The $100 Million Man

The issue of years and dollars is one which every baseball team must deal with, but it’s been especially poignant in Boston since April. The internal narrative reads, “Should our team sign this player, at this age, for at least five years and over $100 million?” which is what Bean Town faces with Jon Lester. He was shipped to Oakland, along with Jonny Gomes, for slugger Yoenis Cespedes, but there’s still a real possibility he could return – the only question is, at what price?

The Red Sox don’t want to change their pay-plan of over-paying players to sign for fewer years, allowing for roster flexibility. It brought them a trophy last season, so a desire to remain in adherence to the principle is understandable for Boston. The biggest issue for Boston, where Lester is concerned, is the money and the years. Mammoth contracts don’t always work out, i.e. Carl Crawford, Ryan Howard, etc. And yes, some players have sat down before they’ve hit free agency and signed below-market deals to remain with their hometown teams (Dustin Pedroia), but not many people have looked at the sheet of offers they receive in the off-season and turn down the one with the most moola. The one exception I can recall is Cliff Lee rejecting the New York Yankees offer in favor of the Phillies, for $14 million less.

So, I wanted to evaluate the baseball market and figure out how much return on investment a team gets, and how long that asset remains a valuable commodity. In Major League Baseball history, there have been 50 deals inked worth north of $100 million. 48 different players have signed them (Miguel Cabrera and Alex Rodriguez twice). For my study, in order to properly evaluate how a player has done in the first, legitimate “half” of his deal, the pact must have been signed in 2011 or earlier. That means only 20 contracts of the 50 are eligible in our study.

For these contracts, the average starting average for a position player is 28.9 and the ending, 36. Likewise, for a Pitcher, the average starting age is older, 29.6, while the ending age is the same at 36. To draw back to our Lester example from earlier, he is on average with most other pitchers, as he will be 30, very near that 29.6 mark.

Here is the list of contracts we can examine. There are five pitchers and fifteen position players.Initial list of Contracts - Copy

As we can see, these are mega-deals for a lot of years. Now, when ball-clubs sign these commitments, they’re not rewarding a player for the incredible production generated a season, or five, previous. They are paying for the future. They know that, inevitably, production will decline, but they overpay in the present to win the players’ services for that year, and sacrifice in the long-run.

What do ball teams look for in players they may spend a lot of money on? I asked New York Mets minor league scout Shawn McNamara at a AA ballgame earlier this spring, and the consensus, he felt, was around three years of the player’s previous production.

The first criterion for value within a player is Games Played. Since we have used the Woody Allen Line in the past to delineate how often a player should appear on the field per season, the acceptable percentage is 80%.

Games Played Improved


We see the average change from the GP average for three years before the deal to the first half of the deal for a position player is minus-6.0%, for a Pitcher is minus-9.0%. Those are acceptable numbers, on average. The exception to both rules being Ken Griffey, Jr. who was oft-injured for the Reds after they signed him away from the Mariners, and Kevin Brown, who swindled the Dodgers at 34 for his $105 million, 7 year deal. (Seriously, at 34 he gets 7 years?! #BlameBoras)

The second-half of the deal is really where we see the decline set in. Ryan Howard, Mark Teixeira, and Mike Hampton are the leading faces for not appearing in games as their percentages plummeted over 50%. Then there’s Johan Santana, who didn’t even meet the minimum to qualify for the list because the second-half of his deal he missed two seasons.

One telling sign, though, is that Derek Jeter is the only defensively-demanding player not to decrease in games played. (I know Manny Ramirez increased by 2.9%, but I concluded after watching him in Boston from 2003 to 2008 that his Left Field is not defense.) It makes you wonder what the contracts for defensively-demanding players (i.e. Robinson Cano, 2B; Buster Posey, C; Dustin Pedroia, 2B) will look like over the life of their deals.

Dustin Pedroia of the Boston Red Sox (signed 7yrs/$100mil in 2012) already looks like a club-unfriendly deal as he blocks uber-prospect Mookie Betts, and it appears his power has been zapped – his Slugging Pct. has fallen by 20-30 points every year since 2010.

As for pitchers, well, they don’t age well. Four of the five didn’t make over 22 starts on average of their second-half deals, while the only one that did (C.C. Sabathia) is now suspected to have a career-ending right knee injury.

O.K., so you’re probably thinking, Fine, they don’t play as much, they probably get rest days. That leads to how well they do on the field, not just if they show up.

Since no Relief Pitcher has ever signed a $100mil+ deal, I feel comfortable using WHIP to define their performance. For batters, OPS.


Once again, for the principle of consistency, 80% is used as the threshold for acceptable performance.

For hitters, it appears that they hold on to their power for a bit longer than their means to get on the field. Todd Helton was one who had trouble keeping up his power numbers, but he can be forgiven because his three-year pre-deal average included 2000 Coors Field – documented to be power-pumping, stat-inflating paradise. Injuries largely contribute to the limited effectiveness of many players as well, namely Teixeira (wrist), Rodriguez (wrist, again), and Howard (leg).

For all of these players, you could argue steroid abuse claimed their inevitable victims (Giambi, for example) but many of these players are suspected to have used, so operating under the theory that by “inclusion-of-all, exemption-likewise” can be reasoned in this case.

WHIP, for the pitchers, is more telling. Anything near 1.000 will likely lead the league, while 1.400 is roughly a 12-6 season with a 4.50 ERA.

Three of the five pitchers remained elite in their first-half deals, but two fell short. Mike Hampton imploded as his WHIP increased 15.5%. It definitely has something to do with the Coors Field atmosphere, but that’s not too much of an excuse. He pitched 15 home games with a WHIP at 1.698, while hurling a pedestrian 1.469 on the road in 17 games.

Then there was Barry Zito, which is curious because he transitioned from the power-heavy AL West to the light-hitting NL West. Actually, the NL West had some fearsome hitters in it (ahem, Barry Bonds!) but he was on the same team/never had to face him. It indicates that Zito was just tremendously over-valued initially rather than meeting catastrophe after three brilliant seasons. His three-year average before of 1.330 is only slightly better than average. (Good choice, Billy Beane.)

That contrasts directly with Kevin Brown, because the conditional formatting in his spreadsheet highlights his 20.3% increase as a significant drop-off in performance quality from the three-year average before they signed him. However, his second-half WHIP clocked in at 1.280, which is better than Zito’s ERA from before he got signed! So, as always, the conditions point out some interesting points, but don’t solely rely on conditions over interpretation.


Now, if you’re a GM that believes in the all-encompassing baseball statistic of WAR, this is the section that you’d want to pay most attention to. Because you’re about to be alarmed. Here’s a chart to help you understand WAR.

WAR, if you don’t know, is the holistic baseball statistic. There are two main strands of WAR; one by baseball-reference and another from FanGraphs. I used baseball-reference for my study.

For WAR, it takes into account running, hitting, and fielding for a positional player. Therefore, as the years move past and the deal progresses, often-times the player’s WAR will lessen because age and speed are inversely proportional.

As you can see for both positional players and pitchers, down the roster, is that all of them lose their value. Some may retain it for the first-half, or not teeter too much, but in the end every player decreases dramatically, as is to be expected. You’re not paying for the last two years, you’re trying to get the first four. Some players – like Vernon Wells, Mike Hampton, and Ryan Howard – decrease quicker, though, so that they become harms rather than helps. They produced lower WAR than a minor-league call-up would.

The only four players to increase in WAR during the first half of their deals were Alex Rodriguez (the first time), Derek Jeter, Carlos Beltran, and CC Sabathia. And we can see now in A-Rod (steroid abuse breakdown), Sabathia (not in-shape), and Beltran (formerly of speed) that every aspect of the game diminishes. Even Derek Jeter is mortal, falling to natural aging and decline. (All four of those guys are currently wearing pinstripes – save for A-Rod, who probably wears Yankee pajamas during his suspension.)

The scariest numbers in this study belong in this section as well. The average loss of WAR for a position player in the first-half of his contract is a whopping 25%, for a pitcher it’s an entire third! That’s a lot of value lost for such a great amount of money. Those number reach staggering proportions when the average hitter loses half of their value in the second-half of the deal and a pitcher loses 93%. That’s an astonishing amount.

Also, I want to note the errors in my study, as well. I realize it’s not faultless and I took introductory Chemistry and Physics, there’s always something you (lab speak: one) can do about improving the study. First, I could include age. Kevin Brown’s deal at 34 for 7 years is not equivalent to Miguel Cabrera’s deal at 25 for 7 years. There not in comparable stages of their career. Furthermore, I could have waited until all the deals had expired to truly capture the length of a contract. I could have included more pitchers (five is a small sample size), but alas, there weren’t enough and this study is pertinent now.

So those WAR numbers are something the Boston Red Sox should note when considering whether or not to re-sign Jon Lester. He will be 30 this next upcoming season, and while the Sox pore over all the numbers and see how significant the regression is, they will wonder is it worth it?

In terms of fan sentiment and nostalgia, absolutely. But when it comes down to it, baseball is a game of money and years plotted upon spreadsheets to determine on-field performance.

And that’s all it will ever be.





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