Getting Less Bang For Your Buck
Will Cliff Lee be a part of this winter's free-agent market inflation?Whether you're talking about your own everyday purchasing activities or the spending habits of your favorite professional sports team, it seems there's one aversion in particular with which everyone is well-acquainted: overpayment. Nobody likes shelling out more dough for a specific product/service than they actually perceive it to be worth, and -- in general, at least -- nobody likes watching their most beloved sports franchise expend undue resources in order to complete a trade or free-agent signing. There's a time and a place for charitability, but it typically won't be found in the pro sports talent markets.
The reason I mention this now is because this winter's baseball talent market appears to be shaping up as a potential boon for free-agent talent -- the very type of commodity that the Rangers (by virtue of their now-existent "financial flexibility" and somewhat diminished stack of expendable trade chips) seem best positioned to pursue aggressively. When I say that, I mean that most or all of the leading indicators to this point in the off-season support the presumption that this is a "players' market," and that we must find a way to lessen our aversion to overpayment if we are to find true satisfaction in any high-priced Rangers transactions that might be forthcoming.
From 2002-08, the average number of dollars spent to acquire one additional (marginal) win on the open market grew roughly 10 percent from one year to the next; for example, in 2005, major league teams spent roughly $3.4 million on each marginal win that was acquired in the previous winter's free-agent market. In 2006, this climbed to $3.7 million. In 2007, this climbed to $4.1 million. In 2008, this climbed to $4.5 million, but then remained static onward into 2009. Last season, however, was anomalous -- in 2010, teams spent only about $4 million for each marginal win, perhaps attributable to both the relative weakness of the free-agent class and economic difficulties within the game.
The 2011 dollars-per-win marker has yet to be determined, but it appears we're barreling back into $4.5 million territory -- and some (un)lucky teams are going to end up spending more than that. We already have John Buck ($18 million) and Joaquin Benoit ($16.5 million) netting three-year deals, despite the former's career-long mediocrity and the latter's injury-plagued history, and the flurry of inflated pre-free agency extensions. We have Adrian Beltre reportedly fielding a five-year, $64 million offer from Oakland. We have Derek Jeter holding out for $20 million per year (though that's a unique circumstance), Victor Martinez likely staring at no less than $12-13 million per year over four years (despite his probable shift away from catcher in a couple years' time), Cliff Lee asking for the moon ... are you beginning to see where I'm coming from?
The funny thing is that Lee, even at a $24-25 million per annum level, is very likely the best bang-for-the-buck value for Texas on the free-agent market where 2011 is concerned; given that he is unofficially regarded as Plan 'A,' this isn't much cause for surprise. Victor Martinez and/or Adrian Beltre might well furnish comparably priced upgrades on the dollars-per-win scale, but they're not pitching upgrades, and neither one of those guys wields the drawing power of Lee. The remainder of the higher-profile names being linked to Texas -- Vladimir Guerrero, Jorge De La Rosa and Carl Crawford -- will either command too much money to compare to Lee value-wise, or don't fit in the Rangers' scheme.
Just to be clear, I don't think it's a certainty that the Rangers are going to be gouged to death in this winter's inflated market. I actually hate throwing around words like "creative" and "resourceful" in the context of the Rangers' front office because they're such vague and nebulous terms and prone to overuse, but both do indeed describe the precedent set by this front office, and that, in turn, fosters some hope that this will be both a fruitful and fairly priced winter endeavor. That said, it may be that a few things here and there don't go quite right, that Texas ends up blatantly overpaying for one player or another, and that the only thing we can do about it is loudly complain or accept it ... or both.
Analysis, Hot Stove Season, The Off-Season
Reader Comments (17)
I'm the sort that instantly focuses on the back end of any new contract signing....sure it sucks alot of fun out of any new acquisition (or extension), but it is what it is. Ask the Angels how much they like Sarge Jr right now....the Yanks of Burnett....the Giants of Zito....you get my drift. Even if the signing is by all accounts wildly successful the first couple of years, more than likely the back end of it (given a players' advancing age), shall become the throat-constricting albatross the mighty MJH often refers to when speaking of Him.
So piggybacking on Joey's point, this rapidly shaping buyers market doesn't scare me as much from a strictly dollars-inflated standpoint, as much as it does from a length of contract perspective. As great as he is I don't want to pay a 40year old Cliff Lee 25M (if given a7 year deal). Because eventually that season will commence, and it ain't going to be fun.
should read ' sellers' market* .
Almost every sports contract is horrible on the back end. That's one of the reasons that the NFL has never gone to guaranteed contracts.
Now with baseball we have to deal with it. If Lee is getting in the 5 year range I think you can deal with the back end for the 3 years he still has a chance to be a top of the rotation ace. If the yankees rumored 7/161 resurfaces, then I doubt anyone can match that because no other team can afford to have something along the lines of 4 years of 23 million a year dead.
Agreed on all counts, and especially on the "it's the length, not the girth" argument with respect to Cliff Lee.
5 years, $120 million simply doesn't seem nearly as daunting as 7 years, $160 million. The Yankees can probably absorb those last couple years without too much difficulty, but that would almost certainly be a deal-breaker for the Rangers.
I see Lee transforming into a Jamie Moyer type at the end of this contract whether it's 5 or 7 years. Ends up relying less on his fastball and gets the "crafty lefty" label. Now is Moyer worth 20mill? No, but say you get 4 years of Original Lee and then 3 years of "crafty" Lee - wouldn't that be okay?
Or maybe Pettite is a better comp. than Moyer.
@JFitz: I'd argue that even factoring in the all-but-inevitable inflation of salaries (and, presumably, inflation period -- though at this point, who knows?!), paying Cliff Lee $22-24 million to pitch like Jamie Moyer for three years could well compromise the Rangers' ability to contend during that time period.
It depends largely on the club's ability to expand payroll as well as its success in finding young, cheap talent for 2015-2018, of course, and none of us has much evidence about either. But assuming the team is reasonably successful from 2011-2014, and everything else remains largely the same in baseball (in terms of drafts and such), it's going to be more difficult for Texas to restock the farm or make trades for prospects.
If the team is going to be gouged; do it on the front end by drafting and signing the Purke's.
The gouge isn't so deep and it only hurts for one year.
If the team is going to be gouged; do it on the front end by drafting and signing the Purke's.
This is all well and good, but it's not terribly often that a player of Purke's pedigree falls as far as No. 14, let alone into the No. 20-30 range (which is hopefully where the Ranger will be drafting over the next 2-3 years). I understand the point you're making, but I don't think this approach is as effective when the best talent in the draft class is off the board by the time you get to make your first choice.
Josh, Joey, how much would you pay for V. Martinez? I am seriously worried about his value because I don't feel he's going to be a full time catcher any longer than maybe one more season. At catcher his bat is very valuable, not so much at DH/1B. And if he is going to get 4 or 5 years I'm not very interested in handing him $50+ million. If he would come on a two year, $25M deal I'd be all over it, but no way that happens.
@tball: I haven't worked out exactly how much I'd offer Martinez if I were the Rangers front office. Three years, $36 million seems like something that he could expect to see from some club, and I'm not so sure that's not an overpay.
But I've read the Red Sox would go up to 4 years, $52 million, and I'd be horrified if Texas trumped that sort of offer. Heck, if Adam Dunn can really pull a 3-year, $40 million deal to be the Tigers' DH, I think that tells you a lot about chances the Rangers can land Martinez for a reasonable price and duration.
That's my thinking. I'd love to have Martinez here on a two year deal, but he's going to get 4 or 5 years of star money, and I just don't think he'll be worth it.
What if the Rangers were to have the contract front loaded instead of back loaded, where as the Rangers would be paying Cliff something around 30 for the first three years, when he would be more proned to actually being worth it, and leave the remaining 70+ million to the last four years. this could give the rangers less flexibility today, but it also would not kill them in the 5th thru 7th year of the contract. and should allow them to remain with the likes of the yakees and red sox. i have a feeling that this is something that isn't done for a reason but i thought that i would throw it out there.
also i have read that molina is a type A free agent, but if he retires do the the rangers get any compensation?
What if the Rangers were to have the contract front loaded instead of back loaded, where as the Rangers would be paying Cliff something around 30 for the first three years, when he would be more proned to actually being worth it, and leave the remaining 70+ million to the last four years.
This is an idea that gets brought up every now and then, and for the life of me I can't remember the last time I saw a front-loaded MLB contract. Matching his salary to his current production level sounds logical in theory, but you have to remember a few things: (a) there's strong motivation on the part of Lee's agent (Darek Brauencker) to maximize the overall dollars for marketability purposes, and (b) a dollar today is worth more than a dollar tomorrow.
Part 'B' means that front-loading Lee's deal is actually LESS beneficial to Texas because the present value of the deal is higher, yet the raw dollar totals are diminished. (I also have an unfounded theory that players like the current contractual model because it guarantees progressively larger salaries in future seasons, which perhaps makes more sense on a cognitive level than diminishing salaries.)
Just to play devil's advocate (and I agree Lee will be overpaid wherever he goes), what would be so wrong about having him front a playoff rotation for the next two years? After two years,like it or not, free agency is going to whittle away the talent of this team. Anything wrong with maximizing the opportunities in this window that JD & Nolan have built? While it's great to have young talent and be proclaimed the best minor league system in baseball, we're only going to have Cruz & Hamilton a couple of more years. Going all in is something to at least consider.
Does anyone else think the FA appreciation makes arbing Bengie Molina a more attractive option than it was 2 weeks ago?