The League

Peter Schaffer
NFL Agent

Peter Schaffer

Agent and professor of sports law

Players Deserve More

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Another NFL draft is upon us which brings forth another round of debating the issue of the alleged overpaying of rookies.

It is easy to throw the rookie under the bus and say that the "untested" players are making too much money and that a "cap" or some other type of restriction on their compensation is in order. This is an argument that teams take on with ease as well as most causal fans. The reality is that the draft by definition is already a restriction on the monies paid to rookies and the actual money paid to rookies in general is a veritable bargain for all NFL clubs and thus no cap or any other artificial restraint is needed.

OK, I am an agent and everyone will take what I have to say about this issue with a grain of salt as it will appear on its face to be self serving. I get that. But look at the facts. In reality the rookie draft system is anything but out of kilter for the vast majority of the 240 odd players selected each year by teams. The compensation packages they receive are incredible deals for teams.

The draft is a prima facie restraint of trade, violating any number of tenants of the Sherman Anti Trust Act. There is no free agency for the top 250 drafted players in the league each year. If there was no draft (imagine that?) and all entry level players were free agents and allowed to secure the best deals for themselves with the team of their choosing, the deals we see today would pale in comparison to what the players would actually receive. The apparent massive deals of Atlanta Falcons quarterback Matt Ryan or Cleveland Browns offensive tackle Joe Thomas, would be peanuts compared to the dollars and contracts they would command on an open market.

Another argument commonly promulgated for a rookie compensation restriction system is that the worst teams should not be penalized by selecting at the top of the draft. Here's an idea: Don't finish last! The draft by definition was created to give the worst teams a leg up for the next year by allowing them to pick first. Teams argue that the benefit of selecting the cream of the college crop is now outweighed by the exorbitant contracts that these picks command. While the top three to four picks receive a windfall as compared to the other drafted player, their compensation packages have remained consistent with the packages that the top players receive in the league over the years.

Matt Ryan's six year $56 million deal, or $9.5 million per year in reality ranks him at about the average compensation for a starting QB in the league with the Peyton Manning's and Tom Brady's making upwards of $15 million per year now. Further who is to say where that $9.5 million per year in five years will rank Ryan in the league as the salaries continue to escalate. The same can be said for the large contract that Joe Thomas, the third pick in the 2005 draft. Thomas received five years and $34 million, or roughly $7 million per year. This number now pales in comparison to the Jason Peters, Jordon Gross tackle deals done this year at $10 million per.

The other reality is that the high price paid for the best talent is offset by the bargains associated with later picks. For example, Jaguars defensive end Derrick Harvey last year only netted $23 million over 5 years ($4.5 per year) despite his ill advised hold out. This is roughly the same amount at the Cardinals paid journeyman defensive end/linebacker Travis Laboy in free agency. 2008 12th pick Ryan Clady got $15 million over five years and he is the starting left tackle for the Broncos. Ravens starting quarterback Joe Flacco, picked 18th overall, received a contract that can pay him from $12 to $30 million dollars over five years, and Aqib Talib, the 20th pick, received $11 million over five years or just a hair over $2 million per year as a corner for the Buccaneers. This is a far cry from the $7 million that the Ravens pay Domonique Foxworth per year, or even the deals that other "nickel" cornerbacks received this year like the Joselio Hanson of the Eagles ($3 million per year and he is has no chance of starting).

Later rounds selections offer even better deals for teams as evidenced by the packages received by players in last year's draft like Eddie Royal of the Broncos, (2nd round at $800,000 per year for four years) or 3rd rounder Dan Connor who will start at linebacker for the Panthers making $623,000 per year for four years. Eagles safety Quinton Demps, got $540,000 per year in the 4th round while the Arizona Cardinals 5th round draft pick Tim Hightower is running for $428,000 per year.

At the end of the day, while it is popular to cry foul at the large deals that the top rookies receive, the overall numbers indicate that the system is broken in the favor of the teams. The system does need to be fixed but not for management but for the other players in the draft selected after the top five players.

By Peter Schaffer  |  April 24, 2009; 12:52 PM ET  | Category:  Draft , Peter Schaffer Save & Share:  Send E-mail   Facebook   Twitter   Digg   Yahoo Buzz   Del.icio.us   StumbleUpon   Technorati  
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Comments

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Nicely written but, howver, I respectfully disagree! Your examples represent the exception and not the rule. There are for more cases of exorbitant rookie deals paid to those who have not, nor will ever, merit the compensation. This has become increasingly pronounced over the years. And this trend flies in the face of a true meritocracy. Ideally, wouldn’t it be nice to have a market driven by paying production and experience? Doesn’t veteran free agency try do just that? Secondly, the rookie pool was originally intended to be a cap within a cap and thereby reserve more $$ for time tested veterans. However, due to an evolution of so called “innovations” in contract structure (and I use that term facetiously), rookie deals, particularly those in the first and second rounds, have surpassed their so called “slot values” by a wide margin. For heaven’s sake, we’re backing up one-time log bonuses with guarantees! As a result, the “market forces” you claim to be suppressed have effectively etched away at what may easily (and incorrectly) be perceived as an unduly structured rookie system. Lastly, we seem to have forgotten that the draft is not based in economics. Rather it is based on competitive balance, a concept that is both logical and essential in the NFL. However, economic factors (i.e. the agents) have been very adept at reshaping the system such that it no longer necessarily rewards a club coming off a down season by letting them select above the rest. It’s broken and it needs fixin‘!

As Paul Harvey used to say…And that’s the other side of the story…Good Day!

Posted by: JimBeam2 | April 24, 2009 6:33 PM

You cannot single out the draft as being anti-trust, if so, you implicate the entire league because there are no other "pro" football leagues in the U.S.(corporations). The current draft system as it is does not function as an open market, which in turn allows rookie salaries to be inflated over actual worth. When the Russian government says a loaf of bread must be sold for two dollars, that might sound like a bargain, but what it does is allow bread that's not worthy of the price be sold at that price. The true free market would be flexible in price, because the buyer (team owners) would have power to drive the worthy price. Here's my attempt to relate this to the current draft system. If there is consensus among NFL teams that only one rookie player this season is worth a multimillion guaranteed dollar contract without stepping on an NFL field, the second drafted player could claim he's worth what the #2 pick was paid in the prior draft, no matter whether the drafting team believes he's as equally talented.

Posted by: destewar | April 25, 2009 2:21 AM

The players deserve more???? With your cut, of course you believe that! Salaries have gotten so ridiculous that the average football fan (me) can't afford to take the family to a football game. I am tired of paying $25 for parking, $8 for a beer, and $4 for nachos, in addition to inflated ticket prices. This, because the players want more of the piece of the "pie". I am so tired of players crying that they "can't feed their families" on multi-million dollar salaries, while thousands of folks are unemployed. Mark my word... the NFL will one day shutdown, as the average fan (me) will stop going to games, buying jerseys, and endorsing this greed. Players that give up $100K in fines in a hold out for a new contract.... makes me sick. I would give up a limb to play a pro sport for the league minimum. Let them do MY job on MY salary and see what they think!

Posted by: lifelongfan1 | April 25, 2009 7:42 AM

Im with lifelong fan. Reading the ramblings of a money grubbing agent is not going to change my mind. The owners are making a killing,but they take all the risks. Salaries have gone up so much im having a hard time affording my season tickets for the Redskins. As most people are aware we arent getting much for our money ( $40 parking). I know nobody is forcing me to buy them. But I love football and cant seem to give them up.

Posted by: bryjen48 | April 25, 2009 11:49 AM

I'm with LIFELONGFAN1 as well. IMHO, Owners + Players + Agents = PURE GREED. These people clearly do not realize how utterly ridiculous they sound to the average citizen when they speak of average salaries well into the millions. Enough of this crap already. This is why I refuse to go to a game, I simply refuse to feed this hideous beast.

Posted by: JKJ88 | April 27, 2009 8:55 AM

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