Amateur Draft (1965)

Part 13 of our series on Important Moments in Team Building.  See introduction, and up-to-date list.

 

“Pro football has a draft, and that cuts down bonus payments. [But] we want to encourage free enterprise on the part of everyone, including, of course, the kids themselves.” So said Joe Cronin, the general manager of the Red Sox in 1952. Indeed, the NFL had started its draft in 1936, and the NBA in 1947. Whatever you may think of the legalities or ethics of a draft, it remains a mystery why baseball did not get on board decades before they did. It is unlikely that the reason was either “encourage[ing] free enterprise”, or “the kids,” since they twice instituted bonus rules that fought against both.

When the free market of 1958 once again resulted in massive bonuses, it did not take long for owners to begin talk of a new rule. At the 1958 winter meetings the magnates tried it again, this time a little less obviously.

Reggie Smith1959-64. First-year player draft. This was not technically a bonus rule, since the policy affected all players whether they received a bonus or not. Every first-year player (with one year of professional experience) who was not placed on a 40-man roster was subject to a new December draft. The drafting team had to place the player on their 25-man roster and pay $15,000 to the draftee.

Despite bonuses not being part of the definition, the rule was clearly intended to curtail bonuses. A team would not want to give out too much money to amateur prospects if they were just going to lose the player a year later.

The details of the rule changed several times, but its effects became more dramatic starting in 1962 when the rule required that the first-year player (with one exception per team) be placed on the 25-man roster. Over the three drafts under this revised rule, many future big league stars changed teams, including Paul Blair, Lou Piniella, Jim Wynn, Bobby Tolan, Reggie Smith, and Rudy May, all left unprotected one year into their minor league careers. In addition, many players (like Tony Conigliaro) saw their big league careers fast-tracked so that they would not be subject to the draft.

Although there were likely fewer bonuses, the highest outlays kept growing. In June 1964 the Los Angeles Angels gave $200,000 to University of Wisconsin outfielder Rick Reichardt, which may have been the bonus that finally got the owners to throw up their hands.

1965-present.  Amateur draft.

ReichardtAt the 1964 winter meetings, the major league owners finally made the decision to create an amateur draft. In the succeeding five decades, the amateur draft has been the primary mechanism for major league teams to acquire high school and college players from the United States, Canada, and (as of 1990) US territories (such as Puerto Rico). Originally there were three drafts: the big one in June, one in August (for American Legion players who were still playing over the summer), and one in January (for those who finished high school or college in the fall. As of 1987, there is one draft.

The effect on team building was enormous. No longer could a team choose to open its wallet for a year or two to restock the system. Teams like the Yankees and Dodgers no longer had any advantage over the Senators and Phillies when it came to signing amateurs. Had the draft been in effect in 1964, Reichardt might have been the first pick (by the Mets or Senators) and would have had one offer to accept.

The profession of scouting changed dramatically. A Yankee scout in the 1950s was part salesman, selling an amateur on the glory and prestige of wearing pinstripes. Beginning in 1965, the players’ views on the matter were unimportant. The best players, certainly those selected in the first few rounds, were well known to every team. The job of the scout was the find good players and then lobby with his scouting director or general manager to draft them if they were available.

Although drafting high offers an obvious benefit, an advantage can still be achieved by uncovering and developing the right players. In the first 30 major league drafts, through 1994, a total of 86 selected players (just fewer than 3 per year) went on to put up 50 WAR (a top-flight star) in the big leagues. Many of these were taken in the top 10 picks (23 times), but 28 others were taken after the first four rounds. There were two in the first draft: Johnny Bench, taken in Round 2, and Nolan Ryan, taken in Round 12.

rick_monday_autographIn a typical draft, a single team will select (on average) 25 to 30 future WAR. If a team can beat that number over a period of several years they will almost always compete for multiple pennants a few years later. The Kansas City A’s were big spenders in the last few years of the free market (1962 through 1964) and then picked Rick Monday with the first pick in the first draft. They followed this up outstanding drafts the next two years. Besides Monday, they also drafted Sal Bando, Gene Tenace, Reggie Jackson, and Vida Blue in these years, and were one of the games dominant teams in the early 1970s.

The greatest single draft class was that of the 1968 Los Angeles Dodgers, who selected and signed 234 future WAR. This group included Ron Cey, Dave Lopes, Steve Garvey, Doyle Alexander, Joe Ferguson, Geoff Zahn, and Bill Buckner. The Dodgers top pick that year – Bobby Valentine – had a promising career snuffed out by an injury, but the depth of this draft remains unprecedented even decades later. The Dodgers had drafted Bill Russell, Charlie Hough, and Steve Yeager over the previous two years, and most of this group stayed together to help win four pennants and a World Series over an eight-year period.

For the past 50 years, many teams that have been successful over a period of years have had good drafts a few years prior. The advent of free agency and new player pools outside of America complicated the calculus somewhat, but the draft remains the biggest and best source of talent for big league baseball teams.

 

 

 

 

Interleague Trading (1959)

Part 12 of our series on Important Moments in Team Building.  See introduction, and up-to-date list.

 

In December 1958 major league owners agreed to the first interleague trading period. Prior to this, teams could trade with clubs in the other league only if the players involved first cleared waivers in their own league, a non-starter for dealing any front-line talent. For all practical purposes, prior to 1959 a big league GM only had only seven teams he could trade with.

One of the instigators of the new rule was Frank “Trader” Lane, GM of the Cleveland Indians and famous for swapping players, often just for the thrill of the deal. The AL approved the new rule 7-1, the NL by a narrower 5-3 vote.

In a trade today, which league a player is moving to or from barely registers, but at the time it was revolutionary enough that the new trading window would only be open for a very short interval, November 21 to December 15. It’s important to remember that the two leagues were distinct and occasionally hostile entities. Though they recognized each other’s territorial rights and reserve lists, they were very competitive and parochial. In addition, the leagues were fighting off the upstart Continental League and beginning to jockey for possible expansion cities.   To many, agreeing to trade with the hated “other league” seemed heresy.

Those believing that an interleague trading window was bad for the game included baseball’s leadership: Commissioner Ford Frick, NL President Bill Giles, and AL President Joe Cronin. Giles, in particular, was afraid of losing some his league’s stars to weaker AL. Frick hoped to get the owners to rescind the rule, scheduled take effect after the 1959 season, at the meetings around the All-Star break. He was unsuccessful, and in November 1959 baseball’s GMs could finally start swapping with the other league. Over the first few years, though there were several significant interleague trades, none of baseball’s recognized superstars switched leagues.   That all changed during the 1965 interleague trading period.

FrankRobinsonCincinnati President Bill DeWitt wanted more pitching. His team had finished fourth in 1965, leading the league in runs but coming in ninth in ERA (in the 10 team NL). DeWitt felt he could bolster his squad by relinquishing his best player, right fielder Frank Robinson, in return for pitching. Robinson wasn’t only the Reds best player, he was one of the best in baseball. Over the previous five years in the highly competitive NL, he had finished in the top four in the MVP voting three times, winning the award in 1961. Nevertheless, DeWitt, believing it was better to trade a man a year too early than too late and that Robinson was “not a young 30”, began shopping his superstar.

The offers were not overwhelming. The Astros would not part with more than third baseman Bob Aspromonte and pitcher Dick Farrell; DeWitt wanted at least outfielder Jim Wynn and reliever Claude Raymond. He wanted pitcher Sam McDowell included in any trade with the Indians, but GM Gabe Paul was unwilling to surrender his young fireballer. According to DeWitt, the White Sox offered pitcher John Buzhardt and right fielder Floyd Robinson (no relation).

Orioles GM Lee MacPhail was also highly interested in Robinson. DeWitt initially wanted Milt Pappas, a 27-year-old pitcher who had gone 13-9 with a 2.60 ERA in 1965, and right fielder Curt Blefary. Baltimore was unwilling to surrender Blefary, but also unwilling to give up their pursuit of Robinson. MacPhail made a couple of lesser trades and soon had a couple of other pieces that would satisfy DeWitt: reliever Jack Baldschun and 22-year-old outfield prospect Dick Simpson.

Before he could finalize any trade, however, MacPhail accepted a new position with MLB as special assistant to the commissioner, and the Orioles promoted Harry Dalton to take over. As his final act as the Orioles GM, MacPhail attended the 1965 winter meetings where he struck the deal with DeWitt that would bring Robinson to Baltimore in exchange for Pappas, Baldschun and Simpson. “I told [Reds GM Bill] Dewitt that I was leaving and would have to clear it with Harry Dalton, the general manager-to-be.” Three days into his tenure, Dalton approved the deal.

The trade could not have turned out any more lopsided. For Baltimore, the arrival of Frank Robinson transformed the Orioles from a consistent contender into a great team. Robinson was a superb all-around player who led the Orioles to the world championship in 1966 while winning the Triple Crown and the MVP. Brooks Robinson, the Orioles top star at the time, enthusiastically welcomed his new teammate, and the rest of the team came on board. “You talk about teams that hoped they could win,” remembered pitcher Jim Palmer. “That was the Orioles before Frank. After he got here, we expected to win.”

In Cincinnati the Reds fell to seventh, Pappas struggled, and DeWitt’s legacy was forever tarnished. A solid baseball man, DeWitt had led the St Louis Browns to their only pennant in 1944, made a couple great trades for the Tigers around 1960, and several more with the Reds after taking over in Cincinnati at the end of that year, leading them to the pennant as well. His son, Bill DeWitt Jr., currently the owner of the Cardinals, has built one of baseball’s best organizations. DeWitt Sr., however, will always be remembered for the Frank Robinson trade.

The lopsidedness of the trade infuriated NL president Giles. What he had feared back in 1959 appeared to be coming to pass. In December 1966, MacPhail, now GM of the Yankees, negotiated a deal to acquire Maury Wills, the Dodger’ star shortstop. Giles stepped in and “used the weight of his office and also his personal powers of persuasion” to block this and potentially other trades of National League stars to the WillsAmerican League. “I heard the Yankees and the White Sox were especially eager to get Wills,” Giles said. “This was during the winter meetings. So I went to Buzzie [Bavasi] and asked him not to rush into such a deal, because he had until December 15 [the trading deadline] . . . As a matter of fact, [Yankees President] Mike Burke and Lee MacPhail could have killed me when they lost out on Wills. Burke told me, ‘Thanks for sabotaging our deal.’” Bavasi instead swapped Wills to the Pirates.

Players are traded between leagues without a second thought today. With eight-team leagues and no interleague trading, a GMs options were severely limited until 1959. Without new innovations, such as the farm system, or new sources of talent, such as through the elimination of the color line, baseball could become ossified. The 1950s AL, with their mostly embarrassingly slow integration of African Americans, highlights what can happen in this type of environment: the lessening of competition and the accompanying loss of fan interest. The introduction of interleague trading was only a small part of rectifying this condition, but it opened up a few more options for creative dealing.

Bonus Rule (1953)

Part 11 of our series on Important Moments in Team Building.  See introduction, and up-to-date list.

Prior to the advent of the free agency in the 1970s, the only time a player could expect a free market for his services was when he was an amateur. Although the financial health and competence of each team was subject to change over time, theoretically the 16 teams were all trying to sign the best high school and college players. As scouting became more widespread, teams inevitably found the same players, and competitive bidding ensued for the best ones. As signing bonuses began to rise, it was inevitable that owners would try to figure out how to cap the bonuses.

The most famous “bonus rule” was in effect between 1953 and 1957, which is why my title says “1953”. But there were actual a few different attempts. Let’s run through them.

Pre-1947. Free market. There were several large bonuses in the 1930s and 1940s, generally in the $10,000 to $20,000 range. The biggest bonus was probably that given by the Tigers to Dick Wakefield in 1941: $52,000 and a new car. He had an excellent year-and-a-half with Detroit and then entered the military in mid-1944. When he returned, he was not the same player, and his case was often cited at the time as a bonus failure, as evidence that baseball had a problem.

At the 1946 winter meetings, owners agreed on their first bonus rule.

RobertsRobib1947-1950. First bonus rule: Any player who received a bonus of more than $6,000 could not be optioned to the minors without clearing irrevocable waivers. Soon after, the rule was amended to allow a one-time option, so that a player could spend a single season in the minors.

The effect was to limit the number of bonuses, especially for contending teams who valued their 25 major league roster spots. A team like the Phillies, generally out of contention, spent nearly $100,000 on pitchers Robin Roberts and Curt Simmons, and was forced to give them both big league jobs in 1948. This worked out very well when both soon became stars, but a more typical case was someone like Frank Quinn, who received $75,000 from the Red Sox and then spent a year-and-a-half taking up a roster spot (pitching 24 innings) for a contending team in 1949-50. Or Paul Pettit, who received $100,000 from the Pirates and won one big league game.

One of the unintended side effects of the bonus rule was the resentment of veteran players to the kids on the bench who (a) had more money than they did, and (b) were not helping the team. At the 1950 winter meetings, the owners voted to scrap the rule.

1951-52. Free market. Baseball had thrived in the post-war period, and owners were more than ready to spend some of their profits. The Red Sox led the way, spending over $1 million in two years, including $700,000 in 1952 on 17 players. The entire major leagues apparently spent $4.5 million on bonus contracts in this single year. All of these players could be sent to the minors, away from their lesser paid veteran players.

After a couple of years of these huge outlays, the owners again voted to institute another bonus rule, stricter than the last.

1953-1957. Second bonus rule. Any player who received $4,000 or more would have to spend two full seasons on the big league roster, with no one-time option. If they were sent to the minors, they would be subject to an end-of the-season draft.

Big league managers began complaining about the rule immediately, saying it hurt development and morale. Charlie Dressen, managing the Senators, suggested a modification that would allow a club to option the players to the minors who would nonetheless count against the 25-man roster. In effect, this would punish the team, but not the player. This sensible proposal was rejected.

KalineAlThis rule was in place for five years, and affected 60 players. Most of these players were soon forgotten, but the group did include four eventual Hall of Famers: Sandy Koufax, Harmon Killebrew, Roberto Clemente and Al Kaline. Kaline was a star very quickly; on the other hand, Koufax and Killebrew took several years to get their careers going with two wasted seasons at the start.

Clemente deserves special mention. The Dodgers signed him out of Puerto Rico in 1954 but then decided to risk sending him to the minors anyway. They were the only team to ever take this chance, and it backfired when the Pirates selected him in the draft after the season. Clemente took a few years to become a star but was soon a legend.

At the winter meetings in December 1957, the owners again voted to repeal the bonus rule.

1958. Free market. Once again, the owners spent money freely. While the Red Sox had dominated the previous free market, this time one of the biggest spenders were likely the Dodgers. Freshly relocated to Los Angeles and with an older team that needed reinforcement, the Dodgers signed the likes of Frank Howard, Willie Davis, and Ron Fairly to large bonuses in this single year.

There were two additional attempts to curb bonuses: the first-year player draft (that began in 1959), and the amateur draft (that began in 1965). Those attempts will be covered in a couple of days.

 

Jackie Robinson (1947)

Part 10 of our series on Important Moments in Team Building.  See introduction, and up-to-date list.

 

JackieOn April 15, 1947 Jackie Robinson made his debut with the Brooklyn Dodgers, bringing to an end a six-decade ban on dark-skinned players in the major leagues. This was a great day for Robinson, a great day for the Dodgers (who had gained one of the game’s all-time great players), and a great day for America. The story of Robinson and the brave men who followed his lead and helped change the game has been told often and well over the succeeding years, and cannot be told enough. Robinson’s bravery and outstanding play combined to right baseball’s great wrong, and led the way for many other players who followed.

Although baseball’s belated foray into social justice is worth all the attention it has received, the issue that concerns us here is that the integration of the game had an extraordinary impact on how a team could be built. Jackie Robinson improved baseball ethically and morally, but he also made it better because he was a great player, and his playing time came at the expense of someone who was a lesser player. Robinson opened the doors for a vast new source of baseball talent, and that talent could not help but dramatically improve the game.

For all the major structural changes that we talk about in this series – the farm system, the amateur draft, free agency – most of them deal with how players get sorted between teams, or how they shift around from team to team. Integration was different. Integration opened up an essentially brand new pool of talent to the 16 major league clubs. The player pool was not new, of course; African-Americans and Latinos had been playing baseball at a high level for decades. The fact that none of these players had played in the major leagues was a crime, variously blamed on many people. All we know for certain is that Branch Rickey signed Robinson, he joined the Dodgers, and the game got a whole lot better.

MaysWhen baseball integrated in 1947, most teams were likely oblivious to how much talent had just become available. Many had expressed skepticism about whether many black players would be able to play in the majors. Their doubts proved unfounded. There were not just a handful of players who could play in the majors, but dozens of them, many of them among the greatest players ever to play the game: Willie Mays, Roy Campanella, Monte Irvin, Henry Aaron, Ernie Banks, Roberto Clemente and Frank Robinson were discovered and signed within the first decade.

In order to take advantage of this extraordinary point in time, a baseball team needed both moral courage (although this arguably became less important by the mid-1950s when blacks were excelling in the game) and the willingness to expend the additional time and money to find and scout these players. If a team employed a dozen scouts spread over a still largely segregated country, chances are they would not have seen many dark-skinned players unless they were instructed to do so, to go see different games in different towns and cities.

Jules Tygiel, the preeminent scholar of baseball’s integration period, pointed out that it was not enough that a team express a willingness to integrate, or even to have a legitimate willingness to do so. A team had to redirect its scouts or hire new ones, including Latino scouts for Mexico and the Caribbean. The Boston Red Sox often claimed to be looking for black players in the 1950s, and they made a few high-profile attempts to acquire established blacks, but they were the last team to actually field a black major league player, in 1959. They had the money – their owner Tom Yawkey might have been richest man in the game – but when faced with one of history’s great talent windfalls, they sat on their hands. The team paid dearly for doing so – on the field, going through its worst string of seasons of the past 80 years, and off the field, tarnishing the reputation of the team and its management for decades.

AaronThe pace of integration moved slowly in the early years; through 1953 only 9 of the 16 teams had fielded a black player. But although there were only 24 blacks in the game, these included several future Hall of Famers: the Dodgers’ Jackie Robinson and Roy Campanella, the Giants’ Willie Mays and Monte Irvin, the Indians’ Larry Doby and the Cubs’ Ernie Banks. Over the next few years the pace quickened, especially in the National League where there were 36 blacks in 1956 and 66 in 1960.

Importantly, these players changed the balance of power in the game especially in the National League. The most aggressive integrators – the Dodgers, Giants and Braves – dominated the NL in the 1950s. The Cardinals, the best NL club for the two decades before integration, were slow to sign black players and went through some lean years. In the AL the Yankees were a grand exception – winning pennants regularly with largely white teams – but its best competition came from the two most integrated AL teams, the Indians and White Sox.

In ensuing decades the game has done much better seizing on newly available talent pools, in several Latin American countries, in Japan, in Korea.

But the Jackie Robinson debut remains its most important and best moment.

Chasing Pennants in Boston (1935)

Part 9 of our series on Important Moments in Team Building.  See introduction, and up-to-date list.

 

photo_thomas_yawkeyUpon his introduction to the Boston press corps in February 1933, Thomas Yawkey, the new owner of the downtrodden Boston Red Sox, cautioned that the path ahead would not be an easy one. “I don’t think the Red Sox can be built up overnight,” he said. “It would be the height of folly to dump a lot of money into the thing all at once.” Yawkey had been born rich, and inherited a fortune when he reached age 30. The only thing he really wanted was a baseball team, and the hapless Red Sox, who had finished 43-111 in 1932 and drawn less 182,000 fans to a dilapidated Fenway Park, had been available.

In 1932 most people in America were either poor or hanging on to their money for dear life, but Yawkey was one of the richest men in America and, as he saw it, had nothing else to spend money on.

In the years before free agency a rich owner was only useful insofar as he found owners who wanted to sell star players. In the years during and after the Federal League battles and the industry hardships caused by World War I a few big names had changed hands (Eddie Collins, Tris Speaker, Frank Baker, Joe Jackson, and Pete Alexander, among others), and of course Harry Frazee had sold many stars to the Yankees in the early 1920s. But major league sales had gone extinct for several years during the 1920s as most teams were making money, and the owners weren’t pressed for cash. The big-dollar purchases in the late 1920s were all from the independent minor leagues. By the time Yawkey entered the scene in the depths of the Depression no players were selling at high prices. He quickly changed things.

Over the next few years, Yawkey (under the advisement of general manager Eddie Collins) dumped a lot of money into the thing all at once, purchasing the following players (with lesser players usually going in one direction or the other):

  • May 1933. Rick Ferrell (catcher) and Lloyd Brown (pitcher) from the St. Louis Browns for $25,000
  • May 1933. Billy Werber (third base) and George Pipgras (pitcher) from New York Yankees for $100,000
  • December 1933. Lefty Grove (pitcher), Max Bishop (pitcher) and Rube Walberg (pitcher) from Philadelphia Athletics for $125,000
  • May 1934. Lyn Lary (shortstop) from the New York Yankees for $20,000
  • May 1934. Wes Ferrell (pitcher) from Cleveland Indians for $25,000
  • October 1934. Joe Cronin (shortstop-manager) from Washington Senators for $225,000
  • December 1935. Jimmie Foxx (first base) and Johnny Marcum (pitcher) from Philadelphia Athletics for $150,000
  • January 1936. Doc Cramer (outfielder) and Eric McNair (infield) from Philadelphia Athletics for $175,000
James-Emory-Jimmie-Foxx-October-22-1907-July-21-1967-celebrities-who-died-young-37012867-577-750
Jimmie Foxx

Three years down and Yawkey had spent $850,000 on these players, and there are several lesser transactions that aren’t included on this list. Understand that the Red Sox started at the very bottom of the league, and they had literally no farm system. In this era there was no way to get better outside of buying players – traditionally from the high minors. Farm systems had just become practical when Yawkey took over, and he eventually got around to that too. But for now, he was buying.

So how did he do?

Let’s look at the Red Sox records, year to year:

  • 1932: 43-111, eighth (last) place
  • 1933: 63-86, seventh place
  • 1934: 76-76, fourth place
  • 1935: 75-78, fourth place
  • 1936: 74-80, sixth place
  • 1937: 80-72, fifth place
  • 1938: 88-61, second place
  • 1939: 89-62, second place

Other than the brief slip in 1936, the team got better every year.   The narrative took hold that Yawkey had “failed”, because he tried to buy a pennant and did not. True, but the Red Sox did overtake every team except the Yankees who, in the late 1930s, were arguably the greatest team of all time.

If Yawkey and Collins made mistakes they were of the sort that baseball owners continued to make in the era of free agency. Namely, that while the star players are worth the expense (Grove, Foxx, Cronin, and the Ferrells continued to perform at their previous high levels), they could have saved themselves a lot of money by turning away from the ordinary players and those past their prime.

A comparison to the Yankees reveals the real lesson. While the Yankees did not land Lefty Grove and Jimmy Foxx, they did build a productive farm system as soon as it was practical and continued investing in young talent. In the late 1930s, while the Red Sox were trying to close the gap, the Yankees introduced the likes of Joe DiMaggio (a high minors purchase), Tommy Henrich, Charlie Keller, and Joe Gordon.

What was true in the 1930s is still true today. Building a team of star players without a core of young talent to put around it is prohibitively expensive, even for someone like Tom Yawkey.

 

 

The Farm System Goes Legit (1932)

Part 8 of our series on Important Moments in Team Building.  See introduction, and up-to-date list.

 

images (3)While Branch Rickey pioneered a rudimentary farm system for the St. Louis Cardinals during the 1920s, other teams remained skeptical that such a scheme was worth its huge cost. Was it really more productive and cost effective than buying fully-seasoned players from independent minor league clubs? One of the fundamental concerns for the naysayers was that these proto-farm systems never really got around the 40 man roster problem—at least legally. The 1921 major league agreement set the major league player control limit at 40 (an increase from 35), and limited teams to 25 active players during the bulk of the season—the limits still in effect today. With one major difference: If a franchise had a working agreement with a minor league team or owned it outright such that it asserted control over those players, they all counted against the 40 man roster, leaving no room for anyone else. In effect, a big league club couldn’t even control one farm team’s worth of players.

During the 1920s the independent minor leagues were relatively profitable and liked the existing structure. Their fans cared about the pennant races, and the owners could make extra money selling their stars to the majors. But like Rickey, many big-league team owners began to chafe and the uncertainty and cost of having to buy players from the minors and being limited to a reserve list of only 15 players beyond their 25-man roster. Today of course teams still have a 40 man roster yet also control all the rest of the players in their minor league system.

To get around this limitation the major leagues resorted to all sorts of subterfuges with friendly minor league owners. The most common dodge involved sending a player to a minor league team, technically surrendering control to that minor league team, but with a handshake agreement that you could buy him back when you wanted him. Another tactic—a favorite of Branch Rickey’s–was to have an option on any one player on a team; that is, not identify a specific player and try to have that count as just optioned roster spot. Though technically not legitimate, it was common practice and often not challenged.

With the advent of the Great Depression, the minor league owners were struggling to stay afloat and willing to surrender some of their independence for a cash infusion from major league owners. This led to a far-reaching discussion at the 1931 winter meetings, where the major leaguer owners debated liberating the roster rules while providing financial support to minor league franchises.

images (4)Yankee owner Jacob Ruppert bluntly asked Commissioner Landis, who was in charge of enforcing the player control rules: “I would like to ask a question: in the event of a club lending a man, or giving a club at least $3,000, and he gives you an option on his ballclub, or an option on one or two players, are those players counted in the player list?” “Yes, sir,” answered Landis. In other words, Landis was confirming that any player on a minor league team—even one that a club controlled or invested in—would occupy a roster spot if the major league team had his option.

Rickey offered his secret for getting around the issue: “I have for several years of taking an option on the club of one man, say $3,000; I have the option on this club to take one man at a certain time, for $3,000. I don’t believe there has ever been a time that any man who has taken an option on a club in those circumstances have ever lost the second man to anybody else, if he wanted the second man. I have never known of it in my experience.” This workaround was not approved by Landis, but apparently the Commissioner did not recognize the extent of some of these tactics and often failed to crackdown on these gentleman’s agreements (Landis had very little staff for investigating the many under-the-table deals).

Unlike Rickey, Ruppert accepted Landis’s answer: “Two years ago at Chattanooga, when the Nebraska State League wanted different clubs financed, at that time you remember we were going to finance a club, I believe they had eleven players on that club; and we were then to select from that club one, or as many players as we saw fit. And at that time, Judge, you ruled those eleven men on that club would count in our player limit.” After some additional discussion it became clear that many owners did not actually understand all the roster and option rules.

The result of all of this talk was that the owners voted that to allow teams to invest in teams in Class B, C, or D leagues, and that those players would not count against the 40 man roster. Under this new rule, a major league team could own a minor league team, have full rights to all its players, and none would count against the major league limits until the major league team actually designated a player for call-up. This rule was eventually implemented for the higher classification minor leagues as well.

It was this rule that really freed up major league teams to create more expansive farm systems in the years ahead. The top teams over the next several years would be those, like the Yankees, that aggressively gobbled up minor league teams or created working relationships to build top-notch farm systems. While there were only 18 MLB-owned or affiliated minor league teams in 1928, a decade later the number was approaching 200, over 10 per big league club.

Branch Rickey’s Farm (1925)

Part 7 of our series on Important Moments in Team Building.  See introduction, and up-to-date list.

 

RickeyBranchIn the early 1920s, Branch Rickey was running (as both field manager and general manager) the impoverished St. Louis Cardinals, and he was getting sick of watching his more well-healed competition spend large sums to buy minor league players. A wave of high-dollar purchases began once the owners realized that post-war surge in attendance and revenue was not transitory and the major league-minor league draft rules became much more skewed in favor of the minors. In one of the first big-buck purchases the Giants paid San Francisco $75,000 for outfielder Jimmy O’Connell, and pretty soon the average big league club was spending $50,000 a year for minor league talent.

Rickey had baseball friends all over the country – college coaches, high school coaches, scouts – and he regularly received tips on where the bright young prospects were. But the Cardinals could control only 40 players – 15 for the big league team, and another 15 (maximum) that could be conditionally optioned and reacquired later. With few exceptions, if the 18-year-old was not ready for the major leagues he signed with an independent minor league team.

Major league teams in this era acquired players by either buying or drafting them from the minor leagues. The draft rules changed many times over the years, and select minor leagues occasionally were allowed to opt out but payments to minor league teams were always a significant expense.

Breadon Sam 4352-76_HS_NBL
Sam Breadon

Rickey’s solution to the high cost of finding players was for the Cardinals to own, or at least control, their own minor league clubs. Sam Breadon took control of the Cardinals in 1920, and Breadon’s deserves credit for agreeing to and funding Rickey’s idea. By the mid-1920s, the Cardinals owned a controlling interest in clubs in Ft. Smith (Arkansas), Houston, and Syracuse. More clubs followed.

An interesting historical question is why Judge Landis, who was named Commissioner in 1921 and became a staunch foe of farm systems, did not work harder to ban ownership interests in these early years. The most likely explanation is that most respected people around the game thought it was a silly idea that would fail of its own accord. Pittsburgh’s Barney Dreyfus and Detroit’s Frank Navin, close confidants of Landis, told the Commissioner it would be financially destructive. John McGraw, the Giants’ respected manager, told owner Charles Stoneham not to waste his money on a farm system. So Landis probably decided to save his political capital on another fight.

images (2)Now that the Cardinals were not signing ready-made players, but high school boys several years away from the majors, Rickey he needed a cohesive philosophy of scouting, instruction, and coaching. Every part of the game—bunting, sliding, run-down plays, and so on—Rickey wanted to be taught consistently throughout the organization. And Rickey wanted the scouting and player-development parts of the system to work hand in hand. As Kevin Kerrane wrote in his classic book on scouting, Dollar Sign on the Muscle, “Rickey applied scouting insights to teaching, and vice versa.” Rickey became a legendary talent evaluator, able to make decisions quickly on players, and all of this became suddenly critical once he had a minor league organization to run.

Rickey’s proto-farm system proved highly successful. He turned one of baseball’s most hapless franchises into one of the best run and one that was consistently competitive. By the end of the decade some of the fruit of his approach was beginning to ripen into major league caliber talent. The team still acquired some of its players the old-fashioned way, but the young ballplayers coming through its system provided a key source of supplemental talent.

Throughout the 1920s, Rickey and the Cardinals still stood alone. As late as 1931, there were still only a handful of minor league teams controlled by a major league team. As long as teams could only control a 40-man roster, there was a limit to how much teams were willing to invest in minor league teams. Before the farm systems could truly take hold, the rules needed to be relaxed. Two clubs in particular led the fight for this – the Cardinals and the Yankees – not coincidentally, the best run and most successful teams in the major leagues.

The Anti-Trust Exemption (1922)

Part 6 of our series on Important Moments in Team Building.  See introduction, and up-to-date list.

 

In December 1915 the Federal League’s still solvent owners reached an agreement with the Major League owners to fold their competing league. In return, the Major League owners agreed to pay roughly $700,000, with FL’s owners receiving widely varying payouts. One problem with the deal came when the owners of Baltimore’s FL franchise, a large collection of Baltimore business and professional men, did not want to fold their club and disband the league—they wanted major league baseball in Baltimore.

Baltimore’s shareholders were angry with the other Federal League owners for agreeing to settle, and particularly angry with major league baseball’s owners for all the underhanded tactics used against the Federals in the battle for players. Rather than take the $50,000 they were offered as part of the settlement, Baltimore elected to file suit against their fellow FL owners and major league baseball.

PepperGeorgeWhartonAfter one misstep in court and some behind scenes negotiations that led nowhere, in September 1916 Baltimore filed suit charging major league baseball with numerous antitrust violations. Baltimore’s attorneys highlighted the myriad ways that Organized Baseball had interfered with the Federal League, noting in particular the reserve clause and the blacklist. Organized Baseball’s lead attorney George Wharton Pepper, later a US Senator from Pennsylvania, sloughed off his clients’ unseemly behavior and reliance on the reserve clause. Instead he argued that baseball was not subject to being regulated under Congress’s antitrust legislation because it was not actually commerce, and even if it was, it wasn’t interstate commerce.

Baltimore prevailed at the initial trial in 1919. The jury awarded the group $80,000 in damages; under the Sherman Antitrust Act provisions the award was trebled to $240,000 and Baltimore was also awarded legal costs of $24,000. In total, the Baltimore shareholders received a verdict for $264,000. In the months after the jury award, a compromise settlement seemed likely as both sides had strong reasons to consider one. At this point a monetary payment was the best Baltimore could hope for; a major league franchise for their city was simply not on the table. For Organized Baseball, a settlement offered the opportunity to pay a sum they could afford, admit no wrongdoing, and continue business as usual.

Nevertheless, no settlement was forthcoming and the case was eventually appealed all the way to the U.S. Supreme Court where Organized Baseball won a complete victory. In a unanimous opinion written by Associate Justice Oliver Wendell Holmes and released on May 29, 1922, the Court ruled that the personal effort of baseball players was not trade or commerce, and, furthermore, that as baseball wasn’t fundamentally interstate in nature, it was not interstate commerce. Thus, Organized Baseball could not be in violation of the antitrust laws because it did not meet two conditions necessary to be subject to them.

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Oliver Wendell Holmes, Jr.

This opinion was not as strange at the time as it seems today. The definition of interstate commerce used at the time was much more restrictive than how it has evolved. In addition, the court was much more concerned about the line between federal and state authority.

So what did this decision mean for team building? We can get some insight into what a counterfactual might have looked like by examining other professional sports. Other sports leagues behaved as if they had an antitrust exemption as well until 1957, when the Supreme Court oddly ruled that the antitrust exemption was an anomaly given to only baseball, and the other major sports were in fact subject to antitrust laws.

Unfortunately for football, hockey and basketball players, making sports leagues subject to antitrust laws did not lead to more evenhanded player control rules. The leagues instituted other expedients to limit the impact of the Court’s ruling on player freedom. For example, the National Football League introduced the “Rozelle Rule,” named after Commissioner Pete Rozelle, which gave him the power to decide on compensation to a team losing a free agent from the team signing one. The fear of losing one’s top players or draft picks as compensation was a strong deterrent against signing players at the expiration of their contract. Not until the 1970s and 1980s did the other sports begin to have true free agency.

The players in these other sports benefited indirectly, however, from the emergence of rival leagues. The antitrust laws tempered many of the more blatant actions–such as the blacklist and inducing players to break contracts–used by Organized Baseball against the Federals. These laws clearly made a difference. Successful rival leagues emerged in all three other major professional sports. The existence of these rival leagues benefited the players as the competition for their services helped drive up salaries. Roster building took on its own challenges as owners and GMs addressed both possible defections from their own squad and the potential new source of talent by going after players in the competing league. With its antitrust exemption baseball was effectively immune from this competition. After the demise of the Federal League, no competing major league ever again took the field.

For more on the Federal League settlement see this book.

 

Howie Roseman Proves a Skillful Team Builder

Saturday’s Minneapolis Star Tribune had a great article on Eagles GM Howie Roseman’s building of that team.  Owner Jeffrey Lurie encouraged the team to be aggressive both off and on the field—as highlighted by the fourth down call at the one-yard line at the end of the first half—and both Roseman and coach Doug Pederson took his directive to heart.

Roseman used all avenues to find players—one of the trademarks of great GMs.  He traded five picks to move up to number two overall to draft QB Carson Wentz.  When Wentz was ready to start, the Eagles traded starting QB Sam Bradford for a first and fourth round draft pick, also freeing up cap space which they used to sign free agent WR Alshon Jeffrey.  CB Ronald Darby and DT Timmy Jernigan came via trade, as did Jay Ajayi during the season for a fourth round pick.  Overall, eight of the Eagles starters were acquired in 2017.  The team also has its own Moneyball-market inefficiency philosophy: high draft picks that didn’t pan out with their original team.  Philly’s roster has 20 players who had been either first or second round picks.

The Trade Deadline (1922)

Part 5 of our series on Important Moments in Team Building.  See introduction, and up-to-date list.

 

DuganJoe
Joe Dugan

On July 23, 1922 the New York Yankees sent Boston Red Sox owner Harry Frazee $50,000 plus three reserves and a pitcher to be named later for third baseman Joe Dugan and outfielder Elmer Smith. For the Yankees, the key player was Dugan, a highly regarded 25-year-old. For the Red Sox, the key was the money. Since the sales to New York of Carl Mays in 1919 and Babe Ruth after that, Frazee had been cashing in his players, mostly to those same Yankees. Dugan was one of the last of his prized players.

While not prohibited—the trade deadline at the time was August 1–these late July transactions by contenders were generally frowned upon. On the day of the deal the Yankees were in second place in the American League, 1.5 games behind the St. Louis Browns. Not surprisingly, the Browns organization and its fans went berserk. Though Dugan was pretty much an average player in New York, the Yankees overcame this small deficit over the last two months of the season to edge St. Louis by a single game.

The previous season the National League had witnessed a similar episode with a more significant player. On July 25, 1921 the Giants purchased star left fielder Emil “Irish” Meusel from Philadelphia Phillies’ owner William Baker. The Giants were running second, four games behind the Pittsburgh Pirates, and New York manager John McGraw wanted a third capable outfielder to go along with Ross Youngs and George Burns. To land Meusel, McGraw surrendered two players and $30,000, though the cash was not reported until several weeks later; it was originally described as a straight trade. Baker had been gutting his ballclub; at the time of the Giants deal they stood 25-62, and Meusel was one of the few good players left from what had been a fine team during the war.

MeuselIrish
Irish Meusel

To shield himself from the ire of his fellow magnates and his team’s fans, Baker charged Meusel with “indifferent” playing and claimed he had suspended Meusel several days before the trade. Suitably riled, Commissioner Landis investigated and determined that Meusel had not been suspended or even accused of malingering by his manager; Baker had simply fabricated the story. Nevertheless, Landis allowed the deal to stand.

The Meusel deal became especially galling for Pittsburgh when the Giants swept them in a crucial five game series at the end of August, with Meusel acting as the catalyst, hitting .500/.556/.938 for the series. By the end of the season the Giants had taken over first place, capturing the pennant by four games over the Pirates.

When the other free spending New York club made its similar pennant-changing deal a year later, the non-selling owners had seen enough. It wasn’t so much the trades themselves, but the perception of buying the pennant by the New York teams. The Giants had long been the biggest spending team and best in the National League, and once Jacob Ruppert and Til Huston bought the Yankees they were assuming the same role in the AL. In 1922, the two New York clubs met in the World Series for the second straight season, and would again the next year as well.

To confine most of the dealing to the offseason, at the joint major league baseball meeting on December 14, 1922, the owners voted to institute a June 15 non-waiver trading deadline. (Intra-league trades only – inter-league deals remained prohibited until 1959.) Any player moved after that date would have to clear waivers. Further testifying to the resentment of the owners and Commissioner Landis, they even considered a provision that would have prohibited the previous year’s pennant winners from making any in-season deals with other major league teams.

Sixty-four years later – in 1986 — the owners moved the trading deadline back to July 31, as much of the original impetus for the earlier deadline no longer applied. This six-week difference in the middle of the season has proved to be meaningful. For the vast majority of teams, it is almost impossible to decide whether to be a buyer or seller by June 15. Too much baseball remains to be played. Today teams can get a pretty good handle on their squads before deciding which way to move, and the later trade deadline has generated heightened publicity as teams concoct their often blockbuster deadline deals.