Where do the Yankees plan to spend internationally?

What Went Right: Andy Pettitte
Monday Night Open Thread

Late addition: After talking about this with a few people, thinking about it some more, and reading the comments, it strikes me that perhaps Rosenthal misheard or misinterpreted the information. Even using the high-end signing figures the Yanks are just barely over that 5 percent threshold. Given the significant penalty for going even that fraction over, I find it hard to believe that they made such an error. Mistakes are made, of course, and it’s possible, but at this point I’m more apt to believe that they are still within the zero to 5 tier, and thus accrue only a tax on the overage rather than a restriction on players they can sign in the upcoming international signing period.

Furthermore, Rosenthal states that the “Cubs and Rangers went over the limit in 2012-13,” when in fact the Cubs and the Rangers are both over their limit in the current signing period, which is 2013-2014 (seeing as it started July 2, 2013 and extends into 2014). From what I’ve read, the Rays were the only team to exceed their international pool allotment in 2012-2013.

It would appear, then, that the Yankees’ plans to spend big in the international market concern this coming year’s class, which will open for business on July 2, 2014. The Yankees will have a larger pool of money this year, since they finished lower, but that won’t change the equation too much; last year, as the No. 28 team, they got less than $200K less than the No. 18 team. But the new period does give them a fresh crop of talent, and if they don’t care about the penalties they can spend as much as they’d like. Given the facts and the implications, this seems far, far more likely than them spending further money during the current period.

Original. One signature element of the current CBA is the restriction placed on almost all forms of amateur player acquisition. In both the Rule 4 draft and the international signing period, teams have limited pools of money at their disposals. Exceeding those limits incurs penalties that affect teams the following year, thereby discouraging lavish spending in any single draft or signing period. There’s even talk of an international draft, which would further limit teams in acquiring talent.*

*Really, it’s just one more way MLB strives for boring parity, rewarding bad teams with enormous talent opportunities, both in available dollars and preferred selection. But I digress.

Teams can create advantages for themselves, given the right circumstances and conditions. For example, if a team feels the current international class is strong and the next is weak, it can splurge before facing the heavy restrictions the following signing period. It appears the Yankees will take that path this year. They’ve already exceeded their $1.8 million international cap, signing CF Leonardo Molina for $1.4 million and SS Yonarius Rodriguez for $575,000. According to a recent bit by Ken Rosenthal, they’re not quite done yet.

According to Rosenthal, the Yankees are just 3.8 percent over their capped limit, but he also has the Rodriguez signing at $550,000. MLB Trade Rumors, which has the Rodriguez bonus at $575,000, notes that figure puts the Yankees more than 5 percent over the cap, therefore already inducing penalties. In that case they won’t be able to sign any player for more than $500,000 during the next signing period, which, given the two bonuses given to their signings this year, is a major impediment. The same penalty, with a greater tax on overages, is in place for the 10 to 15 percent bracket. That essentially means that as long as they can stomach the 100 percent tax on overages, there is no reason to sit at 5.1 percent over the cap. You might as well go all the way to 14.9 percent. Spending that exceeds 15 percent over pool dollars limits a team to $250,000 on a single player during the next signing period.

The question is of how the Yankees are going to spend this money. All of Baseball America’s Top 30 international prospects have signed. There could be a number of players with whom they have experience and who might have flown under BA’s radar. Even in that case, the Yankees don’t have a whole lot of bonus money within that 15 percent threshold; just under $200,000, to be exact. So in order to make an impact, they might have to go over 15 percent and further limit themselves for the upcoming signing period.

Or it could all be hooey. Rosenthal cites “rival international scouts,” and rival scouts have agendas. At the same time, if the Yankees are in fact over the 5 percent penalty, they might as well go hog wild. The rules make very little distinction between a 5.1 percent and a 14.9 percent overage.

What Went Right: Andy Pettitte
Monday Night Open Thread
  • Preston

    I hope they didn’t go over the cap, and if they did i wouldn’t advocate them going over the 15% mark. Only being able to offer 250,000 would exclude them from acquiring any top talent.

    • http://www.riveraveblues.com Mike Axisa

      Yeah, that’s why I’m not a fan of going over. You basically eliminate half the talent pool by being unable to sign any $250k+ guys the next year.

      • Chris Z.

        I am a bit confused, so they offer a guy 250k and then what? How long of a contract is that 250k for? Is that just a bonus? Are the contracts themselves all exactly the same in terms of dollars and years for everyone?

        • Need Pitching & Hitting

          It’s just a bonus.

          • Chris Z.

            So why not offer a larger contract out of the gate and offer everyone the same flat bonus to stay well under the cap?

            I’d offer everyone 250k regardless of who you are and then work the rest into your deal.

            • Preston

              Because it doesn’t work that way. A lot of people spend a lot of time writing these MLB agreements. They aren’t that easy to circumvent. Minor league contracts and rookie contracts are predetermined.

            • Mac

              I think you have to give someone a major league deal and include them on the 40-man roster to pay them more than the standard minor league contract before they hit minor league free agency years down the road.

              • Preston

                Yes, but giving a 16 yo kid a major league contract would be pretty dumb.

                • Mac

                  I didn’t make any judgement on it at all, I was trying to explain my understanding of the rules to Chris.

                  Not only would it likely be dumb even to do once unless you’ve got the Dominican Bryce Harper or something, it would also not be a sustainable strategy to do what Chris suggests: if you start giving a bunch of 16 year olds 40-man spots every year the 40-man is going to fill up with guys who are only ready for low-minors competition pretty quickly.

  • Eselquetodolosabe

    Where are Molina & Rodriguez currently ? Any MLB player comparisons for Molina ? Molina’s tools (arm, speed, power, etc.,) ?

    • Preston

      BA ranked Molina the 5th best prospect overall and called him the best athlete. He rates as a plus CF, his hitting is raw but that’s to be expected at his age. Rodriguez is a defense first SS. Neither has come to America to play yet.

      • Mac

        I don’t think either can play until next season.

        • pablos ham sammich

          I don’t think either can play until next period.

    • http://www.riveraveblues.com Mike Axisa

      These guys sign contracts for the next season (so 2014), so they aren’t playing anywhere yet.

      • Preston

        At Molina’s age isn’t it likely that he doesn’t come to the states until 2015?

  • Mac

    I really doubt that the Yankees are actually a hair over the 5% mark. Obviously I don’t know, but I’d be willing to bet that they’re actually marginally under the 5% mark and the bonuses reported are a bit off. The $1.4M and $575K would put them over by only about $5K. I would say it’s much more likely that the Yankees actually gave Molina $1,394,000 or something and it was reported as $1.4 million than it is that the Yankees have some mystery IFA they are waiting to blow a small wad on in order to inhibit themselves from blowing a big wad next year. (Even if that guy exists, they probably did not risk putting themselves marginally over 5% since it’s no lock he signs with them rather than another team.) It’s certainly possible, but unless you have some idea who that player is or some inside info that he exists, this story seems to draw a pretty questionable conclusion on incomplete information reported in the MSM when a more likely explanation exists.

    • Mac

      Also, parody is boring for a Yankees’ fan… sure. For teams that play in markets that are 1/10th the size of the NY market and smaller, it’s probably not viewed the same way.

      • Bud Selig

        Yes, those are the teams I care most about. All the free money they get every year, plus the free extra draft picks, plus the extra money for signing amateur drones isn’t enough to compensate them for the loss of dignity they suffer. Did you know before I saved baseball with the Yankees’ money some owners could barely afford a new yacht each season? It was shameful.

        • Mac

          I would be willing to bet you that none of that makes up for having 10x the people in your market. If you didn’t compensate teams for playing in smaller markets around the country, many would likely fold or just pick up and move to the bigger markets themselves. While leagues make a big deal about voting on whether a team can move, I have read several times that legally an owner can move wherever he or she feels like. If you have 1 million potential fans in some small market, it’s not hard to justify moving to NY in hopes of capturing more than 1/20th the market.

          Also, Bud Selig serves at the will of the owners. Obviously he calls his own shots, but if the owners don’t like what he’s doing they can just replace him.

          • http://www.penuel-law.com/ Cuso

            Now who is being naive. It’s just as simple as “picking up and moving to a new city,” huh?

            No it’s obviously NOT that simple. Find a city that agrees to take you. Find a city that agrees to build you a ballpark. Find a city that doesn’t have a team that has a stranglehold on the market (see Oakland A’s issues with trying to get park in San Jose and what the Giants are doing to make their lives miserable).

            The flippant remark that “I have read several times that an owner can move…yadda yadda” is not just and ignorant aside attempting to back up a flimsy-ass standpoint, but it’s probably also an outright lie. Basically, I’m doubting that you read much of anything.

      • Preston

        This is something that comes up in baseball only. In the NBA and NFL it’s absolutely accepted that the worst teams get the best players. I’m not sure why baseball is different. Although if the idea is to reward small market teams that have a financial disadvantage, I don’t think the current system works well. Why should the Cubs, Mets or even Astros get to pick high. They have financial resources they just haven’t used them properly to compete and the draft is rewarding them for their incompetence.

        • Mac

          A salary cap is also absolutely accepted in those sports. The NFL in particular seems to be thriving on parity (I have no evidence about causation, of course, but doesn’t seem to hurt).

          I don’t think that the draft or IFA rules are directly about financial parity (rather performance parity). Maybe you could have more of a lottery system to incentivize winning, but just not having a draft would almost necessarily favor the teams in the biggest markets.

      • King of Fruitless Hypotheticals

        No, parodies are funny regardless of your team pursuasion. You’re probably just not watching the right ones…

        • Mac

          Fair point

    • Preston

      I agree, I think this is most likely a reporter being off by a small margin then them actually going over 5%.

      • Robinson Tilapia

        Agreed. Much more likely.

        I still learned something, though.

        • http://www.riveraveblues.com Joe Pawlikowski

          Rosenthal actually had them under the limit. It’s MLB Trade Rumors that had them over, which make me think that they’re under. See the addition above.

          • Havok9120

            If they are still a smidge under the limit, would you rather they stay there are push it to 15%?

            Open-ended because we don’t have any names to go off of, but I’m just curious.

            • http://www.riveraveblues.com Joe Pawlikowski

              I’m really not sure what kind of player would be available today, seeing as the signing date is July 2. Maybe there are a couple of players who haven’t turned 16 yet? Even then, I have no idea what the actual cut-off is.

              Just basing it off recent memory, there probably won’t be much worth signing. As I mention in the addition above, I’m fairly certain that the whole point was that the Yankees are going to spend this coming year.

          • Robinson Tilapia

            Thanks for the addition, Joe.

            If only we’d get a retraction from Eddard every now and….always.

  • Mads W

    It would really suck if they get restrictions on next years class, now that they will have more money to spend, because of their record is worse this year.

  • Silvio

    “Really, it’s just one more way MLB strives for boring parity, rewarding bad teams with enormous talent opportunities, both in available dollars and preferred selection. But I digress.”

    Doesn’t sound like a “digression” to me but, instead, like the heart of the heart of the matter.

    So, is this something to which the Yankees–whether under George or under Hal–have supported? That is, how is it that these “parity” rules get enforced: by diktat from the Comish’s office? or by vote among the owners? or some combination?

    If the Yankees supported these damn rules, they ought to be hit upside the ears with a shitstick.

    • Mac

      There are 29 other franchises who get a vote, and only one operates in as large a market as the Yankees. The commissioner is not the king of baseball, he’s the representative of the owners. I’m sure it’s taken on a life of its own to some extent, but the league is really just a collection of teams.

      It’s also not such a black and white issue as supporting or not supporting change. If you’re 99% sure that change is coming in some form, you might be a lot better served supporting the sort of change that most benefits you instead of just resisting the change out of principle.

  • Bo Knows

    If they go hog wild for next years class it’ll nice

    I say forsake 2016 and just sign the top 5 of 2014-2015. Selig has been screwing the yankees over for years anyway so just return the favor, and raid an entire International signing class of its top talent, while laughing maniacally and flipping Selig the Bird.

  • Robinson Tilapia

    I can’t wait for Joe’s late night update where he just decides to say “screw all foreigners.”