Free agents feeling effects of compensation system
In light of recent prizes like Wacha and Trout, teams not easily parting with Draft picks
When Nelson Cruz, Ervin Santana and the rest of the Frozen Five free agents try to figure out why they've gone beyond Groundhog Day not knowing how long they'll be unsigned, there's no shortage of people they can blame.
Among them, of course, would be themselves.
Ubaldo Jimenez, Kendrys Morales, Stephen Drew, Cruz and Santana were offered the chance to return to their 2013 clubs under one-year deals worth $14.1 million. That's not nothing. But like the other 17 players given qualifying offers in the two seasons that MLB has used its revised compensation system, they said, "No thanks."
So here they sit, no doubt looking for explanations.
Who should they blame?
For one, I'd say Michael Wacha. Then maybe Mike Trout. And, oh yes, Theo Epstein -- definitely him.
All three of those guys have contributed indirectly to the ongoing stalemate -- Epstein, now the Cubs' president of baseball operations, by prompting his rivals to rework the link between free-agent compensation and the First-Year Player Draft, creating a bigger supply of non-compensation free agents, and Wacha and Trout for demonstrating what a huge risk it is to give up a first-round Draft pick.
Epstein notoriously exploited an inefficiency in the old system of free-agent compensation, realizing how easy it was to trade for a complementary player at midseason and then receive extra Draft picks when he left after season's end. This was really good business, but it attracted attention over time.
In the nine years Epstein was in charge in Boston, the Red Sox had 43 picks in the top three rounds of the Draft -- 16 more than their allotment. It was one of the methods he and his front-office staffers and scouts used to create their player-development machine, with smart picks like Dustin Pedroia, Jacoby Ellsbury, Jonathan Papelbon and Clay Buchholz helping the Red Sox back up their 2004 championship with encores in '07 and '13.
Ellsbury was a particular coup. He was selected with the 23rd overall pick in the 2005 Draft -- one that belonged to the Angels until they signed shortstop Orlando Cabrera, who had been acquired down the stretch from Montreal by Boston the year before. That was the Nomar Garciaparra trade -- an Epstein master stroke that played a big role in breaking the Curse of the Bambino -- and long term became a swap of Garciaparra (on his way down) for Ellsbury (on his way up).
Because Epstein and some other smart GMs were manipulating the compensation system, it was rewritten in the Collective Bargaining Agreement that took effect in 2012. The new CBA also assigns slot values to every pick in the Draft, limiting the money organizations could spend.
Significantly, it also specifies that teams that forfeit Draft picks to sign compensation free agents -- now only those who have been extended qualifying offers by their teams -- also lose the value of that slot. They can't go over slot for a tough-to-sign player later in the Draft.
You hear a lot of people say that teams place more value on their high Draft picks in the current system -- and that this has contributed to the lack of attractive long-term offers for Cruz, Santana, Jimenez, Drew and Morales. But is that true?
Perhaps if you compare it to a decade ago -- teams lost 122 first- and second-round Draft picks from 1998-2007, an average of 12.2 per year -- but not to the late years of the old system. There were only 30 first- and second-round picks forfeited from 2008-11, an average of 7.5 per year.
Teams have been valuing their high Draft picks for a long time, even while they also recognize the short-term value of compensation free agents.
As well as the Red Sox handled that Garciaparra-Cabrera-Ellsbury exchange, consider the brilliance of the Cardinals. Owner Bill DeWitt Jr. and general manager John Mozeliak were widely criticized for losing Albert Pujols to free agency after 2011, but now it's the Angels who look bad, in part because they gave up the 19th pick in the 2012 Draft as part of the Pujols package.
The Cards used that pick to grab Wacha, who somehow hadn't stood out at Texas A&M.
For the Halos, this outcome reverses the success they had with Mark Teixeira a few years earlier. They traded for the switch-hitting slugger at midseason in 2008, hoping in vain that he'd carry them to the World Series, and lost him to the Yankees after the season.
However, the Angels received a consolation prize. That was the 25th pick in the '09 Draft, which had belonged to the Yankees. They used that to land Trout.
There are busts in the Draft, for sure. But there are also guys you can build franchises around, like Wacha and Trout.
You can bet that multiyear deals will still come together for most, if not all, of the Frozen Five. Agent Scott Boras salvaged similarly difficult situations with Michael Bourn and Kyle Lohse a year ago. Teams still have some money to spend, and these are players who can fill important roles for contenders next year. They might all already have deals if they weren't tied to Draft-choice compensation -- the risk they accepted when they turned down qualifying offers.
Phil Rogers is a columnist for MLB.com. This story was not subject to the approval of Major League Baseball or its clubs.