Even accounting for inflation, Reichardt’s $205,000 bonus — roughly $1.6 million in today’s money — pales in comparison to what today’s No. 1 draft picks can hope to make. But the more valuable comparison is to the money contemporary major league veterans were making in the 1960s, in the time before collective bargaining agreements between ownership and the player’s union. In 1967, the final season without a CBA, Major League Baseball’s minimum salary was $6,000 and the average salary sat at $19,000. Nothing puts Reichardt’s massive bonus into perspective, though, like the fact that he got nearly twice as much as 1964’s top-paid player, Willie Mays, and his $105,000 salary.
Baseball’s response to Reichardt and the rest of the bonus babies was the institution of the MLB Draft, and while it did not “eliminate the bonus” as Rickey so desired, there was an immediate impact. Rick Monday, the first overall pick of the first draft in 1965, earned $100,000. By taking away amateur prospects’ ability to negotiate with multiple teams, baseball owners were able to slice top bonuses by more than half.
The draft has continued to serve this purpose well. Yes, Stephen Strasburg’s record setting $15.1 million guarantee was a boatload of money, but the growth in top amateur signing bonuses absolutely withers next to the growth in major league salaries. Three players will make $30 million or more in 2017 (Clayton Kershaw, Zack Greinke and David Price) and the average salary is up to roughly $4 million, a whopping 210 times more than it was 40 years ago. It also pales in comparison to the growth in MLB’s revenue in that span, as baseball has gone from a multi-million dollar industry to pulling in $10 billion in 2016.
Over the past decade in particular, major league ownership has taken Rickey’s old advice to heart. The draft did a great job of eliminating what Rickey would have called “self-destructive competition” among teams for amateur talent, but savvy teams looking for a competitive advantage still managed to find ways to leverage cash to acquire prospects. Whether it was by going above recommended slot for draft picks or shifting money into the international free agent market, big bonuses were still very much a part of the league’s reality.
The last few collective bargaining agreements have systematically closed off all these loopholes. The 2012 CBA instituted a bonus pool for the draft based on recommended slot values, limiting teams’ abilities to entice prospects away from college with over-slot offers. An international bonus pool was instituted, with heavy penalties for overages (which rich teams predictably flouted). Both of these policies made it much harder for small market teams to use what little money they had to acquire impact amateur talent — the penalties for investing in that talent were too prohibitive.
These changes left teams with one truly open market in which to invest in fresh talent: international free agents like Cuban defectors and Japanese and Korean imports. The new CBA finally closed that market as well. Although the owners didn’t get the international draft they were seeking, they got something just as good: a hard cap of “$5-6 million per season” to spend on international free agents.
The limited competition from an international draft would have had a similar effect — players like Miguel Sano receive their multi-million signing bonuses only because of frenzied bidding wars for their services, as was excellently displayed in the documentary Pelotero — and from a labor perspective, there’s hardly a difference in the two policies. At least with the cap, players can choose their employers, but the earning potential of young prospects, particularly those from Latin America, will be significantly hampered.
Who was going to fight for them? None of these groups — domestic amateurs or foreign players of any age or experience level — have any representation at the bargaining table. But while we could certainly scold the Major League Baseball Player’s Association for not fighting harder for their future members, the root of the problem is ownership’s conception of amateur baseball players as assets as humans. Rickey’s assessment of the bonus problem clearly shows his take on the issue, again from The American Diamond:
It is bad for the boy, say an eighteen-year-old youth, to come into possession of unheard-of sums of money, unearned to begin with, and probably ill-spent to end with… Something for nothing may be an objective among many slothful, unthrifty segments of our people, who seem to believe that the world or the nation or the community owes them a living, but it has no place in baseball because it tends to damn the player, wreck the club, and bankrupt the owner.”
Rickey’s contempt is barely concealed. By describing these bonuses as “something for nothing,” he does not ascribe any value to the skill of amateur players or the hard work they put in to become a talent worthy of huge bonuses. This was the same philosophy behind his creation of the minor league farm system, first with the St. Louis Browns in the 1910s and later with the St. Louis Cardinals.
As Kevin Kerrane writes in Dollar Sign on the Muscle, Rickey had a fundamental principle: quality out of quantity. “The competition among so many young players in the system operated as a kind of natural selection, and it kept constant pressure on the veterans at the top,” Kerrane wrote of Rickey’s farm system, which was so expansive as to contain more than 30 teams, including entire minor leagues, in Rickey’s tenure in St. Louis. “He was able to bully and bluff major-leaguers, bound by the reserve clause, into absurd salaries. The minor-leaguers could be left on the farms until, as Rickey liked to say, they ‘ripened into money.'” By eliminating the bonus, the last semblance of risk for teams operating under the model Rickey pioneered with the Cardinals — which is to say, every team since the mid-20th century — disappears.
The consequences for the game go beyond the royal screwing of the young labor pool. The cap on earnings potential for young athletes created by the major league draft was a huge influence in the shift of players, particularly black players, from baseball to football and basketball. Due to the lack of minor league systems in those sports and the wide availablity of college scholarships and under-the-table payments at the amateur level, there is much more money available much more quickly in other sports, making the decision to eschew baseball an easy one for many elite athletes.
The competitive implications of removing risk from the amateur talent acquisition process are unfortunate as well. By taking away the ability to press a competitive advantage in scouting through the draft or international free agency, teams now have fewer ways of finding the kind of impact talent that can take a franchise from a cellar dweller to a contender. The only way to ensure access to top-level talent will be to tank for one of the league’s worst records and get an early pick in the draft, resulting in lost years that threaten to force fans to disengage from their teams.
But perhaps what I worry about most with the changes brought about in the latest Collective Bargaining Agreement is a dilution of the game’s culture. The infusion of talent from across the world into major league baseball over the past three decades, whether from the Dominican Republic and Venezuela, Japan and Korea, or from the newly opened territory of Cuba, has brought the kind of baseball played and celebrated in their countries and cultures. It has been crucial in keeping baseball fresh.
I fear that a CBA that puts a hard ceiling on the incomes of foreign players will deter top-level talents from leaving their domestic leagues to come play in the United States or from picking up baseball altogether. I fear it will stifle the growth of baseball in countries new to the game, like Brazil, which showed promise in the World Baseball Classic but may not have the financial incentives to draw athletes away from sports like soccer or basketball.
Ownership never will eliminate the bonus, but owners have done their best to cap and restrict it. That’s all well and good for profit margins, but who else wins? Major league players won minor concessions like a shorter disabled list, more off days, and a higher minimum salary. The cost? Players at every lower level across the globe lost significant bargaining power, dynamic foreign stars like Shohei Otani may be dissuaded from bringing their talents to major league baseball and teams have fewer ways to upend the competitive balance through shrewd or innovative spending on amateur talent.
We’re all happy there won’t be a lockout or a work stoppage, but it’s otherwise hard to find the positives in the changes in the newest agreement. To protect the owners from their own thriftless ways, the agreement threatens to dilute baseball’s talent pool and divert money from the pockets of a largely poor work force into the well-lined coffers of the teams. That may be business as usual for MLB dating all the way back to Branch Rickey’s heyday, but it’s disheartening all the same.