Playing the Slots - Revisited

Commissioner Selig and his friend Mr. Fehr made it official tonight: the players and the league have struck a new labor agreement that will run through 2011. The new Basic Agreement needs only the formality of ratification, which is a foregone conclusion, in order to become the law of the baseball land.

Well hallelujah! Apparently $5 billion or so in annual revenues is enough to make everyone happy - I always wondered what the magic number was, now I know.

Among other things the new Basic Agreement ensures that the outcome of the All-Star game will continue to determine which league's World Series representative will hold home field advantage. (I thought I would pick the least significant provision and highlight it - I'm ornery like that.) Check out MLB.com for an excellent summary of the new Agreement - makes sense, doesn't it, that MLB.com would do a nice job summarizing the MLB labor agreement?

Way, way back in January of 2006, I wrote the column, below, for this site concerning the issue of bonus slotting in the baseball draft - apparently no one took note of my brilliance and, instead of addressing the problem directly, in the inimitable way that the league and players do business, opted instead to address it indirectly. Instead of creating bonus slots for each spot in the draft, the new Agreement calls for teams who are unable to sign their draft pick in one year to receive same-slot compensation in the next year's draft. And, the time to sign draft picks will be much shorter - teams will be required to sign their picks by August 15th, rather than, as it stands now, allowing them the entire year after the draft to sign.

With no ceiling on bonuses, the best players will still not necessarily be selected by the worst teams, thus the point of the draft, to create talent balance in the league, is still not being effectuated. The fact that a team will have a chance to pick in the same slot next year if they can't sign this year's selection doesn't solve the problem: why would the Royals or the Devil Rays be any more likely to sign a pick next year when they couldn't sign a pick this year?

And, while players will now know by August 16th whether they have been signed or not by the team that selected them in the draft, some players will still go unsigned and will miss out on a year of development in a Major League system. Thus, my concerns have really not been addressed by the changes in the new Agreement and, unfortunately, the league and the players have missed an opportunity to fix this flawed system.

Somehow I'm not surprised.

Take a look at my column, below, and see if you agree.

(Update - the League and PA are trying to put a happy face on the new draft rules, but I'm not buying. From what Baseball America is saying, apparently it was the PA that put the kibosh on bonus slotting as an option - nice job guys, very nice. The PA has decided that the marginal difference between free market bonuses and slotted bonuses is more important than certainty and development for its players. As usual, cash is king.)

Commentary - Playing the Slots
(originally published 1/6/06)

Seven months later, this crumb falls off the table at the end of a story in the Journal News: "[a]fter months of inactivity, the Mets are negotiating with Scott Boras to try to get right-hander Mike Pelfrey signed before spring training. Pelfrey was the team's first round draft pick last June."

June? Looking back over the shoulder, squinting the eyes and craning the neck forward, standing on tiptoes, it's hard to see June anywhere. June is a distant remembrance and a wistful thought on a cold night, all at once.

And with Groundhog Day creeping ever closer, Mike Pelfrey brings to mind Phil Humber, another ace Mets pitching prospect draftee who took what seemed like forever to sign with the team - only to tear up his arm to the tune of Tommy John surgery shortly thereafter. You can almost imagine Mike Pelfrey in a quiet moment, perhaps after a throwing session that included a tweak or a twinge, ruminating on the fate of Humber, and hoping that a similar scenario isn't lying in wait for him.

One could argue, of course, that Humber's injury was not necessarily connected to his late signing date at all. And in the pantheon of baseball holdouts, Humber's is a happy story - he signed a $3.7 million dollar deal, after all, more money than most of us make in a lifetime. The landscape is littered, however, with young men of some remarkable talents that weren't so fortunate. Just ask Matt Harrington. Or Jeff Allison.

The easy target for any anxiety or frustration with the Pelfrey situation is his agent, Scott Boras - especially when one considers the havoc that Boras has wreaked with the first-year player draft in the past. Boras represented the three players who have held out the longest after being chosen in the draft, traditionally held in June, pitcher Jered Weaver and shortstop Stephen Drew in 2004, and catcher Jason Varitek in 1994.

However, arguing that Boras is the problem with the draft is the equivalent of blaming the lawyers for the shortcomings of our legal system: it's an easy answer, with a lot of fire and brimstone, but not a very intelligent one. Boras, like the aforementioned lawyers, works within the confines of a previously established system, one not of his making, and he exploits its weaknesses for the benefit of his clients. That is, after all, what he's paid handsomely to do, and he's the best there ever was at it.

Is the system broken? Not by a long shot - just in need of a little maintenance, a little less, even, than many commentators believe. There is a simple solution to the problem, and the league and the Players Association should work together to make it a part of the collective bargaining agreement sooner than later: bonus slotting, a map of bonus parameters for each selection slot in the draft.

Over the past five years, or so, the teams have, apparently, made an attempt to abide by informal slotting directives from the league, with varying levels of success depending on the year, and the team. However, when there are players who hold out for an entire season, losing an important development year, like Weaver and Drew, then it becomes obvious that a problem exists with the system. When you have a guy like Matt Harrington, who passes up two chances to sign multi-million dollar contracts and is now working retail somewhere, it tends to indicate that a glitch is monkeying up the process. Informal slotting isn't working.

Despite what the league may tell you, the unsuccessful holdouts of Weaver and Drew are not a bright shining moment for informal slotting. Yes, the teams made offers and didn't move during negotiations, thus forcing the player to sign for the team's price in each instance. However, these two players lost an entire year off their baseball lives - a year that could have been spent refining skills, a year less at the end of their careers to play the game. That doesn't sound like a victory, it sounds like an unqualified defeat - for the players, and the league.

And then, of course, there is the weird, wild story of Luke Hochevar, selected 40th in the 2005 draft by the Dodgers. Hochevar, an All-American at the University of Tennessee, and widely regarded as one of the best pitchers in the draft, is represented by Scott Boras - thus the disconnect between his selection slot and his prodigious upside. According to Baseball America, last September Hochevar briefly switched representatives and was close to signing a deal with the team, then changed his mind and went back to Boras - during this series of events, he likely took some action that eliminated his college eligibility, losing the most important chip he held in negotiating a deal with the team, and probably costing himself money in the process.

Ultimately, the primary issue is this: why are the league and the Players Association allowing young men to be victimized by a flawed system when a very simple fix exists? The Players Association will tell you that it's a slippery slope when you start putting restrictions on how much money a player can make, they'll tell you that a free market system benefits the players more than a slotting system. And the league? They obviously haven't come up with a tempting proposal - which is their obligation, at the end of the day, because the overall health and well- being of the league and its players is being affected by the draft's deficiencies.

Many commentators agreed that Mike Pelfrey, Craig Hansen and Luke Hochevar were the three best pitchers in the 2005 draft. Of course they went 1-2-3 then, right? Wrong. Pelfrey, as we know, went ninth to the Mets, Hansen was selected 26th by the Red Sox, and Hochevar was, again, picked 40th by the Dodgers. Pelfrey and Hochevar are still unsigned, while Hansen, also a Boras client, signed a deal and contributed at the major league level with the Sox at the end of the season. This is not, of course, the first time that the best players were ignored by the teams picking first.

Can you imagine Peyton Manning being selected toward the end of the first round of the NFL draft? Reggie Bush being projected to go late first round, early second? LeBron James falling to the Lakers, or the Spurs, because the Cavaliers weren't willing to pay him? In the context of other sports, where the particular systems have mandated certain compensation for certain spots in the draft, the idea that the best players being selected in the draft would go to the best teams is ludicrous.

The financial issues that result in players like Hansen and Hochevar being picked so low, by teams like the Red Sox and Dodgers, are defeating the very purpose of the draft itself. The original intent of the draft is to create parity, to allow the lesser teams to re-stock with the best players, however without any formal context for the payment of these players, the lesser teams are unwilling to select the best players because they know that they will be subject to a holdout and, in the end, either pay them too much, to the detriment of the franchise, or lose the selection when the player re-enters the draft after going unsigned. The intent of the draft has been thoroughly undermined.

Some baseball observers seem to think that allowing teams to trade their selections is essential to remedying what ails the draft - thus the lesser teams can get value for the high selection spots, since they aren't picking the best players in those spots anyway. Talk about defeating the purpose of the draft altogether - this is not really a solution as much as it is a capitulation.

No, the only truly viable solution to the problem is the players and the league sitting down and hashing out bonus parameters for each selection spot or round in the draft. This will create "cost certainty" - a phrase we heard often during the NHL lockout last year - thereby allowing the lesser teams to select the best players, knowing exactly how much money will be needed to sign them. It will also eliminate the unsavory specter of a player overvaluing himself, either on his own or with the "help" of an agent, and then getting left out in the cold, or missing out on a year of baseball.

Too difficult? Just ask Luke Hochevar, or Mike Pelfrey, or Jered Weaver, or Matt Harrington about difficult. Sitting out a year is difficult. Selling televisions instead of throwing fastballs is difficult.

Sitting down and being reasonable human beings in the interests of baseball and its players? Not difficult at all.