Reviewing Dominican Baseball: New Pride, Old Prejudice

The core of business is profitability.  The art of business is achieving that profitability.  As with all art, its legitimacy is highly dependent on the point of view.  The United States has increasingly become a consumer culture that has been progressively been removed from seeing how exactly their sausage, banana, or iPhone are made.  The further that distance is, the more reality becomes distorted.  We do not exactly lose our sense of humanity and environmental stewardship as we grow distant from creation.  However, we do tend to grow selective in the set of facts, notions, and misgivings that we surround ourselves to sustain our world view.

It is in this complex board of emotions, facts, and rationalization where Alan Klein's Dominican Baseball is found.  The book intends to fill a void in how the Dominican is discussed by sports columnists in the United States.  It does note that the system in place does have a number of corrupt buscones or amateur trainers (a topic that is heavily over publicized in our media), but that the corruption of a few does not represent the rest.  That this group (perhaps a 1,000 strong) is very well predominantly upright, moral, and filled with good intentions and support.  That this group is contrasted by the large monstrosity of Major League Baseball and how that entity tries to control talent on the island and artificially decrease money flowing into the island (currently around 75 MM per year).  A monstrosity that ignores most aspects of a player (even ignoring the vitally important need for integration into American culture) while simply focusing on baseball and a somewhat authoritarian control.  These topics are rarely discussed and quickly forgotten (how many remember the Mother Jones piece last year showing evidence of disregard for health issues at baseball academies?).

In doing so, the book is one of contemplative advocacy, but very much firmly planted in advocacy.  It is also very much firmly planted in the world of socio-economics to the point where you really need to pay attention in the first couple chapters to truly appreciate what the author is bringing forward: a rather damning appraisal of how Major League Baseball treats the Dominican Republic.  As such, one does notice obvious flaws in the discussion.  For instance:

In 2002, the Los Angeles Dodgers signed Jonathan Corporan, a seventeen year old Domincan pitcher, for $930,000...What the Dodgers saw in Corporan was a wonderful combination of size (he is six foot two) and velocity (he threw regularly in the low 90s). ...increased vigilance stirred questions about his identity, and soon the U.S. Embassy had enough evidence to determine fraud had been committed.  Overnight, seventeen year old Corporan turned into twenty one year old Reyes Soto. ...the Dodgers decided to resign him for $150,000. ...Jeff Shugal, the Dodgers' head of international scouting wryly commented, "He was the same guy we thought was Jonathan Corporan. He just wasn't Jonathan Corporan." ...

Why, if his skills remained the same, would a seventeen year old be so much more valuable than a twenty one year old?

Being followers of this site, perhaps baseball in general, you should immediately see how absurd that conclusion is.  Soto was not docked almost 800k for lying, he was docked that amount because he turned into a rather mundane prospect overnight.  A seventeen year old kid has promise.  At 6'2", Soto had good size, but not prototypical size.  One could imagine that a teenager getting better nutrition might be able to add a couple inches and be more prototypical in stature.  A low 90s fastball for a right hander will simply get you through the door and the hope is that maybe a few more ticks will be added to that ball or perhaps his secondary offerings will become better with more experience.  At twenty one year old, you expect a player has reached his known physical shape and that his secondary offerings are highly unlikely to improve a considerable degree.  There is simply less to project and that is why a prospect can go from an elite 1.8 MM bonus (in 2013 money) to a third/fourth tier 290k bonus (in 2013 money).

That misunderstanding of baseball should not sully the central thesis of this book.  That central thesis, at least to this reader, is that the Dominican Republic was a minimally diverse economy that was somewhat self reliant and had an element of baseball associated with it.  Now, the country is much less diverse with fewer people growing their own food and the population largely depending on a highly competitive tourist trade (my own inference) and Major League Baseball (the book's discussion).  With a humanistic view, the book suggests that the country should have say over their own natural resource (prospects) without being overly heavy handed by the United States' Sphere of Influence.

However, my view on the book in general is one that is somewhat lying in wait for a tragedy amongst all the tragedies within.  The preface opens the book with a victory.  Astin Jacobo Jr., one of the preminent buscons and one you should be familiar with through Pelotero, is expressing a great deal of jubilation.  He and a rag tag group of like minded Dominicans (the language adorned to them carries a hint of romanticism) are able to convince 153 out of 154 Dominican players to sign a protest over the international draft.  The issue for these players is not a monetary one, but one of National pride.  Jacobo exclaims, "We beat them!"  However, as the reader, we have the gift of being removed from the situation and the emotions that are stirred for those deeply entrenched in this as a livelihood.  We know the power baseball has.  We know baseball players eventually care more for their own wallet than they do for the kids back home experiencing something they think they had to deal with in making it to the Majors.  We know that the draft is coming and that international amateurs will be increasingly exploited without the safety nets afforded to the also exploited domestic amateurs.

Well, maybe we do not know this.  It is a generally good assumption.  The powerful tend to obliterate the downtrodden few.  Successful revolutions tend to revolve around the powerful being upended by the downtrodden many.  As such, it is hard to see how the Dominican can take control over their home grown resource.  As such, it is hard to see how the Dominican economy can be made more robust to prevent this incredibly difficult pass/fail economic program revolving around baseball.  Of course, if MLB ever bothered to think about it, economic prosperity in the Domincan would not be good for them.  As the book on Venezuelan baseball so succinctly titled its book, Venezuela Bust, Baseball Boom, a low probability ticket to the Majors is worth a lot more when so many are in poverty.

In summary, do not take Dominican Baseball as the end all in the discussion on this issue.  It is part of the discussion and it is a part that is often overlooked.  The book is not without its prejudices, which is something that should be noted.  However, their presence really should not prevent you from fully considering what is presented here and realizing that monopolies and capitalism have dark sides.  As such, it is one of the several volumes that should grace your book shelf in order to make you competent in discussing international baseball.

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Dominican Baseball by Alan Klein
Temple University Press
200 pages

2013 World Baseball Classic: Puerto Rico

This is the second in a series to introduce everyone to teams participating in 2013's World Baseball Classic.  As this series progress, you will find all of the articles under this key world: 2013 World Baseball Classic.  Previously, we reviewed Australia and Cuba.

The body of the Puerto Rico article was written by Jon Shepherd.

Puerto Rico
IBAF Ranking (out of 74)	12th
2013 Pool	Dominican Republic
	Venezuela
	Spain
2013 Players of Note	Yadier Molina, C
	Jose Molina, C
	Carlos Beltran, OF
	Alex Rios, OF
	Angel Pagan, OF
2009 Record	4 - 2, Round 2
2009 All WBC	Ivan Rodriguez, C
2006 Record	4 - 2, Round 2
2006 All WBC	None

Proximity to the United States, its education and business interests, along with the establishment of the Monroe doctrine (the government’s expressed interest in restricting European interests in the Americas), was a major influence in the spread of baseball in the Caribbean.  The first wave of baseball was from Cubans going to college in the States and then them proselytizing the game to all the islands, Latin America, and the Northern shore of South America.  The second wave often consisted of the US Military establishing bases to secure their interests after the Spanish American war.  In the soldiers’ down time, they would often set up leagues and play against the local.

Puerto Rico’s experience with baseball began the same way.  Early disciples learned the game in the United States and tried to introduce it to the island.  However, it took about a decade before the first baseball clubs were created in the late 1890s.  Shortly thereafter, the island transferred from the Spaniards to the Americans who set up bases and established regular games as recreation to pass the time.  Over several decades, the game became more entrenched with lighter colored Puerto Ricans being picked up by various minor league teams.  The Negro Leagues also picked up players from time to time.

Hiram Bithorn was the first Puerto Rican to appear in the MLB game.  The Chicago Cubs, trying to stay competitive while dealing with a massive efflux of players due to World War II, signed Bithorn in 1941.  He was an ace pitcher in the Puerto Rican winter leagues and was also a manager.  Bithorn struggled his first year and then proceeded to dominate in 1943, going 18-12, 2.60 ERA, 7 shutouts, and 19 complete games.  He then enlisted in the military and served out until the end of the war.  Upon coming back 30 or 40 pounds heavier, Bithorn pitched poorly and retired in 1947 after developing a sore arm.  He was murdered by a policeman a few years later in Mexico as he tried to make a comeback in the Mexican leagues.  You may remember that the main stadium in Puerto Rico, where the Expos played in 2003 and 2004, is named Hiram Bithorn Stadium.

Talent came out of Puerto in a slow trickle until the 1980s.  Roberto Clemente was the first Puerto Rican to be enshrined in the Hall of Fame with Orlando Cepeda being the second.  The 80s though saw a massive influx of talent coming to the US from the island.  Javy Lopez, Pudge Rodriguez, and Jorge Posada all came out at the same time and all have a good argument to be included in the Hall of Fame.  Roberto Alomar is already in.  Other late 80s talent finds included Bernie Williams, Juan Gonzalez, and Carlos Delgado.

Since then, talent has been trickling in again with Javier Vasquez, Carlos Beltran, and Yadier Molina establishing themselves as elite players.  Much of the concern over the reduction in talent has been placed at the feet of the 1991 decision to include Puerto Rico in the Rule 4 draft.  No longer could trainers and agent collect amateur talent and sell it to the highest MLB bidder.  Now, every team had a chance as long as they had a high enough draft choice.  The argument goes that with reduced money being handed out to players, that the system that was in place to develop these amateur players had no financial reason to exist anymore.  However, there is some argument to this.  Opposing points of view suggest that improved standards of live have pushed families to further educate their children instead of wishing on big money from baseball.  Others still simply suggest that the island simply has had a run of bad luck.

Below is a table showing how Puerto Rico compares in developing players who wind up in the Major Leagues.  I would interpret any player born before 1974 to be in the pre-draft era.  The 1974 to 1978 range would be players born in the time when the draft was instituted, but the island's talent likely still benefited from pre-draft infrastructure.  The 1979-1983 cohort would represent the group that most likely did not benefit much from the previous system.  I compared the country to the two other stalwarts in baseball player production, Venezuela and the Dominican Republic, who are also in their starting pool in the 2013 WBC.

Born	Puerto Rico	Venezuela	Dominican Republic
1954-58	16	5	26
1959-63	20	15	31
1964-68	32	18	57
1969-73	29	28	81
1974-78	39	47	108
1979-83	19	67	105

The interesting thing to me about the above table is how talent greatly increased from Venezuela from the 1969 to 1983 time period.  It may well be that other clubs began mining the country for talent after the Houston Astros showed so much proficiency there.  It may have also been a product of clubs deciding to reroute their scouting and training money from Puerto Rico to Venezuela.  It may also be the elimination of the trainer/agent system and the lack of a developed little league system.

MLB and other interests recognized after a decade of having Puerto Rico under the Rule 4 draft that something needed to be done.  In 2002, MLB had every team pay in money to support the Puerto Rican Baseball Academy and High School.  It sounds more grand than it actually is.  A few years back, the Orioles established their own academy in the Dominican Republic, spending several million.  MLB hands over to the Puerto Rican Academy $400,000 a year.  The academy is a single building that acts as an academic setting and headquarters with its players being transported to fielded around the area to play.  The academy does not sufficient lands or funds to build their own complete training facilities.

However, it is still roughly productive with five players getting drafted and 40 being sent to the states for collegiate baseball per year.  According to my records, 61 players have gone from the Puerto Rican Baseball Academy and High School directly to the professional ranks, starting with their first graduating class in 2004.  None have played a single Major League game, but there is some hope that the island's infrastructure for developing talent is improving.  Carlos Correa was drafted last year number one overall by the Houston Astros with MLB.com's Jonathan Mayo assessing that he was the 30th best prospect in baseball.  Correa definitely shows that top tier talent is capable of turning up in Puerto Rico, but it remains to be seen if the island can return to its former glory as a producer of baseball players.

Much of the island's reemergence will likely be related to how invested MLB is to creating infrastructure in Puerto Rico.  By having a laissez-faire attitude when the country was not under the Rule 4 draft allowed for the area to develop a more professional tone with weak youth leagues and strong trainer/agents.  Upon draft inclusion, the trainer/agents no longer could make serious money by selling off to the highest bidder and that profession crashed.  The youth leagues were underfunded and neglected to the point where they were not a suitable way to develop talent.  It can be argued that it is the populations' responsibility to invest in their own infrastructure if they want to produce top level baseball talent, but that should also be in MLB's interest as well to encourage the game in one of their strongest markets.

2013 World Baseball Classic Roster

In 2009, Puerto Rico's roster was populated with some of the old guard now gone, such as Javier Vazquez, Ivan Rodriguez, Carlos Delgado, and Bernie Williams.  Returning players include Carlos Beltran, Yadier Molina, and Alex Rios.  New significant additions are Jose Molina and Angel Pagan.  That leaves the impression that this WBC team has been historically an offensive powerhouse, which would be accurate.  It also suggests that some top level, aging talent is being replaced with lower level talent.  Jose Molina may in fact be the great defensive catcher in the past twenty years, but his utility may be minimized with Yadier on the club catching as well.  Angel Pagan is certainly better than 2009's Bernie Williams, but he truly is not an elite player.  Generally speaking, the team's offense is weaker than it was four years ago and it lacks an ace pitcher or, really, any pitchers of elite talent.  Anything can happen in a short series, but they will need things to break their way to get by Venezuela or the Dominican Republic.

Napkin Scratch: To Overslot or Spend on International Free Agents

After Zach Davies signed today, I asked myself a question.  I have always been a proponent of overslotting several players in drafts and I have also been heavily supportive of dedicating money to sign international free agents.  So, this question was simply...what is a more efficient use of funds: spending more than 500k for players after the tenth round or 500k for an international free agent.

1) Reed MacPhail wrote a solid piece on the value of overslotting players later in the draft.  His basic conclusion was that it costs about 400k to sign a third round talent in the third round.  To sign the same quality player after the tenth round, it costs about 600k.  Quality of player is defined by Wang's work using prospect rankings and resulting performances in the Majors.

2) Various sources have looked into how much the draft depresses the amount of money a player can earn if he was able to sell his services in the free market.  Jim Callis suggested that the draft reduces a player's value by a factor of four to five.

3) When I looked at the differences between IFAs and Rule 4 Draftees, I came up with with a 400k draft talent as costing 570k internationally.

Based on these pieces we have a couple things we are sure of: it is cheaper to get third round talent in the third round and that overslotting players past the third round is not more expensive than signing international free agent talent.  What becomes a bit more confusing is to what degree are overslots a good deal?  If you go by Callis a third round talent may be worth up to 2 MM.  My calculations placed that IFAs and overslots were basically equivalent.  This may mean that if you believe in your scouting, feel free to go crazy with overslots because these domestic players are just as valuable as IFAs.

It also makes it look more reasonable to hand Josh Bell a 6MM deal.  He would cost that much if he was Dominican or Venezuelan.  Does it really matter that he is an American?  Value is value and hard slotting is likely around the corner.

International Draft Addendum: Free Agent Compensation Part II

This is the final part of a series looking at a potential international draft and free agent compensation.

Aspects that work well?
1. Subdivision of positions.
It makes sense to value players by subgroups.
2. Taking into account the value of a player for his current team.
At bats and innings pitched connotes a players worth to his own team.

Why is the current system not very accurate?
1. Poor statistics are used.
The numbers used are either of dubious use (fielding percentage, chances) or are rather useless (RBIs, winning percentage).
2. Undervaluing/overvaluing certain positions.
A major issue often encountered are free agents who flounder around due to unrealistic compensation statuses attached to them. For instance, Jose Valverde is struggling to find a decent market for his services because he is a type A reliever, but no team is willing to offer both the cash and loss of their first unprotected pick for him. The same thing happened to Orlando Hudson, Adam Dunn, and Juan Cruz last year.
3. Potential over-compensatory approach for players on disabled list.
There really is little reason why a player like Erik Bedard would qualify for compensation even though he has only seen 164 IP over the past two years. Being able to stay healthy should be a consideration as it affects a player's future cost.

But what is the major failing of the system?
Value lost is not value gained. Losing a top free agent results in getting two players who are, at best, 4 years away from the free agent signing to making a difference on the big league club. This is the most glaring issue with the current approach. The other failings need to be corrected, but making the adjustment closer to real time is a better solution.

After the jump, a better way to identify type A and B classifications and a more fair way to compensate.


How to better classify free agent classes:
Use a condensed statistic like WAR. This system would use all of the attributes from the current one and place them in a more defensible construct. It also incorporates health as a attribute as opposed to assuming a players health is a constant. For defense, the system should use a three year weighted average to determine UZR for fielders. Assume all catchers are average defensively until a dependable measurement technique is devised to measure that.

What is a more fair way to compensate teams?
Get rid of the draft pick compensation scheme. It makes no sense. I think the best way to do it is to issue a signing tax on any type A or type B free agent on the team that signs the player. A type A player contract would be taxed 20% and a type B player contract would be taxed 10%. The tax would be paid from the signing team to the one who lost the player. That team has the option of beginning the program that year or waiting until the following off season to begin. This tax money must be spent on a free agent and must be at least on a 1:1 dollar shared ratio. Any unspent money is forfeited back to the player on which the tax was issued.

For instance:
Lets say Mark Teixeira signed an 8 year deal for about 180MM. That is a yearly average of 22.5MM. Assuming that yearly sum is what the Yankees are willing to offer him, under the new scenario he would be paid 18MM with 4.5MM being sent to the Angels. This would happen in years n to n+2 or n+1 to n+3. The Angels would have that 4.5MM allotment to spend on 9MM or more for a single free agent. If they only spend 8MM on a free agent assigned to this allotment, they can only receive 4MM in compensation and 0.5MM goes to Teixeira.

Why would this be good for teams?
Compensation for a type A players generates on average about 5.6MM in value. In order for a team to get similar compensation a player would need to sign a 3/27MM contract. That is about what an average baseball player would sign for if 1 WAR is worth about 3.5 to 4MM. That seems about right. The better the player, the higher the compensation. The value of that compensation is also more immediate and more dependable than draft picks would be.

Why would it be good for players?
It would probably push for players demanding long term contracts as well as forcing teams to spend money on MLBPA free agents. Money cannot disappear from the market if a team wishes to get compensated. It also encourages the teams to sign a player for 3 years so they can fully really that compensation. Likewise, a team/player is only taxed for three seasons and it is based on his lifetime contract, so it is not a great burden.

Amateur Talent Addendum: Free Agent Compensation Part I

After writing a piece on an international draft, I figure there were some aspects of it that need more exploration. This multipart series will reintroduce what Type A or B compensation means as well as how to implement compensation into this new draft system I propose. Part I will reacquaint you with what this compensation means.

As it stands now, the loss of a type A or B free agent results in compensation in the form of draft picks. For a type A free agent this means that the former team of the player receives a sandwich round pick between the first and second rounds according to the Elias rating (higher ranking free agents result in a higher draft pick during this round) as well as the new team's first unprotected draft pick. This translates to the second half of the first round (first half picks are protected) or the first half of the second round. Further complicating this approach is that if one team signs two type A free agents, the team who gave up the higher rate free agent would be the one who secures the higher pick. The second team then winds up with the next unprotected pick. An example would be last year when the Yankees signed CC Sabathia, AJ Burnett, and Mark Teixeira. The Yankees gave their 1st round selection to the Angels for Teixeira (98.889 rating), their 2nd round pick to the Brewers for Sabathia (98.110 rating), and their 3rd round pick to the Blue Jays for AJ Burnett (89.729 rating). It should be noted that although original round 1 to 3 picks are protected for one year, compensatory picks are not. If a team fails to sign a player with a compensatory pick, they do not receive a replacement in the following year's draft.

After the jump, we will more greatly characterize how Type A and B status is determined.


After the conclusion of each season, Elias Sports Bureau uses a somewhat secret formula to determine a rating of every player in baseball . . . not just the free agents. A type A player is considered to be a free agent who has performed in the top fifth of baseball over the past two years. A type B player is considered to be a free agent who has performed in the second fifth of baseball over the course of the previous two years. Former teams who lose players beneath the 60th percentile will not receive compensation.

So are there restrictions on compensation?
Yes, compensation is in effect until the first week in December when there is a deadline for the former team to offer arbitration. Compensatory terms remain in effect if the team offers arbitration and the player declines.

How are players rated?
First, players are divided by position. The groupings are as follows:
Group 1: 1B, OF, and DH
Group 2: 2B, 3B, and SS
Group 3: C
Group 4: SP
Group 5: RP

A weighted system that takes into consideration for lost time on the DL uses these statistics:
G1: PA, AVG, OBP, HR, RBI
G2: PA, AVG, OBP, HR, RBI, total chances, Fielding %
G3: PA, AVG, OBP, HR, RBI, Fielding %, Assists
G4: Total games (relief appearances are discounted by half), IP, W, Win %, ERA, K
G4: Total games (relief appearances are discounted by half), IP, wins and saves, H/IP, K/BB, ERA


As you can imagine, this system is needed in terms of granting compensation for lost players for small market teams, but the manner in which they do this is rather poor. In the next part of this series, I will discuss a revamped approach that will fit into the proposed system of slotting I made earlier.

Fixing Amateur Talent Acquisition

It seems a major issue Bud Selig wants to address before he retires as the commissioner is to equalize the playing field with respect to amateur acquisitions. Apparently, his concept of fixing disparity between franchises is to fix perhaps the one area where small market teams actually can compete. So lets just go for the ride and find a system that can actually work.

Based on current work of Stark, the New York Times, and the Biz of Baseball . . . I think it is safe to assume revenue sharing in general comes to at least 500MM. With that in mind, I think it would be easy to isolate about 300MM of that to amateur talent acquisition. The main step is to abolish the draft and set up annual salary shares.

I'll explain after the jump.


The draft is largely a tool to force talent to sign with certain teams and restrict their earning potential. These two issues would be a stopping point for many Japanese players looking to play state-side. To resolve this, I propose that the draft be abolished and instead teams are allotted fixed salary points based on the reverse order of their records for the previous season.

For instance (CLICK PICTURE TO MAKE LARGER):



You can see for this plan each team will be able to sign 100 players each season. This is enough to fill two Rookie league teams, a Dominican Summer league team, and provide a few guys for short season ball. It also provides several high paying positions and there are at least two teams who have contract shares of the same amount. Some may argue that the bonuses in question here are on average much greater than what is doled out in the draft and international free agent market. That is true. A rough estimate on what is currently spent on bonuses is around 240MM. This throws in another 55MM, which will help raise domestic player bonuses, which have been unfairly discounted in the current restrictive market. Another plus for players is that this system gives them choices. Even single shares, even the 10MM one, has at least two teams capable of offering it. This enables choices to be made and a better idea of what is available. It should also result in players quickly signing on as neither side has much room to haggle. The prices are effectively set.

How does this benefit the owners? It establishes a system that is ultimately fare for revenue sharing and should not greatly impede the local markets in Latin America. One issue of concern is that an international draft would collapse the baseball talent streams in areas like the Dominican Republic. In these areas, part of the local economy are buscons who develop children at a very young age and move them into position to sign with big league clubs. Finding fees are associated with these dealings. A run of the mill draft with no leveraging between teams would nip that in the bud as there would be less incentive for an MLB team to invest in these regions. Keeping them free agents with set contracts enables this to continue and MLB continues to get their talent pool stream.

But does this system benefit a player like Dice-K or Hideki Matsui? No, not in this form. Under such a plan, these players would wind up receiving a 10MM bonus and then be forced under the renewal/arbitration system. This would need to be adjusted and a potentially easy solution would be to set aside an additional 20MM in revenue sharing. This money would be used for a pay for play system similar to what is instituted in the NFL. Basically, during the renewal years players will receive a certain point total for plate appearances or innings pitches. The quality of those innings or plate appearances are not considered, just how often a person actually player. This results in a final point total. Add up all of the players that fall under this classification of renewal year talent. Divide 20MM, but that number to determine a price per point value. Players then are paid on how many points they have accumulated.