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Phillies, Major League Baseball to see a “Tank Tax” in the future?

By John Town

LOS ANGELES, CA - OCTOBER 25: Major League Baseball Commissioner Robert D. Manfred Jr. attends the 2017 Hank Aaron Award press conference prior to game two of the 2017 World Series between the Houston Astros and the Los Angeles Dodgers at Dodger Stadium on October 25, 2017 in Los Angeles, California. (Photo by Tim Bradbury/Getty Images)
LOS ANGELES, CA - OCTOBER 25: Major League Baseball Commissioner Robert D. Manfred Jr. attends the 2017 Hank Aaron Award press conference prior to game two of the 2017 World Series between the Houston Astros and the Los Angeles Dodgers at Dodger Stadium on October 25, 2017 in Los Angeles, California. (Photo by Tim Bradbury/Getty Images) /
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To try and keep teams like the Phillies from biding their tame and saving money, could Major League Baseball implement a “Tank Tax”?

There have been two major complaints about baseball this offseason: too many teams are “tanking” and too few are signing free agents. The Phillies are arguably guilty of the former, but they have been one of the few teams to actually spend a significant amount in free agency this offseason.

As a whole though, spending is down and rebuilding is on the rise. This year, the Marlins and Pirates joined the pile of several major-league teams, including the Phils, who are planning on not competing in order to build for the future.

How could you blame them though? The last three World Series champions, the Royals, Cubs, and Astros, all went through extensive rebuilds before climbing back to the top of the pile. It’s now a proven strategy that acquiring young talent at the cost of established players can secure a trophy. Teams are trying to follow that same strategy in the hopes of winning a championship.

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While building for the future may be the best way for teams to gain success down the road, it doesn’t help keep the game competitive this year. With as much as a third of the league not looking to make a playoff run, it severely hamstrings any sense of competitiveness in the league. On any given night you could have two teams playing where neither one’s front office believes winning that game is beneficial; if anything, it only hurts their draft position.

To try and reconcile this gap between building for the future and maintaining present competitiveness, J.J. Cooper of Baseball America came up with a new system: the “tank tax”:

"It’s relatively simple. The same draft system continues to exist. The worst team picks first, the second worst picks second, etc., with one caveat: any team that fails to win 70 games in back-to-back seasons faces a 10-spot draft penalty."

Cooper goes on to write that the “tank tax” would work similarly to the luxury tax in that the penalty increases if a team fails to reach that 70-win threshold in consecutive seasons. This would lead to a 15-game penalty the second consecutive year, and so on.

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Cooper argues that this system would motivate teams to add free agents to reach that win threshold, whatever it may be. He says this would help remedy the current free agency freeze in the league and make teams actually want to win in September even if they are out of a playoff spot.

While Cooper’s idea makes sense, just like any other potential remedy for tanking/rebuilding, it has some flaws. Some teams just get plain unlucky; just look at the Mets last year. Nearly every key player on their team dealt with injury, causing them to lose 17 more games compared to 2016.

It’s certainly possible that a team could wind up triggering the penalty just because of bad luck with injuries, even if they were actually trying to win.

Sometimes free agent signings don’t work. The Phillies went out and signed three big-name free agents in Carlos Santana, Tommy Hunter, and Carlos Santana. The three combined for 5.3 wins above replacement in 2017, which would push the club above Cooper’s 70-win threshold. However, if those three failed to produce at the same level this year, and other players couldn’t make up the difference, Philadelphia or any other team could be penalized even though they were actively trying to improve.

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Is there an ideal way to fix the competition gap in baseball? Most likely not. Other leagues have their own systems in place, but there is no one certain way to suddenly make every team in baseball try to be competitive. Cooper’s “tank tax” may have some good ideas boiled in, but just like other systems, they have some holes.

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