Sides dig in for battle over slotting in draft
With the relationship genial as ever between Major League Baseball and the players’ union, it stands to reason they’ll figure out how to bridge their philosophical differences on an amateur draft overhaul that includes pre-determined bonuses for each pick.
After surveying a cross-section of executives, agents and representatives of MLB and the union, one thing is certain: It’s not going to be that easy.
On one end is Rob Manfred, MLB’s chief labor negotiator and an advocate of the so-called slotting system that assigns a fixed dollar value to every draft pick. While MLB desires an international draft, sources said its implementation remains extremely unlikely for the next collective-bargaining agreement, which will replace the one that expires Dec. 11.
The slot issue, however, is one MLB will not concede without a fight.
“It continues to be an important component of the overall reform of amateur talent acquisition we want to achieve,” Manfred said.
On the other end are the agents that help advise the MLB Players Association’s brain trust, and the mere idea of a slotting system this week evoked laughter, anger and outright dismissal among them.
“There is no way,” one agent said, “there will be a slotting system.”
“Never,” another agent said. “Never, ever will happen.”
Somewhere in the middle sit the players, the MLBPA’s truest voices and, in all likelihood, the ultimate arbiters of the draft slotting debate. Former union chief Don Fehr called this a “wedge issue” for good reason. While the Washington Nationals gave Stephen Strasburg(notes) $15.1 million and Bryce Harper(notes) $9.9 million as the No. 1 overall picks, veterans went unsigned or fetched less than anticipated. It sent a bad message: Big money, previously the domain of union members on 40-man rosters, instead was going to unproven kids.
At the same time, the union is certain its players will overlook the big dollar values at the top for the empirical fear: Any sort of a cap on salaries, even for amateur players, opens the Pandora’s box for MLB to suggest one in other facets of the game.
True or not, it’s the union’s party line, and it’s not changing.
MLB implemented an amateur draft in 1965 to curtail the exorbitant bonuses going to amateur players and stifled the market for the next 25 years until agent Scott Boras helped Brien Taylor negotiate a $1.55 million bonus as the No. 1 pick in 1991. The thaw in bonuses continued for the next 20 years, even as the commissioner’s office instituted recommended – but unenforceable – slots, to which only foolish franchises adhered.
The increase in bonuses has scared teams away from the best available player and allowed superior talent to slip because of signability concerns, a problem for a draft supposedly designed to distribute talent evenly. It’s also something agents do not believe slotting would solve.
“Slotting will never work because the men who are trained to evaluate this game – it handcuffs them,” Boras said. “It also does not recognize the revenue increases that change annually in the game. It also does not recognize the potential for a decline in revenue. The fact that there’s flexibility for the experts to manage this – that’s the best thing that can happen.”
The benefits of a slotting system for MLB aren’t terribly compelling. For a sport that in recent years has lost some of its best athletes to football, the lure of large bonuses keeps some players from jumping. Bubba Starling and Archie Bradley, two projected first-round picks this year, signed with Nebraska and Oklahoma, respectively, to play quarterback, and will command higher-than-recommended bonuses to keep them off campus and on the diamond. For top-end talent, teams usually don’t balk.
They spend around $200 million on the draft every year, and between 40 and 45 percent of that goes to picks in the first two rounds. Even if MLB wants to depress the market by $50 million, it’s scant savings, not even $2 million a team, surely not enough to offset what they’ll have to give up to get a slotting concession. There are no guarantees, either, that the money saved via the draft would go to major leaguers. The union’s aversion, though always money-oriented, is more about why MLB would push so hard for something with such little tangible value.
Nevertheless, it could have an effect on the draft, which starts June 6. Some scouts believe their teams plan to spend big this year, throwing big dollars at high school players in late rounds with hopes of swaying them from college commitments. If indeed slotting comes into effect for the next collective-bargaining agreement, industrious owners willing to take a risk could ration some of 2012’s budget to 2011.
At the same time, one AL general manager believes that’s backward thinking.
“We have the leverage,” he said. “If a high school player doesn’t want to sign for a million dollars in the first round, the chances of him getting more than that, coupled with the opportunity cost, coupled with the time-value of money – all those things factored in, it’s not close.”
Another point: With same-slot compensation – if a team can’t sign a pick in the first three rounds, it receives that same pick, one spot later, the next year (i.e. Arizona didn’t sign Barrett Loux, the sixth overall selection last season, and it is picking seventh this year in addition to its regular pick) – teams that don’t sign early picks could do so next year at a discounted rate.
Meanwhile, the negotiating goes on behind closed doors, with the union weighing what, exactly, it would need to justify a concession on slotting. Is an increase in the number of arbitration-eligible players enough? Larger major league rosters? Anything?
“I’ve always felt like the union cares less about [slotting] than they do anything else,” the GM said.
“No. Freaking. Way,” another agent said, sure to emphasize and enunciate each word.
The chasm isn’t surprising. The early stages of collective bargaining tend to perpetuate extreme positions and muscle flexing. Only this is an issue with little compromise available.
Just like in most games of slots, there may be no winners.