In The Baseball Dead Of Winter, An Old And Unresolved Ethics Problem Glows Bright

From left to right: MLB, players, and the union.

…as Major League Baseball ignores it, as usual.

Ethics alarms test: Scott Boras, lawyer and player agent, represents two Washington Nationals free agents in their prime. One is Stephen Strasburg, one of the best and most sought after starting pitchers in the game. He was seeking, on the advice of his agent, a long-term contract of more than 30 million dollars a year. Another is Anthony Rendon, third-baseman, and the Nationals’ best player in 2019, their championship year. He also is seeking a salary of at least 30 million per year, over many years. He is a fan favorite in Washington, D.C., and obviously enjoys playing there. Contrary to popular belief, however, Major League baseball teams do not have endless supplies of money, though they have a lot. Mike Rizzo, Washington Nationals general manager, told the sports media and Washington fans that the team could not afford to sign both Strasberg and Rendon at the rates they were demanding and the marketplace dictated.

Is there a problem, and if so, what is it?

You shouldn’t need much time to answer, but then again, thousands of baseball sportswriters and the entire baseball establishment havn’t figured this out over many years, do I’ll give you a “Jeopardy!” period of reflection:

OK, contestants,what’s your answer? Continue reading

Once Again, Baseball Agent Conflicts Are Hurting Players Who Don’t Understand Why

Baseball writers are the tools of baseball player agents, useful idiots who write on and on about the underpaid millionaire players and the unfair owners, who won’t pay them what they “deserve.” They scrupulously avoid educating readers about the unethical player agents who manipulate the system and the players for their own benefit, not their clients.  I have written about the unregulated and largely ethics-free baseball agents before, but their conduct this off-season is unusually revolting.

At the top of the list, as usual, is mega-agent Scott Boras, who cleverly treads the line between being an agent and a lawyer—he is both—while having too many stars under his thumb for the sports organizations or bar associations to hold him to account. For example, as a lawyer, Boras would be absolutely bound to tell his clients about a settlement offer, and would be subject to disbarment if he rejected an offer without communicating it to his client (you know, like you regularly see lawyers doing on TV and in the movies). However, there are no player agent rules that require an agent to communicate a team’s salary offer to a player. Agents can, and presumably do, reject offers without their clients ever hearing about them. This, of course, avoids the problem of a baseball star saying, “Oh, hell, that’s more money than I could ever spend anyway. I know it’s less than we talked about, but go ahead and take it.”

Agents have conflicts of interest so grand, and apparently so little understood, that meaningful consent from the client, theoretically the remedy, is virtually impossible. Let’s look at Bryce Harper, Boras’s client who is seeking more than $300 million dollars over a ten year guaranteed contract. Harper is 26 years old and has already made 49 million dollars, not counting endorsements. The functional utility of each dollar he earns is less than the one earned before in his situation. Realistically, there is very little difference between a $250,000,000 contract and a $300,000,000 contract to Harper, except from an ego perspective. The extra 50,000,000 won’t make any difference to him. Boras, however, is a different matter. Let’s say his cut of Harper’s salary is 5%.  He’ll get 15,000,000 if Harper signs for the high figure, but “only” 12,500,000 if Harper agrees to the lower figure. $2.5 million means nothing to Harper: he could throw it down the toilet, and wouldn’t feel a thing. The difference to Boras, however, is much greater in practical, and add to that the marketing advantage of being able to tell potential clients that he set the new all-time record for a free agent contract for his client. Continue reading

Note To Prof. Painter On His Teeth Gnashing Over Trump’s Conflicts: “If You Have No Option, You Have No Problem,” or “NOW You Tell Us?”

Ethics expert Richard Painter, who was White House ethics counsel from 2005 to 2007, has authored a thorough, convincing and I’m quite certain accurate brief about all the problems arising from soon-to-be President Donald Trump’s vast business connections, and the conflicts of interest they can and will involve. It’s an automatic ethics train wreck. Here’s Painter:

Even absent a quid pro quo, the Emoluments Clause bans payments to an American public official from foreign governments. Yet they will arise whenever foreign diplomats stay in Trump hotels at their governments’ expense; whenever parties are organized by foreign governments in Trump hotels (Bahrain just announced such a party in a Trump hotel this week); whenever loans are made to the company by the Bank of China or any other foreign-government-owned bank; whenever rent is paid by companies controlled by foreign governments with offices in Trump buildings; and whenever there is any other arrangement whereby foreign government money goes into the president’s businesses….How can we expect a Trump administration to rein in loose lending practices, particularly in the real estate sector, when the president himself owes hundreds of millions of dollars to banks? What will he do when a foreign dictator acts up in a country where there is a Trump hotel?

Yikes. Yikes and true. Also Yikes, true, and why are you bringing this up now when there is absolutely nothing that can be done about it? Continue reading

Trump, Master Of Rationalizations, Scores A Perfect #4 AND A Perfect #5!

Former District of Columbia Mayor Marion Barry attends a news conference on the steps of Washington's city hall Monday, July 6, 2009. At the news conference Barry's attorney Frederick Cooke said Barry vehemently denies the allegation by Donna Watts-Brighthaupt, and that he's confident the stalking charge will be dropped. Barry, 73, stood behind Cooke but said nothing. (AP Photo/Manuel Balce Ceneta)

Somewhere, Marion Berry is smiling…

This is juuuust the beginning…

I have noted before that our President Elect never expresses any ethical awareness, and uses rationalizations exclusively to explain and justify his conduct. This is typical of say, 12-year-olds, but is less common among professionals in responsible positions.

Trump just authored a classic example, following the expression of concerns about his conflicts of interest, which are massive, unavoidable, and which should have been addressed seriously long ago, like in a Presidential debate, and at length. Unfortunately, Hillary Clinton and various journalists felt it would be more helpful to their cause to spend time talking about what Trump had said about an over-weight Miss Universe and in a private conversation with Billy Bush. How did that work out for you, guys?

Now various lawyers and ethics experts are saying that Trump “must” sell off his business holdings because his company’s myriad business entanglements will cast many White House decisions under a cloud. The President Elect has a neat answer for them, to wit:

“The law’s totally on my side, meaning, the president can’t have a conflict of interest.”

— Donald Trump, interview with the New York Times, Nov. 22, 2016

Bravo! This is a perfect expression of Ethics Alarms Rationalizations #4, and #5

4. Marion Barry’s Misdirection, or “If it isn’t illegal, it’s ethical.”

The late D.C. Mayor and lovable rogue Marion Barry earned himself a place in the Ethics Distortion Hall of Fame with his defense of his giving his blatantly unqualified girlfriend a high-paying job with the DC government. Barry declared that since there was no law against using the public payroll as his own private gift service, there was nothing unethical about it. Once the law was passed (because of him), he then agreed that what he did would be wrong the next time he did it.

Ethics is far broader than law, which is a system of behavior enforced by the state with penalties for violations. Ethics is good conduct as determined by the values and customs of society. Professions promulgate codes of ethics precisely because the law cannot proscribe all inappropriate or harmful behavior. Much that is unethical is not illegal. Lying. Betrayal. Nepotism. Many other kinds of behavior as well, but that is just the factual error in the this rationalization.

The greater problem with it is that it omits the concept of ethics at all.  Ethical conduct is self-motivated, based on the individual’s values and the internalized desire to do the right thing. Barry’s construct assumes that people only behave ethically if there is a tangible, state-enforced penalty for not doing so, and that not incurring a penalty (that is, not breaking the law) is, by definition, ethical.

Nonsense, of course. It is wrong to intentionally muddle the ethical consciousness of the public, and Barry’s statement simply reinforces a misunderstanding of right and wrong.

Continue reading

President Trump’s Massive, Unfixable, Unwaivable Conflict Of Interest…And Why Weren’t We Worrying About This BEFORE The Election?

trump-tower

Donald Trump, as President of the United States, will have an unprecedented conflict of interest—many, actually—that realistically cannot be fixed and never could. He will be President, and he will own a global set of businesses worth billions of dollars that his policies and decisions will unavoidably affect for better or worse, usually to his long term benefit or disadvantage.

Almost nobody, including me, and it’s my business to do so, focused substantially on the problem during the campaign. Trump, as  usually, airily dismissed the issue when it came up as if it was nothing, saying, “If I become president, I couldn’t care less about my company. It’s peanuts,” during one debate. “Run the company, kids. Have a good time.” Typical, stupid, and neither Clinton nor the moderator had the wit or information to follow up with the required, “Wait a minute, that doesn’t deal with the problem. Will you also not care about your kids, Mr. Trump? Your companies’ stockholders? Business partners? Employees?”

At least we know why Hillary was reluctant to pursue this issue, don’t we?

The Trump Organization’s executive vice president, Alan Garten, similarly brushed the problem away, saying in September, “His focus is going to be solely on improving the country. The business is not going to be a factor or an interest at that point.” That’s an incredible statement, naive at best, dishonest at worse. Of course it will be an interest. How could it not be? The question is whether it will be a factor. Human nature, and Trump’s nature, strongly suggest that it will be.

Who can tell with Trump? Maybe he really believes there’s no problem. After all, as I have written repeatedly and all evidence proves, the man doesn’t know ethics from ambergris. Whether he knows it or not, however, this is a massive  and potentially crippling problem for him and his administration, not to mention his children and his businesses. It is especially a problem because the same journalists who dismissed Hillary’s family foundation’s influence peddling while she was Secretary of State and after as another overblown conservative attack (after all, why should venality and hidden conflicts of interest interfere with electing the First Woman President?) have the long knives out to eviscerate Trump on any hint of impropriety, real or not, they can find.  This is real. Continue reading

The Unforgivable Conflict of Interest: Sports Agents, Robbing Their Ignorant Clients

The ethical course is to choose.

The ethical course is to choose.

Sports agents are rich, powerful, and ethically handicapped by inherent conflicts of interest. The first two qualities so far have insulated them from dealing fairly and openly with the second. This is wrong, and has got to stop. For it to stop, it would help if the players, their unions, the sports leagues and the sports media didn’t either intentionally pretend not to see the obvious, or weren’t too biased and ignorant to realize what’s going on.

Four years ago, I wrote about this problem in a long piece for Hardball Times, a baseball wonk blog of consistent high quality.  The specific agent I was writing about was Scott Boras, the king of baseball player agents, but the egregious conflict I flagged isn’t confined to that professional sport; it’s present in all of them. In the article, I argued that Boras, a lawyer, is engaged in the practice of law when serving as an agent and was therefore violating the legal ethics rules, which prohibits having clients whose interests are directly adverse to each other, specifically in the so-called “Zero-Sum Conflict” situation.

A lawyer can’t assist two clients bidding for the same contract, because the better job he does for one, the worse his other client fares. A lawyer can’t sue a defendant for every penny that defendant has on behalf of one client when he or she has another client or two that have grievances against that same defendant—if the lawyer is successful with the first client, he’s just ruined his other clients’ chances of recovery. There is some controversy over whether the legal ethics rules automatically apply to a lawyer-agent like Boras, but never mind—whether he is subject to the legal ethics rules or not when serving as an agent, the conflict of interest he is blithely ignoring still applies, still harms his clients, still puts money in his pockets, and still should not be permitted. Continue reading