mlb slotting guidelines: should we be listening?

mlb slotting guidelines deal with the first-year player mlb draft (which starts in june). similar to football and basketball, the slotting guidelines recommend the bonuses that clubs should be offering to their players based on what draft pick they were (1st pick should get higher bonuses than 2nd, etc.). the guidelines are designed to stop higher revenue clubs from getting the best players in the draft even with worse draft picks. this occurs because high profile players (some represented by scott boras) want big bonuses and small market clubs realize this and are unwilling to spend high picks on these players due to the fear that they will be unable to sign them. think jd drew, who went back into the draft after the phillies drafted him (he was later drafted by the cardinals the following year).

we're going to start with the simple supposition that baseball teams are better served by putting a greater portion of their revenue into the draft, scouting and development rather than signing mediocre free agents. as it stands today, most teams do not follow this approach (see pittsburgh pirates, new york mets, kansas city royals). but teams like the tampa bay devil rays, the boston red sox and the new york yankees have started to see the light when it comes to this philosophy.

and so we have the slotting guidelines. the problem is that there are just that... guidelines, nothing more. mlb has no power to control how much money teams give to their players as bonuses. they can just try and convince the 30 teams that it's in their collective best interest to follow them. and that's true. if all 30 teams followed the guidelines then bonuses would be driven down and teams would obviously save some money. but for teams like the red sox and yankees, they have no incentive to follow suit. relatively speaking, it would hurt them while helping out the smaller market teams that never gave out the big bonuses in the first place.

so why do most teams continue to follow this practice? well, for most teams it is still their hope that teams will fall in line and will help drive down prices. and second, most of these teams have no choice as they are not financially in the position (or are not smart enough) to put a higher percentage of their revenue into the draft.

if teams started putting more money into the draft it would either 1) make the red sox and yankees (and tigers) spend even more in the draft to get the big time players thus pushing the bonuses up even higher (which would lead to the same situation as before) or 2) it would create equal bargaining power with draftees. it is still the fear that option 1 would occur and therefore teams are reluctant to bypass the guidelines especially if it is going to drive up the prices anyway with a higher bottom line.

then we have the mets, who don't have financial difficulty (forbes values them as the second most expensive ballclub) yet are not willing to go against the mlb slotting guidelines. we can see the ramifications of their choices in the last couple of years. they have drafted many college relief pitchers (players who don't normally get big bonuses and are quick to get to the majors) and now their farm system is almost completely devoid of any top level prospects (some of that is due to the santana trade). so why do the mets continue to do this? i wish i knew.... it is complete insanity. it is understandable that small or mid market teams believe they have no real choice, but almost all big market teams have forgone the guidelines in lieu of their traditional spending habits. the mets have not (and i'm sure one or two other big market teams as well). for now, the red sox, yankees and tigers are taking advantage of a big competitive edge that will most likely show up in the next two to five years in terms of their major league competitiveness.

so the answer to the question is no. the mlb has shown that they lack either the power or desire to enforce any restrictions on bonuses given to first year players. and in doing so, the power structure in the draft has moved back to what it once was, with the yanks and sox on top. some teams like the royals believe that they have no choice but to follow and some teams like the mets are just stupid to follow.

if baseball is serious in trying to create a balance of power in the draft, they have to concern themselves with the general state of baseball financial equality that will filter it's way down to draft bargaining power. without doing so, teams will always have the incentive to bypass the guidelines to gain a competitive edge. (it is true, however, that the luxury tax and some revenue sharing has led to much greater financial equality in baseball, but it's still far from that of the nfl)

to be honest, the teams could easily rectify this themselves. if they were smart enough they'd put more money into the draft and the royals would never spend 10 mill a year on gill meche. but we'll save that for another day.