In Defense Of Scott Boras

December 2, 2009

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We are on the cusp of the baseball free agent signing season. This means that the vilification of player agent Scott Boras will soon begin in earnest. For those who are somehow unfamiliar with Mr. Boras, he is the premier agent in baseball, representing a cadre of superstar players including Matt Holliday, Alex Rodriguez, Mark Teixeira, and many others.

To say that Boras is a tough negotiator is akin to saying that Warren Buffet has a decent nest egg for his retirement – a gross understatement. Boras is tough as nails, willing to use any tactic as leverage for getting maximum value for his client. His clients rarely give their team a “hometown discount”. Boras client often sign at the very last minute – and often don’t sign, electing instead to return to college (if they are eligible).

Not surprisingly, many teams – and their fans – despise Boras, blaming him for any of all of the problems with the game today. I take exception to that characterization. Boras’ role is not that of some benevolent fan ombudsman. His role is to represent the interests of his clients and ensure that they receive the best possible package of financial and non-financial benefits. He would be derelict in his duties (and a possible target of malpractice suits) if he were to leave money on the table “for the good of the game.”

One thing that seems to get overlooked in the Boras bashing is that salaries for baseball draftees lag behind salaries for top NFL picks. Stephen Strasburg’s contract – paying him $15.1 million over four years (a pro-rated 2009 salary, as well as 2010-2012) – was the subject of much debate over the summer. Many were outraged at the value of the contract.

On the flip side, top NFL draft pick Matthew Stafford (who is just a few months older than Strasburg) signed a six year contract that is worth $72 million (plus an additional $6 million in incentive bonuses) – with $41.7 million in guaranteed money. [Note: unlike baseball contracts, football contracts are not fully guaranteed].

Stafford is definitely a fine football player. However, he is not of the same relative caliber of Strasburg, who is widely regarded as a once-in-a-generation talent. Yet Stafford will walk away with $41.7 million even if he becomes a complete bust (like Ryan Leaf, Akili Smith, Tim Couch, etc before him). If Strasburg busts, he’ll get $15.1 million. So, remind me again why the Strasburg deal is a big travesty and the Stafford deal is business-as-usual?

Baseball teams have long enjoyed the luxury of having more control over a player’s salary than any of the other major sports. For the first hundred years of professional baseball, teams had complete control. Baseball’s “reserve clause” made it possible for teams to re-sign players at whatever salary they wanted. The players were bound to the team for life, so they had minimal leverage. They could refuse to sign a contract, but they couldn’t sign with any other team. Finally, in 1975, the reserve clause was struck down, paving the way for free agency.

In today’s system, players are drafted (or signed as undrafted free agents) by major league teams. They are then signed to what is most often a minor league contract. Essentially, this pays them peanuts during most of their minor league years. The MAXIMUM salary for a player in their first minor league season is $1100/month. They only way for the players to earn any substantial money during their early minor league years is by getting a signing bonus with the contract. For first round picks, this can mean millions of dollars. For players in the later rounds, this can be a few thousand dollars, or nothing at all (usually for players who have no college eligibility remaining, and thus minimal leverage).

After a player reaches the Major Leagues, they are under the team’s control until they have accumulated six seasons of service. Note that this does not simply mean they have been in the Major Leagues during six seasons – it means that they have been on the active roster (or disabled list) for the equivalent of six full seasons. Most often, a player does not become a free agent until after their seventh Major League season (or later).

Players with fewer than three years of service (other than a subset of players we’ll discuss later) can be renewed by their team at a minimum salary, regardless of performance. A player could win the MVP in his rookie season and not get a substantial raise – and could make substantially less than the crappy veteran relief pitcher who has the neighboring locker.

Players with three years of service – as well as the players who are in the top 16% (in terms of service time) of players who have more than two years of service – are eligible for salary arbitration. The player and team submit offers to an arbiter. The arbiter listens to arguments and chooses one of the offers and sets it as the player’s contract for the following year. The arbiter MUST choose one of the numbers – he cannot choose a number in the middle. Players in their arbitration years earn more than in previous years, although they typically earn less than the market rate for their skills.

Finally, after accumulating six years of service – at which point the player is often knocking on the door of age 30 – the player is allowed to become a free agent and may sign with any team.

If a late round pick – one of those guys who signed for a minimal signing bonus – happens to blossom and become a good player (something that happens more often than you might think), he may have spent 4-6 years in a team’s minor league system, and then another six years at the major league level. Finally, after 10-12 years working for a team, he finally had the ability to actually negotiate a contract.

If you waited twelve years for the opportunity to negotiate a contract with your employer, you’d probably want someone like Scott Boras helping you out.

15 Comments (+add yours?)

  1. Squeaky
    Dec 02, 2009 @ 11:24:49

    Great article Kosmo. You taught me a lot and never went over my head. Thanks for the lesson.


  2. kosmo
    Dec 02, 2009 @ 12:00:23

    I’m happy to know that I didn’t go over your head. I can sometimes have a tendency to do that with baseball stuff, especially issues relating to contracts.

    I’m just a wee bit of a baseball geek – I have a printed copy of the current collective bargaining agreement in a binder … and I refer to it at least a couple of times each month.


  3. King of Cali
    Dec 02, 2009 @ 13:41:14

    Very nice post today! I don’t think people can blame Boras, because he’s just really good at his job. That’s why all the top players want him as their agent. If the owners don’t want to pay these crazy contracts for his clients. Then I’m sure his prices would drop as well. Supply and demand…he’s got what they want and gets them to pay way over the real value, cause the teams really want his players. He’s screwed my Giants on Zito, but you can’t blame Boras for the Giants wanting to agree to that contract to get Zito.

    ~King of Cali
    All The Latest SF Giants Rumors
    .-= King of Cali´s last blog ..SF Giants Rumors – Giants Still Interested In Betancourt? =-.


  4. Peter Rabbit
    Dec 02, 2009 @ 15:02:39

    Couple of points.

    I believe the NFL guys get that money because they play right away. Some of the MLB guys get that money and never make it out of the minors or collect it before they hit the majors so that could be the difference in starting salaries. In addition, NFL players have much shorter careers and playing in the NFL has long term health issues associated with it so to some degree it should pay more.

    As for Boras, I agree he does a good job but I still think it is bad for the game. It has similar effects to the Wall Street Bankers that we all want to villanize for having huge bonuses. With one exception, the Wall Street guys don’t have fans.

    To me some of these ball players should understand that when they force a team into signing some crazy contract they hurt the team’s ability to get other players to put around you. In essence you should realize that this is still a game and the fans do count as without fans there is no baseball and it is already sad that so many parks have become corporate meeting spots as the 8 year old boy dreaming to see Arod play can’t afford a ticket.

    But mainly we should blame the athlete and not Boras as at the end of day they should be in control of their own agent.


  5. kosmo
    Dec 02, 2009 @ 15:24:08

    @ King of Cali – Man, the Giants screwed themselves on Zito. EVERYONE at the time was talking about how Zito’s skills had eroded and that this was a horrible contract.

    @ Peter – I should have qualified my comparison a bit more. Quite often, quarterbacks who are drafted very high sit on the bench for a year or two before thrown into the fire – although more teams seem to be starting them from day 1 now. Strasburg will DEFINITELY be in the rotation for the ‘Nats at some point next year. So I saw that as pretty much a wash.

    That’s a good point regarding health and length of career. I’m a bit wary of what is being measured by “length of career”, though. I always see the number 4.x years for an NFL player, but I never see the actual math. Is that average calculated using every single player who ever played a snap in the NFL? If that’s the case, I’m not sure that the average MLB career is much longer – there are a lot of guys who have a “cup of coffee” and never get back to the big leagues.

    As for the greed factor, note that I characterized Boras’ role as such:

    “His role is to represent the interests of his clients and ensure that they receive the best possible package of financial and non-financial benefits.”

    If the player merely wants the most money, Boras should try to get him the most money. If he prefers to play for the best team, Boras should try to get him that. But if Boras is pursuing the interests of his client – whatever interest that might be – I have difficulty criticizing his efforts.

    At the end of the day, the player salaries are really in the hands of the owners. No one is going to force the Cardinals to pay Matt Holliday $18 million. They can simply choose to walk away and let someone else sign him for $16 million. Will they be a less competitive team without him? Of course. But that’s a decision they need to make.

    Or the owners could always band together and collude to keep player salaries down. Oh, wait. They already tried that


  6. Lazy Man and Money
    Dec 02, 2009 @ 15:34:59

    I agree with the premise that people shouldn’t be mad at Boras for his negotiating tactics.

    However, you brought up a lot of issues and there are some I’d like to bring up as well.

    1) What about Boras and Manny Ramirez? While there is no proof of it, it considered true by anyone who followed the situation that Boras instructed Manny to commit acts (like fake injuries, push an elderly Red Sox employee, etc.) to get him traded out of Boston so that he could get a new long term contract rather than have the Red Sox use their option. More can be read here: If true, one can not defend Boras.

    2) Everyone in the NFL (except the rookies) agrees that the rookie salary structure is a problem. Even the commissioner is it: So the comparison is misplaced. It’s like saying that I can assault someone (baseball contracts) because some other person is committing murder (NFL contracts).

    3) The NFL salaries for rookie drop dramatically.
    – If you were the 41st player in the NFL, you’d get $4M over 4 years with only $2M of it guaranteed:
    – If you were the 41st player in the MLB, you’d get a $950,000 signing bonus:

    4) Some of that difference could be explained by the different sports themselves. You can’t play in the NFL out of high school. Should a 20 year old NFL player get more money than an 18 year old Grapefruit League player? I think so. NFL careers are shorter and players take on more risk than baseball. After the NFL career, a lot of players suffer from cumulative head injuries that baseball players don’t have to deal with.

    5) I’m not sure I feel bad about the minor league salary for baseball players. They do get lodging and food stipends as well.

    6) Lastly, baseball teams employ something like 100-150 minor league players, right? That’s dozens that aren’t eligible for the 40 man active roster. The NFL has a 53 man active roster and a practice squad that is about 8 or 9 people big. The minor leagues in baseball is about equivalent to the NFL practice squad, except that money is even more diluted amongst dozens of players.

    7) Why not compare Strasburg with the top rookie hockey salary? I bet the 15M guaranteed for Strasburg looks quite good in that light.
    .-= Lazy Man and Money´s last blog ..“Debt Crisis in America” & JCR Advertising are Evil =-.


  7. Peter Rabbit
    Dec 02, 2009 @ 17:18:03

    Not sure it is all in the hands of the owners as they also have to think of the fans so they can be pressured to some degree.

    I know the Mets took a lot of hell when they did not sign Vlad back a few years ago. They have jumped into things like Tom Glavine to try and not take the same heat again. In the end the owners seem to be more at risk if the fans don’t come to the park so they cave more often then a Scott Boras will.

    In effect Boras can approach 5-10 teams with a guy like Holliday but the Cards may not see 5-10 guys in FA equivalent to Holliday so there bargaining power is very limited.


  8. kosmo
    Dec 02, 2009 @ 17:25:23

    @ Lazy Man

    1) Yeah, if that’s true, it would be a problem. With Manny, though, I wonder if he was self-instructed to do these things.

    2) I don’t really have a problem with the free market dictating the value of Stafford’s contract. Teams CAN choose to pick another player. It worked out OK for the Texas when they did that (Mario Williams)

    3) I really would like to see what numbers they are using for length of NFL career. I don’t doubt that the careers are shorter, but there are so many ways to measure this.

    5) Other sports get these stipends too. For that matter, I get these expenses paid when I travel on business for my employer.

    7) Why not compare to hockey? Because I don’t know much about hockey.

    @ Peter Rabbit – Correct. Holliday is a scarce resource.


  9. Evan Kline
    Dec 02, 2009 @ 20:13:51

    I think sometimes, not always, Boras actually harms his clients. Wasn’t there someone (a catcher, maybe?) who missed a whole season, and an important year of his development, and never really blossomed? Of course, I guess the flip side could be argued- it was a good thing he held out and got all that money, because that’s the only big contract he’ll ever get.

    I’d love to see the math, calculating the amount of money a player loses by reentering the draft and missing a year (like J.D. Drew), and if that is offset by the increased money when he does sign. With all the rules in baseball on years of eligibility to qualify for free agency, etc., that lost year can be crucial if it translates into reaching the big leagues a year later.

    Regarding the comparison of football and baseball salaries, there are numerous reasons for that, I’m sure. A big one has to be the fact that, as much as it is a crapshoot to predict success in the NFL, it is an even bigger crapshoot in baseball. Take 20 “can’t miss” prospects, and probably half or more do miss.

    Anyway, nice thought-provoking article concerning a guy that we Philly fans don’t particularly like.
    .-= Evan Kline´s last blog ..Get Your Google Wave Invitations Here =-.


  10. kosmo
    Dec 02, 2009 @ 20:22:53

    I’m drawing a blank on the catcher you’re talking about. You could be right though – do you remember any other details that could jog my memory? Are you thinking it was in the last few years, or back a decade?

    I agree that sitting out a year is usually a bad move financially.

    I agree that baseball is a crapshoot (albeit less of a crapshoot toward the top of the first round than the bottom), but quarterbacks, in particular, seem to have a very high bust rate when they are picked high in the NFL draft. Many are already writing off Jamarcus Russell.


  11. kosmo
    Dec 02, 2009 @ 20:46:28

    Is this the guy you’re thinking about? Landon Powell? He was 18 and had a GED and was thus eligible for the draft, but teams somehow weren’t aware of it, since he was technically a HS junior. Thus he was an undrafted free agent eligible to sign with any team.

    Nobody signed him, and he went to college at South Carolina and was a 1st round draft pick 4 years later. So it worked out OK for him. He hasn’t made an impact at the MLB level, but I don’t see that as being related to the issues back in 2000.

    the Wikipedia page implies that he didn’t play in 2001 by saying that his first season with the team was 2002, but the official U of South Carolina page for him indicates that he DID play in 39 games in 2001 (roughly half a season). He apparently enrolled at South Carolina for the second semester.


  12. biondino
    Dec 03, 2009 @ 08:59:05

    As I’ve mentioned on the Row [editor’s note: Biondino is referring to the Rockies blog Purple Row] several times, I’m an agent (nowhere near Boras’s calibre, and in a totally different field) and I very much appreciate the points you make.

    Each MLB (and NFL) club has a ruthless, experienced front office which would eat alive any young player who tried to negotiate his own deal. Having an agent balances the situation. Having a good agent gives the player that little edge, but ultimately it’s up to the FO to say yay or nay.

    An honest agent, who cares first and foremost for his clients’ welfare, has just as valid a place in this and many other industries as every other salaryman who helps the wheels of business turn. A dishonest agent – well, they exist, like in any business. And then of course there’s pragmatism, gamesmanship, amorality – the real world is driven by them, unfortunately, but at least the playing field is level for all concerned.


  13. Lazy Man and Money
    Dec 04, 2009 @ 17:03:43

    Kozmo said,

    “I don’t really have a problem with the free market dictating the value of Stafford’s contract. Teams CAN choose to pick another player. It worked out OK for the Texas when they did that (Mario Williams).”

    You’ll note the Texans had to pay him as if he was the #1 player though. There’s no way you can take a player at #1 and pay him too far out of the rookie slotting. If you take a player that is around the 15th best, you’ll still end up having to overpay him a lot more than he would get if he was drafted at #15. In that scenario, you lost value of your #1 pick (overpaying for ability less than the best player). And if you choose not to sign the player, you lose the draft pick – hardly a win for the team.

    I think everyone had Crabtree as the top receiver in the draft, but when the Raiders took someone unexpected did Crabtree say, “I’ll settle for my rookie slotting?” No, he said, that he deserved to get paid for where he should have been drafted and the stalemate lasted half a season.

    If you want to have a free market dictate a contract, then I think you have to get rid of the draft and let multiple teams negotiate like free agency. I think you’d find that free agent veterans with experience would then get more money than the new rookies, except in rare cases (the rookie is really highly ranked, the veteran being compared is older and skills are declining, etc.).

    As for determining the length of an NFL career, I don’t know if there are specific stats out there. Anecdotally, I see a few cases.
    – Terrell Davis’ talent lasts 4 seasons and more or less ends with injuries before age 27.
    – Deuce McAllister had 4 productive seasons (2 pro-bowl ones) and at age 30 finds himself unable to play for another team.
    – Shaun Alexander was a 3 time All-pro who has 24 career yards since he turned 31 in 2008 – currently not playing with any team.

    These were stars of the game, all with seasons where they rushed for over 1600 yards (impressive to average more than 100 yards a game). These aren’t players who didn’t have the talent… they are closer to the Matt Holliday’s of baseball than the Matt Sullivan’s.

    The best example might be Earl Campbell widely considered one of the NFL’s best rushers (and is in the Hall of Fame). He had only five seasons where he rushed for more than 650 yards and retired at 30. According to his Wikipedia page, “Campbell has great difficulty walking and sometimes requires the use of a wheelchair.” I’ve seen him walk with a cane at times and though he’s only 44 year old, he looks like he’s closer to 90.
    .-= Lazy Man and Money´s last blog ..“Debt Crisis in America” & JCR Advertising are Evil =-.


  14. kosmo
    Dec 04, 2009 @ 20:52:27

    @ Lazy Man

    1) I believe the Texans did sign Williams for less than the money Bush wanted, though. People thought they were being shortsighted for this, instead of realizing that the Texans realized that Bush would never be a feature back in the NFL.

    My larger point with this comparison is that Strasburg and Stafford aren’t even the same caliber player. Grown men nearly cry tears of joy watching Strasburg, and more than one baseball insider has said that he is a “once in a generation talent”. Stafford might be good, but I haven’t heard that term used to describe him. So, logically, Strasburg should be worth considerably more, right?

    Also, while people might complain about Stafford’s contract (and escalating contracts in general) I don’t hear the venom directed at specific agents like it is at Boras in baseball. Nor does there seem to be the same amount of ink spilled on the topic o Stafford’s deal as theire was on Strasburg’s.

    2) The “average career of an NFL player is 4.x years” is something I hear quite often from the talking heads. What I never hear is how they come up with this. There are probably a dozen calculations they could do to generate what they might call an “average”. A decade ago, I might have trusted them to be competent, but not after I saw The Sporting News calculate the average service time of the starting running backs on opening day 2008 and use this to determine the average length of career for an NFL running back. (Stop and think about that for a minute – how many flaws in the logic can you find?)

    Your anecdotes are nice … but by definition, anecdotes don’t tell the story. And there are anti-anecdotes like NFL players with very long careers (Warren Moon, Steve DeBerg, Morten Andersen) or baseball players cut down by injuries (Tony C, Sandy Koufax, Mark Fidrych, Mark Prior?). You chose your anecdotes from the position with probably the lowest length of career, and even your anecdotes played longer than the quoted average – davis played parts of 7 seasons, Mcallister part of 8, Alexander parts of 9, and Campbell 8 seasons. (Yes, I realize that they weren’t their former selves toward the end, but certainly the “average length of career” isn’t intended to measure that.)

    Are NFL careers shorter than MLB careers? Probably. But without transparency regarding what the heck they are measuring, we can’t begin the determine the level of difference.


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