(The following is being syndicated fromThe Captain’s Blog).
Even in peace, MLB finds a way to get bruised. Instead of focusing on the unprecedented 21 years of labor peace that will result from yesterday’s new collective bargaining agreement (CBA), the focus of many, if not most, has been on elements of the deal they don’t like. Interestingly, the strongest objections have been for items like draft slotting and expanded playoffs, which just so happen to be heralded in other sports. In some ways, that’s unfair, but baseball has always been held to a higher standard (see steroids) because it is the National Pastime.
We are headed for massive problems in the next CBA. Competitive balance is going to get progressively worse.” – Anonymous GM, quoted by Ken Rosenthal, November 23, 2011
The most repeated criticism of the new CBA is it has the potential to dampen competitive balance by restricting the amount of money that small market teams can spend in the draft and international free agent market. Because teams like the Royals, Pirates, Royals, and Padres have become the most prolific spenders in the draft, the theory goes, curtailing the amount of money spent will limit their ability to be competitive. However, there is a flaw to this logic. The reason those teams have spent more is twofold: they have amassed more picks and bonus payouts at the top of the draft have been increasing exponentially.
Top-10 Spenders in the Rule IV Draft, 2007-2011
| Team | Total Bonuses |
| Pirates | $52,057,400 |
| Nationals | $51,084,600 |
| Royals | $45,204,900 |
| Red Sox | $44,097,250 |
| Orioles | $41,219,700 |
| Rays | $40,582,200 |
| Blue Jays | $38,429,600 |
| Mariners | $36,055,900 |
| Padres | $35,768,100 |
| Diamondbacks | $35,261,000 |
Source: baseballamerica.com
In the Pittsburgh Tribune-Review, Dejan Kovacevic decried the new CBA because it “sticks it to the Pirates”. As Kovacevic points out, if the Pirates spent $17 million in the 2012 draft, as they did last year, the team would now be subject to harsh penalties. As a result, he concludes the new CBA is an unfair arrangement designed to benefit large market teams at the expense of the lowly Pirates. Of course, that notion is absurd. If there is an aggrieved party, it’s the players, who could have their leverage reduced even further. Not only aren’t small market teams being victimized, but there’s every reason to believe the bonus pool policy was implemented on their behalf.
In 2011, the Pirates gave number one pick Gerrit Cole an $8 million signing bonus.
The new CBA was not designed to trample the Pirates’ hopes of building through the draft. More likely, it was designed by them to help control costs. After all, the reason the Pirates spent so much last year is because they were compelled to give Gerrit Cole a record bonus of $8 million. Had the new system been in place, it’s likely Pittsburgh would have still wound up with Cole, but at a much reduced price. Why? Because under the new system no team could pay him more, and the further he dropped, the chances of another club being willing to overpay would lessen because of the penalties. With early round bonuses continuing to spiral, it seems more likely the Pirates of the world would have been priced out of top talent under the old system than constrained by the new one.
When you start to delve deeper into the framework, the new CBA looks more and more like a fair comprise, at least with regard to the Rule IV draft. The international free agency rules, however, do not appear as equitable, especially if the initial reports of $2.9 million budgets are correct. For many teams, that allotment wouldn’t cover one player, so it’s hard to imagine how they’ll be able to stretch it over an entire year’s signing period. One solution to that problem could be a provision that allows teams to transfer their budgetary allotment, creating a “cap and trade” like system. Considering that many teams spend little, if anything, on international free agents, the ability to transfer the approximately $100 million in allotted funds could mitigate what, at first glance, seem like onerous restrictions.
One final point being made about the international free agency rules, as well as the push for an international amateur draft, is the potential chilling effect it could have on the talent pool. Although I have often advocated that position, and still believe it to be valid, it’s worth pointing out that baseball can still control that issue. Even with the restrictions, the relatively higher salaries, longevity, and guaranteed contracts (not to mention the lesser risk to health) promised by a baseball career are still very appealing. On its own, lowering signing bonuses shouldn’t drastically shrink the talent pool, especially when you consider most international amateurs do not sign for the like bonuses that seem to be the target of the new CBA. If baseball continues to foster a policy of investing in foreign markets, both in terms of funding amateur academies and marketing interest in the professional game, baseball’s appeal to athletes in these countries should remain strong. However, on this issue, Bud Selig, and any future commissioner, must be vigilant. If he notices a waning investment, Selig shouldn’t hesitate to act in the best interest of the game.
Knee jerk reactions to complex issues are perfectly understandable, especially in this day and age of advanced media and instant communications (for my own premature look at the new CBA, click here). However, only after all of the details are revealed and the first implementation of the new rules are evaluated, can a more informed assessment of the new CBA be made. In the meantime, baseball fans should be happy to have a CBA to debate. Followers of the NBA wish they were so lucky.
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Glad the Pirates aren’t getting screwed. But most readers of this blog are concerned that it was the Yankees who got screwed.
Virtually every provision will make it harder for the Yanks to secure good young talent. They’ve already been penalized by a draft that rewards performance mediocrity. Now even more high picks will go to Bud’s pets in the small markets. And they Yankees IFA budget willo — if they perform well on the dield — be miniscule. Selig is a charter membero of Occupy Yankee Stadius and with this lop-sided CBA he has cvemented his credentials with the small market owners who’ve always been his political base.
The net effect of this deal IMO will be to force the Yankees to be ever more dependent on pricey free agent signings. That works well to a point but once the farm is barren it will be a recipe for disaster.
I’d like to think most readers of this blog care about the entire sport, not just the Yankees.
Regardless, the Yankees are not being “screwed”. That’s just hyperbole that doesn’t stand up to scrutiny.
Screwed is going too far. I will say it will make it harder to find players on the international level, but that just means we have to develop a new strategy.
Amateur draft in reverse order of finish: screwed
luxury tax: screwed
revenue sharing: screwed
caps on draft budgets: screwed
Gee, I wonder if there’s a common motive there….
As to a new strategy, I’m all ears. Any ideas?
The only one of those things I’m not in favor of is budgeting the draft. Teams should be able to spend whatever they want, on whoever they want both in the draft and IFA.
Strategies will come from trial and error, eventually certain teams will get better at takng advantage of the current system just as they where the last. It may not be ideal but it’s what you have to deal with, smart GMs will learn to work it instead of just bitch about it.
-Buy the Nippon Ham Fighters
-Have them sign every top Latin American talent
-Use the NPB as your developmental league
-Repeat annually until Bud outlaws these arrangements in the next CBA.
I don’t know…I think having a franchise in a protected market that could probably support 3 or 4 teams is a pretty nice perk, one that allows the Yankees to make so much money that they can still pay a luxury tax and contribute revenue sharing while still being able to field a perennial pennant contender.
Btw this doesn’t go here but the Yankees and Freddy Garcia “are close to a 1 year deal”. I’d like for it to be for 5 million with another 5 million in different incentives, though I have no problem going up to 8 million after the kind of value we got from him last year.
If we can manage to get a number 2 starter in some way we should have a set rotation. Sabathia, *insert name*, Nova, Burnett, Garcia should make a pretty solid rotation to start the year. If Garcia stumbles, or completely falls flat on his face you have Hughes, Noesi, Warren, and Phelps all waiting in the wings for the 5th spot.
I am not comfortable having penciling Garcia into the fifth spot because right now the Yankees only sure thing next year is Sabathia. Unless Garcia is the fifth man in a Burnett-less rotation, or one that has a really strong number two, it could be tempting fate.