clock menu more-arrow no yes

Filed under:

Steve Cohen and minor league pay

New, 33 comments

He said the quiet part out loud.

MLB: Miami Marlins at New York Mets
Steve Cohen
Brad Penner-USA TODAY Sports

The 2021 MLB Draft was an objective disaster for the Mets. After being passed over by multiple teams and dropping lower than expected, the Mets selected Kumar Rocker with the tenth overall selection. Rocker was coming off of a dominant season at Vanderbilt, where he posted a 2.73 ERA in 122.0 innings with 75 hits allowed, 39 walks, and 179 strikeouts, but concerns about diminished fastball velocity raised questions and concerns and prompted teams to pass over him in favor of other players. The Mets knew ahead of time that they would need more than the MLB-assigned slot value for the tenth overall selection of $4,739,900 and followed a similar strategy that they had employed in 2019 and 2020, following the selection of a high-upside player who would command a high, overslot signing bonus with lower profile players who would accept underslot deals. The Mets, Kumar Rocker, and his representation (Scott Boras) verbally agreed on a $6 million signing bonus early on, roughly $1.4 million above the slot value, and the team made up the difference in savings by signing picks 2-10 for deals that were at or below slot value.

As the clock ticked closer to the August 1 deadline to sign draftees, reports began trickling out that the Mets had concerns about Rocker’s health. Despite the well-publicized questions about his arm health, the Mets elected to select the right-hander anyway, passing over players who were still available and are now generally considered Top 100 prospects by national sources- Brady House, Harry Ford, Kahlil Watson, Sal Frelick, and Matt McLain. Ultimately, the deadline came and went and the Mets decided to not extend an offer to Rocker, having worries about the health of his arm. For what it’s worth, Rocker’s representation has made public multiple times that the pitcher has undergone multiple independent scans and tests that demonstrated that his shoulder and arm were uncompromised, had no considerable change as compared to past tests and that he would be able to pitch in 2022 and beyond.

Normally, a team must make an offer to a player for at least 40% of his MLB-assigned slot value in order to receive compensation for failing to sign him, but because Rocker did not register for a pre-draft MLB medical program, the Mets will still receive a compensation pick- many high-profile players who are expected to be drafted early often do not participate in this program and Rocker’s lack of participation is not an indictment on his health.

In the wake of the failure to sign Rocker and the team leaving millions of dollars on the table that went unused as a result, the organization received a great deal of flack. Rightly or wrongly, much of it was directed at Mets owner Steve Cohen, who maintained a high profile on twitter, regularly discussing baseball operations and interacting and engaging with fans. In response to some of the negative attention and publicity that he and the Mets were receiving, narcissist and smartest-man-in-the-room Steve Cohen wanted to clear the air to a degree and tweeted, “Education time - Baseball draft picks are worth up to 5x their slot value to clubs .I never shy away from investments that can make me that type of return.”

In short, he was attempting to save face by claiming that Rocker was not currently worth the verbal overslot bonus that had been agreed upon. As a savvy investor- indeed, Steve Cohen’s billions have all come from an almost preternatural understanding of how markets and finances work and never from racketeering and insider trading- it was a simple analysis of risk and reward. Rocker, and the questions and potential red flags surrounding him, was not the best bet in his mind to invest in and reap the financial rewards.

Fast forward to today, and Mr. Cohen’s tweet will be entered in as evidence in a class action lawsuit being filed by minor league baseball players against Major League Baseball, claiming that their subpar wages violate several labor laws. The lawsuit was initially filed in February 2014, but Senne v. MLB was delayed by years of appeals and legal back-and-forths and is now finally to begin on June 1, 2022. Korein Tillery LLC, the law firm representing the players, hired Dr. Erica Groshen, Senior Economic Advisor for the Cornell University School of Industrial and Labor Relations and former Commissioner of the U.S. Bureau of Labor Statistics under the Obama and Trump administrations, as an expert witness and as part of her report, she will be citing Steve Cohen’s tweet. According to Dr. Groshen, Cohen is asserting in his tweet that baseball draft picks are in actuality worth up to five times their slot value and that by setting limits to how much money clubs can give their draft picks, Major League Baseball is tampering with their wages and setting an artificial barrier to their earning potential.

In short, Cohen said the quiet part out loud.

After years of being an issue that went largely unscrutinized, the treatment and wages of minor league baseball players has gained traction in recent years. Groups like More than Baseball and Advocates for Minor League have been raising awareness and swaying public opinion, and tangible gains have been made. While there is still much to do, these advocacy groups have secured concessions that will have major impacts on minor league players, such as Major League Baseball raising wages slightly and covering housing costs.

Steve Cohen is no stranger to finding himself in the news in regard to minor league pay. Back in late June, Advocates for Minor Leaguers tweeted an infographic highlighting the difference in treatment between Mets minor league players and Phillies minor league players, as the two teams happened to be playing each other that weekend. Whereas the Phillies provided housing stipends, outright paid for team hotel costs, and paid players during extended spring training back in April, the Mets did none of those.

After tweeting that he was unaware of this practice, having recently gained ownership of the team, he promised to address the issue. “We are looking into this and will have a comprehensive response by late next week,” he said via Tweet. “This was news to me and want to be thoughtful and not reactive in my actions. We need to examine our treatment of coaches too.” Though the salaries and situations of certain players improved, as we learned that some players saw raises, Cohen’s self-imposed deadline came and went without any kind of comprehensive public response. “It’s a step in the right direction,” according to Harry Marino, an executive director of Advocates for Minor Leaguers, “but it’s not going to solve the problems that are going on here.”

The changes fell far short from some of the demands that Mets minor league players in particular had. With former Mets farmhands Ty Kelly and Raul Jacobson Co-Founders and Board Members of Advocates for Minor Leaguers, the group has a unique insight and special connection the Mets’ organizational culture in particular. Among the issues important to the dozens of players in the organization that they were able to poll, year-round salaries, paid housing, three meal per diems, paid offseason training, and adjusted salaries/per diems based on the cost of living were most important to Mets minor league players.

There is still a great deal that needs to be done. As researched by From Complex To Queens and other national and local outlets, it costs roughly $4-$7 million dollars to completely run a minor league system from top to bottom. For roughly double that amount, a team would be able to pay its players a fair market wage for their services, fully cover housing and food costs, pay for training costs, and address virtually every other concern that players have voiced. All that would be needed to justify the increased investment- ignoring the obvious moral aspect of the argument- would be a single player developing. With the theoretical value of a win share (WAR) somewhere in the range of $8 million dollars as of 2020, a minor league system would have to produce a single player worth 1.0 WAR in order to financially validate the increased expenditures.

Historically, teams have been risk averse to the point of doing everything possible to keep minor league costs and expenditures as low as possible and this poisonous thinking has contaminated players and fans alike, morphing unfair and possibly illegal labor practiced as a “grind” that must be overcome in order to prove talent and worth. Cracks have begun showing up in the foundation of this grift perpetrated by penny-pinching millionaires and billionaires over these last few years and hopefully the dam will soon be broken.