Fair Pay …

I was watching television yesterday afternoon, and a commercial came on that featured a boy and a girl (both black, if that matters to anyone) talking about what they were going to do when they got older. Specifically, they were talking about all of the things they were going to achieve playing basketball from that age right through their university careers. The commercial focused on them either achieving the same things or the girl achieving even greater things — the boy talking about getting to state once while the girl talked about getting there three straight years — all through their career. And then, at the end, they talked about their rookie salaries in professional sports. The boy said that his would be $4 million, while the girl talked about hers being $40,000. This then led into a comment about a specific WNBA player fighting for fair pay (it ended up being a wealth management commercial).

There are a number of problems with this commercial wrt the notion of fair pay. The first is that while I suspect that this comparison was based on real people, having the girl’s projected achievements be so over-the-top works against the comparison. Treating the comparisons as identical and them having roughly the same amount of talent, she comes across as unrealistic or bragging. But this goes away once we consider that maybe her achievements are more realistic, but only because the competition isn’t as stiff in the women’s game and so one good school and one good player really can be that dominant. But then the attempt to show that her equal accomplishments are being underappreciated due to her significantly lower salary falls flat, as we start to think that they aren’t that comparable after all.

The second problem is comparing the starting salaries themselves and looking at what counts as fair pay. Now, a problem, in my opinion, with the debates over fair pay on the national teams is that it often focuses — on both sides — on how much revenue the teams bring in. National teams don’t exist to make money, so how much revenue each brings in, or even percentages of that, are irrelevant. The teams — and from that, the players — should get the funding they need to put together teams that can win big tournaments and titles. If that means that women need to get paid more even if they bring in less revenue, then that’s what should be done, and vice versa. The big issue is treating the two teams identically and as if they were a league team that has to worry about revenue and percentage of revenue and the like. That’s the wrong approach for either to take.

But here we’re talking about the NBA and the WNBA. And so, here, revenue matters. There is no way that the starting rookie salary for the WNBA could be $4 million because the revenue is not there to pay that much. An admittedly conservative estimate of the WNBA revenue is $60 million. 12 teams times 11 players at the $4 million minimum would be, in and of itself, $528 million. If we assumed that only big stars would get that to start — or at all — and posited an average of $1 million per player, that’s still $132 million or twice as much as the revenue taken in. And, remember, that’s revenue not profit. There might be one or two WNBA teams that actually make some profit at the existing salaries, but all of them would be deeply underwater if the salaries increased to anything near what that rookie NBA player would get.

This is why the smarter arguments — like the one linked above — focus on percentage of revenue rather than on absolute dollars. This, of course, has its own issues — fixed costs will take up a greater percentage of the revenue the less revenue you have — but it at least takes the vast revenue differences into account. The commercial, however, simply tosses out the dollar amounts as if that’s supposed to get us to see how unfair this all is. But an average salary of $100,000 is $13 million, which is a significant amount of the revenue — it’s actually close to what the article above claims is already the case, being slightly higher — which is far, far less than that rookie salary, and yet as it’s slightly higher than what is being paid today it would still result in most of the WNBA teams not making any profits. Going any higher, then, would likely simply push the teams under water. The article linked above wants the salary cap to go to 50% of revenue, which would represent an average salary of about $220,000 a season. That’s about as high as you can fairly go given revenue, and yet it’s still dramatically lower than the NBA rookie salary and — as this wouldn’t bring in more revenue on its own — would result in each team having to eat $1.4 million dollars in additional losses when, again, most of them don’t make profits now. An even split of revenue seems a dicey prospect, let alone trying to pay anything like equivalent salaries for the NBA and the WNBA.

Look, you can’t just look at the men’s and women’s pay and say that they should be paid exactly the same. You have to take the context into account, or else you make really stupid arguments. I sense a lot of stupid arguments in this commercial.

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