Horse Trading Part 3 - MLB Makes Proposal On Amateur Drafts

 Baseball America did a detailed article on the MLB's latest proposal that covered amateur drats.  Here are my comments:

1. Rule 5 Draft -MLB's proposal does not eliminate the Rule 5 draft and, in fact, accentuates it.  The MLB proposal would allow for domestic players to be R5-eligible after 2 seasons with teams being able to 'buy' a 3rd season of protection for $30,000. 

My thoughts: I have published several posts on this site with data that shows that the Rule 5 ML draft does not work.  While MLB's latest proposal would change the dynamic to the R5 draft based on eligible players it is still not workable and, IMO, the ML R5 draft should be eliminated. The goal of eliminating the Rule 5 draft would be to give teams LONGER periods of control for their players to develop and to reduce the money and effort spent on determining which players to roster and which to draft in the R5. 

2. MLB Draft Changes - MLB proposes dropping the draft to 12 rounds, cutting the bonus pool in half, not allowing players to be drafted until they turn 20 (no HS players or JUCO freshmen), limiting the bonuses for NDFA to $10,000, draft choices are freely tradeable with some limitations, no competitive balance picks.

My thoughts: 

No drafting of HS/young JUCO draftees - I am on board with that.  The demographics show that the most high risk is in drafting HS players, especially RH pitchers and catchers. While some guys do make it big being drafted out of HS, a lot fail.   

However, this system will only work if foreign leagues support this and refuse to sign US kids who are not draft-eligible. The system must also allow for matriculation from college to pro ball at a faster rate so that kids pushed to college find playing time at colleges that will develop them and get them ready for pro ball at a young age.  This cannot be like HS where seniors and juniors play and freshmen and sophomores sit (or play JV, which doesn't currently exist in college) and wait their turn.  For example, IMO there are still too many Friday night SP in college baseball who are seniors because they give the team the best chance to win and winning is a main goal for a college coach.  While that may impact winning for those schools it adversely impacts kids with a lot of talent but no experience.  Additionally, if the influx of players to college is not handled correctly, the already out-of-control transfer portal will get crazier as kids find that they can't get playing time early and so transfer to a place that 'guarantees' them playing time..

Dropping the draft to 12 rounds: I am totally against that.  The pool of draft-worthy players will, in theory, be the same every year even if HS/JUCO kids are not eligible. Those kids will simply be in college at their draft age,  MLB has already dropped the draft from 40 to 20 rounds.  Dropping it further favors cheap teams not having to spend money on amateur player acquisition AND make it harder for draft-worthy players to get playing time in their freshman and sophomore years in college. I am not in favor of any rule that allows cheap teams to cheap out on amateur player acquisition. 

Cutting the bonus pools in half: Again, totally against this.  In fact, I want the bonus pools enhanced for the resource-limited teams.  Make them spend more on amateur player acquistion.

Elimination of Competitive Balance Draft Picks - I am totally against this.  Resource-liimited teams should get more draft picks, period.  As I have said repeatedly, any change that allows resourc-limited teams to avoid spending money on amateur player acquisition is bad for baseball. There is a substantial difference between revenue sharing, which can be accomplished with better local media revenue sharing and a salary floor and competitive balance. The latter requires carrot-and-stick rules for small market teams.  That is, give them extra bonus pool money but make them spend it.

Somewhat Free Trading of Draft Picks - I am TOTALLY against this. Trading a 1st round draft pick could save a team MILLIONS of dollars.  Being a Cleveland guy I remember Ted Stepien for the Cavaliers and the DeShaun Watson/Browns trade.  These trades hamstrung their teams for years.  Rules should NOT be made that allows this kind of shooting in the foot.  Just the opposite, actually.  I am against any rule that keeps cheap teams from spending on amateur player acquisition. My rule is to not allow draft picks from being traded before the 11th round and then they can only be for the current draft cycle and only be traded by large market teams.  I don't want teams to be able to mortgage the future for a brass ring push in a year.  

Limiting NDFA bonuses to $10,000 - Again, this, like cutting the draft to 12 rounds, is just a mechanism for teams to save money on player acquisition while driving kids back to college.  Kids need to matriculate to pro baseball from college to give younger college players the opportunity to play.

Hard Draft Slots - I am against this.  Teams should be allowed to decide how to spend their money.  Nowhere in this proposal does it address a college player simply saying that they don't want to be drafted in a particular year.  This would be heightened if hard draft slots were adhered to.  I think this spending flexibility is one of the beautiful things of the draft.  Some teams might like to spread their money around.  Hard slotting eliminates creativity in amateur player acquistion.  However, there does need to be rules saying a team MUST spend between 95% and 105% of their draft pool budget. 

3. International Draft - Players can only be drafted when they reach 18, bonus pool the same for international and domestic drafts. Skip the 2027 January 15th signing period.

My thoughts - I am on board with these proposals.  That being said, this proposal has still not eliminated the difference in age between domestic and international signees that currently exists.  This draft would clearly have to include elimination of the R5 draft so these kids could develop.  My other thought on this is that there are huge advantages to getting kids in younger. All teams right now get these kids to finish their HS education.  MLB would have to invest in academies for kids to continue to develop and get life skills until they can be drafted.  That obviously exists in the US but one of the beauties of signing these kids at 16 and them having them play in the DSL is that you get them in a structured environment early.  MLB would have to figure how to do that.

SUMMARY 

Many of these changes could be good for baseball.  However, a salary floor and salary cap should be tied to changes in revenue sharing.  Changes to amateur player acquisition should NOT.  Even in a cap situation the best players would leverage their talent to get to a large market where their earning power outside the game would be maximized.  Talent will NEVER be split evenly in a cap/floor environment.  Also we need to provide small market teams a pathway that allows them to reach the salary floor by signing their only prospects like the Athletics did and other teams are now starting to do.  This comes from enhanced amateur player opportunities for small market teams that are mandated to be followed both in keeping and using draft picks and spending appropriately instead of just not using money on these drafts. The new CBA should not just make fringe players and AAAA players richer as teams try to get to the floor.  Finally, in no way should ANY of these changes impact the gains that were made in the historic MiLB CBA.  Those benefits should be protected. so guys can chase their dreams to their natural conclusion without giving up because they can't afford to continue.

Anyone For Some Horse Trading? Part 2 - Let's Trade the Right Horses - Initial MLBPA and MLB New CBA Proposals

I started to write this months ago. but, after thinking about it and looking back at how the previous CBA unfolded, I decided to wait until the MLBPA made their initial proposal to the owners.  Surprisingly, IMO, it was not as shock-and-awe as I had expected it to be, instead nibbling at the edges.  The publicly released part of the MLB proposal was shock and awe as it really only addressed a cap/floor system with initial dollar figures

Note that many of the topics below were not publicly disclosed in MLB's counterproposal.

Let's dive in and see where the two sides are and where I think this should go.  Again, only one guy's opinion.

1. Minimum salary -

MLBPA - $1.65 MM minimum, scaling up to $2.2 MM at the end of the CBA.

MLB - Not mentioned but MLB is rumored to be against such a hike in rookie salaries

My Thoughts - fits right in line with what my goal of a $2 MM minimum salary I proposed.  Owners are going to have to see that a salary floor is coming and the smart ones will see that it is better to give this money to their own players than be forced to give it to mediocre FAs who won't impact the course of a season. As I said before, 26 players at $2 MM gives you a base total salary of almost 1/2 of the $120 MM floor they will likely settle on.

2. Pre-arbitration pool - 

MLBBPA - Raise from current $50 MM to $180 MM. 

MLB - Not mentioned

My Thoughts - Currently, each of the 30 ML teams contribute $1.67 MM to the pool. The new pool would cost each team $6 MM, which disproportionately taxes the 'poorest' teams.   If the owners are to agree to this increase it is going to have to be tied to something in lieu of a salary cap (see #7 below).  For example, the bottom 10 markets would still contribute $2 MM/team, the middle 10 markets would contribute $6 MM each and the largest 10 markets would each be left to contribute $10 million.  I am not saying the $180 MM will end up being the number but whatever the number is, the split should hit the wealthiest teams the hardest.

3. Super 2 Players - 

MLBPA - Increase from 22% to 44%. 

MLB - Not mentioned

My thoughts -  I think this IS a shock-and-awe request designed to get them concessions elsewhere.  I would think an increase to $25% with a increase of 1% per year of the next CBA would be a good compromise without meaning that the owners have to give up something else somewhere.  Frankly, I think that arbitration should be dropped to after 2 years of service time.  This eliminates the Super 2 issue while it still doesn't address the player control issues that led to Super 2, PPI and other rules.  I think that this would be less of a hard pill to swallow if teams had access to more revenue and were forced to spend it.

4. Minimum Arbitration salary 

MLBPA: 3 MM

MLB - Not mentioned

My Thoughts -  I think this, in combination with the ca. $2 MM minimum salary is good and the owners can complain about it to gain some good PR but they will see that paying a rookie $2 MM is better than paying a mediocre arbitration-eligible player $3+ MM.  I see this nicely fitting into current organizational thinking of when they pull the plug on arbitration-eligible

 players. I also see those players being stuck getting minor league deals which is not helpful to those players playing in the majors unless there is an increase in salary year over year due to service time.

5. Service time for ML free agency - 

MLBPA - No change for younger players . 5 years service time for players over 30 to become FAs

MLB - Not mentioned but I have to guess this would be a no for teams.  They develop players and want to hold onto those players for the longest time possible before potentially losing them to free agency.  Still, teams that understand the 'churn' of expensive players leaving for greener pastures, might want to horsetrade this for other concessions.

My Thoughts - The players propose 5 years for players over 30 years old.  I see the owners doing some horsetrading here by giving in to this but asking for two things in return: elimination of the ML Rule 5 draft and change in the minor league free agency to 7 years for players signed before their 18th birthday.  Latin amateur FAs take so long to develop that exposing them minor league free agency or the Rule 5 draft is just foolish.  These two horse trades are something that owners of small market teams would likely favor, anyway.

6. Competitive Balance Tax and Other Penalties

MLBPA:  Raise Competitive Balance Threshold from $244 MM to $300 MM, raising in subsequent seasons.  Remove all penalties for exceeding tax

MLB - Not mentioned but from their low salary cap proposal, MLB probably considers this irrelevant.

My Thoughts - Assuming no salary cap, my philosophy to improve competitive balance is to make teams choose.  If they choose to buy FAs (high team salary), they should be penalized more heavily than they are now.

7. Revenue Sharing

MLBPA - More sharing of broadcast rights, less stadium revenue sharing, Lower revenue teams receive at least $240 MM in revenue sharing annually but they must spend that money or suffer penalties. Low revenue teams would receive bonuses if they make the playoffs or have a winning record.

MLB - Not addressed

My thoughts - I align with the MLBPA here.  More revenue sharing, penalties if not spending that money, bonuses for successful franchises. I would like part of that money going to the draft, giving those low revenue teams even larger bonus pool, and money they HAVE to spend or be penalized.

8. Salary Cap

MLBPA - Does not want

MLB - $245 MM

My Thoughts - This is where the rubber meets the road in these negotiations.  Owners can play hardball here but everyone should warn them that it will be THEIR fault if this results in a work stoppage.  There are plenty of ways to improve competitive balance without a cap.  In fact, having a cap actually will hurt competitive balance as big market teams will just funnel money to player development and scouting. See #6 above for ways to help compettive balance.

9. Salary Floor

MLBPA - $150 MM - Penalties for teams spending under that (reverse competitive balance tax). 

MLB - $171 MM (includes player benefits meaning it is lower). Likely to be closer to $150 MM in salaries.

My Thoughts - MLBPA's plan is similar to my plan.  Remembering that 100% of owners need to approve the new CBA and only 50+% of players need to approve, the lower the salary floor, the better to get 100% of owners to approve.  Note that this floor needs to be tied to increased revenue sharing, particularly from local revenues (TV and merchandise).  It is still not clear how the MLBPA is addressing that their plan guarantees teams $240 MM in revenue sharing but only requires them to pay $150 MM in salaries.  As I have said, part of that revenue should be forced into draft bonus pools (domestic and international (see below) with the smaller market teams getting more money to spend, and have to spend, to sign amatuer players.

10. International Draft

MLBPA - Not mentioned

MLB - Not mentioned

My Thoughts - This is a must for me.  A large part of competitive balance has to include all amateur players being subject to a draft.

11. Rule 5 Draft

MLBPA - Not mentioned

MLB - Not mentioned

My Thoughts - The ML portion HAS to be eliminated.  I have published a number of evidence-based articles on this and the current R5 does not work.  As a good part of competitive balance has to be in amateur player acquistion and development, the R5 is counterproductive.