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Worldly Currency

Today has been an especially busy day in baseball, with the Cubs at the center of some wheelings and dealings. A recap of the Cubs morning:
  • Cubs acquire RHP Jake Arrieta, RHP Pedro Strop, and international bonus money from the Orioles for RHP Scott Feldman and C Steve Clevenger
  • Cubs acquire RHP Matt Guerrier from the Dodgers for RHP Carlos Marmol and international bonus money
  • Cubs acquire international bonus money from the Astros for 2B Ronald Torreyes
There are multiple layers to each deal (the first two in particular), but the common thread can't be ignored. The Cubs have added almost $1 million in international draft bonus money to their allotted signing pool today, conveniently the first day international free agents can sign with MLB teams.

International free agency used to be a free-for-all with no regulation whatsoever until the new Collective Bargaining Agreement kicked in a few years ago. Now each team is given a series of international bonus slots - one step sort of a draft, but certainly parallel to the recommended slot system MLB uses in the amateur draft. The common wisdom is that this is a transition step from an open market to an international draft.

The reality is that an international draft is likely in the next CBA. However, I think MLB might have stumbled into a pretty cool system.

 Historically, teams expenditures have greatly fluctuated in the international market. Some teams scout foreign-born players much more aggressively than others. The allocation of international bonus resources is much more equal than historical spending has been.

I like the way this new system is working on paper. Teams with little intention of using their international bonus money now have an asset they can use to acquire something they could not get before. People (myself included), figured that international bonuses would sink in the new system, but the trades today suggest that maybe they won't as much as was anticipated. However, in this system, the teams willing to spend more must be willing to do so at the cost of some other resource (likely a player/prospect). It is a more organic way of promoting competitive balance than revenue sharing.

I do not expect MLB leadership to see the benefits in their transitional international draft system, but I would love for them to consider an alternate world. What if the amateur draft also worked like the current international signing bonus system? Teams would be given slot recommendations without draft picks, and on a certain day be free to sign whomever they please. Amateur players would have some choice in where they land, and teams could trade draft cash to accumulate larger bonus pools if they wish. Perhaps top prospects would refuse to sign with bad teams, but those teams could auction off their excess draft cash for current prospects.

Furthermore, compensation for lost free agents could be easily tied to the contracts players sign. For instance, a team could receive something like 5% of a player's contract in bonus money. So a player signed to a 10 year, $100 million deal could give a team $500,000 extra each of the next 10 years in the draft, whereas a veteran signed to a 1 year, $2 million deal would net $100,000 one time. MLB would lose the spectacle of televising a draft, but wouldn't a free-for-all for guys like Bryce Harper, where every team could get involved and crazy hypothetical trade scenarios are in play, make up for that loss?

Just a thought, based on what the Cubs have done today. An amateur draft system built completely on slot recommendations, as the international bonus pool is right now, could generate competitive balance while giving teams and players more choices than they have right now.