The Sherman Antitrust Act - Essay Example

Despite the important purposes of the antitrust laws, Congress has seen fit to carve out various exemptions for certain types of businesses and activities. For each such exemption, there is a rationale, the merits of which can often be debated. Among the antitrust exemptions are the following:Labor unionsPublic utilities (such as electric, gas, and telephone companies)Major League BaseballCooperative activities among U.S. exportersHospitalsPublic transit and water systemsMilitary suppliersJoint publishing arrangements in a single city by two or more publishersMajor League Baseball ExemptionOne of the most debated - and maligned - exemptions to the antitrust laws is the exemption for professional baseball.

It is an exemption that no other professional sport enjoys. The exemption was granted to Major League Baseball in 1922 by the U.S. Supreme Court, which held that baseball is a sport, not a business engaged in interstate commerce, and therefore antitrust laws do not apply (Stephenson, 2001, par. 2). The effect of this decision is that "owners can act in concert on many matters that a regulated business cannot" (par. 3). The ability of the owners to collude on how they operate has impacted the business by enabling them to have "absolute control over where franchises are located.

While the NFL couldn't stop Al Davis from moving the Raiders to Los Angeles or Bob Irsay from moving the Colts to Indianapolis, baseball can put the brakes on such a move as it did when the Giants tried to move to Tampa Bay" (par. 3).The argument that baseball is a sport and not a business is a specious basis for exempting it from antitrust regulation. Notwithstanding the deferential treatment afforded to America's "National Pastime" in the early 20th century, few today would argue that Major League Baseball is not a profit-driven business for which the bottom line is the main driver of how owners make their decisions.

From ticket sales to merchandising to media exposure and advertising, baseball has certainly become a 21st Century corporate juggernaut that generates enormous profits. Some of the highest-paid players in sports are baseball players. There is simply no rational basis for treating this sport differently from any other professional sport in the United States. Zimbalist (2004) argues that this exemption has "led to a management culture of laxity, inefficiency, and arrogance. Evidence of this culture still persists" (par. 3). Rescinding the exemption would go a long way toward making America's Pastime reflect the best of America's free enterprise system - allowing owners and players to take advantage of a truly free market much like most other businesses in America.