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Even after Masahiro Tanaka, MLB could be haunted by the new posting system

MLB rushed a new posting system into place to stop another $50 million-plus fee, but they might have bigger problems down the road.

Koji Watanabe, Getty Images

On Thursday reports came out saying that Rakuten Golden Eagles star pitcher Masahiro Tanaka would not be posted and that an announcement to that effect would be made on Friday. Friday came and the only news was no news: Rakuten is still undecided about whether or not they will honor Tanaka’s request to be posted. The new posting system has dramatically reduced the incentive for Japanese clubs to part with their top talent. With Rakuten eyeing a repeat as NPB champions in 2014 -even signing Kevin Youkilis to a $4 million deal to help their cause -- the odds that Tanaka will be pitching in America next season are falling fast.

Rakuten’s frustration with the new system and their subsequent indecisiveness is easy to understand. Under the old system, there was no cap on what teams could bid to earn exclusive negotiating rights with an NPB player. This resulted in fees over $50 million dollars for pitchers Yu Darvish and Daisuke Matsuzaka. The Golden Eagles were no doubt counting on that type of return. After seeing that return more than cut in half as a hurried negotiation forces a new, less-team friendly way of handling the transitions between the two leagues on them, they are well-justified in their anger.

Still, they take a risk by withholding their ace for another season. To post him for 2015 and $20 million is a huge boon to an NPB team. If nothing else, it seems reasonable to assume that whatever decision they make will now be dragged out as long as possible, leaving the bidding on Tanaka to take place in February, if it happens at all. The hand-wringing taking place in front offices right now as teams try to decide how to spend their money in a weak pitching market with the best player available being dangled just out of their reach is fitting punishment for the hasty imposition of these new rules. However, as is so often the case with MLB’s policies, the unintended consequences could be far more important in the long run. It isn’t hard to imagine this new system creating a few dramatic issues for the league in the future that make an uncertain market for pitching look insignificant in comparison.

Given the information that came out during the posting system negotiations, there isn't much mystery about MLB’s motivations in the pressing a revision of the posting system at the point. The league looked at the offseason ahead of them and saw Masahiro Tanaka and another $50 million-plus posting on the horizon. Rather than waiting for the next collective bargaining agreement to implement changes, they decided to act.

Early in the negotiating process, Ben Badler of Baseball America cited MLB’s desire to have more of the posting fee applied to the luxury tax, a change that could not be implemented outright without altering the CBA. Impossible to execute or not, it is a telling revelation now that the new system in place effectively ensures that more of the total spent on Tanaka, or other high-priced Japanese players, will go to the luxury-taxed contract side of the equation. Badler also reported that during the early negotiations, the league considered using draft order to award bidding rights after the maximum bid had been reached. This did not make it into the final agreement, but it is also helpful in reading the league’s intentions, even if it was ultimately scraped in the final agreement.

The league’s two ever-present concerns -- cost control and competitive balance -- can be seen in the new deal. They get a limit on another potential avenue for overspending which also opens the bidding up to more clubs, and puts most of the total spent back in the system that helps those teams too poor to join in the bidding frenzy. In that sense, it is a win for the league on the two fronts commissioner Bud Selig has built the bulk of his impressive legacy upon. However, in this case, the necessity of such heavy-handed tactics is questionable and it appears that MLB may have overplayed its hand, opening itself up to negative consequences it hardly considered as it raced to stop Tanaka from earning Rakuten a huge bounty.

The immediate and obvious negative effect of the new posting system is that one of the best players in the world will not play in the U.S. this coming season. The league seemed to expect that Tanaka would be posted even if they put this extreme cap on the fee paid to Rakuten and if that was the case, they may have seriously miscalculated. Tanaka will still come to America at some point, but it will be disappointing if it doesn't happen this season. Daisuke Matsuzaka and Yu Darvish brought a highly enjoyable level of excitement with them when they landed in the show, and I am sorry we will not be treated to that again in 2014. Great players are what make Major League Baseball what it is and there may be one less than there could be taking the field here next season.

Still, the loss of one exciting player for one season probably doesn’t mean much to the league overall. Even if this new system means players are routinely posted later than they would have been with an unlimited posting fee available, I suspect MLB’s top brass won’t lose much sleep. That would mean shorter U.S. careers for players like Darvish and Ichiro, but that is a small price to pay to the twin gods of cost-control and parity. The bigger threats to the league lie in the possibility for tampering, and in the chance that this will have a negative impact on the relationship between the two leagues.

To understand the new avenues of tampering that this agreement could create, we turn to Ben Badler and Baseball America once again. Badler details two plans Rakuten could employ to get around the limits on the posting fee:

"One idea floating in international circles is that Tanaka could just agree to give Rakuten a percentage of his contract. But it’s not the only potential solution. There is a way for Rakuten to get around the $20 million cap by taking a page from how MLB teams openly conduct business in Latin America. To be clear, there have been zero rumblings of this happening… [snip]… Rakuten, essentially, would coordinate a package deal with Tanaka, another Eagles player and an agent who will represent both players and align himself with all three parties. The Eagles would allow Tanaka to be posted for a $20 million release fee. Rakuten would also take a second player—preferably a low-salary reserve player it won’t miss—and post him, too; we’ll use a $15 million release fee for him, by way of example. The parties involved would all agree that, for an MLB team to sign Tanaka, it also has to sign the second player to a contract worth $1 million."

Just imagine for a second if this actually were to happen. Picture the back pages of daily rags across the country as they decry these evil machinations. Channel the indignation that would rage across the sports-talk airwaves. Conjure the image of a friend or co-worker as they sneer in disgust at the thought of some unheard-of bench warmer from Japan costing their favorite team $16 million as part of some shady deal to bring another player from the Far East to a stadium near you.

Such manipulation of the system may be all well-and-good when it takes place in the backfields of the Dominican Republic far from the eyes of the casual fan and the hyperbolic commentator, but on an international stage, with the fans of the two most lucrative leagues on the planet watching, it would be a disaster. It would put lofty figures on the covers of sports pages with far greater intensity than the old system did. It would reveal the darker side of international scouting in the most prominent way possible. In the end, the casual fan, making a small fraction of the sums being tossed around with such disregard, could be alienated from the game in amazing new ways.

And costs would be only slightly better controlled than they were under the old system.

I don’t think this will happen, but why on earth would the league even consider opening this Pandora’s box? Is saving owners from their own reckless spending really worth rushing into a deal that could produce such a cyclone of fecal matter?

The potential that this deal will damage the relationship between Nippon Professional Baseball and Major League Baseball is far more realistic than the doomsday scenario above, and that is still reason enough for the league to regret the way they have gone about creating this new system.

162960754Photo credit: Koji Watanabe -Getty Images

Peter Gammons of MLB Network cited reports claiming that posting Tanaka would be an admission that the NPB is merely a minor league for Major League Baseball. For American fans, it is easy to fall into the trap of that perspective. Prospect experts often rate the quality of play in Japanese league as slightly above MLB’s Triple-A level. Marginal major leaguers or washed-up veterans often have successful careers across the Pacific after they have been cast aside by MLB. NPB team revenues and, in turn, player contracts, are dwarfed by America’s top league. There is steady trickle of top NPB players seeping into the ranks of MLB.

However, Japanese club owners, players and fans are far less likely to share that view. Baseball is incredibly popular in Japan and there is a passionate and dedicated fan base for the NPB and its clubs. A move that would be perceived as acknowledging a lesser status for the league could hurt Rakuten and if it appears that MLB bullied the league into subservience, the blowback could reach across the Pacific and into owner’s pockets.

Japan is the only major-developed nation that shares America’s passion for baseball. MLB has put a substantial amount of time and effort into building the game in places like the Netherlands, Italy and Australia in hopes of mining more talent and reaching into new markets. If there is a best case scenario for these efforts, it would probably look a lot like Japan. In Japan, MLB has a potential fan base that loves and understands the game, and has money to spend on entertainment. The previous posting system was expensive, but it maintained a positive relationship between fans and their departed heroes, turning Yomiuri Giants fans into Yankees fans with the posting of Hideki Matsui and Seibu Lions fans into Red Sox fans as Boston added Daisuke Matsuzaka.

"Another thing is that part of the reason that Japan is a good market for Major League Baseball is because Japanese Major Leaguers bring huge fan followings with them. Guys like Darvish, Ichiro and Hideki Matsui were stars before they ever stepped on a Major League field. I don’t have the numbers on this, but I would assume that the market for MLB has grown many times over since Hideo Nomo braved the Pacific in 1995." Patrick Newman, NPB Tracker

Like Newman, I am bereft of exact numbers on the financial impact of Japanese stars coming to MLB teams. It is hard for me to believe that some of the smarter GMs in the game would have paid more than $50 million in posting fees if that cost wasn’t justified, at least in part, by the expansion of their brand into the second-best market on the planet for baseball, however. If the bitterness over this new posting system has a lasting impact on that aspect of Japanese players’ migration, MLB will have killed a goose that laid golden eggs for them because they were shocked by the cost of feed.

The league may not suffer any of these consequences, but they have opened the door to such potential problems in the rush to stop some team from making a big bid on a player that they want. The old system was far from perfect, but rushing to fix it before Masahiro Tanaka could land Rakuten another huge fee was completely unnecessary. If this new system works out it will by pure chance and not careful design.