Stuck in the middle: the second Wild Card's impact on the trade deadline

Last season, Major League Baseball introduced a second wild card to the playoffs and a one-game winner-take-all qualifier between the two wild card teams for entry into the Division Championship series. Aside from the obvious appeal of more playoff baseball for fans and more post-season revenues for owners, this change has had some positive effects for the game. It incentivizes the division title, breathing life back into division races that had grown stale in the Wild Card era. It gives more teams a chance at the World Series, increasing parity and helping teams that are not in the division race maintain interest longer during the season. As we approach the trade deadline, it is also clear that the appeal of this additional playoff spot is a double-edge sword for those teams at the edges of the playoff race and the precarious position of teams in the middle of the pack is impacting the July 31st trade deadline in unexpected ways.

Over at Baseball Nation, Grant Brisbee ran down four bad teams that aren’t yet selling. All four of the teams Grant focused on (the Phillies, Royals, Mariners and Giants) are below .500 and trailing at least four teams in the Wild Card race and still unwilling to sell as the deadline draws near. Other teams in very similar or even worse positions are also conspicuously absent from the seller’s side of the market so far this season. The Rockies, Angels and Blue Jays all face similarly marginal playoff odds and all three appear to be unwilling to part with veterans to build for the future.

The result of so many teams straddling the fence at the deadline is a strong seller’s market. The Cubs have made two high-profile deals so far, sending pitcher Matt Garza to the Rangers and trading outfielder Alfonso Soriano to the Yankees and the haul they have gotten back is impressive. For Garza, they will receive four players- pitcher Justin Grimm, corner infielder Mike Olt, pitcher C.J. Edwards and a player to be named later. Grimm and Olt have seen the majors already and struggled but both are young and have impressive minor league track records. Olt was even ranked the 22^nd best prospect in the game by Baseball America entering the 2013 season. Edwards is further away and was drafted low, but he has been a standout in the low minors and with a mid-90s fastball and strong command at a young age, he could be steal a few years down the road. The return for Soriano was less, in large part because Soriano is owed a pro-rated $18 million this season and $18 million next season, but Chicago still got a young arm with mid-90s stuff in Corey Black out of the deal.

With veteran rentals commanding such strong returns in young talent, it is hard to believe that so many losing teams are clinging to such players with less than two seasons of team control left. While each individual team has its own logic for not selling, the allure of the second Wild Card spot is central to the larger trend. Teams like the Royals or Phillies (who both may be reversing their position on selling) are in an especially difficult spot thanks to this extra playoff possibility.

Both teams are built to win now and just not winning. The Phillies have an aging roster that once dominated the NL East and they have tried to keep enough role players around their veteran stars to stay competitive. The Royals have a young team that was long expected to become something great by now and has never fulfilled that promise. They added star talent at a huge cost by acquiring James Shields this off-season and GM Dayton Moore is running out of time for his beloved "process" to produce. Both teams have playoff odds below 3% by Baseball Prospectus’ calculations, but the pressure to play for that slim chance is significant. As a result both clubs are resisting their fate (for now) and hanging onto players that they would probably be better off selling.

As teams like this demonstrate, with this new second Wild Card spot dangling out there, the impact of the July 31^st trade deadline is likely to be diminished. Top teams will still swap prospects for quick-fix rentals and also-ran clubs will still leverage their Matt Garza’s and Alfonso Soriano’s for help down the road, but the middle of the market is bigger than ever before and those in the middle appear content to wait.

After all, the term "trade deadline" is a misnomer. July 31^st is the last time that teams have the opportunity to trade players without placing those players on waivers, but almost every season, major trades take place after the 31^st despite the additional complexity of the waiver wire. Last season, the Red Sox and Dodgers made one of the biggest trades in baseball history on August 25. The 2013 Red Sox found themselves in stuck in the middle of the market as July 31^st approached and took the position of a reserved buyer instead of selling. Like the 2013 Phillies, they were built to win that season and yet, they were just flirting with .500. They didn’t sell at the deadline but less than a month later, they were ready to face the music and they found a market just as good, if not better than they would have at the traditional deadline. This is a trend that I believe will continue and even intensify in this new era of two Wild Cards.

Baseball is inherently unpredictable. Individual players and entire clubs run hot and cold for extended stretches. If July 31 was truly the last time that teams could execute trades, I think GMs like the Phillies Ruben Amaro Jr. and the Royals Dayton Moore would probably accept the need to sell. That would water down the market and probably reduce the returns those GMs would get for their top talent, however. Faced with the choice of selling now in a busy market, or waiting for 20-25 more games and selling to a more desperate, if more limited group of teams with that one percent chance of post-season glory still on the board, it isn’t surprising that teams are taking the latter and passing it off as confidence for the fans.

This plan might make sense in some basic way, but it is a high risk/high reward strategy. Not only are teams hoping against hope to defy the playoff odds, but by waiting, they are also hoping that the waiver trade market will hold and they will be able to navigate it to get the return they want. That strategy was extremely successful for the Red Sox last year, but they also had an ideal buyer in the Dodgers. Teams like the Phillies, Mariners, Giants and Royals might not be so lucky this season, but at least of few of them are likely to test this strategy out. The results of any post-deadline trades this season could set a precedent for teams in similar situations in years to come, diminishing the role of the July 31^st deadline in favor of the August 31^st deadline. With just one season under the new CBA and its second Wild Card spot on the books, we have too little information to conclude that such a shift will happen, but the resistance of some many obvious sellers to join the market suggests that it could.

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