When Ian Desmond came to terms on a one-year $8 million contract with the Texas Rangers this weekend, he became the final free agent tied to draft pick compensation from this year’s crop to sign with a team. Obviously the former Nationals shortstop’s first dip in free agent waters did not go as he’d hoped. At 30, not far removed from being one of the top offensive middle infielders in baseball, he was coming off a career-worst season, but one that ended with a .262/.331/.446, 12-homer second half. When Desmond and his agent talked about his future last fall, odds are playing left field for nearly 30 percent less than what he earned in 2015 isn’t a scenario that got mentioned. But that’s exactly where he is now in Texas.
After four off-seasons, baseball fans are pretty familiar with the qualifying offer system. Agreed to as part of the 2012 collective bargaining agreement and enacted during the ensuing winter, it was designed to make the draft pick compensation system for free agents more equitable. Teams would now decide who was pick-worthy instead of the Elias Sports Bureau, who previously assigned a "type." Players get linked to picks when their current team offers a one-year deal at the average of the top 125 player salaries from the prior season. This year that number fell in at $15.8 million. The player has seven days to either accept or decline.
Of the 54 players who’ve received qualifying offers in the system’s short history, only three have actually accepted – Brett Anderson, Matt Wieters and Colby Rasmus, all this year. Plenty of others have seen their market value sink in an MLB universe where teams increasingly stress the kind of player development that requires holding onto picks. Pick compensation is a noble idea – it’s meant to "make it up to" teams who teams who get outbid for their own guys.
The Cardinals, for example, made a valiant effort to re-sign Jason Heyward this year, but got outbid. The rules have been exploited, though, by big market teams who collect picks for players they simply don’t want anymore. 21 of the 54 tenders since 2012 have been made by seven big spenders – the Yankees, Red Sox, Tigers, Rangers, Cubs, Dodgers and Giants.
You shouldn't feel bad for Desmond or Dexter Fowler, another qualified offer free agent who hung around for most of the off-season then signed with the Cubs last week for one year and $8 million with a mutual option for 2018. Those guys turned down nearly $16 million in a decision that can no longer be viewed as just a formality. Anderson, Wieters and Rasmus may have made the right call to avoid a crowded market and try again next year, but you can’t fault Desmond, Fowler and others for taking their shot.
$15.8 million over $8 million is a huge difference, but not a life-changing difference, the way easing into a multi-year deal would be. Asdrubal Cabrera, who has been 6.3 wins less valuable than Desmond over the past three years per fWAR got a year and $10.5 million more. Fowler watched Gerardo Parra and his career wRC+ of 93, and Danard Span, who spent most of last year on the DL with a hip injury score three-year deals as he settled for one.
Players’ Association chief Tony Clark has made it clear that he intends to address the qualifying offer issue as he negotiates the next CBA, which will go into effect next year. Owners, though, might not agree that it’s a problem. According to Ken Rosenthal, a big factor in the Rangers’ decision to cough up the 19th pick in the 2016 draft to sign Desmond was their intent to recoup it by slapping him with tag again next winter. That might be a bit of a reach since moving to a corner outfield spot might make him not worth what would be a higher tender, but apparently Texas doesn't expect much to change.
Owners typically favor anything that keeps salaries down, even if it’s only a few in an unjust and arbitrary way. Teams add their own perceived fiscal value of a pick to a player's cost and essentially charge him for it. His appeal is slashed by circumstances that are mostly out of his control – whether his team thinks the qualifying offer is worth the risk and whether he was traded during the season, which would get him off the hook.
Draft pick compensation is fine in concept but there has to be a way to fix it so that mid-level players don’t cost the same as elites like Heyward and Zack Greinke. A tiered system might work. To get a first rounder you’d need to offer more years and more money – maybe three at the average of the top 25 players instead of 125 – while the current qualifying offer would get you a later sandwich pick and cost the acquiring team only a second or third rounder.
You should also need to hold on to a player for more than a year for him to be compensation eligible leaving fewer ways for teams to manipulate the rules. That could include carryover rights for teams who trade prospects for players nearing free agency, but if you sign a player to a one-year deal, he should get the opportunity to re-enter the market without being trolled by a qualifying offer again.
For the Yankees, the qualifying offer system has been more pro than con. They've picked up six draft picks since 2012, and it provides them with a good non-money excuse when they don't sign certain players. They’re highly protective of picks and prospects as they seek to lower payroll and infuse youth. They seem to surrender picks to bring players in only when they’re also gaining picks through letting other players walk. They signed qualifying offer free agents in Jacoby Ellsbury, Carlos Beltran and Brian McCann two winters ago, but they also let two, Robinson Cano and Curtis Granderson, walk. In 2008-09 they gave up picks for Mark Teixeira, CC Sabathia and A.J. Burnett, and one of those unfortunately turned into Mike Trout, but they also got one back for their failure to sign Gerrit Cole a year prior.
Next year, the Yankees will shed around $53 million in salary if they let Teixeira, Beltran, Aroldis Chapman and Ivan Nova walk as free agents. Whether they’re aggressive in replacing and improving from without could depend highly on whether they can bring back picks for Teixeira and Chapman.