First, let me put on my contrarian hat and say that I think people claiming that legitimate two sport athletes will now choose college football or basketball over professional baseball are probably really overstating the case. It’s true at the margins that baseball needs to worry about this potentially happening now, but as far as the truly elite athletes go, baseball is still the rational sport to play. Top picks in the draft can still expect to get nine figure signing bonuses, which is obviously more than you can make in college sports and outstrips the value of the full ride scholarships available in football and basketball. And since the new system caps spending through a total pool of money instead of hard slots by draft position, the elite of the elite in the draft will likely still command hefty bonuses. In other words, though it may push their bonuses down, the Joe Mauers and Bubba Starlings of the world will still get a lot of money to sign with a professional baseball team and, for them, baseball remains the rational choice over football, from a financial standpoint.
As I see it, there are two primary areas to be concerned about when it comes to the issue of a talent drain. The first is in the third to tenth rounds, where a lot of the overslot spending is happening now. Roughly speaking, teams have found value in going over slot in these rounds to sign more talented high school players, getting them into their minor league systems instead of sending them off to toil in college baseball. This has been a hugely positive development, especially where pitchers are concerned. In the minor leagues, the goal is to turn you into a good major league player, with coaches evaluated on what kind of progression young players make under them. Everyone’s invested in your future, in other words, and winning as such is a secondary concern to making the players better prospects. And where pitchers are concerned, looking out for the health of their
moneymakers arms is a big part of that.
College baseball has the exact opposite dynamic. The coaches work for the universities, not major league baseball teams, and have no direct incentive to concern themselves with the players’ major league prospects. Their job is all about winning in the present, and given that players are inherently limited by their college eligibility, they become highly fungible assets, and the logical thing for a career minded coach to do is burn through everything they can give him while they’re in college without regard for what they have left when it’s time to move on. With pitchers, that means abusing their arms in borderline sadistic ways (if you think I’m being unfair, pay close attention to some of the crazier workloads coaches pile on their best pitchers come CWS time). The concern here for MLB should be that, by giving these mid round picks more of an incentive to bide some time in college hoping to get picked higher in the draft at a future date and thus earn more money, they’ll be sending more talented young pitchers off to the NCAA meat grinder, and the overall quality of MLB pitching will ultimately suffer for it.
The second, and biggest, concern is what happens to the Latin American talent pool in the face of capping the amount of money teams can spend on international free agents. At present, teams with a large presence in the region have opened training academies to identify and train the most promising young talent, and in exchange they’re signing a lot of young players relatively cheaply. It’s a deal that has largely worked out well for everyone. For the teams, it’s a ready supply of talented young athletes who can be signed relatively cheaply, and the clubs who do it right see a substantial return on their investment. For the players, getting into a training program is one of the few avenues to social advancement in the Dominican Republic. Training comes with food, room and board, better nutrition (which takes on even more importance for youngsters at that stage of physical development), and education. For the ones that sign contracts for amounts that seem relatively cheap by the standards of signing bonuses (say, $50,000), it’s provides a pretty substantial increase in living standards.
But with spending on these bonuses capped, incentives for the teams change dramatically. The prospect of investing in training players, only to have those players sign with other clubs will significantly reduce the clubs’ impetus to invest in Latin Ameican talent development (and this is doubly true since the amount of “pool money” available will be staggered based on a team’s performance the year before, meaning that successful teams will be allowed to spend less money signing international amateurs), and this alone will obviously push the talent level down. But in sheer monetary terms, decreasing the amount of money floating around in the baseball industry in these countries will necessarily push more talented athletes there away from baseball and into soccer or international basketball.
Ultimately teams know all of this, which is why several national reporters were quoting “team executives” who didn’t like the new rules yesterday. But Bud Selig and Jerry Reinsdorf like it, no matter its impact on the game, because it tamps down the cost of amateur players and represents at least a small amount of redemption for their embarrassing failure to impose a salary cap on the players back in 1994. And the current players like it because they believe this means more money will flow to them instead of amateur players who they openly feel don’t “deserve” the money they get. That won’t happen, of course. Most of the saved money will simply wind up in the pockets of owners, especially as the inability to stockpile talent cheaply strains the ability of small market teams to compete and thus puts a dent in their revenue streams, but even if it would improve the lot of mediocre big leaguers at the expense of amateur players, that should be seen as a bug, not a feature. The Mark Ellises and Juan Riveras of the world might be better off for investing money in replacement level veterans rather than investing it in the high end talent of the future, but the sport and the industry as a whole certainly doesn’t benefit from such an arrangement.
But today’s players clearly don’t care about that. For quite some time, the MLBPA did a good job of holding their players in line against the salary cutting tendencies of the owners, and held that line on the broad economic interests of amateur and minor league players as well, eschewing the tendency to increase their earnings on the backs of their less powerful and unrepresented brethren. Those days appear to be over, and in the long run, that may be the most important important aspect of yesterday’s announcement. I’ll have more on what this means for the current and future MLBPA on Monday.