% in '09) and he has definite power potential, he is limited by his speed (or more correctly a lack thereof) and his low positional value (either a poor fielding LF/1B or DH). Personally I'm not as high on White since he doesn't have a plus second pitch after his fastball and has somewhat awkward (perhaps injury prone) mechanics, but I understand the upside. Furthermore, the true strength of the Indians' system lies with it's incredible depth (especially with pitchers) and I dig the aggressive Kipnis grade based on his polished approach and possible move to 2B (although, it should be noted that the tribe tried the exact same thing with Trevor Crowe and it failed).

Anyways, with prospectin' out of the way let's move onwards and upwards to the "meat" of this post. What the hell does the US sugar quota have to do with the current economic inequality amongst baseball teams? Essentially, sugar can be grown more cheaply in other countries than in the USA. Thus beginning in 1938, the US Congress enacted a quota (limit) on the amount of sugar that could be imported in the United States to "protect" domestic producers/workers. Although this act was well intentioned, the United States simply possesses less than optimal conditions for sugar production (namely climate, but yes our labor force is more expensive to hire as well). A country like Brazil can more easily produce sugar due to climate and their relatively cheaper workforce. Sure, Brazil might have to clear some rainforest or other habitat to accommodate sugar production, but that's a sad consequence of sugar production anywhere as illustrated by the degradation of the everglades by the sugar industry in Florida.

Anyways, this sugar quota means that the cost of this inefficient US sugar production is spread amongst the consumers to the benefit of the few producers of US sugar. Not only do US consumers buy less sugar ("a reduction of the size of the pie" that has moreover increased sugar substitute consumption like high-fructose corn syrup), but consumers are forced to pay a much higher price than the world price for the sugar they do purchase. The producers use lobbyists and campaign contributions to ensure congress keeps sugar restrictions in place.

Phew. Well what does this have to do with baseball you ask? We currently have a economic landscape in baseball that is rigged to benefit a half dozen teams (namely the Yankees, Red Sox, Mets, Phillies etc.). The few teams that benefit from the current system are like the producers in our sugar analogy. However, the rest and broad majority of baseball teams (the consumers in our sugar analogy) are harmed by the current economic landscape. It's not only the Indians who are forced to trade or lose players to free agency like Manny Ramirez, Jim Thome, CC Sabathia and Cliff Lee, but the Royals who lost Carlos Beltran and Rockies who lost Matt Holliday. The fact that the large majority of teams are hurt by this decision diminishes the MLB's potential fanbase and revenue due to disenchanted fans losing interest in the game. In effect the current system "reduces the overall size of the pie." Although the MLB has seen an increase in revenues lately, the NFL (and their revenue sharing that allows the tiny Green Bay market to compete with the behemoth New York market) has eclipsed the MLB as the "top dog" in America sports. Thus less baseball is consumed overall, so to speak, than would be if there was more parity and small and mid-market teams could keep more of their homegrown talent. This "reduction of the size of the pie" equates to the reduction in the amount of sugar consumed as a result of the sugar quota opposed to free trade.

There's the breakdown of the current system:

Winners- A couple large market teams (the Red Sox, Yankees, Mets, Phillies)

Losers- The bottom 22-25 teams (Indians, Twins, Reds, Pirates, Rays etc)

Overall- A net loss (fewer fans because of disenchantment with payroll inequality a "dead weight loss" to speak in economist terms)

To sum it up quickly: the current system benefits a couple of the top teams at the expense of everybody else and the overall advancement of major league baseball. I don't know enough to suggest specific detailed solutions, but there needs to be more revenue sharing for the health of baseball as a sport. Fans are turning away because small and mid-market teams have little to no chance to compete in the current system. These fans see the Yankees and Red Sox with their seemingly limitless payrolls gobble up grossly disproportionate shares of the MLB's talent. The Yankees and Red Sox will protest like the US sugar producers fight the abolition of sugar quota, but it's time for the rest of MLB teams to come together and fight for greater revenue sharing for their own good and the good of all of baseball.

Alex Trebek