Comparative Advantage: The Case For Sloughing 2013

I recently visited Las Vegas for the first time. I went with my dad and brothers, who were all 'veterans' of the city. Shortly after arriving, I began to make a list of things we ought to do over the week. Some were fun, some were more practical, but whenever someone mentioned something we ought to do, I recommended they add it to the list.

Needless to say, by the end of the week, the list had grown in size. It wasn't that we didn't want to accomplish the items.Time got away from us. Unsurprisingly, veterans of many tourist areas have lists of things they still haven't done.

When Theo Epstein took over the Cubs, I'm sure he had a lengthy list of things to account for as quickly as possible. Tell me which one doesn't fit in with the other ones.

Learn the system prospects.

Teach hitters to not swing at bad pitches.

Get pitchers to challenge hitters.

Scout for the draft.

Improve the talent level of the system.

Reach the 74 Win threshold for a season as quickly as possible.


When Theo ran the show in Boston, he figured out a couple ways to not only upset Bud Selig, but increase the team's talent level as well. He would trade for veterans with 'expiring contracts', offer them arbitration (which they would refuse), and log a compensatory draft pick. If that wasn't enough, he would use the team's wealth to try to 'buy out' high schoolers from their college commitments. Voila! More top draft picks.

When Theo came to Chicago, the Collective Bargaining Agreement changed. Out were his pet ways of gaining a comparative advantage. A moderately-solid slotting system had eliminated over-slot bonuses, and compensation was far less likely as well. So how would Theo game the system to the benefit of his new employer? In reality, the new CBA has fewer holes than the old one. (Which doesn't mean I like it.) It favors smaller market teams over larger ones. It favors teams that comply with the rules over ones that don't. And it favors lousy teams over good ones.

It rewards smaller market teams with a 'Competitive Balance' lottery, giving bonus draft picks to smaller market teams. As an entree into trading draft picks, these draft picks can dealt for big league players. A similar lottery will give six teams that abide at or under the league standard picks as well, though there may be some winners of these picks that don't qualify under the frugality pledge. (We'll find out in July.) About the only other way to earn a competitive advantage is to be bad.


The amount a team can spend on the draft is now tightly correlated with how early the picks are in the entry draft. The punishments are severe. Cash fines and lost draft picks result from overspending 'your amount'. It seems to be 'working well' so far, but this is a test case, to be sure.

The Astros signed the first pick in the draft Carlos Correa for a $4.5 million bonus. The value for the pick was a bit over seven million. Houston can use the excess to entice others to opt to sign. It sounds like that is their plan. For reference sake, the 17th pick this time around (who was high school outfielder D. J. Davis, for the record) had a slotted value of two million. Just 16 picks of difference trimmed over five million of value from the projected amount. Albert Almora (Cubs pick at 1.06) has a slot value of a bit under half of Almora's. Simply put, the first pick in the draft runs up significantly how much a team can spend in the draft. And it gets more severe next season.

In the 2013 International signing season, the top teams in the league will be limited to under $2 million per annum. There will be an increasing scale to the worst team, who will get to spend $5. I haven't read the CBA, and there are caveats, but the new 'in way' to be rewarded is to have a horrible big league record.


Theo Epstein, Jed Hoyer, and Jason McLeod are very competitive people. They want to win very badly. Why would they want to 'deliberately lose'? That, they won't do. But if, for instance, their starting third baseman goes on the shelf for awhile, they will have little difficulty plugging in Luis Valbuena at third, instead of trading for a more glitzy replacement. If a team wants to trade for a Cubs player, they will be more than happy to trade a proven pro for a younger upside-heavy option (see Sean Marshall and Ronald Torreyes). Ryan Dempster may well be the next to go. Why? Dempster's value is relatively high now, and may bring a solid prospect in return.

So 2012 is becoming more unwatchable. When will it end? Honestly, I don't know, but I have some hunches. As Theo examines the players he has left in this upcoming off-season, he will have one over-riding question, I think. Can we compete in two years? I think the answer will be a resounding "No."

If he were to outbid Magic Johnson and others for, for instance, Cole Hamels, he would have a very nice starting pitcher. The holes remaining on the team would likely limit the team's success to a mid-70's win total. The bullpen, outfield corners, third base, and others would keep the Cubs from being an elite team. So, Theo could overspend to hit the mid-70's, or treat 2013 like 2012. He will still be paying for Soriano and Marmol, who don't figure to be productive. Jason McLeod will be continuing to upgrade the farm system through improved training. And, if the next Jorge Soler/Aroldis Chapman wants a $3 million deal, the Cubs will be one of the few clubs able to pick up the phone.


2013 will look an awful lot like 2012. For instance, seven of Theo's first eight picks were pitchers, but six of his first seven were from high school. Not much help incoming for Dale Sveum, especially since the one college arm is recuperating from TJS and won't pitch until next April or May. There were plenty of college pitchers in the June draft. Theo wanted high school ones instead.

Will losing/sloughing be the forever goal? No, it won't. Theo wants to win very badly. This system doesn't have many championship level players. That number will be ramping up. Drafting and development are both key components to Team Theo. I foresee some success from the most recent two draft classes, but talent usually takes three or four years to represent in the majors.

With Soriano's contract gone, home-grown talent creeping toward Wrigley, payback from some shrewd trades, dogged development of the present available options, and the June Draft (probably) going international, I expect the Cubs to approach a .500 record in 2014. Poor results for comparative advantage sake becomes old hat very quick. I still don't see Theo overpaying on talent until a year after that. I expect a Cubs team contending in 2015 to the level of trading prospects for a win-now type player that year. With our best-ever talent development pipeline running for a few years by then, the Cubs could well be a destination location by then.


And, yes, I could be wrong. Theo Epstein could have all his best efforts go for naught. He could be gone after five (like so many starting pitchers) with no success. Even if that does happen, it will be the first time that the owner and front office had a good plan that failed in my forty years following the team. Trust me, winning a World Series title is on Theo's to do list. I don't think he wants to leave town with that unaccomplished.

This is a FanPost and does not necessarily reflect the views of SB Nation or Al Yellon, managing editor (unless it's a FanPost posted by Al). FanPost opinions are valued expressions of opinion by passionate and knowledgeable baseball fans.

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