THE BOOK--Playing The Percentages In Baseball

1.  Allow trading of draft picks.
2.  Come up with a realistic method of ranking players for compensatory draft picks.
3.  Stop this absurd slotting talk, which bullies some mid-level (eg. picks around ~15 overall) teams into not taking the top talent available.

That’s a start.  Still having a hard time with rich teams drafting the good players and paying them a lot, but that’s really no different than anything (e.g. free agency).

long time listener, first time poster. What about allowing teams to trade draft picks? It’s very common in other sports and I’m surprised MLB doesn’t allow it.

Scrap the draft entirely.  All non-contracted players are free agents.  Do away with revenue sharing, and replace it with a pooled amount of money that is distributed to teams annually for acquiring new players.  Teams can use it to sign kids from the US or foreign countries, but may not use any of their own money.  Teams that make the playoffs get less than those that don’t. 

If a team wants to go balls out on international kids and just ignore Americans, they can.  If a team wants to just sign every player from their home state and scrap their international scouting department, they can.  If a team wants to sign every kid who throws 95+ and ignore position players, they can. 

It takes away the competitive advantage that the big markets have in reloading their farm system and encourages teams to out scout each other instead of out spend each other. 

Not exactly what you were looking for, but it would work way better than a draft.

I think letting any kid over 18 enter whenever he wants is a good start. (Currently I believe College Freshman and Sophomores are not allowed to enter the draft.) After that I agree, put a cap on it, let teams sign whomever they want and abolish the draft is an even better idea. I’ve long advocated it in the NFL and NBA so why not here. As long as there is a cap I think it is a great idea. Although a potential problem is that I would wonder how willing top prospects are going to be to sign with Pittsburgh or Kansas City.

David C., I love the idea of creating what amounts to an auction draft for the new talent, but the regulation could be a nightmare. Under the table dealing would be rampant.

http://www.nypost.com/seven/08152008/sports/sportsshorts/nhl_losing_on_radulov_124543.htm

The Post has learned that Medvedev also informed Bettman that the KHL would hold a universal draft for the 2009-10 season that will include players currently under contract in the NHL. Medvedev told Bettman KHL clubs will offer signing bonuses of $1M to players who are playing in the NHL this season.

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Jon/1: compensatory picks?  For signing free agents?  Go way outside the box here.  Why even have comp picks?

Dave/3: now that’s a good start.  Instead of slotting players (effectively salary cap), you are advocating a payroll cap for draft picks.

Trying to extend that, I’ll say it should be a payroll cap for a 3-yr period.  It could be that one year you really are not targetting any great player, so you will be left with alot of spending room.  That spending room should roll over.  Or, say 75% of the spending room gets to roll over.  Or, have a 3-yr period to spend your 3 years of payroll money.  Something like that.

This works out neat, in a Herschel Walker kind of way.  You can basically blow your whole 3-yr payroll amount on say a Junior or ARod, etc.

As David/5 said, this could also effectively be an auction, where you buy in chips, have a limited number of chips (which you can carry over, or maybe carryover a certain percent every year), and each year you have a chips to dollar conversion.

You can give out more chips to teams that don’t make the playoffs, or scale it based on lose%.  If the average team gets 5MM to spend, a team that loses 60% would get 6MM and a team that loses 40% gets 4MM.  Probably cap it at 3MM and 7MM.

I like that…

I don’t like the idea of giving more money to losing teams at all. It’s de-incentivizing success.

If you want to put small- and large-market teams on a level playing field, award money based on actual market size, i.e. metro-area population and/or TV market size. The smaller your market, the more money you get. But we should be trying to reward teams for actual on-field success, not punish it.

Anthony/7: I hear you.  It’s not a reward system, but a rebalancing system.  An estate tax if you will.  Or some sort of communist system.

How about an auction?  Just a thought.

-- every team has a cap with which to buy draftees.  The cap can be higher for the worse teams and lower for the better teams. 

-- every potential draftee can set a minimum which he will accept.  He doesn’t have to, but he can.  That minimum is public. 

-- the draft is an eBay-like auction.  A preliminary round of bidding takes place with a fixed expiry.  There is a small but positive minimum bid.  (Of course, any player could have set a higher minimum bid if desired.)

-- at expiry, the player with the highest current bid is finalized first.  All teams have five minutes to bid.  When he expires, the next-highest goes up for bid for five minutes, and so forth, until everyone is gone or every team has used its cap.

-- to encourage bidding in the preliminary round, the team with the highest bid at the end of that round receives an extra sum ($100,000, say) to bid on that player.  Or, that team has the right of last refusal at the end of the five minutes, although that might be too big an advantage.

-- teams can trade away part of their draft salary cap to other teams.  They have to send the money along too, not just the cap space.

-- if a player is not bid on at his reserve price (or he goes unbid on entirely), he can wait until next year, or offer himself at no signing bonus.  All teams get a crack in reverse order of standings.

There are several advantages; one one is that teams with a limited budget for signing bonuses don’t have to waste a first round pick on someone they have no chance to sign.

Ever play that Christmas party game where each present can be stolen up to three times?  I’ve wondered what would happen if the draft was like that.  Suppose, for example:

* Each player can be “stolen” three times, that is, each player can be drafted by up to four teams.

* Once a player is drafted, he can only be drafted again within the next 30 picks (one round).

* If a player you’ve drafted gets “stolen”, you can either choose to keep your pick and compete with the other team for his services, or you can immediately pick someone else.

I have no idea if a system like this would make the distribution of talent more fair or less fair, but it would certainly make the draft a heckuva lot more interesting.

The NBA draft I think works really well (not the lottery system, the draft itself). The signing bonuses are pre-determined, and there’s no griping and drama about signing. The MLBPA won’t go for this, but it seems to work well.

If that doesn’t work, I love Dave Cameron’s idea

Abolish the draft.  No auction, cap, or money pooling would be necessary if the relationship between MLB teams and their minor league affiliates was terminated.

If teams were only allowed to control 40 or so players, top prospects would be driven to smaller market teams that could afford to take more risks with their roster.  Mid-tier prospects would be driven to independently viable “minor league” squads.

Minor League teams, by and in large, wouldn’t be viable without their relationship to MLB clubs.  Most minor league teams are subsidized by MLB in order to stay in business.  It would work for some teams in some markets, but there’s no way you’re making a profit in Pulaski, Virginia, no matter how good your marketing campaign is. 

Without large signing bonuses as a carrot to sign professionally out of high school, kids would simply choose to go play college ball rather than piddle around nowhere towns for next to no pay.  So, you’d have minor league teams folding left and right because they couldn’t pay the bills, and even the ones that could survive would have a tough time convincing legit prospects to play for them in lieu of attending college. 

It wouldn’t work.

I suspect that you are correct in that a number of minor league teams would go under.  So?  I don’t know the figures, but I would guess only about 10% of minor leaguers ever make it to the bigs anyway.  What’s the upshot? A lot more kids going to college.

Maybe two or three minor leagues end up making it as an alternative who for prospects so inclined.  A rise in local amateur leagues would ensue, most likely…

I’m not seeing a big problem here.

Also, the minor leagues that do survive become much more competitive, and in turn, more than likely financially viable.

Why don’t you just have a lottery for the entire draft where everyone has the same chance to get each pick within one round?  Basically ignore win-loss records.  This would help prevent the cyclic nature of team talent that we often see today.  Sure it might create an unbalanced system for small market teams but if we add a salary cap to the league then everything could work out fine (although the luxury tax is pretty much an effective cap).

You could do the lottery a few weeks in advance and then allow teams to trade picks and players.  I wouldn’t allow money to be traded unless it was to pay part of a traded player’s salary although I’m still not sure about this.  I basically don’t want to see a team selling top picks.

There are a few topics where I can definitely see both sides. 

Slotting draft pick bonuses is a pretty bad system.  Allowing teams to sign willy-nilly is also just not fair to some teams that just don’t have the cash other teams do.  I like the idea of the MLB using a percentage of revenue sharing for the draft.  These funds would represent a matching fund that the teams could use to pay for players.  If the teams don’t use the money for the draft then 50% would roll over to the next year to encourage the teams to all use it.  The matching funds would also make the teams pay a little themselves so that might make them spend money with some intelligence.

I also don’t like the FA compensation picks they give out these days.  I don’t have a great answer but there really isn’t a great way to figure out how good a player is.  Which stat do we use or do we just let MLB decide?  I say let the market decide.  If a player is paid like the top 10% of FA in the league then that is a high compensation pick.  If he is paid like the top 25% of FA then it’s an ok comp pick.  I’m assuming yearly salary would work best for this but maybe total deal length should get factored in too somehow.

"Or some sort of communist system.”

I’m reminded of a conversation I had with David Pinto.  We discussed whether the product is the league or whether the products are the individual teams themselves.  While I’m generally a free-marketeer, if the product is the league, then it might make sense to implement some sort of communist system if it makes their product better.  I’m just not convinced that it makes sense (yet), since marketing of baseball implies that the product isn’t the league, it’s the individual teams.

But MLB isn’t run as an all-in-one package, like the NFL seems to.  I remember a few years ago Randy Vataha’s company GamePlan tried to buy the entire NHL with the plan to merge it into a single a company.  I wonder how that would have worked out.

Internationalize the draft and cap the bonuses. No more slot “recommendations” that are ignored, have actual limits that teams must abide by.

Also, re-structure the free agent compensation system. Lose a Type A and sign no one, get a supplemental first. Lose a Type A and sign a Type B, get a supplemental second. Lose a Type A and sign a Type A, get nothing.

Cool article by David on the compensation system:
http://ussmariner.com/2008/08/17/free-agent-compensation-2/

Thanks for posting that, Tango. I agree with his assessment of Goal #2, but disagree with Goal #1 to an extent.

Better teams do have better players, which is a result of higher payroll and better scouting, though you can’t force teams to identify talent better.

And I can’t remember the last time a small market team declined to offer a player arbitration in fear that he might accept. However, a few years ago, the Padres offered arbitration to some of their free agents on the condition that the free agents wouldn’t accept. Sometimes teams prefer the draft pick(s).

When it comes to competitive balance, nothing short of a salary cap and floor will have any type of significant effect.

http://www.fangraphs.com/blogs/index.php/abolish-the-draft

It’s basically the payroll cap of the NHL, but applied to the non-pro players.

In post 6, I was going even further, and allowing teams to “rollover” money, maybe at 50% or 75% from the previous year, or “buy ahead” at 125% or 150% of the next year to the current year.

Say that the Penguins draft Crosby, and they know it’s going to cost them a fortune (presuming rookie cap doesn’t exist).  So, they take 5 million out of their next year’s allottment, and add 4 million to this year’s allottment.  And maybe they had 3 million left over from last year, and get to add 2 million to this year.  (Companies for example do this kind of banking for vacations, where you are allowed to carry over at 100% but a maximum number of days.) So, if the Nats are unable to sign Strasburg, they get to rollover say the extra 15MM they had left over, and count it at 10MM.

Slotting is ridiculous because the talent level in the draft is not so spread out relatively speaking year-to-year.  Note that slotting is fine for the lower rounds, since the Strasburg issue won’t happen there.

(The rookie cap that the NHL has for example is just as ridiculous, especially since the European players have viable alternatives.)

We need some order, otherwise it becomes a huge free-for-all.  What you can do is take 90 players out of the draft altogether.  All those players are available to open bidding using the allocated funds (plus any banking). 

After that, you go through a regular draft with slotting.  The minimum bid for any of the 90 players is whatever the slot money for the 91st player is.  If the player gets no bid, he goes into the draft for slot money.