MLB Wants an International Draft. Here’s Why It Shouldn’t Happen.

The draft has driven great Puerto Rican athletes like Angel Pagan away from baseball (via SD Dirk).

The draft has driven great Puerto Rican athletes like Angel Pagan away from baseball (via SD Dirk).

Major League Baseball established its amateur draft in 1965, nearly a century after the birth of the National League. It has been so successful that MLB has said that expanding to an international draft is a major priority. But would that be a good thing?

Before the establishment of the draft, every player signed a contract with a team, and due to baseball’s reserve clause, that team had exclusive rights to that player’s services unless it sold or traded the player. Many teams signed numerous young players and stashed them in the minor leagues, leaving them down or calling them up as they pleased. The player had no bargaining rights, and as long as he wanted to play in the majors, he would have to accept whatever salary that team deigned to give him. His only other choice was retirement. The reserve clause was finally struck down in an arbitrator’s decision in 1975. Nowadays, all amateur players are subject to the same draft pool, and available to every team.

The draft also brought a major financial benefit to the teams. Free agents can negotiate with every team in baseball, while draftees can negotiate with only one, which drives down prices considerably. However, the draft  applies only to players in the United States, Canada and Puerto Rico. Major League Baseball would like to expand draft eligibility to players in many other countries.

Broadly speaking, the international draft is something that owners want and players do not, that Americans want and non-Americans do not. The details of implementation are almost impossibly complex, particularly because many people are skeptical about whether the draft would benefit those countries. The idea of an international draft has been seriously discussed for at least a decade. But it has remained in limbo because no one can agree on how it should work.

In recent years, many Puerto Ricans have argued that baseball in the territory has suffered considerably since the 1990 establishment of the draft there, and officials in other countries have been notably apprehensive at the prospect.

In Latin American countries outside of Puerto Rico (and the closed society of Cuba), prospects are signed as free agents. The official minimum age at which a player can be signed is 16, though younger players can be brought into baseball academies before signing an official professional baseball contract. By contrast, in Puerto Rico, as in Canada and the United States, only players with the equivalent of a high school diploma are eligible for the draft. This is actually a big deal. Younger players are always more in demand than older players: a 16-year-old who can throw 90 mph is a lot more desirable than an 18-year-old who can throw 90 mph, because the 16-year old has more growing to do, and he may add more velocity to his fastball as he gets older and bigger.

There are also only 40 rounds in the draft, so a team can bring a maximum of 40 new draftees into its system every year, while there is no limit to the number of free agents that a team can sign. Meanwhile, each American player drafted takes away a slot that could be used to draft a Puerto Rican or Canadian player.

(Before 2012, there were more than 40 rounds. Famously, Mike Piazza was drafted in the 62nd round in 1988. The latest a player has ever been drafted was in 1996, when Aron Amundson was selected as the 1,740th overall pick in the 100th round.)

Before the amateur draft was established in 1965, there were many more minor league teams than today, filled with players signed off semipro teams and school lots, some of whom would make it and the vast majority of whom would not.

In 1942, Yogi Berra was signed as a 17-year old dropout playing part-time American Legion ball in St. Louis, and working the rest of the time at a local shoe factory. As Allen Barra recounts in his biography of Berra, the Yankees’ bullpen coach showed up at Berra’s parents’ house, offering a contract to play for the Yankees’ Class B farm team in Norfolk, making $90 a month with a $500 bonus.

Of course, the dollars are different, but outside of Puerto Rico, Latin American teenagers are still signed as international free agents, and they’re often signed after they and their families develop a personal relationship with the scouts who sign them. In 1999, when 16-year-old Miguel Cabrera was seen as the top international prospect, numerous teams trekked to his parents’ dirt-floor house in Maracay, Venezuela, some offering in excess of $2 million.

As the Orlando Sun-Sentinel reported, he signed with the Marlins for $1.8 million for personal reasons: because he admired Venezuelan shortstop Alex Gonzalez, because his family became close with scout Miguel Garcia, and because Miami is closer to Maracay than any other major league city.

Cabrera is exceptional; every team knew and wanted him. The majority of Latin teenagers are signed for relatively little money, so teams must depend even more on the personal connections and scouting acumen of the people on the ground. And the 16-year-old players must likewise depend on these scouts and trainers to bring them their best chance at a livelihood.

Unlike in Berra’s day, there are no Class B teams in the minor leagues, or Class C or Class D. In an essay called The Minor League Pyramid, Bill James commented on the significance of the disappearance of so many franchises in the low minor leagues. Essentially, he wrote, as minor league teams came under greater control by major league teams, which could pluck their talent at will, many minor league teams ceased to be viable economic entities in their own right.

As a result, while previously the minor league system was “pyramid-shaped” — many teams at low levels, with fewer and fewer at higher levels and a single major league team at the top — the minor leagues came to resemble “a school system,” where players proceeded from class to class, Low-A to High-A to Double-A, so that the highest levels consist of a few top prospects and a lot of retreads and washouts.

James believes that this makes it harder for players who are not tabbed as future stars when they are teenagers to make it to the big leagues. Rather, these max-effort players have to work harder to get noticed and overcome the initial lack of expectations — players like Enos Slaughter, Pete Rose and Brandon Inge. He believes that more of these players were able to succeed when there were more minor league teams.

This is one reason that many scouts and baseball people in Latin America worry about a draft: they worry that it would cap the number of players who get a chance to play professional baseball. In fact, many Puerto Ricans believe that is exactly what has happened in their country since 1990, when the amateur draft expanded to include Puerto Rico and Canada.

“If you go to school here, and don’t get drafted in high school, the chances of getting drafted are zero,” says Alex Cora, a former major leaguer who is now the general manager for the Caguas Criollas in the Puerto Rican League. “They don’t get a second chance.”

Another problem is that there are not many full-time scouts in Puerto Rico. “The organizations rely more on area scouts. They ask them to scout Puerto Rico from Florida,” explained Cora. “They just go to showcases. Most of the scouts here, they stay in the metropolitan area, San Juan.”

One possible reason for the lack of full-time scouts is the draft calendar. In the Dominican Republic, scouts can sign eligible players as soon as they see them, at any time of the year. But in Puerto Rico, as in the mainland United States, players can be drafted only one month out of the year. Moreover, the fact that each team has just those 40 draft slots means most will be used for highly scouted, highly touted American prospects, so teams are unlikely to draft many Puerto Ricans.

If the draft were to expand to other countries, teams might make similar decisions to economize elsewhere. “In smaller countries like Nicaragua or Panama they might go to part-time guys,” says Ben Badler, a writer for Baseball America who has focused on Latin American prospects. “I don’t see many jobs in jeopardy, but I know it is a concern that there may be a change.”

The biggest reason that Puerto Ricans oppose the draft is that they see fewer of their countrymen in the major leagues than ever, while the proportion of Dominicans has risen greatly. In 2012, The New York Times reported that San Juan, the capital of Puerto Rico, no longer had a team in the Puerto Rican Baseball League. “No one here disputes the diminished stature of baseball in Puerto Rico,” writes reporter Jorge Castillo, “and most agree on the culprit.” The draft.

In 2008, Rep. Jose Serrano, a Congressman born in Puerto Rico who represents a heavily Hispanic district in the Bronx, addressed an open letter to Commissioner Bud Selig, writing, “I believe that baseball should begin by ending the draft in Puerto Rico and return to free agency.”

Of course, the situation in the Dominican Republic and elsewhere in Latin America is hardly ideal. As 16-year old players like Cabrera command multimillion-dollar bonuses, there are major economic incentives to commit fraud. In 2008 and 2009, a wide-ranging MLB investigation into allegations of bonus-skimming in the Dominican Republic led to many baseball executives resigning or being fired, including White Sox player personnel director David Wilder and Nationals general manager Jim Bowden. One of the main cases involved a player whom the Nationals signed as a 16-year-old named Esmailyn Gonzalez, who turned out to have been a 20-year-old named Carlos Alvarez Lugo.

Simply adding the draft on top of a corruptible system will not necessarily fix things. “If anything, a draft just raises more questions about age and identity in investigations,” says Badler. “You have investigations that take five to six months, sometimes longer. If you have a draft, you have to address questions like, what if you draft a guy and he has a false age? Or age inconclusive? That puts risk on a team, of whether or not to accept it.”

Additionally, 16-year-old players who sign with a team and don’t make the majors miss out on a great deal of education. The draft is open only to high school graduates, which means that Berra wouldn’t have been eligible. That is a major advantage of the draft, says Edwin Rodriguez, a former manager of the Marlins who managed the Puerto Rican national team in the 2013 World Baseball Classic.

“They sign an average of 1,200 players from the Dominican annually,” says Rodriguez, who notes that many players begin at the age of 14 in one of the “baseball academies” that major league teams have established. “Only three percent of those players have the chance to travel to the United States. So the other 97 percent, they stay there without an education, they stay in the Dominican with no place to go — they’re already professional, so they can’t play in high school and college. I’m in favor of the draft because they have to earn a high school diploma.”

There are other problems with the academies. In 2013, Mother Jones investigated the death of an 18-year old Washington Nationals prospect named Yewri Guillen. Mother Jones found that the Nationals, like 21 of baseball’s 30 teams, had no certified trainer at their facility, and his family was too poor to afford care at an expensive local private hospital, and so Guillen’s bacterial meningitis went undiagnosed until the disease had progressed too far to be treatable.

The problem in many Latin American countries is not the presence or absence of the draft: it is endemic poverty and insufficient infrastructure. This is not Major League Baseball’s fault, but because baseball is a major part of the economy in all of these countries, it is in the position to create powerful economic incentives.

To some degree, the international draft has already been used as a bargaining chip. In 2010, The Los Angeles Times reported that the threat of a draft had helped Sandy Alderson, then in the commissioner’s office, to receive greater cooperation from government officials in the Dominican Republic. The newspaper quoted Charles Farrell, a former sportswriter who founded a Dominican baseball academy.

After years of foot-dragging the government has offered to help license and regulate buscones, the independent scouts who find and develop most Dominican players and whose operations have been responsible for much of the fraud and drug use.

“The international draft, at this point, is a leveraging tool for Alderson,” Farrell said.

The draft is a leveraging tool because it stands to significantly limit the amount of money entering these countries. That is, of course, the reason that owners like it. It’s also the reason that most people in Latin America are opposed. But they are not at the bargaining table, because the draft is a part of the Collective Bargaining Agreement between baseball’s owners and the players union. The biggest reason it has not been implemented is that it is almost impossible to figure out how.

Of course, the international draft would include not only the Dominican Republic and Venezuela, the two countries that produce the most international free agents. It would also include countries like Japan, Korea, Taiwan and Mexico, which have their own professional baseball leagues. Perhaps trickiest of all, Major League Baseball would have to determine how to treat Cuban players.

Aside from the thorny issues of how each individual country would be brought into the fold, numerous other questions remain to be answered. Badler noted nine of the most important and the 2011 Collective Bargaining Agreement noted numerous others in an addendum. Every last one of these will need to be negotiated.

For example: Are any countries exempt? What will happen to the Latin American baseball academies — and how will baseball ensure the players actually get an education? What happens to undrafted or unsigned players? Will there be one draft or several? What will be the age of eligibility? What are the rules regarding representation by trainers and agents? How will signing bonuses be regulated? How will player identities be verified?

It has been three years since the 2011 CBA and none of those questions have been resolved. It will likely take many more years to answer them all to the satisfaction of Major League Baseball and the players union, to say nothing of all of the individual countries involved.

It is, in short, a logistical nightmare, and while Selig targeted it as a major priority, he will be long out of office by the time the 2016 CBA is signed. His successor may not feel as strongly, instead opting for the far easier course of refining and stiffening the restrictions on international free agent signings. A complete international draft may just be too difficult to put in place. Yet a piecemeal approach, adding one country at a time — as with Puerto Rico — will please nobody.

“How are you going to do it?” asks Cora. “I’ve been thinking about it for the last three years. And every time I think, ‘Oh, this might work,’ I realize: ‘No — that won’t work.’”

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Comments

  1. Steve said...

    I guess that I’m naive, but I for some reason thought that a portion of these baseball academies was actually a school for these kids. Shame on MLB teams if this isn’t the case. The cost for a teacher in these countries is literally negligible to a MLB team. I understand that the MLB isn’t a charity organization, but if you are scouting and accepting 14 yr old children into your academy, you should be required to school them as well.

  2. said...

    Nice article! Enjoyed the read. Very well balanced.

    While I feel for the PR prospects who lose hope and moves on, the MLB is not in the business of making dreams come true for a lot of people. It is a tough business.

    As noted, a lot of young men try to make it and miss out on their high school education trying to live the dream, and unfortunately, not that many are capable of doing it. And definitely, if players are missing out on their education playing baseball, the MLB should be helping them get through school, much like how some draft picks ask for money for college as part of their signing package, so that they can go back to school when their playing days are over. Or like in the entertainment business when they hire tutors to teach the young actors on set so that they are not missing out on their education.

    But some type of reform is necessary. Look at the list of Latin prospects who got $1M+ and you will find a lot more prospects who don’t do much of anything in the majors. For every Miguel Cabrera, there are dozens of failures, most don’t make the majors, few even contribute much, fewer still ever start. If there were a draft, that money would have gone to the guys who continued to develop in high school, and who would be closer to reaching the majors, who have actual realizable talent. I don’t think baseball has that much issue with giving out this money, as long as they are getting some value back. The record here is not good, from what I’ve seen of BA’s Top 10 signing lists.

    If they are athletic enough, and love the game enough, they will continue playing in high school and be good enough to get drafted in the draft. I love Pete Rose, and think he belongs in the HOF, but it costs a team a lot of money to carry all these players who never amount to anything, fans always forget about the other costs involved with finding your baseball stars. And frankly, it is much easier, relatively, to make good money in a lot of other sports, like track, basketball, football, there are no minor leagues there, when you make it to the top there, you are in the majors, but in baseball, you still need to slog through 4-6 years in the minors unless you are really good. And all that is money that is never discussed.

    For example, one thing that drives me crazy is when someone points to, say, Trout, and note that he only got a $1.2M bonus, how cheap that is. That’s like saying you only paid $1 for your lottery ticket winner when accounting for all the losing tickets pushes you in the red. What that ignores is the whole player development process, for every Trout you find, you find dozens more who never even make the majors or at best get a cup of coffee in the majors. For every Posey there are numerous Beckhams (both Gordon and Tim).

    The total cost in terms of signing bonus, when you account for all the misses as well as the hits is probably closer to $20-30M, which is still cheap for Trout, but it’s not pocket change either. And that don’t include the costs of supporting all the organizational players who are playing alongside them, who will almost never make the majors, their salaries and other benefits (albeit fewer than they should get, but that’s another story).

    And I don’t see why professional leagues like Japan and Korean have to be mixed into the draft. Any professionals in other countries should have their own arrangement with the MLB. Perhaps this will encourage investment in Latin countries for professional leagues that can develop their players much like what happens in Japan or Korea, then the MLB can have a separate arrangement with them too. That’s a loophole to avoid the draft, but would give them the chance to be their country’s Pete Rose as well.

    Yes, there are a lot of issues to be worked out, but that doesn’t mean that the draft is not the right thing to do.

    • said...

      Most bonuses are in the thousands, not the millions, whether it’s the amateur draft or international scouting and signing. Comparatively few players get paid Trout/Beckham bonuses — and they’re the players whom everyone agrees are talented. Moneyball is about identifying diamonds in the rough, people around whom there is no consensus. The more of those guys a team hits on, the more successful it will be. But the minor league system currently makes it very hard for those players to even get into the system, let alone succeed, because there are only so many spots in rookie league and Single-A, and five-tool players and pitchers who throw in the upper 90s are so vastly preferred.

    • Matthew Murphy said...

      Even ignoring the superstars, a league-average player under team control pre-free agency will generate a net value of around $40M. So even if a team were to hand out $1M signing bonuses to 20 players and only found one MLB-quality player they would still be getting a significant return on their investment.

      • Steve said...

        It only took three responses before someone on the players’ side mistakenly applied fangraphs’ $/WAR value. That value is strictly for use on competitive free agents,. You know: the least common and least efficient means by which MLB clubs acquire talent. A league average player under team control pre-arbitration is worth far less than $40M in real dollars. That number probably closer to $4M than $40M. Given that the typical “MLB quality” player is also easily replaceable the $40M figure is just ludicrous. It would be crazy even if you were talking about the average top 100 prospect. The guess that one in 20 players is going to become a MLB quality player is also crazy given how many international free agents get signed to minor league deals. The average team adds over 100 players each year between the draft, undrafted free agents, and international free agents. Only in rare cases do 5 of those players even reach the majors, much less stay in the majors until free agency.

        Also the author mistakenly characterizes the average minor league system. It is true that team no longer characterize their teams as B, C and D, but between short season ball, rookie ball, the Gulf Coast League and the Dominical Summer League, that’s exactly what those teams are. The average major league team has 8 minor league teams (AAA, AA, A+, A-, short season, rookie, GCL, DSL).

  3. Tomcat said...

    MLB should expand the academy system buy out the franchises who have invested and fund the talent development and acquisistion process through the rev share money. That way they can standardize the intake and treatment of these players, and add things like education and medical care to the adgenda.

    • Tomcat said...

      sorry for the misspelling but I for one would like to see an African and Asian academy program introduced. Somewher in the Congo or India or China is the next Yu Darvish, Ichiro or Miguel Cabrera why not plow the increased revenue into finding them

      • Steve said...

        Maybe, but no one currently plays baseball in India, China, or the Congo. So in order to find the next Ichiro or Miggy, MLB would literally have to teach an entire country the game of baseball from the ground up. I just don’t see the owners spending the millions of dollars that would be necessary to do this. Especially when the fruits of these actions wouldn’t be seen for at least 10 years (and that is probably overly optimistic) and these mostly old white men will probably not be around to see it anyways.

        It is a ton easier to go to one of these undeveloped countries and find a basketball or soccer player because athletic freaks of nature translate much better to those games. Also you can practice individual skills with only a ball and a goal for soccer and basketball; in baseball not so much. How does one evaluate the hit tool for a player if he never sees more than a 75 mph fastball?

        I’m not saying that it couldn’t be done, but I doubt there is the will to make it work out there now.

  4. Richie said...

    Why couldn’t the current draft include whomever from wherever? No ‘free agent’ signing of anyone from anywhere until they’re 18, but if you want to draft some 17-year-old from Curacao, knock yourself out. Or just no signing anyone until he declares himself for the next draft, then if he goes undrafted, sign away.

    Isn’t this exactly how the NBA does it?

      • Richie said...

        If there are ‘X’ amount of spots available in the minor leagues, then clubs will sign ‘X’ amount of players in order to fill those spots. Drafting everywhere will simply reallocate some of those spots away from ‘free agency’ places back toward Puerto Rico and the US. Maybe. It can’t do a blessed thing more than that unless you believe it will somehow motivate clubs to cut minor league teams or said roster sizes.

      • Richie said...

        It’ll reallocate those signing bonuses to the clubs and the players (in the form of whatever concession they get from ownership in return for agreeing to it). If you’re against it for that reason, fine. But “can’t be done”?? That just seems nuts. The NBA manages it just fine, but MLB couldn’t?

      • said...

        Major League Soccer couldn’t do an international draft, either.

        There are professional baseball leagues in numerous countries that would not want to allow their players to be taken away from them.

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