How Allowing Draft-Pick Trading Would Impact MLB's Balance of Power

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How Allowing Draft-Pick Trading Would Impact MLB's Balance of Power
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What jersey would 2013 No. 1 overall selection Mark Appel be wearing if MLB allowed teams to trade picks?

Oh, the possibilities.

Imagine if Major League Baseball combined the primary aspects of the yearly June draft (i.e., selecting amateur talent) and the annual July trade deadline (i.e., dealing big-name big leaguers and top-notch prospects).

That's pretty much what would happen if the sport chose to allow teams to swap draft picks.

While that scenario hasn't yet come to fruition, there seems to be a growing sentiment toward moving in this direction at some point in the fairly near future, perhaps even by the time the current Collective Bargaining Agreement is set to be renegotiated after the 2016 season.

If nothing else, the possibility certainly exists.

Even though it's a theoretical concept that's still at least a few years away, it's a worthy exercise to at least consider the implications and ramifications.

Because such a scenario is both fun and frightening, given that any large-scale alteration to the fabric of a sport brings with it the potential for circumstances that are simultaneously fresh and unforeseen.

Certainly, letting teams use draft picks as tradeable assets would help the MLB draft itself, for many reasons. But what about the bigger picture when it comes to baseball's competitive balance, specifically with regard to small-market and big-market teams—would the gap between the two shrink or expand?

Mike Stobe/Getty Images
Commissioner Bud Selig is proud of baseball's parity, which could be impacted by making draft picks tradeable assets.

For all the enticing endeavors, there would be just as many slippery slopes. As such, if MLB were to adopt full-on draft-pick trading, there would need to be some restrictions to keep things in check. For parity's sake.

To keep the fanciful flowing, let's bring up a few different possibilities and talk through them.

 

Possibility No. 1: The Draft-Pick-for-Money Trade

Should teams be able to swap selections for cash?

The financial feasibility would be arguably the biggest issue up front because unlike most other major professional sports, baseball doesn't have a salary cap. Teams can spend what they want, more or less, to obtain and pay readily available talent.

Sure, commissioner Bud Selig has implemented deterrents and spread-the-wealth policies like the luxury tax and revenue sharing over the years. And while those certainly have had an impact—you've heard of the New York Yankees' ongoing attempt to get under the $189 million team salary threshold by 2014 to avoid paying a steep luxury tax yet again—they're more you-should-do-it-this-way guidelines than hard-and-fast rules that must be followed.

But what's to stop a deep-pocketed team from hurling tens of millions of dollars at the club with the No. 1 overall pick? Especially in years when the top talent is a can't-miss, once-in-a-generation type like, say, Stephen Strasburg or Bryce Harper?

Brad Mills-USA TODAY Sports
How much would big-market teams like the Yankees, Dodgers or Red Sox have paid to get a chance to pick Bryce Harper in 2010?

This would be similar to what happens when a player from Japan's Nippon Professional Baseball goes through the posting process, and we've seen how that has played out before.

Only two offseasons ago, the Texas Rangers forked over a record $51.7 million to the Nippon Ham Fighters for the right to negotiate with star right-hander Yu Darvish.

That's essentially what would be happening here—purchasing the opportunity to sign the top amateur player in that year's draft. Sounds like something MLB would want to avoid for the sake of competition, no?

One pre-emptive fix would be to cap the amount of money a team can trade for any one draft pick, which might be reasonable enough now that there are actual assigned dollar values tied to selections: Just set the maximum amount of money that can be traded at the same price as that slot's bonus figure.

For instance, if the Los Angeles Dodgers wanted Mark Appel, they could have offered the Houston Astros a lesser prospect or two along with up to $7,790,400—the full assigned pick value of the No. 1 overall selection—for a shot at Appel.

Frankly, that could still get messy, as some of baseball's more frugal owners—to put it nicely—might decide they'd rather have an extra $5 or $10 million in their pockets than spend it by gambling on some teenager who might not help the team for a handful of years, if ever.

Steve Mitchell-USA TODAY Sports
MLB might have to plan to prevent greedy owners like the Marlins' Jeffrey Loria from trading draft picks for cash.

Perhaps, then, the solution to all this would simply be to prevent teams from being able to trade draft picks for cash considerations altogether.

 

Possibility No. 2: The Win-Now-and-Forget-the-Future Trade

Another factor that is unique to baseball is that the draft is actually held during the course of the regular season, while teams are in the very heat of competition. Think about how that could impact decisions on draft day if picks were allowed to be traded.

It could certainly lead some clubs to abandon the long-term for the short-term because of desperation, couldn't it?

Pretend the Pittsburgh Pirates—you know, the franchise with the longest streak of consecutive losing seasons in the history of major North American professional sports—had the ability to swap one of their two first-round draft picks (Nos. 9 and 14) back in June.

They easily could have received a very good major leaguer in exchange for either selection, the kind of player who could help them in their quest to get above .500 for the first time since 1992.

Jared Wickerham/Getty Images
Would Pirates GM Neal Huntington have traded one of his team's two first-rounders to push for a winning season in 2013?

But would that be the right choice, the smart choice?

Small-market clubs, like the Pirates, are exactly the ones who need to take advantage of acquiring young talent on the cheap—at the draft.

But these are the same teams that often feel the most pressure to win now—while they can—because they never know when that chance could come around again.

Unlike the pick-for-money issue, though, there isn't exactly an easy solution or action for the league to step in and prevent this sort of thing from happening.

In fact, who's to say the league would even want to? Maybe Selig and Co. would prefer that Pittsburgh make just such a trade in order to have the personnel to make a push at 82 wins.

Ultimately, teams have to make their own choices.

 

Possibility No. 3: The Stocking-Up-on-Draft-Picks Trade

Draft picks are an inherently valuable commodity. Teams need them, teams want them, teams covet them.

That's why, for example, we saw the Yankees make no real attempt to re-sign free agents Nick Swisher and Rafael Soriano after the 2012 season—but not without first tendering them qualifying offers, which they promptly rejected for big-money, multi-year deals elsewhere.

That ensured New York would pick up very valuable assets in two extra draft picks at the tail end of the first round (Nos. 32 and 33).

David Richard-USA TODAY Sports
Rather than re-sign Nick Swisher, the Yanks waved goodbye to a productive player to score an extra draft pick.

If the Yankees, who are only the highest-salaried squad in MLB for like the eleventy billionth straight year, are willing to go that route, don't you think other, less financially stable organizations would jump at the chance to accrue as many selections in the draft as possible via trades?

That might be a good thing for competition—or it might not.

It could work because, again, the draft has proved to be a savvy way—and a cheaper way—to construct a club. So if next year the Tampa Bay Rays traded, say, Matt Joyce, for a third-round draft choice, that might be the prudent thing for head honcho Andrew Friedman to do.

Joyce's salary, after all, jumped from a Rays-friendly $500,000 in 2012 all the way to $2.45 million in 2013, as he became eligible for the first of three pay hikes via arbitration, and it's only going to go up again next year.

Kim Klement-USA TODAY Sports
Because of a very limited budget, Rays decision-maker Andrew Friedman would be a candidate to stockpile draft picks.

But does baseball want that sort of thing to start happening with regularity?

Wouldn't it be dangerous to watch teams like the Rays or the Oakland Athletics or the San Diego Padres—those who have teeny-tiny budgets or who are constantly rebuilding—just start selling off actual major leaguers and not even get prospects (i.e., professional players) in return, but rather positions in a player-selection process?

If you think the Houston Astros and Miami Marlins rosters are rough to look at now, it could get worse.

A suggested fix here could be to put a limit on the number of picks any one team can trade for. Maybe it's a maximum of five overall. Maybe it's more. Or maybe it's some sort of sliding scale, where teams can acquire via trade, say, only two picks within the first five rounds, three more picks from Rounds 6 through 10 and no more than four after that.

Whatever the solutions to these three possibilities might be, they aren't yet known because they don't have to be.

Draft picks, for now, can only be traded in a limited capacity. Funny enough, the ones that can be swapped just so happen to be called competitive balance picks because they're awarded, via a lottery, to the 10 smallest-market teams and the 10 lowest-revenue clubs.

Proving the final possibility above to be true, some of the picks already have been traded. Would you like to guess which team was involved in the two trades?

That's right—the Marlins.

In the first deal, they sent their 2013 competitive balance pick (No. 39 overall) to the Detroit Tigers as part of the Anibal Sanchez-Omar Infante trade that netted Miami young right-hander Jacob Turner, as well as the Tigers' selection at No. 73 overall. In the other trade, they picked up the Pirates' competitive balance selection (No. 35 overall) by moving first baseman Gaby Sanchez last July.

Cary Edmondson-USA TODAY Sports
Jacob Turner was part of MLB's first-ever trade that included draft picks.

That's just one example of one of these possibilities starting to come to fruition. Frankly, there are plenty of other possibilities—and loopholes—that wouldn't even be exposed until after draft-pick trading comes to be, whenever that may occur.

That's a scenario that's looking more and more likely to happen, which is extremely exciting for baseball, the only major pro sport that doesn't allow teams to do what they want with all of their draft picks when it comes to wheeling and dealing.

It's also something that MLB needs to flesh out, turn upside down and inside out before making the final decision.

For the sake of competition and parity, safeguards and checks and balances may very well need to be put in place.

Because there are oh-so-many possibilities. Both good—and bad.

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