A rough draft

By Joe Schackman


It's no secret the wealthy New York Yankees can afford to pursue any player they set their sights on. But the blockbuster deals that send their payroll–and opposing fans' collective blood pressure–soaring have their roots in a more democratic process.


The New York Yankees are, by far, the most polarizing force in baseball. Their free-spending ways are easily vilified and the Steinbrenner family is so boisterous they can enrage the most devoted among even their own fans. The monster contracts the team dishes out every off-season are often pointed to as the biggest problem with baseball. However, the true financial might of the Yankees is flexed in an area often overlooked and considered the most democratic form of player acquisition: the draft.


Major League Baseball’s First-Year Player Draft is supposed to be the place where the worst teams get their pick of the top talent. It’s seen as the best way to maintain balance of power in the league, allowing the worst teams to draft baseball’s next superstars. But in reality, the structure of the draft and the economic landscape of the league destroy that vision.


The baseball draft is different from the drafts held by other sports. Baseball players are years away from Major League stardom. Unlike the NFL and NBA, baseball’s top picks are rarely instant impact players. Only once every 10 years do you find a Stephen Strasburg.


The players entering the draft do not necessarily have to sign with the team that drafts them. A large number of the prospects are kids who just graduated high school, and if they are drafted and do not like their position, or the contract being offered, they can instead accept one of the numerous college scholarships most likely available to them.


That means that the team that drafted them loses out on that pick. There is compensation if you fail to sign the player you drafted. However, it is not the same number pick next year, and if you fail to sign a player with that compensation pick, you lose out completely.


There is also no rookie wage scale in baseball. In the NBA, there are defined parameters around what a team can pay each draft pick. The NFL will now have an official scale as well, though even before the new CBA there was an unspoken scale, with compensation based on their draft position. Rarely was the third pick in the draft paid more than the second, and so on (unless Al Davis got involved).


A baseball player, however, can demand a signing bonus of any amount. They aren’t necessarily going to get that number, but theoretically it is a blank check. Since turning draft choices into major league starters is such a hard process to predict, most teams are not going to throw around seven-figure singing bonuses. Cost and “signability” can be just as big a factor as talent in the MLB draft; unless of course, you have serious money to burn.


And so we come to the case of Dellin Betances, one of the Yankees’ top pitching prospects and their eighth-round pick in the 2006 draft. Betances, coming out of high school, had the talent to go in one of the early rounds, but with a serious commitment to play college baseball at Vanderbilt, every team knew it would take a $1 million signing bonus to get him into a minor league uniform. Betances was not a can’t-miss prospect, but still a darn good player with a high ceiling.


For a small market team, $1 million is not realistic outside the first few rounds. But for a team like the Yankees, the money was not an issue. They had a chance to get a quality player and $1 million was a drop in the bucket. They pulled the trigger and, after a few years of development, they now have a budding star.


Betances, at 23 years old, is consistently ranked in the top 100 prospects, reaching as high as No. 43 on some boards. He stands at 6’8”, 260 pounds, and has a fastball that can hit 98 mph, along with a strong cut fastball and a devastating knuckle-curve. He has the ability to become a number one starter. Yet despite all this, the chances of seeing Betances in pinstripes are rather slim.


While the Yankees can do damage in the draft, you rarely see their top picks suiting up for them. These prospects’ value, to the Yankees, is higher as trade chips. The Yanks, with their win now attitude, need a pitcher or hitter today, not in two years. So they trade those prospects for bona-fide major leaguers. Their high-risk pick five years ago quickly looks like a high-yield investment. A few of these risky picks, coupled with their most prized early round selections, and the Yankees have a fully stuffed farm system at their disposal.


Now, this is not a knock on the Yankees. Most big market teams employ a similar strategy (ironically not the Mets, but that’s a discussion for another day). These other teams might not have quite the resources of the Yanks, but are still able to take significant risks. In the most recent draft, the Boston Red Sox, with their second pick of the first round, selected catching prospect Blake Swihart out of New Mexico. Swihart has already accepted a scholarship offer from his dream school, the University of Texas, and in order to get him into their farm system, the Sox will effectively have to bribe him with a signing bonus few teams could afford.


This is not a call to reform the draft either. Any team can invest and spend on player development. The Rays became a force by doing just that. The Kansas City Royals have created one of the best systems in baseball despite their small market status. Even Pittsburgh has committed to the draft and the benefits are already being seen this season. It is rather, a look into the subtle economics and tactics employed during each draft.


The Yankees are often ridiculed for handing out absurd free agent contracts. And while they do spend the cash to sign the likes of Alex Rodriguez and C.C. Sabathia, their real power lays in their ability to take big chances on players who may never actually play a game in the Bronx.