Will the pendulum swing the other way?

[jerichoholicninja]

http://sportsillustrated.cnn.com/mlb/news/20140225/young-players-extensions-free-agency-mike-trout/index.html

 

To sum this article: because so many young players are signing extensions that buy out their free agent years, free agency will become an even more inefficient way to acquire talent.

 

I totally agree with that premise. Buying out free agent years of good players early in their careers has been how small market clubs have been able to have superstar talent (Longoria, Braun, McCutchen, etc.). Now, however, even the big spenders are starting to do this. Invariably, the price is going to start going up and up to buy out free agency years. With Mike Trout set to probably sign a $100M+ contract at the age of 21, is this practice eventually going to out-price the small markets from doing so? Are we within 5-10 years of small market teams actually being better off by spending on the free agency scraps than locking up their own players? I don't think it will get quite that bad but I think soon a team like Rays or Pirates won't be able to afford to extend their own players and will be better off trading them after only 3 or 4 years for prospects.

 

What do you think?

[Fear The Chorizo]

The combination of teams wanting to pay big dollars to players during their prime (rather than having them cheap through arbitration and then overpaying for older free agents), and the crackdown on PED's that most likely contributed to extending primes well into player's 30s is going lead to what you're thinking, IMO. I can see arbitration rules changing to reduce MLB service time prior to free agency - that would likely eliminate the free agent year buyouts of these younger players and more big time contract extensions that actually happen during their prime years. Then you'd have a 2nd wave of early 30's free agents who would either rely on shorter term deals at high costs, or longer deals at a bargain price knowing they're guranteed contracts. You're already seeing free agents with draft pick compensation tied to them that end up signing much later and for much less than what they'd have gotten 4-5 seasons ago.

[monty57]

It is fun to watch markets, because you never know how they're going to act. However, as long as the league minimum remains ridiculously low relative to free agent contracts, pre-arby players are going to have incentive to extend. Since they can't choose the team who drafts them, and since they are under "team control" for six years that don't pay them like a pro athlete is normally paid, they either have to accept what the team is willing/able to pay them, or they are going to have to take the risk that they may get injured or underperform and find themselves looking for a "normal job" for the rest of their lives.

 

Take Segura for example. The Simmons deal set the market, but both the Brewers and Segura still have to agree. If the Brewers are not willing to pay an equivalent to the Simmons deal, and Segura isn't willing to take less, then the risk stays on Segura. Not including any signing bonus (I don't know what he got), he's probably made around $600,000, so after taxes, agent fees, etc, he's probably netted around $300,000. Therefore, he's probably not set for retirement. He'll be guaranteed around $550,000 this year, netting say $300,000 take home. God forbid something happens that ends his career this season, he will be out looking for work by the end of the year. That's a lot of risk... be guaranteed set for life or go flip burgers.

 

The Brewers (or any team) should only sign the extensions if they get enough of a discount to make it worth the additional risk they are assuming. Players may turn down the lower offers "small market" teams can afford, but they then keep immense risk on themselves. The rules as they are set should keep the market from acting "freely" and ballooning as much as the free agent market, which is not tethered with things like "team control" and pre-arby/arby years.

 

I generally like early extensions for star players, but I have no problem with players choosing to go year-to-year to free agency. That's their choice and more power to them if they're willing to take the risk to get maximum dollars. I think that small market teams need to treat these players differently, and look to trade them early in the arbitration years to get maximum value from them since they're going to walk anyways. Hopefully they can net a player or two in trade who will be someone they can extend long-term. Let the big market teams (or small market teams with short-term time horizons) take them on for the last couple of arby years and see them walk as free agents.

[jerichoholicninja]

TThen you'd have a 2nd wave of early 30's free agents who would either rely on shorter term deals at high costs, or longer deals at a bargain price knowing they're guranteed contracts.

 

I think part of this is going to start happening. Non-super star free agents are going to start taking the 2yr/$30M deal instead of the 5yr/$60M. This offseason may be showing the signs of this shift. Sure, the superstars Cano and Ellsbury got their fat contracts but there weren't a whole lot of disaster, desperate overpays like is typically seen.

[Bombers]

Trout is an exception as he is simply outstanding. Many of these players being locked up early (i.e. Lucroy) are good players but not the best in baseball. Also, if you are a pitcher and have the ability to sign a large contract and all you have to do is give up is a few years of free agency, I think you would be out of your mind not to take the money. These contracts are all gauranteed and ensure you will never have to work again. The injury risk is just to great. Even in the case of players who were top of their game could benefit from taking an early large contract. Take Lincecum for example. His last good year was 2011. He had 2 controlled years left, he could have easily received a 5-7 year deal in the 20 mil range. Now? (He was only able to get a 2 year deal at 17 mil per becuase he fell apart) ...

 

So to me, ya the salaries are going up for players who are excelling in the early years but I don't forsee it getting completely out of control.

[JohnBriggs12]

Until a couple of these younger guys now getting the long term deals start breaking down and/or their production falls off, I see the trend continuing. You have to be careful though on who you give these deals too. Not all work out (cough,Weeks, cough)

[TheCrew07]

Weeks was a FA contract extension, that's completely different than locking up a player prior to arbitration.

[brewcrewdue80]

I think a lot of these new extensions are a result of a team having a new influx of money to play with from the TV Deal.

Don't forget the big extender of this offseason Atlanta. They have a new stadium in the works so there's that to be considered. I also look at the length of extensions. Freeman/Simmons long term, safe bets imo. Heyward? He got 2 years from a guy you would have thought prior to last season was a 6-7year extension candidate.

 

Also, you know what fuels the money these guys make in an extension? Players who win their cases in Arb or the money they settle for. I think you can look at the extensions as a way to reduce so and so from going through Arb and raising the value drastically of a player's worth. You get to year 2 of arb and suddenly numbers are being tossed of 6.5mil from the team and 11mil asked from the player. All it takes is one player to win his case to make all the players behind with similar careers their first 4 years to be worth 11mil year 2 in Arb. And who knows? Jump it up to 16-17mil year 3 in Arb.

 

At the same time you have someone like Starlin Castro who's deal could become foolish if he doesn't revert back to the player he was prior to his extension. And if he doesn't? Deals like his will turn teams away from signing extensions. Just wait, Mr Trout will get a 10year extension record money and blow out his hamstrings prior to year 3 never being the same player again. And that will turn off these long term, assume all the risk, deals by teams. Personally, I'd love for it to be 2-3year length of contracts only. Removing teams from a long contract albatross. Pujols? and the Angels anyone? Also when a player declines due to injury early in a contract(Weeks) a Team doesn't have to sit on that player paying him AllStar money for Bench player stats for any longer than 2years.

But That's my single opinion and one that I'm sure the Player's Union completely squashed probably older owners having that kind of opinion years ago. Plus potential team turnover every 2 years could turn away fans.