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History of Trade Deadlines and a Primer on the New Rules

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The Major League Baseball trade deadline is Wednesday July 31 at 3:00 Central Time. For the first time in the history of the game, the trade deadline is a real one, meaning that certain trades will be outright prohibited after that time, instead of requiring teams to go through the mysterious process known as “waivers.” There have been several changes to certain rules involving trades over the years, and in this article, I will trace the history of the important ones, as well as outline the new rules that will govern the clubs going forward.

HISTORY OF TRADE DEADLINES

In the beginning of major league baseball, trades did not even appear to be allowed. In 1901, amidst the ongoing conflict between the National League and the upstart American League, both leagues established a rule permitting trades, but only with the consent of the players involved. When the leagues signed the National Agreement of 1903, the requirement of player consent was eliminated.

The first trade deadline was established by the National League for the 1917 season, and the League chose August 20th as the target date. The American League set their first trade deadline in 1920 and picked a date of July 1st. Both leagues agreed to switch their deadline to August 1st for the 1921 season. After much discussion among the leagues over the next 2 years, Commissioner Kenesaw Mountain Landis set the deadline for both leagues at June 15th for the 1923 season. The deadline stayed at that date for over 60 years, until the agreement to resolve the players’ strike in 1985 moved the deadline to July 31st for the 1986 season, where it has remained ever since.

THE DEADLINES WERE NOT FIRM

Although the dates I have mentioned were called deadlines, they were not true deadlines, because trades were not categorically prohibited after that date. Until this year, trades were allowed after the “deadline,” if the players cleared the process known as “waivers.” I will explain more about waivers in a follow-up article, but essentially you can think of a waiver as a club forgoing its right to claim a player for a set price and grant permission of another club to make a certain disposition of a player. There were several flavors of waivers, and in the case of trades, there were several rules enacted with respect to trade assignment waivers that made it more difficult on clubs to execute their preferred trades.

RESTRICTIONS ON INTER-LEAGUE TRADES

Up until the last couple of decades, the American and National League were not as harmonious as they seem to be now. They jealously guarded their separate interests, had separate league presidents that had much greater power than the current occupants of the posts, and even had different rules on everything from the size of the roster to waivers. Over time the attitude developed that if a club wanted to trade a player, it should first give the opportunity for the other clubs in the league to have a crack at the player instead of helping the other league out.

For the 1934 season, a rule was enacted requiring a player to be waived out of his own league before a club could trade that player to the other league. For example, in those days, if the Cards wanted to trade or sell a player to the Yankees at any time during the season or the off-season, it had to give all the other National League clubs a chance to claim him for the waiver price first. If a player was involved instead of cash, the Yankees in my example would have to give the other American League clubs the same chance to claim the player they proposed to trade to the Cards.

For several years leading up to the 1952 winter meetings, American League club owners, most notably Clark Griffith of the Washington Senators, had been grousing about those New York Yankees. The Yankees had won the World Series 4 years in a row, and in each year had bought players from or traded players with National League clubs that helped them in the pennant race, and had done so late in the season after the trade deadline. On August 22, 1949, for instance, the Yankees bought Johnny Mize from the New York Giants for $40,000. The rules only required that Mize be waived out of the National League before the Yankees could purchase him, and several American League owners, especially the owners who could not outbid the Yankees, wanted a chance to claim such players for the waiver price just like the National League clubs could in that situation. The Yankees also bought 1B Johnny Hopp from the Pittsburgh Pirates in September of 1950, obtained P Johnny Sain in a swap with the Boston Braves for a player and a $50,000 in late August of 1951 and P Ewell Blackwell from the Reds in August 1952 for 4 players and $35,000. To respond to these complaints, a rule was passed at the 1952 winter meetings for the 1953 season that required players involved in an inter-league trade after the trade deadline of June 15th to clear waivers in both leagues.

INTER-LEAGUE TRADING PERIODS

After several years, apparently in an effort to make the winter meetings more active and interesting, Major League Baseball created a window of opportunity for clubs to execute inter-league trades without waivers being required. The first period became active in the 1959 off-season and ran from November 21st through December 15th. For the 1970 off-season, the opening date of the window was changed from November 21st to the 5th day following the conclusion of the World Series. For the 1972 off-season, the ending date of the window was changed from December 15th to the next-to-last scheduled day of the winter meetings, whenever that happened to fall. Effective for 1977, another inter-league trading period was established which ran from February 15th to March 15th. Beginning in 1982, the end date of the second inter-league trading period was pushed from March 15th to April 1st.

As part of the settlement of the 1985 players’ strike, not only was the trade deadline moved from June 15th to July 31st, but all the other special restrictions on inter-league trades were removed going forward. For the 1985 off-season and beyond, waivers were required for all trades that took place between 12:01 A.M. EST on August 1st and 5:00 EST on the day following the final game of the regular season. Clubs in both leagues had the chance to claim any player placed on waivers, with priority given to the league in which the club placing the player on waivers played. I’m not sure when, but at some point the time of the deadline was moved from midnight to 4:00 p.m. EST, where it remains today. The last inter-league trade the Cardinals made that required waivers before the trade deadline was in May of 1985 when the Cards traded Lonnie Smith to the Kansas City Royals straight up for John Morris. The trade was held up for about a week while each player cleared waivers in their respective leagues.

CLOSED TRADING PERIOD

In earlier seasons, even with trades permitted after the deadline, most clubs tried to complete trades by August 31st, which was the date that a player had to be in the organization to be eligible to play in the playoffs. Nonetheless, for a good while, there was no closed period. I have been unable to determine exactly when, but at some point a rule was passed that did, in fact, bar trades for a window of time. Under the rule in effect for last season, no trades of either major league or minor league players were allowed—regardless of waivers—between 12:00 p.m. EST on the 7th day prior to the conclusion of the regular season and the day following the last day of the regular season.

NEW RULES

Effective in April of this year, the rules associated with the trade deadline were changed drastically, and here is what you need to know going forward:

First, trade assignment waivers (and all the shenanigans that went along with them which I will explain in a follow-up article) have been abolished. Matt Adams and Tyson Ross will go down in history as the last players the Cardinals actually acquired on trade assignment waivers. Next, and most importantly, all trades of 40-man roster players are flat-out barred in the period beginning at 4:00 EST on July 31st and ending the day following the day that the last game of the World Series starts.

In addition, in a twist that has not been widely reported, the prohibition above on trades also applies to players that had a major league contract for the season but were outrighted to the minors! For example, the Cardinals just announced yesterday that Chasen Shreve cleared outright assignment waivers and was outrighted to AAA Memphis. If the Cardinals want to trade Shreve they have to do so by July 31st at 4:00 EST or they will be barred from doing so until after the World Series.

Finally, trades of all minor league players that are (a) not on a 40-man roster; AND (b) have not been outrighted this season after signing a major league contract for this season ARE allowed after the July 31st trade deadline, and waivers are not necessary. Trades are only prohibited for these players between 12:00 EST on the 7th day prior to the conclusion of the regular season and the day following the last day of the regular season. The only minor league players that can’t be traded during this time are players who were just selected in the June draft.

RAMIFICATIONS

The first thing that comes to mind is that clubs must essentially decide by July 31st if they are post-season contenders or not. If the situation changes after that date, they will not be able to do much about it. With multiple layers of playoffs and 2 wild card spots, many feel that the trade deadline is too early, because teams can get into contention for various reasons as late as September. Making the trade deadline a firm one makes it more urgent that teams make up their minds.

The second thing is teams must be more clear on what their contingency plans are if one of their star players gets injured. Remember in 1985 when 1B Jack Clark got hurt? He didn’t play at all between August 23rd and September 18th, right when the Cardinals were in the thick of the pennant race. On August 29th of that year, the Cards compensated by trading a minor-leagure named Mark Jackson to the Cincinnati Reds for Cesar Cedeno. Cedeno slashed .434/.463/.750 with 6 HR in 28 games, and it is likely that we would not have won the pennant without him. That trade would be barred today.

This makes it much more important now not only for clubs to have players on hand who have positional flexibility, but also have players on their higher level farm clubs who they are confident could play in the majors in a pinch. Now if a star player gets injured after the deadline, a club is not going to be able to acquire a major league player to fill the void. They only player they can get is a minor league player that’s not on a 40-man roster and who has not been outrighted that season. It’s possible that a club can acquire such a player to help in an emergency, but it’s a lot tougher than it would be if they could simply make a waiver trade.

CONCLUSION

With the trade deadline being firm now for the overwhelming majority of desirable players, it would be reasonable to expect the next few days to have an even greater flurry of moves for contending clubs than ever before. What will teams do? Will the shenanigans associated with trade assignment waivers be replaced by a separate set of shenanigans? Will friendly clubs try to circumvent the rules? If Club A needs a player off of Club B’s roster after the deadline that Club B doesn’t really need, will the two clubs engage in a wink-wink deal? Maybe Club B releases the player, and in a separate side agreement, Club A arranges a favorable trade with Club B for minor league players.

What do you think of the new rules? Let me know in the comments, and enjoy the flurry of activity! Stay turned for the second part of this story.