Baseball's Exploitation of Latin Talent

September 25, 2007

In this era of globalization, multinational businesses are increasingly criticized for exploiting cheap sources of labor in developing countries. Corporate techniques that outrage critics include the use of child labor, poor working conditions, the non-existence of labor unions to protect workers’ rights, lack of attention to occupational safety and health, and the flouting of local legal systems. Most people upset about such corporate behavior do not realize that each of these techniques has been, and continues to be, practiced by U.S. Major League Baseball (MLB) in connection with its recruitment of baseball talent in Latin America.

Baseball fans often prove to be the most incredulous when it comes to accusations that MLB exploits children and young men in Latin America. Being lovers of statistics, baseball fans notice the Latin presence in the game reaching unprecedented levels. On opening day of the 2003 MLB season, approximately 28% of players on MLB rosters were born outside the United States, a percentage that has nearly doubled since 1990. Of these foreign-born players, approximately 86% are from Latin America and the Caribbean. The numbers are equally or even more impressive at the minor league level. At the start of the 2003 minor league season, 46% of players signed to minor league contracts were born outside the United States, with 78% of those players coming from the Dominican Republic and Venezuela.[1]

These statistics reveal just how significant Latin America has become as a strategic asset for MLB. For some, these numbers suggest the dawning of a “golden age” for Latin American talent in MLB, but the analysis usually stops at the superficial level of statistics. The significant Latin presence in MLB did not happen overnight, and most people who observe baseball—including those who purport to be interested in the economics of the sport—have paid little, if any, attention to the system fueling the growing Latin contribution to “America’s pastime.”

In previous scholarship, we challenged this complacent and uninformed view of MLB’s recruitment of Latin American baseball talent by arguing that the league intentionally exploits children in Latin America.[2] This attack on MLB generated disbelief and anger in the world of professional baseball and beyond. But several years into our efforts on this issue, our analysis has survived attempts to ignore or discredit it. MLB has only grudgingly acknowledged the systemic exploitation endured by Latin recruits. As a result, the reforms it has undertaken or proposed fall far short of adequately addressing the problems.

Understanding how Latin players find their way into minor and major league ball is critical to comprehending how MLB operates as a global business. The statistics concerning the Latin presence in today’s game demonstrate, beyond any doubt, that Latin American talent is critical to MLB’s economic system. Yet, when pundits debate baseball economics, few pay any serious attention to the methods used to recruit Latin American talent. This critical labor recruitment system seems to exist in another dimension, beyond the interests of fans and the analyses of economists. One reason may very well be that it is an ugly, discriminatory system.

The Latin American recruitment system differs radically from the manner in which North American* and Asian talent is brought into MLB. North American amateurs are subject to the annual amateur draft, which contains extensive protections for drafted players negotiated between the MLB Commissioner’s Office and the Major League Baseball Players Association (MLBPA). MLB also has official rules protecting high school and college players in North America from unscrupulous behavior by teams. Asian players, such as those from Japan and Korea, typically enter MLB as free agents after their initial contracts with professional teams in their home countries have expired (e.g., Hideki Matsui of the New York Yankees). If a MLB team wants to recruit a Japanese player under contract with a Japanese professional club, it must go through an elaborate process agreed upon by MLB and the Japanese baseball commissioners. A similar agreement exists between MLB and the Korean professional baseball league.[3]

For young players in North America and Asia, recruitment into MLB is a highly structured and regulated process. The opposite is true for Latin America, the biggest market for foreign baseball talent. Latin prospects are not subject to the amateur draft, nor do agreements exist between MLB and Latin professional leagues about talent transfers.[4] MLB recruitment in Latin America is a free-agency system that is essentially unregulated.

It is important to keep in mind the socioeconomic contexts when comparing how MLB recruits talent in North America, Asia and Latin America. Because MLB’s Asian talent is predominantly Japanese and South Korean, only Latin American recruitment occurs in a context where extreme poverty is prevalent. Socioeconomic inequities in developing countries constitute an important factor in the labor exploitation by corporations from developed countries. In environments such as these that call for heightened attention to, and regulation of, corporate behavior, MLB has established, operated and even defended the unregulated recruitment of minors. In this sense, the league has sidestepped international human rights law, which requires extra protections when children are the subjects of economic utilization, especially in poverty-stricken settings.

MLB’s recruitment system is intentionally designed to access baseball talent as young and as cheaply as possible. Without question, recruitment practices in Latin America target children, defined in international law as persons under 18-years of age.[5] The only official rule MLB has adopted to regulate Latin recruitment is the so-called 17-year-old rule, which teams have routinely violated since the rule was implemented in the mid-1980s and the Commissioner’s Office has refused to enforce effectively.[6] Latin prospects who are of age but pretend to be younger than they really are, also serve as evidence that MLB teams prefer signing younger players. Teams also routinely scout and make contact with players well under 16, sometimes looking for talent among 10-, 11- and 12-year-olds. Often, teams recruit players too young to sign in their “baseball academies” to hide them from other teams and to begin the prospect’s training as early as possible. Perhaps most alarming is that MLB has never adopted officially binding rules on tendering contracts to Latin prospects or the quality of living conditions and playing fields in Latin minor league facilities.

The extensive rules on tendering contracts to persons subject to the amateur draft have been historically denied to Latin youth and their families.[7] MLB has been recruiting in Latin America since at least the 1940s, but it wasn’t until the summer of 2001 that the Commissioner’s Office finally translated the standard minor league player’s contract into Spanish, and only then, reluctantly, as a result of criticism.[8] MLB had, thus, been tendering contracts in a way that virtually all recruited Latin prospects could not read, let alone understand. This blatant and deep-seated discrimination against Latin players underwrites the exploitation of Latin youth by the teams and the Commissioner’s Office in recruiting minor league prospects.

In terms of the living and playing conditions at Latin minor league facilities, sometimes referred to as “baseball academies,” MLB teams display highly variable approaches, with some providing good facilities and others dishing out inhumane treatment. Our book, Stealing Lives, documented the shocking mistreatment of 17-year-old Latin prospect Alexis Quiroz and his teammates by the Chicago Cubs, including the failure of the Cubs to provide adequate food and water, sanitation facilities and proper medical treatment for injuries. The Cubs protested and insinuated that Quiroz was a publicity-seeking liar.[9] Subsequent investigative reporting by the Chicago Tribune confirmed Quiroz’s story, including details from a MLB report criticizing the treatment the Cubs provided its Latin minor leaguers. [10]

Although not every team has behaved as abysmally as the Chicago Cubs acted towards Alexis Quiroz and his teammates, a number of teams have treated players more or less as the Cubs did. Remarkably, this behavior toward children does not violate any MLB rules. Official rules regulate the quality of playing facilities in North American minor leagues but contain no equivalent protections for facilities on which Latin prospects are recruited to play.[11] In the world outside MLB, this kind of behavior is considered intentional discrimination.

The system of exploitation surrounding the league’s recruitment of Latin talent includes MLB teams’ penchant for ignoring local laws that attempt to regulate their behavior. Two specific problems have recently received attention in this regard. The first involves the league’s historical encouragement of so-called “street agents,” or buscones, who find, train and then sell Latin prospects to MLB teams. The buscon system has raised many serious problems, and despite feeding this system and benefiting from the efficiencies it creates, MLB has pretended not to have any responsibility for its regulation.[12] The second problem involves the abuse of performance-enhancing drugs, including drugs designed for livestock, by Latin minor league prospects and players.[13] The initial response by the Commissioner’s Office to the exposure of this problem illustrated MLB’s discriminatory predilections. Despite having set up a mandatory drug-testing system for minor leaguers in North America, the Commissioner’s Office argued that applying the same program in Latin America would be too costly, complex and might represent, in the words of a responsible official at the Commissioner’s Office, money flushed down the toilet.[14]

All these examples of intentional discrimination are at the heart of a long-standing strategy that Latin baseball expert Sam Regalado calls, “Latin players on the cheap.”[15] MLB and those who benefit from the system we criticize do not receive our thesis kindly, but the league’s own behavior has in many ways confirmed our arguments against it. During the time we have been criticizing the Commissioner’s Office, it has grudgingly acknowledged the systemic nature of the problems created by its Latin recruitment practices.[16] The following developments that occurred between 2000 and 2003 validate our arguments against MLB:

- The opening of an office in the Dominican Republic with responsibilities to oversee MLB operations in Latin America.
- The decision to implement the 17-year-old rule more robustly.
- The decision to translate the uniform minor league player’s contract into Spanish.
- The drafting of standards for MLB baseball academies in Latin American countries.
- The proposal to negotiate with the MLBPA a worldwide draft that would cover Latin America as well as other regions.
- A memorandum to MLB teams indicating that they should not have anyone under 16-years of age training in baseball academies.
- A memorandum to MLB teams reminding them to comply with local laws concerning their operations in Latin American countries.
- A directive from the Commissioner’s Office to teams that signing bonuses should only be paid directly to players and not to buscones.
- The dramatic reversal of the Commissioner’s Office policy on drug-testing for Latin minor leaguers and the announcement of the intention to have full drug-testing in place for the 2004 Latin minor league season.

While at first glance impressive, one should keep in mind that each of these steps came amid bad publicity and severe criticism. Investigative reporting by Steve Fainaru of the Washington Post was instrumental in exposing the extent of the problems, embarrassing the Commissioner’s Office and forcing it to change its approach in successive rearguard actions.

The latest of these controversies—the drug abuse problem—reveals the reluctance in the Commissioner’s Office to reforming Latin recruiting strategically. Even after the slew of embarrassments came to light—abuses of the 17-year-old rule, tendering English-only contracts, lack of standards for Latin baseball academies and the buscones problem—the Commissioner’s Office reverted to form and responded to the exposure of a serious drug-abuse question in Latin America with discriminatory arrogance by claiming drug-testing was not worth the effort. The response of the Commissioner’s Office to the drug problem in the Dominican Republic was so appalling that even Governor George Pataki of New York felt compelled to intervene and publicly demand that MLB stop operating in Latin America on the basis of double standards.[17] The Commissioner’s Office only reversed course after criticism of its response became too politically damaging.
Still, the Commissioner’s Office fails to grasp that it needs an overarching strategic vision for correcting the Latin recruitment system. Instead of proactive and sincere reform efforts, MLB has responded to bad publicity by simply applying one band-aid after another. The one systemic reform that could have revolutionized the Latin recruiting process—the worldwide draft proposal—is now dead, killed by a lack of motivation on the part of MLB teams to change the exploitative status quo.[18]

The lack of a strategic vision in the league’s half-hearted “reforms” is also apparent in two other contexts. First, the Dominican office opened by the Commissioner’s Office remains understaffed and underfunded considering the extensive responsibilities it has been given. The office staff is essentially one person, who is expected to single-handedly monitor the largest market for foreign baseball talent. What’s more, this office is also charged with the responsibilities of dealing with the Winter League Agreement between MLB and the Caribbean professional leagues, which regulates the treatment of players under contract to MLB teams who play for teams in the Dominican Republic, Mexico, Puerto Rico and Venezuela during the MLB off-season. Given the strategic importance of the Latin labor pool to baseball today, the staffing of the Dominican office suggests MLB is interested more in successful public relations than in actually stopping the discrimination and exploitation of Latin youth.

Second, many of the reforms mentioned above, including the translation of the uniform minor league player’s contract and the standards for the baseball academies, have not been adopted as formally binding MLB rules. The Commissioner’s Office claims that teams are now required to tender a Spanish translation of the uniform contract and to ensure that baseball academies meet certain standards. However, these “requirements” are non-binding recommendations, not officially binding rules formally adopted by the league. By refusing equal treatment to Latin recruits under official MLB rules, standards and principles, the Commissioner’s Office has missed a paramount opportunity to make a powerful statement.

Although the new standards for baseball academies represent some progress—the acknowledgment, for example, of problems regarding sanitation and food—they continue to fundamentally neglect glaring deficiencies in the way teams behave. The most shocking is the absence of any requirement—not even one word—instructing teams to provide adequate medical trainers and supplies to deal with injured players, a problem the Commissioner’s Office knows is widespread in Latin baseball academies.

The MLB guideline prohibiting buscones from receiving any portion of signing bonuses in the Dominican Republic (strangely, the guideline does not apply in Venezuela) may also cause more trouble for the system by pretending that MLB teams have no responsibilities for the buscon-player relationships. MLB’s position concerning the rampant abuses taking place in the buscon system is that it’s not responsible for the buscones and cannot regulate them because of “legal constraints,” such as anti-trust laws. Thus, it tries to wash its hands of the problem through its signing-bonus guideline while continuing to create incentives that lead to buscon abuses, a situation that leaves prospects more, not less, vulnerable. MLB is correct in that it cannot fix the buscon problem by itself, but it has fundamental responsibilities for helping to transform the current anarchy into regulated order and has the requisite market power to make progress happen.

In other areas of global business, some corporations regulate the conditions under which they deal with their suppliers. Many companies have corporate codes of conduct under which they will not use suppliers that do not meet certain manufacturing standards, including proper treatment of their workforces. Why MLB faces “legal constraints” in regulating its suppliers, the buscones, remains a mystery, especially when doing so would protect countless youths from exploitation. Hopefully, the dramatic change of policy on drug-testing in the Latin minor leagues introduced by the Commissioner’s Office represents a deeper, more strategic understanding of the systemic nature of the problems that it has to fix. However, it’s too early to tell whether that hope is justified or even whether the Commissioner’s Office will actually implement a robust drug-testing system equivalent to the one used in the North American minor leagues.

The inadequacy of reforms undertaken or promised by the Commissioner’s Office means that much work remains to be done before Latin youth are accorded the same kind of treatment as North American minor league prospects. Governor Pataki was right: It is time for MLB to stop applying double standards against Latin children. The case for ending double standards and the resulting discrimination and exploitation is compelling from both a human rights perspective and from the self-interest of MLB’s access to Latin talent. As a strategic talent source, Latin America is profoundly important to the economics of globalized professional baseball. Such a strategic talent source requires a strategic vision that provides opportunity for Latin youth without discrimination and exploitation.

Implementing such a strategic vision will not be easy, because it will confront the narrow-mindedness that the Commissioner’s Office has exhibited on this issue and the entrenched economic interests of all those who feed on the current system, from teams to buscones. We and others who have expressed similar sentiments are not deterred by the magnitude of the challenge. The human rights of children and the best interests of baseball itself require nothing less than radical, effective reform.

About the Authors
Arturo J. Marcano is a lawyer from Venezuela and serves as International Legal Advisor to the Venezuelan Baseball Players’ Association. David P. Fidler is professor of law and Ira C. Batman Faculty Fellow, Indiana University School of Law, Bloomington, Indiana.

1. John Donovan, “A New Game Face: Globalization of the Grand Old Game Hits All-Time High,” Sports Illustrated On-line, July 11, 2003.
2. Arturo J. Marcano and David P. Fidler, “The Globalization of Baseball: Major League Baseball and the Mistreatment of Latin American Baseball Talent,” Indiana Journal of Global Legal Studies , Vol. 6, Issue 2, Spring 1999, p. 511. Also see Arturo J. Marcano and David P. Fidler, Stealing Lives: The Globalization of Baseball and the Tragic Story of Alexis Quiroz, (Bloomington: Indiana University Press, 2002).
3. William B. Gould IV, “Baseball and Globalization: The Game Played and Heard and Watched ‘Round the World’ (With Apologies to Soccer and Bobby Thomson),” Indiana Journal of Global Legal Studies, Vol. 8, Issue 1, Fall 2000, p. 85.
4. Amateurs in Puerto Rico are subject to MLB’s annual draft, but not amateurs in any Latin American country.
5. United Nations Convention on the Rights of the Child, November 20, 1989.
6. MLB teams cannot sign players before they are 17-years-old unless they will turn 17 during the current baseball season or by September 1, whichever is later. Major League Rule 3(a)(1)(B).
7. Andrew Zimbalist, May the Best Team Win: Baseball Economics and Public Policy (Washington, D.C.: Brookings Institution Press, 2003), p. 7.
8. Steve Fainaru, “The Business of Building Ballplayers,” Washington Post, June 17, 2001, p. A01. Interestingly, in its agreement with the Latin Winter Leagues, MLB mandates that English-speaking players who play in the Latin Winter Leagues have their contracts translated into English. Winter League Agreement, Article IV(a)(1).
9. Arturo J. Marcano and David P. Fidler, Stealing Lives, pp. 66-81, 105-118.
10. Gary Marx, “Clean Up Begins of a Sorry Mess,” Chicago Tribune, June 28, 2003.
11. Major League Rule 58 regulates minor league playing facilities.
12. Steve Fainaru, “Baseball's Minor Infractions: In Latin America, Young Players Come At a Bargain Price,” Washington Post, October 26, 2001, p. D01.
13. Steve Fainaru, “Injecting Hope—and Risk: Dominican Prospects Turn to Supplements Designed for Animals,” Washington Post, June 23, 2003, p. A01.
14. Steve Fainaru, “MLB to Evaluate Drug Test Policy,” Washington Post, July 14, 2003, p. D01.
15. Sam Regalado, “‘Latin Players on the Cheap’: Professional Baseball Recruitment in Latin America and the Neocolonialist Tradition,” Indiana Journal of Global Legal Studies, Vol. 8, Issue 1, Fall 2000, p. 9.
16. We do not claim responsibility for causing these changes; we simply note that these changes have been proposed or adopted in the time period we have been criticizing the Commissioner’s Office.
17. Steve Fainaru and Christine Haughney, “Pataki Urges MLB on Testing: N.Y. Governor Wants Action in Latin America,” Washington Post, July 16, 2003, p. D01.
18. We are neither in favor nor against the worldwide draft. We developed strategic reform principles—democratization, centralization and implementation—that we argued in memoranda to the Commissioner’s Office (and others) should be applied to all reform proposals on all issues.

Tags: sports, baseball, MLB, globalization, labor rights, exploitation, drug testing

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