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Thoughts on Amateur Spending and the New CBA

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Everywhere you look, someone is writing about the new collective bargaining agreement. Dave Cameron of fangraphs, Ken Rosenthal of Fox Sports, Buster Olney of ESPN (subscription required), Jeff Passan of Yahoo! Sports, and many more have chimed in with their thoughts.

If you haven't read about the new CBA, check out MLB Trade Rumors for a simple breakdown of its highlights.

There have been plenty of mixed reactions. Some hate it, some love it, and some people say that it will ruin the competitive balance of baseball in five years.

Now, I'm not so sure it will ruin baseball's balance in such a short period of time, but I do have some thoughts about the new CBA that I would like to share with you.

Many people have said the new CBA hurts the small market teams, and they are right, to an extent. Teams are now no longer allowed to go above the recommended slot during the amateur draft. If they do, they face penalties up to the loss of two future first round picks. 

That aspect of the CBA does not hurt small market teams in the slightest. In this scenario, it is extremely likely that the players drafted will now go in order of talent rather than signability. The de facto hard-slotting prevents players from demanding high bonuses, which would normally make them fall to teams who could afford their demands.

Due to hard-slotting, players can't reasonably expect high bonuses, and with cost certainty, teams will select the player they want rather than the player they can afford. This will prevent the Jered Weavers of the world from falling in the draft.

However, there are aspects that significantly hurt small market teams. Small market teams are now handicapped because they aren’t allowed to overpay for (relatively) cheaper talent due to capped international spending, and they can’t afford to pay for elite Major League talent, which is obviously extremely expensive. How is that supposed to help?

This also affects the large market teams, despite Dave Cameron's thoughts. The large market teams, such as the Yankees, Red Sox, and Phillies, now have little to no chance of drafting elite talent under the new CBA. In the past, the only chances they had of getting the elite players, because they’ve been good for such a long time and have been drafting near the end of the first round, was to hope teams would pass on the high bonus demands of players in favor of more signable players, forcing the elite players to drop to the end of the first round. Or, they would just hope for exceptionally deep talent pools.

Now, due to hard-slotting, players cannot demand extreme bonuses because teams can't give them out anymore. The players who would normally demand high bonuses will now get drafted in order of talent, rather than signability, and the large market and consistently good teams will be hampered because the elite players have no chance of falling to them. And, since there is no draft pick trading, they have no chance to move up to acquire the talent that will never reach them.

Additionally, the large market teams' greatest strength when it comes to amateur talent was taken away from them. With caps on international spending, these teams cannot offer high bonuses to the Jesus Monteros and Gary Sanchezs of the world. It's because of international spending that the Yankees were able to build a good farm system - Montero, Sanchez, and Manny Banuelos, the team's top three prospects, were all signed internationally.

How are the large market teams going to bring in elite amateur talent if they cannot spend a lot of money internationally and the elite players in the draft won't fall anymore? 

However, there is one thing, a major aspect that still significantly helps the large market teams. Due to the limitations on amateur spending for everyone, winning is even more about spending at the Major League level, and only the large market teams can do this. But, it's not like this advantage is anything new.

We have positives and negatives on both sides. What are your thoughts?