The Minor Leagues and Student Debt
Evan Drellich of The Athletic had a great story yesterday on the economic hardships young baseball players face in extended spring training, when not all teams pay them a salary. They get housing and some food, but often their meal allowances aren’t enough for three meals a day.
The whole story is definitely worth reading, but one part of it really stood out:
Another player from Latin America said he feels he’s participating in a system “kind of like the Hunger Games.”
“Just make your way through it and if you win, you get the big prize, making it to the big leagues,” he said. “You get the lifestyle you’ve been dreaming of. If not, the team just sees that they don’t require your services, it’s bye bye, just like that.”
When I read those words, I thought about America’s student debt crisis. There’s roughly $1.7 trillion in debt held by 45 million former students across the country, all of whom made roughly the same bargain as these players. They didn’t exactly envision the lifestyle of professional athlete, but they thought a college degree would pay for itself, via the higher earnings a college degree supposedly confers.*
*It is empirically true that college graduates earn more than non-college graduates over their lifetimes. Whether that is actually due to the degree itself—as opposed to just the selection effect—is less clear.
This makes programs to relieve student debt controversial, since the people benefitting from them are generally the economy’s winners, and hence not very sympathetic. It’s the same problem that plagues professional athletes in labor fights—they are too rich to be exploited.
But one major problem with this attitude is we’re only seeing the survivors of the process. As the player quoted mentions, some of them will make the big leagues—but for some it will be “bye bye, just like that.” Plenty of minor leaguers will never make the majors, and so their bet will never pay off. By the same token, nearly 40% of people with student debt do not have a college degree, so they are not even benefitting from the wage premium it confers. And even those who do have degrees have seen the value of those degrees shrink.
It's important to realize that this an example of the system working as intended. It’s a feature, not a bug. Both college and the minor leagues are examples of the meritocracy at work: a system designed to sort people from most deserving and qualified to least. And, it should be said, they are both pretty good at that! Look at the minor leagues: Everybody who goes through baseball’s minor league system is one of the most talented players in the world. Players who are successful there get promoted to the big leagues, and those who are not don’t. Basically nobody becomes a major league baseball player because they know the right guy, or their uncle pulled some strings.
College isn’t quite that good. There are definitely some strings pulled, graduates who don’t deserve it, acceptances based on family names, etc. But, overall, colleges are good at identifying smart students and getting them degrees.
But a byproduct of these systems is that people who don’t make the cut will be discarded. What makes the situation so inhumane is that not only are they discarded, but they are often left burdened by this pursuit, whether in the form of student debt, drained savings to cover the costs of years without income, or just years of potential earnings forgone for the sake of a dream. These financial burdens can linger for years, or even decades.
When people push for more merit-based systems, they should recognize that this is what they are pushing for. It is tempting to think that the only problem with the idea of “meritocracy” is that it doesn’t work (and, indeed, it usually doesn’t), but they are also bad when they work perfectly!