Baseball Does Not Have a Tanking Problem, It Has a Trading Problem

Baseball America recently asserted that tanking is getting worse in Major League Baseball. The article noted that MLB is on pace to have two 110-loss teams, the only non-expansion year in which that has ever happened, and it blames this phenomena on the success of the Cubs’ and Astros’ tank-enhanced rebuilds. I was planning on addressing tanking during the offseason, but this seems as good a time as any. So here goes.

Baseball does not have a tanking problem, it has a trading problem.

Tanking is usually defined in North American sports as intentionally losing so as to get top draft picks. The behavior of the Astros from 2011-15 likely meets this definition. During that time period they had the worst record in baseball three years in a row, and thus received the No. 1 overall pick in 2012, 2013, and 2014, and the Nos. 2 and 5 overall picks in 2015.

Thus, if teams were emulating the Astros we would expect the worst teams in baseball to be in the midst of rebuilds. Yet the worst record in baseball belongs to the Baltimore Orioles…who did not intend to tank this year. The Orioles refused to trade Manny Machado during the offseason because they believed they had the ability to contend in 2018. They also have numerous high-priced free agents signed in recent years, such as Chris Davis and Mark Trumbo.

The third-worse record in baseball belongs to the San Diego Padres, who signed one of the biggest free agents last year in Eric Hosmer and who were reportedly in the market for Chris Archer at the trade deadline. Hardly the behavior of a team trying to lose as many games as possible.

So why are these teams losing? Simply put, it’s because bad teams happen. The Tribune Company spent 25 years trying to create a winner and, more often than not, ended up created losing teams. At least half of the teams out of contention today (7 games or more out) did not intend for that to be the case, including the Orioles, Nationals, Twins, Angels, Giants, Blue Jays, Mets, and arguably the Pirates (who actually did trade for Archer).

Only a handful of teams genuinely had no illusions of contending in 2018. The Tigers, White Sox, Rangers, Marlins, and perhaps the Royals. Even the Reds were hoping to blossom this year into a semi-contender.

How do we know these teams were rebuilding? Because over the past two years they 1) traded quality veterans for prospects while 2) refusing to sign top free agents. This is the hallmark of the modern rebuild. For example, the White Sox traded away Chris Sale, Jose Quintana, Adam Eaton, Todd Frazier, and Anthony Swarzak in 2017. The Tigers traded away J.D. Martinez, Alex Avila, Ian Kinsler, and three Justins (Verlander, Wilson, and Upton). The Marlins <sigh>…you get the idea.

Trading is the mark of the rebuilding team. These teams, however, did not make these trades in order to become less competitive and thereby obtain top draft picks. Rather, the trades themselves were the rebuilding mechanism. The fastest, most effective way to rebuild in baseball today is to trade for prospects. This allows teams the opportunity to target prospects several years after the draft, when they are nearing the majors and are more projectable. Eliminating much of the guesswork results in a higher percentage of successful players.

By contrast, the MLB draft remains a crapshoot. Prospects take years to develop and top picks routinely fail to make the majors. Mark Appel, selected No. 1 ahead of Kris Bryant with one of those top Astros’ picks above, is already out of baseball having never thrown a major league pitch. Teams are not crazy enough to throw away whole seasons for a single lottery ticket and they rarely tank after being eliminated from contention.

Winning percentage among MLB teams drops only 2 percent after elimination from the postseason, by far the lowest drop among the four major North American sports.

Trades are far more effective and better allow teams to transfer wins through time. A quality veteran today might add three wins to a mediocre team. Three wins in a losing season is not going to bring in more fans or affect long term team fortunes, but trading that veteran for a few prospects that could add those same three wins (or much more) in a few years, when the team is competitive, can result in a playoff berth. Playoff seasons result in huge revenue increases and long-term team health.

As evidence that trades are the primary driver of modern rebuilds, consider the two Chicago franchises. The Cubs traded away virtually any decent MLB player they had from 2011-14. In return, they obtained Jake Arrieta, Kyle Hendricks, Addison Russell, Pedro Strop, Carl Edwards Jr., and Travis Wood (among others). That group produced more bWAR during the 2016 (when the Cubs won the World Series) than Cubs’ draftees (15.2 vs. 11.3).

Similarly, the White Sox created a powerhouse farm system as a result of a series of trades in 2017. The Sox currently have seven players in MLB.com’s top 100 prospect list. Three of the top four of that group — Eloy Jimenez (3), Michael Kopech (13), and Dylan Cease (41) — were acquired via trade. Those trades also brought in Yoan Moncado and Lucas Giolito, both top 100 prospects in 2017.

As a result of trading away all this talent, the White Sox lost badly in 2017. Yet the one top draft choice the Sox earned pales in comparison to the talent they acquired in trade. In other words, the Sox would have made these trades regardless of the effect their resultant poor team preformance had on improving their draft status. Thus, the White Sox were not tanking in the traditional sense of the word. They were not losing to obtain a benefit. They lost as a byproduct of a legitimate rebuilding strategy.

It is true that rebuilding teams are unconcerned that they will lose a lot of games and that they indeed recognize that the draft picks and international bonus money they will accrue will be rather helpful. Yet rebuilding teams would still trade away talent even if losing records had no effect on draft slots, because the true rewards are the prospects obtained in trades.

One could argue that the difference is semantic. Whether the intent is to obtain draft picks or prospects, teams are intentionally losing today in the hopes of succeeding tomorrow. This is absolutely true. But the different matters when people focus on changing draft rules as a solution to the problem. If we want fix the “tanking” problem in baseball, we need to address modern trading practices.

So what should MLB do? We will explore this question in part two.