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Now, though, MLB, by punishing those teams who exceed slot money, is limiting the ability of its teams to compete not only with one another but also with organized football.
Either Anthony Alford is worth millions as a baseball player or not, but the football angle has nothing to do with it.
If Alford's not worth "millions as a baseball player" then obviously you don't offer him that much no matter what the alternative is, but if he's worth "millions as a baseball player" but also "millions as a football player", it's reasonable to think he'll cost you more than a kid whose next-best option is studying refrigerator repair at the local community college
Understood, but the "millions as a football player" is both pure speculation and a minimum of three years away. (After some quick Googling, it seems Alford was rated as around the tenth-best HS QB in the 2012 class. That probably makes him an NFL prospect for 2015 or '16, but he probably shouldn't be spending his NFL earnings just yet, either.)
but in most cases the player's worth to baseball is far, far more than what they're trying to get away with paying him right now.
Alford's actual football prospects are irrelevant. What matters is his perceived football prospects.
No, what matters is his perceived baseball ability/value. His football ability, for which he can't receive NFL compensation for at least three years, is little more than a bright, shiny distraction.
Of course, they shouldn't offer either more than $1M. But they should offer the football player more than the refrigerator repair man. So, yes, Alford's perception of his football ability is absolutely relevant to what the Blue Jays should offer him.
The overwhelming majority of baseball draft picks are akin to your "refrigerator repairman," but that doesn't stop MLB teams from offering and paying huge signing bonuses.
I don't know much about football, but it appears that Alford is a slightly better baseball prospect (36th-best in the draft, per BA) than football prospect (10th-best QB in class of 2012), while not being a truly elite talent in either sport (i.e., a top-five pick). If his perception of his future NFL prospects is out of whack, then the prudent course of action for TOR is to walk away rather than try to "buy him away" from football.
The big signing bonuses usually go to guys who aren't akin to the refrigerator repairman--they're HS seniors with offers to play at top colleges, or college players who haven't exhausted their eligibility.
If he's willing to accept a bonus which, no matter how high, is less than the value that the Blue Jays think he'll bring to their club, they shouldn't walk away. If he won't sign for less, sure, they should.
And then what are their options after college? To get drafted by MLB again, or to play in Japan, Mexico, or the indy leagues. MLB essentially enjoys monopsony power over them.
Yes, to potentially get drafted by another team. It's not about MLB having monopsony power over them. It's about what power the drafting team has over them.
If I read the article right, Alford was picked in the 3rd round. His bonus is (effectively) capped at something well below $1 M. That's the "problem".
But doesn't the NFL have a slotting system too?
But, yes, Joe I think you can say the "average" draft pick is underpaid relative to value. The Pirates pretty much blew everybody else out of the water spending $49 M over the last 4 drafts. But that only requires 9 WAR combined (at today's prices) in their first 3 years of service to break even on that. (OK, maybe 10-11 WAR after you factor in 3 years of min salary).
Kids play the sports they like to play, not the sports that have the most long-term financial upside for them. (Anthony Alford is just the latest example of this.) Otherwise, millions of American kids wouldn't be playing soccer or lacrosse or running track, and great 5-foot-10 high school athletes would be playing baseball instead of point guard or wide receiver.
If MLB wants to get more of the Anthony Alfords, it needs to get them at age 7 and 10, not try to "buy" them at age 18.
Baseball should also give its teams the freedom to buy any kid who prefers football away from that game if they want to meet his price.
But I think baseball would be doing marginally great-er if they didn't limit the capacity of teams to acquire the best amateur talent.
It seems like a major stretch to suggest MLB is hurting itself in any way by losing an occasional kid like Alford.
If players aren't drafted and compensated according to ability, there's really no sense in having a draft at all.
I don't see why. It seems entirely obvious that occasionally losing talent hurts the game. Maybe not more than marginally, but it hurts the game. There is no upside whatsoever, and a small downside. It's dumb.
There's a huge gap between a non-rigidly-slotted draft and a pure free agent system. [...] I don't think that a draft becomes senseless if it isn't rigidly slotted.
I just don't see the logic behind paying the 36th-best player in the draft as if he was the third-best player in the draft just to keep him from playing football — especially when his football value is entirely theoretical anyway (i.e., 3-4 years down the road).
But in an odd and relatively recent development, whenever amateur talent is involved these days, normal market and business principles go out the window and people become spendthrifts.
When a guy comes along who has more leverage than a typical prospect - perhaps because he's willing to forego baseball for another sport
But that's not really leverage. Alford's only true leverage is his baseball ability.
Of course it's leverage. In a monopsony labor market, the ability to walk away is some of the best leverage you have. In a monopsony labor market, you need leverage in order to get value for your talents - otherwise you'll usually be wildly underpaid compared to a more free market.
What I dispute is your claim that this has been happening regularly, that teams have been foolishly overpaying for amateur talent. [...] I dispute the characterization that "business principles" have gone "out the window".
And in return, players' rights and salaries are largely under team control for years, regardless of how well they play. Teams win in aggregate.
Joe, would you argue that teams should control a player's rights in perpetuity upon drafting? That would lead to some of the outcomes you're suggesting...
I just believe MLB's compensation system is severely out of whack when kids like Correa and Gausman have more money in the bank on Day 1 than actual MLB players often have after three or four years of ML service.
If the quoted text is true for players who have the ability to walk away, then why isn't the reverse true for players with no or limited options? What explains Carlos Correa getting $5M, or Aaron Crow getting $3M out of an independent league? MLB made them multimillionaires despite the fact MLB was their only real option.
Why do you keep saying MLB is their only real option? MLB isn't the one hiring Correa. The Houston Astros are.
Correa has the option to go the University of Miami. He has leverage, in that he can turn down the Astros and return to the draft in three years. The more attractive one's options are, the more leverage he has, and the more you should be willing to offer him.
The reason I say business principles have gone out the window with the draft is because MLB has almost total control over the global amateur baseball market but still finds itself making millionaires out of players who don't make it out of A-ball.
The only reason players like Correa have come to expect millions of dollars is because MLB teams have foolishly been paying it. If MLB teams had the sense to band together, for a single year, the landscape would be much different. If the No. 1 pick in the draft suddenly got $500,000 instead of $7 million, what would happen?
The last 20 years of draft history tell us that, given the choice between a big check and sitting in a classroom for 3 years, 98 players out of a hundred will take the check. This idea, peddled by "experts," that a 10 or 20 percent reduction in signing bonus money would suddenly result in players heading to college en masse is just silly.
Even assuming his only career options right now are in pro baseball--and realistically, therefore, with an MLB organization, the Astros are competing with 29 other teams for his services.
That would be illegal. And yes, collusion by employers keeps wages down. I don't see how that says anything about proper salaries in a non-collusive market.
The Blue Jays don't care whether players would head to college en masse. They care about whether Anthony Alford would.
How are the Astros competing with 29 other teams? The Astros drafted Correa and have what amounts to exclusive control over him until June 2013. The only way the Astros are competing with 29 other teams is if we suspend disbelief and pretend that Correa would spurn a $2M bonus check, head off to college for anywhere from one to four years, and then reenter the draft. Twenty years of draft history tells us there's maybe a 1-in-50 chance that Correa would make such a decision.
I'm not making a moral argument here; I'm making a business argument. (And the draft is "collusive" by definition.)
Right, but instead of holding the line on an occasional Anthony Alford, the industry started spending like drunken sailors, to the point that Stetson Allie gets $2,500,000 to flame out in A-ball and people just shrug. Nowhere else in business, sports, or entertainment does such a spending model exist.
Anyway, our long international nightmare is over. Jim Callis is reporting that Alford will be signing with the Blue Jays for between $450,000 and $800,000, with the Jays allowing him to continue playing football. (The wisdom of the latter is debatable, but I'll leave that for another time.) Once again, the "signability" business went right out the window as soon as a kid was presented with a very large check.
The only way the Astros are competing with 29 other teams is if we suspend disbelief and pretend that Correa would spurn a $2M bonus check, head off to college for anywhere from one to four years, and then reenter the draft. Twenty years of draft history tells us there's maybe a 1-in-50 chance that Correa would make such a decision.
It depends on what Correa and team think the market will look like in 1-4 years; will bonuses shrink, rise, hold steady over that time? Also, I bet there's a tendency for the player to overvalue how they'll be regarded in the future - few predict much of a chance that they'll implode over that time.
So, if you're talking halfing, cutting by two-thirds, etc... bonuses - and it's not being done unilaterally by all clubs - then I'm pretty sure 1-in-50 seriously understates the number of guys who'll wait to sign.
The catch is that you need more than just one or two teams to be hardliners ...
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