J.D. Drew opts out of his contract
J.D. Drew walked away from the Dodgers today, opting out of the remaining 3 years and $33 million he had left on his contract. He’s bound to get more money in the craziest free agent market since Denny Neagle and Mike Hampton cleaned house, but he also was unhappy in Los Angeles and wants to relocate.
So, the question for Mariner fans is should we be interested?
My answer is a conditional yes. If the Mariners are willing to think outside the box, there’s an easy way to make this work.
Trade Richie Sexson for whatever you can get. Give him away if you have to. He’s clearly inferior to Drew and a worse fit for this team, yet the team still owes him $14 million each of the next two seasons. Find a team (like San Francisco) who like Sexson and take whatever they’ll give you for him.
J.D. Drew steps in as the new left fielder (or right fielder, whichever he prefers) and Raul Ibanez moves to DH. Voila. Team better with no extra cash output.
Trade Richie Sexson for J.D. Drew – sort of.
Budgeting Wins
I was reading an article by Nate Silver a few weeks ago when I ran across a paragraph that articulated many of the thoughts I’ve been having on how teams should approach their offseason plan. Essentially, Nate put my thoughts into words, and then expressed them in a way that made sense of the jumble I had going on upstairs. Here’s what he wrote under the context of suggesting moves for Walt Jocketty in keeping the Cardinals as contenders in 2007:
Set a wins budget, not a payroll budget. It’s my belief that most major league baseball teams go about their budgeting the wrong way. Sometimes it’s worth spending more than you might have been planning on if you can acquire a player who will get you over the hump and into the playoffs, since the financial rewards for making the postseason are substantial. Other times, your team is so far from making the playoffs-–or such a cinch to make them-–that paying market price for free agent talent just doesn’t make sense.
Put differently, rather than figuring how much money they want to spend, baseball teams should determine roughly how many wins they’ll need to make the playoffs, and spend on payroll until that they have the talent on hand to realistically reach that goal. For the Cardinals, the magic number is probably 90 wins; it would be higher if they played in a tougher division.
This is a wildly different concept than most teams operate under. Because almost every major league team is run as a corporate operation, the baseball operations department is given a budget for player payroll that fits into a fiscal year line-item for the corporation as a whole. Essentially, the accountants tell the front office how much money they can spend and tell them to do as well with that as they can.
While acknowledging that there are some issues with what I’m suggesting, I believe this design for setting payroll is inefficient and could be vastly improved. Instead of trying to cram as many wins as possible into a preset number of dollars spent, teams should figure out how many dollars they need to spend to reach their preset number of wins targeted.
Basically, Nate and I (independently, as we haven’t talked about this) support a 180-degree change in the way the baseball operations departments interact with the organization’s accountants. Rather than handing the baseball ops people a similarly sized check every year, baseball teams would be better off going to requisition-style budgeting concept.
How would this work?
We’ve talked a lot about marginal win values on the blog. Essentially, the concept of marginal wins is that a team of league minimum players would win 50 games or so, and every dollar spent over the league minimum is being used in hopes of gaining wins 51 and up. These wins are the marginal wins, and the excess payroll is the marginal dollars spent. This kind of analysis allows us to look at the league as a hole and say that a marginal win is worth about $2 million in salary.
However, league wide averages of marginal win values start to lose some of their importance when applied specifically to one team. Every team has a different roster of committed salaries and budgets for the following season, and so each team will have a different marginal dollar amount to spend on building their roster. The Yankees can blow the $2 million per win number out of the water and not blink an eye, while if the Marlins tried to spend $2 million per win, the ownership would flip out and demand a firesale.
In a win-budget concept, a team would do a rational, honest evaluation of how many games the current roster could be expected to win if each additional hole was filled with a replacement level player, and then request a player payroll budget based on the amount of marginal wins they’re going to attempt to add that offseason. For a team that believes it has a 60 win team in the organization, spending $30 million to buy another 5-10 wins is pretty foolish. However, if a team has 90 wins sitting around, spending $30 million to make yourself a 95-100 win team is well worth justifying. A team operating on a win budget system would spend significantly more when their team is contending and significantly less when their team is rebuilding.
A move away from a fiscal year budgeting system would give the baseball operations department much more flexibility in their long term planning and allow organizations to allocate resources much more efficiently. Let’s use the Mariners as an example of what I’m talking about.
For 2005 through 2007, the Mariners are going to end up having spent around $270 million on their player salaries. They essentially spent it in equal chunks, with about $85 million going out in 2005, $88 million in 2006, and a projected $95 million or so in 2006.
If they had shifted to a win budget system after the debacle of 2004 and correctly analyzed the talent they had on hand, they could have fielded a 65-70 win team in 2005 for about $70 million. Last offseason, the goal was to get to 80-85 wins, which could have been accomplished on a payroll of about $80 million.
That would leave them with $120 million dollars, not including the accrued interest gained from the money not spent in prior years, to spend on the 2006 Mariners, the year that they’ve been mandated to win or lose their jobs. Would you like the M’s to have $120 million payroll next year? Yea, me too.
A win budget system systematically shifts payroll dollars away from years where the team is rebuilding and into years where the team is challenging for the World Series. It maximizes the impact of the wins the teams are paying for, and acknowledges that a 95th win in one season is worth more than the 72nd win in another season.
Someday, someone in a front office is going to convince their owners to shift to a win budget system. And their economic advantage is going to be staggering.
A’s moving to Fremont, California
Two papers, the San Francisco Chronicle and San Jose Mercury News, reported yesterday (while I was at the polls) that the A’s will be moving to Fremont, California into a new 36,000-seat stadium they’ll build with private money for about $300m.
This gets them out of the Al Davis Reconfigurable Hole, for one thing, and it’s also a fairly amusing way to move without going to San Jose, which the Giants claim as their territory, which
a) is a dumb claim in the first place and
b) is an excellent example of how stupid and counter-productive MLB’s territorial rights system is
Fremont, if you don’t have a map handy, is southeast of Oakland, a little more than half way between Oakland and San Jose. It’s across from Redwood City/Palo Alto. ESPN’s article includes a comparison table between Oakland and Fremont that includes a racial breakdown (no, really)
What’s this mean for the Mariners?
It’s bad. This is, in the long term, possibly the worst news of the off-season. Now, Billy Beane’s record with straight free agent signings is kind of ugly. Okay, it is ugly. And there’s an argument to be made that part of the A’s success has come from the restraints on their budget (which is like the Robert Frost argument that you had to write poetry using meter).
The people in charge of the A’s are smart. They’re not moving to Fremont unless they think it’ll substantially improve their financial situation from small, profitable operation into large, more profitable operation. Some of that money is going to go to the baseball side. And the team that beats the M’s like a drum over and over is going to be far better financed.
I’ve tried to think about what the A’s would do if they didn’t have to make signability picks. Would they look at the draft and still see players of essentially the same value, and pour money into international signings? Would they drop the pretense that drafting cheap guys in the first round is a good idea and go nuts, armed with more money and better slotting? Spend even more money dumpster-diving every year?
None of these possibilities are good news.
And at the major league level, are they going to open their pocketbooks to try and field a more-expensive team as they move in? Would the A’s even spend on free agents unless the market cools a little, or are they going to sign their guys to long-term deals to buy out free agent years?
The Mariners would be playing in a division without a poor kid, where every competitor they face in unbalanced play is well-funded. Things are going to get tougher. Hopefully the M’s will get smarter and be able to compete.
Go vote
Hey, I’m going to be out today volunteering at the polls, so here’s my non-partisan plea: if you haven’t mailed a ballot in, find the time to go vote today. If you’re in the metro area, especially if you’re on the eastside, there’s a good chance you’re in the 8th, which looks like it’s going to have one of closest elections in recent history, and if you’re in eastern Washington, the 5th (map of Washington’s districts). And really, no matter where you are, the difference in who represents you comes down to whether you drag yourself to the polls.
I’m not going to ask you to vote for Darcy Burner, or lobby for support for some proposition. Just vote. If your vote is the opposite of mine, I’ll be happy you went out. If you’re a reader, I’m relatively assured you’re a reasonable, smart person, and I trust your judgment.
And maybe I’ll see you out there.
The amazing haul of the the Nationals
This came across the MLB.com transaction wire today:
Signed RHP Tim Redding, RHP Joel Hanrahan, INF Josh Wilson and OF Michael Restovich to one-year contracts. Signed RHPs Jermaine Van Buren, T.J. Nall, Colby Lewis, Felix Diaz, Eduardo Valdez, Josh Hall, Winston Abreu, Jim Magrane; LHPs Mike Bacsik, Billy White and Chris Michalak; C Juan Brito and C Danny Ardoin; INF Joe Thurston and INF Alejandro Machado; and OF Darnell McDonald and OF Wayne Lydon to Minor League contracts.
As Dave put it
Yea, Jim Bowden signed almost every interesting minor league free agent on the market. It’s amazing that they all signed with one organization. I’m guessing their standard NRI contract is better than every other club’s standard offer.
While my opinion of Bowden as a GM is pretty low, this is a great batch of signings.
I’ll try and briefly hit the highlights. Read more
Matsuzaka: what the hell?
If you’ve been around here for very long, you know that we’ve been rabid for the team to go after Matsuzaka. We were happy knowing they were ready to do it. I’d sum up the USSM consensus as: his arm’s either going to explode or he’ll do great. I don’t think any of us buy the “his arm is made of adamantium so there’s no way his ligament snaps” – that argument’s been used for many, many pitchers who later went under the knife.
But they’re not going to even bid for him. Why? Let’s hit the big ones.
Too expensive
The posting fee on top of what Matsuzaka is looking to sign for is going to be a ridiculous total package, even for an ace. Say he gets an AJ Burnett contract, plus the team has to pay $30m for the right to give him that contract. Even in a ace-scarce environment, that’s terrifying.
The M’s might look at Schmidt and see a known quantity they can count on who, even on a 4/$45m deal would be much cheaper than Matsuzaka will be.
No accounting hijinks
While the posting money doesn’t count against the salary cap (making this particularly attractive to the Yankees), it looks like the M’s didn’t get a special dispensation from Nintendo to make a bid and still spend $whatever on payroll and player development. Whatever the M’s have said in the past about accounting differently for foreign players acquired as undrafted free agents, it appears that today it’s just another line item, and they decided that they could get more from the money than they would from putting it in a Matsuzaka bid+contract.
Matsuzaka doesn’t want to play with Ichiro
… and he told Boras who told teams, so the M’s said “okay, we won’t bid, then.” I don’t even know how we would start trying to prove or disprove this one.
Waiting it out
Accusations are already flying that teams are trying to tamper with the process, considering posting an immense bid and then telling Boras to stick it. Before the hijinks started, I would have thought that the chance Matsuzaka went on the market as a free agent next year were slim. Now, it’s a real possibility. Maybe, especially given the other factors, they’d rather sit this one out.
He’s repped by Boras
Boras is not a factor. It’s not. Bavasi and Boras are friends, and they’ve come to easy agreements with Boras clients before. The team isn’t afraid or even reluctant to pursue his clients.
The Mariners hate us and want us to be miserable
Between this and Hargrove’s retention, I have to admit that this is pretty persuasive.
(I’ll add more if there’s any suggestions for additional things)
—
I really don’t know that going after Matsuzaka, especially through the posting process, is financially responsible. It’s going to be a ridiculous amount of money. But in trying to fill holes through free agency, GMs are trying to make the least bad decisions possible. Matsuzaka + random minor league free agents to fill out the rotation is almost certainly going to be a much better decision than Jason Schmidt+Adam Eaton, for instance, even if it’s a pretty wild bet.
The big question that remains, though is that if it’s financial, why not submit what they consider a reasonable bid, even knowing it’ll lose? Even if you think Matsuzaka is going to demand $100m, you can bid $12m, offer him 5y/$35m, and let him go if by some miracle your bid wins. Unless you think he’s not even worth a shot in the dark, and he clearly is, why not buy that free lottery ticket?
I don’t have an answer to that. I don’t understand why you’d want to look apathetic about the best pitcher on the market this off-season, especially given the team’s poor showing these last few years.
Free agent reviews: Jason Schmidt
Heyyyy, Jason Schmidt. That guy’s supposed to be pretty good, right?
Nope. There’ve been a number of good write-ups on this I’ll point you to, particularly Jeff Sullivan’s writeup on this at but to sum up: he’s not a #1 starter. He hasn’t been in years. The last really good season he had was 2004. Since then, he’s been an average pitcher.
The bait many, many people are biting on – is that his raw stats from last year look just fine. 3.59 ERA, 180 K, 80 walks, only 21 home runs allowed? That’s pretty good. Part of the problem is that, like Jarrod Washburn, he got really lucky with runners on, which made his ERA look good. Some supporters of him pick up on this as some kind of skill but, as we discovered with Jarrod Washburn, it’s not.
Plus, as Jeff mentions, he’s not a spring chicken. You’d be giving a power pitcher clearly on the decline a huge long-term deal that will probably pay out $10m+ for his age 38 and 39 seasons.
Or, they’re trying to make arguments that he’s got some magic glow, that somehow Schmidt is special, that his stuff will translate well, or… or whatever. The argument that he’s somehow the exception is lazy. We can go to every pitcher and by hand-picking our statistics or our scouting reports find a way to support the contention that that pitcher is special, and will be awesome forever. And maybe one of them pans out. And maybe the Mariners have scouted this all out and have reason to believe he’ll succeed in Safeco, so they give him his money, Schmidt comes to Seattle and he’s an ace for five years and we look dumb (hey, look at Raul Ibanez). The point isn’t that that can’t happen – but it’s whether it’s a good gamble or even, as I put this last year, he’s the least bad free agent choice available. For a reasonable amount of money, I’d take the chance, but I’m with Dave (and Jeff) – I wouldn’t bet more than $10m a year, and on a fairly short contract. That won’t land him.
Schmidt’s going to demand ace money and he’s not going to be worth it. Do we really want another Jarrod Washburn on the roster, being paid far more than his contributions warrant? We should hope that the Mets or some other team with even more money than sense makes Schmidt a ridiculous 5/$50m offer and the M’s let him go.
Free agent reviews: Alfonso Soriano
Rumor on the street is that Alfonso is looking for $17m/year. And in M’s fandom, some fans want the M’s to sign Soriano and Schmidt which is clearly insanity.
Soriano’s 30. He’s made five straight All Star teams. His conversion to left field started badly but I’d bet the good end-of-year defensive stats are going to show him at average or not much below average (he’s a weird case for the bad, traditional stats: his fielding percentage is bad, his zone rating good). BP’s got him at 9 runs above average, which… well, RAA isn’t a great fielding stat. I’d be shocked if that was borne out by UZR/etc.
Reasons to sign him:
– Add offense, hopefully
– Add a little bit of speed
Reasons not to sign him:
– What the hell happened to him this year?
– He’s right-handed and they’re not moving the fences
– They already have a big roster issue with too many LF/DH/1B guys
– Soriano doesn’t look like a guy you really, really want to be paying $17m when he’s 35
– The Phillies supposedly want him, and every horrible move Gillick makes us feel good about his departure
The first question is the really unsettling one. David Pinto at Baseball Musings touched on this last week, so I’ll quote him
If I’m a GM interested in signing Alfonso, I’ll want to know what changed. Why did he draw so many more walks than in 2006 than in previous seasons? Did the Washington coaches get him to change his approach? Was it that with a poor offense behind him, he got less to hit? If it was coaching, it this something that he’s absorbed, or does he constantly need to be reminded?
At .350, with his power, he’s a very productive player. At a .330 OBA, he’s more of an out machine and certainly not a good leadoff hitter. My guess is that the teams convinced 2006 is real are the teams that wind up bidding for Alfonso. The other will find the money offered too rich.
I entirely agree with Pinto on this. My thought is it’s likely a combination of factors: RFK suited him, for one, it was a contract year and (as we learn in “Baseball Between the Numbers”) the contract year effect is real. I don’t think this is a new level of performance for Soriano, though as a Mariners-obsessed writer I haven’t spent the kind of time researching this that a team thinking about plunking down $17m would.
Let someone else overpay. The M’s have more important needs and even if you want to upgrade the offense somehow, there should be better ways to spend that money.
Soriano’s deal, though, will still be better than whatever Carlos Lee gets.
USSM re-floated, again
Thanks to everyone who helped out, now or before, by chipping in any amount of money. Grand total for the new box was just under $2,200. And if I may, this thing is faaaaaaaaaaaaast. It’s all yours, dear readers. I’m really happy – this was a long, stressful week backstage, as we fought with the box and getting a new server in while I had to turn around the copy edits for my book (received last week, due back tomorrow).
I find it amusing that when I checked in I found that once the site had gone back up, people went back to commenting on Dave’s last post without missing a beat or even noting we’d been down for a while.
If any of our fine readers are (or know) a decent accountant we could chat with, could you drop us a line? I’m not sure how we’re going to account for this thing.
Further bulletins as events warrant.
Free Agency
With the World Series ending, players are now eligible to file for free agency. They have fifteen days to do so following the last game of the season, so the filing period will end November 12th. So, for the next couple of weeks, you’re going to see headlines of non-news stories such as “Alfonso Soriano files for free agency.” Of course, this is about as newsworthy as “Alfonso Soriano rises from bed and ponders navel.” Players who are eligible for free agency almost always file. They want to test their market value, and in most cases, if they wanted to stay with (or were wanted by) their original team, they’d have already signed an extension.
This is also the period where we begin to hear the rumors of what players are asking for, as teams begin to get a feel for what a player thinks their value should be. A lot of the early numbers are going to be bogus; Alfonso Soriano’s not going to get $18 million a year, but it’s in his agents best interest to get that number out there now as they attempt to get him as much money as humanly possible.
One of the other annual traditions of the beginning of the free agent passage is that people start hauling out the old incorrect cliche that a player “is worth what the market will bear.” In an efficient economic model, this is generally true, but MLB’s salary structure isn’t anything like an efficient economic model, and it’s not supposed to be. Because of the existance of a massive player pool whose salaries aren’t determined by a free market, a rationale floor is created for the value of a certain production level. If a few general managers get together and decide that a 4 win player like Alfonso Soriano is worth $16 million per season, that doesn’t establish his actual value – it establishes that they suck at their jobs.
In general, the free agent market in the last few years has been significantly overheated, as teams have failed to hold a rationale line on market valued salaries, instead chasing after pennants by throwing good money after bad. It’s going to happen again this winter, and this might be the ugliest winter yet in terms of amazingly bad contracts being handed out to mediocre players.
When Randy Wolf starts signing for $30 million over three years, the correct response is not that the Mariners are just going to have to buck it up and get in the game if they want to contend, but instead, a well run organization would see their competitors wasting money and look for values elsewhere. There will be values on the trade market. There are values to be found in minor league free agency. There are often values in the low-end of the free agent pool.
If someone offers Jason Schmidt more than 3 years, $30 million (and they will, by a long shot), the Mariners need to have the stones to walk away. It’s not fear, it’s not a lack of commitment to winning, and it’s not an inability to read the market. Free Agency is a wildly inefficient market and, in general, a terrible way to build a roster. The Mariners would do well to let other teams spend themselves into oblivion. This is the worst free agent crop in recent memory, and it comes at a time when teams are flush with cash.
If the Mariners didn’t sign one free agent this offseason, I wouldn’t cry. There are other ways to build a roster. Better ways.