Baseball Considers Drafting Reform, How Would It Affect The Royals?

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About two weeks before pitchers and catchers are due to report for spring training, owners and players are at least talking, but there are still major differences that need to be worked out. One of the topics discussed is changing the design.

Players want to reform the design to disable tanking. The top pick in the draft has a much better chance of success than any other pick, and according to research by Bless You Boys’ Patrick O’Kennedy, there’s a significant drop in value after the first four picks. Accordingly, teams have begun intentionally making their teams less competitive in order to land one of these picks. These teams don’t participate as actively in free decision-making, which hurts the market and lowers salaries. Player salaries have fallen to their lowest level since 2016 over the past year.

Owners may not want to reform the design as much as players do, but they likely recognize how tanking hurts the sport. According to reports by Evan Dreilich and Ken Rosenthal at The Athletic, each side has a different proposal for the proposed reform:

Union proposal:

  • All non-playoff teams would qualify for the lottery
  • The first eight picks in the draft would be raffled off
  • Small-market teams that finish in the bottom four for two consecutive seasons would not be eligible for the lottery in the third year
  • Hypermarket teams finishing in the bottom eight for two consecutive seasons would not qualify for the lottery in the third year
  • Small-market teams that make the playoffs will receive an additional draft pick after first-round compensation picks and before Competitive Balance Round A
  • Small-market teams that finish .500 or better will receive an additional draft pick after Round 2 and before Round B of Competitive Balance
  • Playoff teams would be ranked by market size (small market teams by record, then large market teams by record)

Suggestion from the owner:

  • All non-playoff teams would qualify for the lottery
  • The top three picks in the draft would be raffled off
  • Playoff teams would be ranked by market size, by playoff round (small market first round playoff losers first, then big market first round playoff losers, then small market second round playoff losers, etc.)
  • Teams cannot pick a lottery (top three) three years in a row

The player proposal would go much further to prevent tanking by subjecting the first eight picks to a lottery. From one perspective, this could hurt small market teams who find rebuilding by draft is more cost-effective than rebuilding free agency. A small-market team that finishes with one of the worst records in baseball could potentially become the No. 9 draft, much less have a guarantee of helping their struggling team.

On the other hand, this should reduce the incentive to actively downgrade your team when teams are no longer guaranteed a good draft pick. Baseball might give bad teams better chances of winning the lottery like the NBA does, but subjecting it to chance a bit makes the outcome less attractive. Failing to qualify teams for last place for three consecutive years also discourages long-term tank jobs.

Additionally, the additional draft pick pay for small-market teams would be a great outcome for teams like the Royals. It would stimulate and reward victory and help offset some of the financial benefits enjoyed by big market clubs. Imagine if this had been a decade ago, the Royals could have gotten a draft pick to win their pennants after the first round of drafts in 2015 and 2016, which could have helped them sustain their win a little longer. Also, their pick for the first round would also be better as they could move in front of the bigger market teams even if they had a better record.

The owner’s suggestion would help small market playoff teams a bit, although not as much as the player’s suggestion. A large-market team that lost in the ALDS would still win ahead of a small-market team that won the championship, while in player recommendation, small-market teams get the first dibs regardless of how far they’ve gone in the postseason. I’m also not convinced that a three pick lottery would discourage refueling that much – the worst team in baseball wouldn’t get any worse than the No. 4, still an attractive result for a recovery team.

The question also arises as to whether the design encourages refueling at all. O’Kennedy’s research, cited above, shows that even at the head of the draft committee, the draft is still pretty much crap. The Astros have notoriously struggled to nab stars like Carlos Correa, Alex Bregman and Kyle Tucker with top-five picks, but they also drafted Brady Aiken and Mark Appel with the No. 1 picks. It’s entirely possible that teams don’t tank to get good draft picks, they tank to save money, and getting good draft picks is a nice side benefit.

But while the draft is still hard to predict, teams are playing the odds today — and the odds are on the higher picks. Reduce these odds a bit and you may see teams change their behavior, especially if the draft rewards overall standings success. It’s encouraging to see both sides talking about reforming the draft, particularly with a conversation about how to reward successful small market teams. Hopefully, the two sides can come to an agreement soon, and we can see some changes by the 2023 draft.

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