Give a Little, Get a Little, MLB Owners

Editor’s Note: This is the seventh in a 10-part series commemorating baseball’s new commissioner with advice for his tenure. To read more about this series, click here.

Boston drafted Jacoby Ellsbury with the pick it received when Orlando Cabrera signed with the Angels. (via Parker Harrington)

Boston drafted Jacoby Ellsbury with the pick it received when Orlando Cabrera signed with the Angels. (via Parker Harrington)

Back in 1977, the White Sox signed first baseman Ron Blomberg to a major league deal. The slugger had two at-bats for the Yankees the previous season, and injuries meant his career high in at-bats was only 301, but he was a proto-Nick Johnson, hitting whenever he was healthy enough. Only 72 players in baseball history with 1,000 plate appearances or more had an adjusted OPS as high as Blomberg. The White Sox were making a downright sabermetric move, then.

It failed. Blomberg played in just 61 games before retiring. But you’re not here to read about the former first-overall pick who couldn’t stay healthy, or the machinations of the 1977 White Sox. You’re here to read about the horrible compensatory draft pick system, which started with the pick given away for Blomberg. The Yankees used the pick to draft Wonder Dog Rex Hudler, who probably wasn’t the missing piece for future White Sox teams. The idea that they had to give up anything just to sign a player, just to help their team win, though, that’s what rankles. And it’s rankled for nearly 40 years.

World Series have been won because of compensatory draft picks. Consider Jacoby Ellsbury and Clay Buchholz, drafted by the Red Sox for losing Orlando Cabrera and Pedro Martinez, respectively. World Series have been lost because of them. Picture an alternate history with Rafael Palmeiro on the Padres, Torii Hunter on the Reds, or Shawn Green on the Giants. The picks affect every offseason, every team’s plans. They cost players millions of dollars when the circumstances are just so.

It’s important to remember, though, that draft pick compensation is just the stupidest thing. I’m reminded of something Sam Miller wrote once:

Draft pick compensation is just the stupidest thing.

Indeed. Miller likens the system to something that taxes the team trying to get better and taxes the player who dares switch teams. It rewards the team that loses the free agent, but the newest Collective Bargaining Agreement even took the steam out of that reward, giving teams picks at the bottom of the round instead of the higher pick the signing team lost.

Here’s how the current system works: A team can offer its free agent the deal of a one-year salary that’s based on the average of the top 125 player salaries from the previous season. This is called the “qualifying offer.” If the player refuses this offer, any other team that signs him has to give up a draft pick. A team picking in the first 10 spots will give up a second-round pick (or later if it has signed other free agents who received the qualifying offer.) A team picking after No. 10 will give up a first-round pick for the first qualifying free agent it signs sign, losing a subsequent pick for each free agent thereafter.

This is actually an improvement on previous systems, if slightly. It’s something we’re used to, something that’s codified, but that doesn’t mean it still isn’t pointless. Review the arguments for the compensatory draft system:

  1. To save the owners money
  2. To save teams money, and therefore save the owners money
To cost the players money, which leads to the owners saving money

The other benefit is that it saves owners money. This is why it will never die.

Here’s hoping, though. Commissioner-in-waiting Rob Manfred has a lot of priorities, I’m sure. Lots of ideas, lots of big ideas. They all come under the umbrella of one goal, though: Make baseball better. That’s the golden rule of baseball commissioning, then. Do unto baseball as you would have baseball do unto you. Make the game better. Expand the audience. Help the fans enjoy the sport more. Worrying about money is an important part of the gig, but it still falls under that golden rule. Make the sport better, and the money should follow.

A free agent market without compensation would make the game better. Not directly, sure. The average fan isn’t sitting at home, wondering about compensation picks at the end of the first round, then using the information to decide on season tickets. But what does stoke the interest of the average fan is movement. Transactions. Big free agent deals. Teams going for it. Teams really going for it. Signings. Trades. More signings. The coal of the hot stove warms many a heart, and ditching the system makes for a better hot stove season. More teams will be interested and active. The team with the No. 11 pick doesn’t have to worry about losing it because it had the gall to finish with 86 losses instead of 87.

What’s not going to happen: Manfred walking into an owners’ meeting and saying, “Let’s get rid of this money-saving tactic we’re used to because it’s just the stupidest thing. All in favor? Ayes have it. Next order of business…” It saves money. The average fan doesn’t know it exists. We’re all used to it. What reason would the owners have for ditching it? None.

What reason would the commissioner have for ditching it? Well, it would make the game incrementally better. It’s a part of the golden rule. So he would have to sell it to the owners. Here’s how I would hope he could do it:

A Hardball Times Update
Goodbye for now.

Let us use this money-saving rule as a bargaining chip to get some sort of concession from the MLBPA that can also save us money, but isn’t so dippy and transparent.

The owners are sitting on a bargaining chip that is in place, and it’s one they’ll fight for, fangs bared. But it’s also a nonsensical one that disproportionately hurts the mid-high-range free agents who win the reverse-free-agent lottery and the teams trying to win more games (and draw more fans). More than a few owners have been burned by the idea of compensatory draft picks. “Boy, I’d sure love to make my team better, but …” is a thought GMs have to ponder every year. Get a concession from the MLBPA that’s just as juicy, and it might not be farfetched for compensatory picks to go away forever. They’re only popular when they save money.

Exactly what would that concession be? You got me there. I’m a baseball writer, not a lawyer. I walk off the lot with an overpriced car and extended warranty every time. That’s not for me to figure out.

The basics make sense, though. The players hate the system. The system depresses the free agent market, which is a stealthy marketing tool to keep people caring about the sport during the winter. The money saved is abstract, except for a few unfortunate cases. Most of the owners have been burned by it. No one likes it (until they save money).

Figure out a way to exchange the system for something else, then. Make it revenue-neutral, that’s not my business. Keep on ownin’, owners. Keep on saving money wherever you can. But if I had to figure out something for the new commissioner to do, it would be “make the game better.” Here’s an easy target and a good place to start when the new CBA comes up.

Grant Brisbee is a writer at McCovey Chronicles and SB Nation. He has a wife, two girls, and is sick of "Frozen." Follow him on Twitter @mccoveychron.
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Jim S.
8 years ago

Anything which penalizes the richer teams (Yankees, Dodgers, etc.) who can afford to sign high-priced free agents would seem to level the playing field. And you’re saying that’s a bad thing? I don’t get it. Not at all.

8 years ago
Reply to  Jim S.

The reality of the compensation picks does not seem to hurt the rich teams. If you look at which teams are gaining draft picks I think you’ll find the rich teams end up with a disproportionate share. Think of the free agent binge – Yankees can go sign Tex, CC, and AJ in one offseason. They only give up one first round pick to do this.

Shane Tourtellotte
8 years ago

If you want one side to give up its ugly contrivance, the other side has to give up its own. It wouldn’t fully balance the books, but it’d be a strong start if, in compensation, the MLBPA gave up Super Two status. We’d no longer have the dread spectacle of teams burying a hot prospect in the minors, giving away WAR in what could be a tight race, so they don’t start his arbitration clock a year early.

How’s that?

Paul Swydanmember
8 years ago

I actually like that a lot. Super Two status only affects a handful of players per year at the front end of arbitration, and free agent compensation only affects a handful of players at the front end of free agency (more or less).

8 years ago

Good idea, but it won’t stop teams from keeping top prospects in the minors. They’ll just keep them there long enough to avoid getting a full 3 years service.

DG Lewis
8 years ago
Reply to  Rally

If a player spends 20 days or more in the minors, he will fall below the 172-day threshold for a full year of service. (If he spends less than 20 days in the minors, he accrues MLB service time for the time he’s in the minors.) So top prospects would join the club in the fourth week of April instead of some time in June.

8 years ago

The unmentioned reason for the draft pick compensation is an attempt to level the playing field between teams with tons of money and teams without tons of money.

Unless MLBPA is willing to move closer towards a salary cap system, I don’t see the teams on the lower half of the economic spectrum agreeing to anything that would help shuffle the best players to the teams with the most money to spend. And I don’t see the MLBPA agreeing to anything that puts a cap on what the big money teams are able to spend on player salaries.

matt w
8 years ago
Reply to  munchtime

Even when a small market team has a top free agent and can afford to make him a qualifying offer, the system isn’t that beneficial to the small market team. The sandwich round picks they get aren’t that likely to turn into impact major leaguers.

8 years ago
Reply to  matt w

A sandwich pick is worth more than nothing, regardless of how you feel about the quality of MLB draft prospects beyond the 30th pick.

Paul G.
8 years ago

I always thought the loss of pick was to (a) give small market teams something to remain competitive when they cannot re-sign their own free agents and (b) try to encourage players to stay with their team as their team would not lose a pick for re-signing them. I do not find either of those motivations to be nefarious. But, yes, sometimes the big market teams end up the beneficiaries and owners like money.

If you want to dump this system, keep in mind that teams with money are going to benefit more as salaries go even higher and price more players out of the reach of small market teams. There is a bigger issue than draft picks lurking.

8 years ago

Draft pick compensation is not stupid and is not a problem, The draft pick penalty is a problem for the players, but not stupid since it helps suppress salaries for free agents so it works for the owners . What is stupid is MLBPA giving into the owners as their share of the revenues has dropped for 50+% to low 40’s% from the turn of the century.

8 years ago

Why not go when step further and just eliminate the draft? Questions about legality aside, its entire purpose is to lower wages for players and reward teams for trying to lose.

Calvin Liu
8 years ago

The compensatory picks may not be superstar picks, but they’re not worthless.
If said system is removed, this means the lower market teams get nothing at all for big budget teams picking off free agents. How exactly is this better?
The only real fix for the system is to have MLB manage to lump all regional cable deals into one pool as has been done with free TV.

8 years ago

This is the dumbest thing I’ve read in a while and I was just looking at MSN “news” before this article. You think the off season transactions are what interest the fans? What interests me is good baseball and part of that is having teams other than the Yankees, Red Sox, Dodgers dominate with their bottomless pockets. As everyone else has pointed out the object is to try and have some sort of parity. I personally think their should be a salary cap, but that’s a whole other story. The draft pick compensation helps in a very small way to keep a little parity. If you’re not excited seeing teams like the Royals or Orioles playing in the post-season because of solid team play and hustle and would rather watch an aged all-star team the Yankees could piece together I don’t know what to tell you. Sounds like maybe you’re not the person to be speaking for the “fans”.