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Draft Pick Compensation Newsbeat

Monday, February 22, 2016

For Orioles, Yovani Gallardo worth the risk ... and the draft pick

On Saturday, the Orioles reportedly reached an agreement with the free-agent hurler on a three-year deal. In addition to the $35 million they’ll pay Gallardo, the Birds must forfeit their top pick in this June’s draft by virtue of the fact that Gallardo received and rejected a qualifying offer from his old team, the Rangers.

That lost pick—which in Baltimore’s case is the 14th overall—helps explain why Gallardo, a former All-Star who has started at least 30 games in seven straight seasons and is just 29 years old, went so long without striking a deal: Teams prefer free agents who (A) don’t come with draft strings attached (think Johnny Cueto or Scott Kazmir) or BB) have so much star power that it’s easy to look past said draft strings (Zack Greinke). Just because Gallardo doesn’t fall into either category doesn’t mean the Orioles made a bad move by signing him, though.

I think the Orioles got a steal of a deal here and it appears to be because of the draft pick compensation. How does Ian Kennedy get twice as much guaranteed money otherwise?

Russlan thinks deGrom is da bomb Posted: February 22, 2016 at 12:08 AM | 28 comment(s)
  Beats: draft pick compensation, orioles

Tuesday, February 02, 2016

Owners are worried about tanking. Which is something they themselves created. – HardballTalk

Tanking as an issue is much ado about nothing. Teams already pay a price for tanking. Attendance and ratings drop. 

Now, however, there is a lockstep relationship between losing and the draft. If you’re not going to make the playoffs, it’s clearly better to lose 105 games than 95. at a certain point it’s in a club’s best interest to simply wave the white flag and position itself for three years from now. Unless and until that relationship is reduced in strength, that incentive will persist.

If, as Olney says, owners are angry about taking, which one of them is going to propose that they chuck draft slotting and bonus pools first? And if mid-range veteran free agents are going to be miffed that they’re still unsigned in February — or if they’re going to be upset with how an allegedly tanking team goes about its business — which union representatives are going to go back to what Michael Weiner thought about the topic back in 2009 and go back to the business of opposing salary caps in all forms?

Gentlemen: start your negotiating.

As Buster Olney noted in his column , “Some of the concerned teams link the question of tanking to the ongoing conversation about revenue-sharing, according to sources. Owners of large-market teams believe small-market teams should allocate funds provided to them to improving their on-field product. Instead, in some cases, those dollars have been used for debt and for partner and executive payments. Some small-market owners believe they should be able to use the revenue-sharing funds as they see fit.

The possibility that some teams which get revenue-sharing dollars might be taking the money and still structuring their rosters to lose rather than spending it to improve has inflamed the ire of some big-market clubs.”

So, the issue isn’t really about tanking or the draft, it’s about money big market teams give to small market teams.

Jim Furtado Posted: February 02, 2016 at 09:58 AM | 42 comment(s)
  Beats: draft, draft pick compensation, economics

 

 

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