It’s the Management, Stupid

As an investment analyst and former economics student, I particularly
your use of risk/reward concepts
in this column. It has been proven time
and time again that economic efficiency is greatest where good management
is rewarded and poor management is punished. This is the beauty of our
system of economics.

However, I must disagree with the assertion that there is no competitive
balance problem in baseball. I think a more accurate statement is that the
competitive balance problem has nothing to do with the financial position
of various teams.

Free agency structure is such that the stable of free agents is always
artificially low. For example, there are 30 starting shortstops around
the league, but only 2 or 3 might be free agents in a given off-season. So
a team in need of a new SS has very limited options. Artificially
constricted supply leads to higher prices, and a decrease in economic

In fact, maximization of economic efficiency requires portability of
productive inputs. In this case, productive inputs means players. The most
obvious solution would be to drop the service time requirement.
Essentially this would increase the supply of available free agents
dramatically. This should have two positive economic effects:

  1. Younger players would receive compensation closer to their actual value.
  2. Older players would not be overpaid simply because there was an
    artificially small supply of free agents.

There would also be two positive effects on parity:

  1. Teams would not be able to delay paying their star young players,
    creating salary crunches for successful teams sooner.

  2. Since only the dregs of players would be paid the minimum salary under
    this system, the "Pohlad Maneuver" would probably cease to be
    an effective strategy.

There are problems with this system, such as a lower incentive to develop
talent. However these are problems the market has solutions to, such as
rules corporations have on tuition reimbursement. Elimination of service
time would increase economic efficiency in baseball and as a result,
improve competitive balance.

--Tom Graff

Interesting stuff, and there’s certainly enough
strange constraints and twists in the current system to find lots of
inefficiencies. I’m not sure that the current supply constraints caused by
the free agency rules really do all that much, as demand is also
constrained, but there’s clearly enough going on to make Adam Smith spin in
his grave, and Keith Law toss and turn at night.

Thoughtful letter, and we appreciate the time you took to write in. All of
us at BP thank you, but we’re all a little frightened that the "Pohlad
Maneuver" could possibly be from a film starring Jessica Hahn. We at BP,
particularly Gary and Keith, welcome any submissions on baseball
management, economics, finances, or legal issues. We’re hoping that we
don’t get to discuss these things at length after the 2001 season.

–Gary Huckabay

I do not believe that the US population
has risen as drastically as the number of MLB clubs
since the days of 16 teams. Of course the talent pool
has been diluted and that includes pitchers, catchers and position players
as well. Your argument about the population growth is at best ludicrous
and at worst just plain stupid. John Doe is not seeing the best at the
major league level, fully 1/4 of the MLB players should be no higher than
AAA and the remainder at AA or less.


Dear Abe:

In the pre-Jackie Robinson days, there were (if my
math is correct) 384 roster spots in what we know as MLB — 16 teams, 24
players per team. Approximately 11% of the US population was ineligible
to play because of the color of their skin. Using historic census data,
the highest number of citizens per roster spot prior to 1950 was
approximately 324,300.

The peak number of eligible citizens per roster
spot occurred around 1960, with about 470,500. Most of the years from 1950
to 1970, there were just over 400,000 U.S. Citizens (God love us) for each
roster spot in MLB.

Tragically, that number has dropped to 366,277 American citizens for each
one of the 750 roster spots in MLB. And, as we know, there are no players
in MLB or in farm systems from any other country in the world.

One way MLB may be able to address this dilution is to find out if there’s
baseball talent anywhere else in the world. Imagine if there were
literally thousands of teams in leagues in dozens of countries, and
American clubs could scout players in these leagues, and select the best
for inclusion in the MLB system. I’ll bet there’s at least two or three guys in
Mexico, Venezuela, Japan, the Dominican Republic, or Korea who could probably
make a roster as a long relief man or pinch hitter.

Thanks for your letter, and do give our best to the folks there at
Springfield Retirement Castle.

–Gary Huckabay

Big Baby

Amen. It was interesting to read the Daily Prospectus in juxtaposition with
Keith Law's Imbalance Sheet and Curt Schilling's essay (though any such piece that suggests putting the Cubs and Cardinals in opposite leagues takes a shot across the credibility bow in my mind). There are a scattered few fans that aren't blinded by jealousy over the big money paydays and likewise roll their eyes when Bud Selig and the posse walk around town with their "the End is Near" placards, but so long as each side of the baseball fence seems intent on playing the part of doddering fools -- converts will be few and far between.

Once upon a time it was easy. In my youth, I could simply talk disgustedly about the injustice of players going on strike. As I grew older and wiser, I learned that people like Carl Pohlad weren't exactly giving the order to lock out players from third world hovels. To whom do we turn for our moral compass once players like Mark McGwire retire?

It almost reminds me of ordering a pizza in my college days - everyone starts shoving pieces in their mouth as fast as possible, worried they won't get their share. Of course, the pie was only so big back then.

It's no fun choosing a rooting interest in a baseball labor war no matter what the circumstances, but how can you even pick a side here? In the owner's corner, you've got megalomaniacal idiots like Peter Angelos and the Boss, clueless dopes like Jerry Colangelo, and Scrooge-esque skinflints like Pohlad.

You'd think that would make the players winners by default, but then bozos like Thomas make you wish things like salary caps were a good idea. If Donald Fehr wants any kind of public leverage this fall, the union would be best served by imposing huge fines on guys like Gary Sheffield and Thomas every time they demonstrate their liking for the taste of their own foot. Then they might really need the extra five million.

--Shannon Jaronik

Don’t let a couple of bad apples spoil the bunch. It doesn’t take
a Jayson Stark article full of unattributed comments to make me believe that Thomas
and Sheffield are the exception to the rule. In general, the players
I’ve met seem happy enough just to be in baseball, and I always think
about them while counting to ten whenever I hear of a situation like

–Dave Pease

I live in Chicago and as a Cubs fan inherently can't stand Frank Thomas. At the same time, what I now dislike more is the amount of print space devoted to contract squabbles. I honestly couldn't care less. This constant plea to what the "blue collar worker" thinks about what these guys get paid and how they whine for more is getting so old and tiresome. Any worker anywhere wants to be paid more, if they told you differently they're lying! Here's a novel idea: write about baseball! Tell me who's looking good in spring training. Whose fastball looks lethal vs. lefties. Basically, your core competence. Enough about dollars and cents. I really think it would be better for the game and for sports journalism altogether.

--Eliseo Thorrens

We’ve all been taking a stab at the financial side of the game lately,
and I’m afraid that’s going to continue for one more Daily Prospectus.
After that, you have my word that we’ll be giving it a rest and concentrating
on the game itself for a while.

Well, except Keith Law, but he’s basically an unstoppable force.

–Dave Pease

Transaction Analysis

I'm interested in the note about Kim Ng's promotion to assistant GM of the
Yankees. A lot of ink is expended on the lack of minority hiring in
baseball's front offices--yet if the name is any indication, we have an
Asian (Asian-American?) woman holding down a pretty important post in
baseball's premier organization. Even if she's a WASP with an Asian surname
through marriage or adoption, it's still noteworthy that a woman was hired
for the position. When the promotion was announced, was there any indication
she is going to handle duties consistent with the job title? Or was this
just a token hiring to generate some "feel-good" news? How did this slip by
the mainstream media without comment? Or did I just miss it in my haste to
read Boondocks and Dilbert that day?

--Mark Murphy

Kim Ng’s promotion has gotten a reasonable amount of coverage, and the
really happy element of the story is that
she is in no way a token. From her
early days starting out in the front office of the White Sox with Dan Evans,
she’s worked in MLB’s main office before her work with the Yankees.
From what I remember, her specific area of expertise was in doing
arbitration research, but I’m guessing that her responsibilities
have grown with this recent promotion.

The relative lack of coverage in the national media does lead to a couple of
observations about the nature of media coverage of baseball in general,
which is that if it isn’t a "downer," it probably doesn’t get covered. Media
coverage of baseball as an industry is relentlessly negative. That undoubtedly comes
across as the pot calling the kettle black, but most coverage of the
industry and the game seems to be based on the assumption that something is wrong,
instead of focusing on everything that’s right. There are a number of
reasons for this problem: inept spin management by the industry itself, basic
ignorance of the relevant issues among far too many fans, editors or journalists, and
probably an element of people worshipping an idealized past that never
existed, and making the usual dissatisfied comparisons with the present.

I’m also willing to guess that there’s a double standard here. Hiring Don
is seen as progress, firing Don Baylor is seen as a setback, but
hiring somebody in the front office who is neither white or male somehow
doesn’t count in this kind of arithmetic. Meanwhile, Willie Randolph and
Chris Chambliss don’t get hired, but Lloyd McClendon does, and Baylor
gets new opportunities after squandering old ones. The problem, such as
it is, is less racism than the absence of standards to evaluate who should
get hired, or who gets hired and why.

Lastly, Kim Ng is indeed Asian-American, not by marriage.

–Chris Kahrl

I think your comment on Jerry Manuel was both correct and gracious.
You have been overly harsh on him and he has gotten better. It's good of
you to acknowledge it (columnists, like managers, are more appealing when
they correct their errors). Most importantly, I think Manuel is a fairly
intelligent guy which means that he can learn from his mistakes and sort
things out. That's why I'm relatively confident that he will, for example,
end up playing Valentine, Clayton, Perry, Crede and Singleton (and Ramirez?)
in a credible mix and get the right guys into the rotation (ok, not Keith
, but that's hopeless).

We'll see how Jerry handles the latest Frank Thomas flap but my guess there is
that the Big Hurt will simply have to put his tail between his legs and come
back to work. I just don't see Reinsdorf budging an inch on this one, just
as he didn't budge when Scottie Pippen was in a similar situation. What is
it with Thomas anyway? I don't think he's a truly stupid person but how can
he possibly win this fight? All he's doing is
giving the idiot commentators
and columnists a chance to go off on him
while driving away the many fans he
could have. I don't get it.


As I always like to point out, one of the best things about baseball is that
as much as we think we know, something will (not may, will) happen
to make you think about your ideas and preconceptions. So it is with me
and Jerry Manuel, or me and a lot of things in the game. If we ever tried
to assume the mantle of infallibility, that would merely mean we’d make a
slightly louder noise when we fall flat on our faces when we get something
wrong. Getting things wrong isn’t the end of the world: they’re learning
experiences, and an opportunity to find out why we’re wrong.

One thing that I don’t think got enough attention was that Jerry Manuel
did a pretty good job of hiding Jose Valentin against lefties. Not every
manager would have given Tony Graffanino a chance to play short.
Not every manager would have given good exposure to Mark Buehrle
and gotten good work out of him. If there’s such a thing as an ideal
manager when it comes to aggressively using talented journeymen and
equally talented rookies, Manuel has clearly gotten short shrift from me.

As for Thomas, I never cease to be amazed about how he almost
deliberately shoots himself in the foot when it comes to public relations.

–Chris Kahrl

In the wake of the Mike Sirotka snafu (and considering the war zone that was the
Expos' pitching staff last year), I caught an interesting item
the other day.

The Expos are requiring all pitchers who are new to the
organization to take an MRI.

I can't be alone in thinking: what took baseball so long to
figure this one out?

--Ron Johnson

That is an interesting item, in that barring some sort of block discount,
that won’t be cheap, but in terms of big league expenses, it should also
be very survivable.

It’s interesting to consider what that kind of approach might have
done for the Indians, so that they could have caught on that Charles
was hurt sooner than they did, and potentially making the
playoffs instead of losing that extra game or two.

But I would stress one thing: there’s a reason that so many teams
aren’t doing something like this, and it goes back to my original
observation: they’re cheap. When it comes to non-player expenses,
a lot of teams try to cut corners. I know, I know, we’re both on the
same page when it comes to "better to blow $150 grand on preventive
care and maintenance than oodles of cash on Darren Oliver," but
then not that many teams have assimilated the concept of sunk costs.

–Chris Kahrl

The Rest

What about this Toe Nash guy
that Gammons made famous a month or
so ago
? I'm not saying he should necessarily be on your
Top 40 Prospects
list. I'm more curious just to hear your thoughts about the guy... Likely
to be a high prospect next year? What position do you even think he'll play?

--Jeff Richied

Normally Rany gets to field the prospect questions, but I got to this one
first. Goody.

First of all, this is assuming Toe Nash actually exists, and isn’t shackled
in some backcountry jail for his alleged criminal record as you read this.

Toe Nash hasn’t even seen a AA curveball yet, much less major league
quality breaking stuff. I’m a betting man, so I’m not sure how much this
is worth, but I’d be willing to bet he’ll never be an average major-league
player, at any position.

If he actually is incarcerated for any length of time, judging by Gammons’
report of his tools, I think his chances of making the Louisiana Penal
League All-Star team are good.

–Dave Pease

This is for a school project. Can you tell me how a fastball, slider,
splitter, change-up,and a screwball work. Like how snapping your wrist and
air pressure effect it. Can you also tell me why some great pitches in MLB
are so successful in throwing strikes? I also need to know how the length of
your arm, your overall height, total body mass, the length of your leg, and
the size of your fingers effect your pitching. What makes a good pitcher?
Can you also tell me what scouts look for in a pitcher? I also need to know
about how to pitch underhand as in softball vs. overhand in baseball.


While I could try to explain some of this stuff to you, I’d inevitably get
some of it bollixed up. I recommend that you purchase a book called
The Physics of Baseball by Robert Adair.

–Jeff Bower

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