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Wednesday, January 30, 2013

Drenonomics | The Longoria Window | The AL East

Tyler Drenon

          Arbitration is one of the murkiest concepts in the economic theater of baseball. Essentially, it's an argument over money. A player against his own team and vice versa. The decision makers (or arbiters) are independent panels contracted by both MLB and the MLBPA. They do not operate in compromise. They hear arguments (and salary figures) from both sides. That includes the team's presentation of player weaknesses. One side completely wins and one completely loses. The players only retroactively contribute to this bureaucratic squabble. The rest is left to opportunistic buzzards, paying off their six-figure college educations.
          Avoiding the arbitration routine has it's obvious benefits. When teams and players "avoid arbitration," they come to terms on the amount of the player's raise before the debates begin at a compromised figure. Some teams view this slight concession as an advantageous alternative to argumentation. Others ("file and trial" teams) go through with the process as a general rule. In essence, these teams are weighing the odds because panels typically side with the team slightly more often than the player.
          It's certainly an imperfect system, but it provides a necessary buffer between rookie contracts and naked free agency. The absence of such a structure has been problematic for NFL organizations (CJ2k, DeAngelo Williams, MJD…) The potential rift between teams and players still exists in baseball, but it is modulated and more importantly, these conversations are expected. Many excellent players move on from small market teams after or in the midst of their economic adolescence. This is why "buying out" arbitration years tends take place (in the form of an extension.) It publishes stability in black and white, it exhibits confidence on both sides, and it can potentially keep players around longer in small markets (specifically when the club buys out a chunk of the player's free agency as well.) However, there is some risk involved in signing young players before they are considered "established." In an attempt to avoid some of the assumed risk, teams assign some of the big money years as team options. 
         Free agent contracts are bloated and often times it takes a few extra years to net coveted talent. Those future commitments can become shackles. So, many teams attempt to negotiate this type of cost-effective extension within a limited period. Theoretically, it begins with a player's arbitration clock. Day One in the Majors. And extends to the end of his final arbitration year. But, to be more telescopic, an optimal window for such an extension exists in a smaller time frame. If a player has little to no Major League experience, the team may hesitate unless he is deemed a sure thing. Conversely, after a player establishes himself as a commodity, he may have priced himself out of the team's financial reach. So, this window is almost always a little risky and very small. Tampa Bay has seen the full panorama of these extensions in recent years. They nailed it with Evan Longoria, and it wasn't really a tough choice. They whiffed on David Price (though they may not have had a chance) and jumped the gun on Wade Davis. These issues don't just effect the little guys, though. Even larger market clubs would benefit substantially from a Longoria-type contract. Of course, the Rays have since extended Longo through 2022 at a dollar amount that rivals the GNP of Micronesia. However, his original team-friendly extension would assist any GM trying to build a competitor. Even the notoriously frivolous Yankees now fear the ominous ceiling of the luxury tax.
       So which players are cooling on the sill of the Longoria Window? And who can get themselves there soon?

The Longoria Window: AL East

Baltimore Orioles

         The O's have a binary star system in orbit around the horn in Camden. Dylan Bundy and Manny  Machado are the pillars of the Orioles future. GM Dan Duquette has some other interesting pieces and he may choose to sign a few to extensions during their arbitration years, but this duo is likely the focal point. He may have missed the opportunity to get the most out of an Adam Jones deal, but the 7 year $91MM arrangement is far from a failure after Jones was named an All-Star and won a Gold Glove in 2012. After back-to-back Gold Gloves and All-Star appearances, Matt Wieters may have also climbed through the ideal contract window too quickly for Duquette to catch him. There is still a chance for him to call games in Baltimore for some time, but he won't be cheap.
         Baltimore has a trio of young pitchers struggling to find consistency in Zach Britton, Jake Arrieta and Brian Matusz. These pitchers will have to build more of a résumé to garner consideration in this arena. Jason Hammel is a free agent after the season, so an extension with his camp may be strenuous. He's getting pretty expensive, so prolonging his tenure wouldn't really meet the hypothetical ethos of The Window
         So, is Duquette savvy enough to lock these players down? 

        The O's probably want Bundy to get some significant big league exposure before they make an offer. Bundy certainly has the potential. He's regarded by most as the best pitching prospect in baseball, but handing out an extension to a pitcher before he reaches the majors may be too bold. Even if he can hit 98 MPH on a consistent basis. He'll make $1.245MM a year until he has a chance to see the panel in 2016. He may be in for some historic raises depending on where he is after the 2015 season. If they follow the guidelines of a prospect who debuted with similar potential and at around the same age, the team may come up with something close to the Dodgers' short-term pact with Clayton Kershaw. Of course, they may try to avoid the year-to-year guesswork and simply offer a bit more to consolidate the contract. It would be ideal if Baltimore could buy out one or two of Bundy's free agent years as well. A long-term commitment is likely on the horizon, but Bundy has to settle for being a 19 year-old millionaire for now.

        Machado is in the same boat as Bundy. Not enough pro data. Position players may be easier for GMs to count on considering the Tommy John epidemic. He won't be eligible for arbitration until 2016, and he should be in Baltimore until at least 2019. The team may choose to extend him after he further develops his Major League aura. Machado cut his teeth in Camden last year, but the team still has him on the rookie rebate for now. 

       Wieters signed a $5.5MM deal to avoid arbitration this offseason. He won't hit the market until 2016, which is becoming a common theme for Duquette. Wieters could double his salary in 2014 if he is able to duplicate his recent success. The team could also choose to sign him through the end of his arbitration and, perhaps, a few years of free agency. An extension of this kind would likely be costly, especially considering the position primer. It would be extremely beneficial for the team, although it would've likely been more suitable to have agreed at this time last year at a discount.

        Johnson has the exclusive Super 2 privilege of a fourth arbitration year, but if he approaches his performance last year, he should be sticking around for a while. Next year will be that fourth year. The sooner Duquette gets an extension on the table, the more Baltimore can spend elsewhere. He may have missed the boat though. Johnson can do some serious damage to the chance of an extension if he continues to refine his finesse in finales. With that consistency, the team will probably look to lock him up one way or another. 

        The American game hasn't rattled Chen much. The usual export inflation was expected, but he has adapted well. He's signed through 2014 with an affordable team option for 2015. After which, he'll hit the arbitration process at age 30. An extension seems doubtful unless Chen takes some sizable strides forward. 

Boston Red Sox

       The Red Sox have some interesting prospects in the minors and a few have begun blossoming into Major League possibilities, but the immediate horizon is less than brilliant. The struggles of Daniel Bard have put the team in a holding pattern on that front. He may yet develop as a starter, but for the time being his amorphous role and plodding development keep his finances erratic from year to year. Buchholz and Lester have had their share of inconsistency, but that seems to be like it may improve now that Boston ousted Josh Beckett from the clubhouse. He was not the only problem (i.e. Bobby Valentine, John Henry, Boston in general,) but his pouty, entitled attitude certainly didn't profess sportsmanship. 
      They may see some young players move closer to big league relevance in the near future. For now, they have candidates for extension, but they are almost all past arbitration and could only be had at a high cost. Seems like the luxury tax (i.e. baseball's elective salary cap) played a part in the Sox financial back pedal last year. 
      The Sox really don't have much going on in the vicinity of the Longoria Window, but they do have a player the window could've also been named after. Dustin Pedroia is on a 6 year $40.5MM with a 2015 team option at $11MM. The 5'8" second baseman's contract seems to have been found in the bargain bin at a Kmart in Southy.

       The Sox have one guy who may be on the precipice of an arbitration buyout. Middlebrooks hit the ground running at the hot corner last year. Now that his clock is ticking, new Boston GM Ben Cherrington may be considering a pact with his new third baseman at a dollar amount that would make Nuf Ced McGreevey fall off his barstool again. Middlebrooks won't be eligible until 2015, so the Red Sox have some time. Their resources are flush, especially after the LA purge. 
       These negotiations may not even begin until the panel is looming, but since they have deep pockets, they can manage if they miss the most ideal time for an extension. 

New York Yankees

       Even if you hate the Yankees, you have to appreciate their history. Ruth, Gehrig, Mantle, Berra, Jackson and sometimes even Derek Jeter, are just too damn good to truly despise. Some of the most consequential things in the history of baseball have happened in pinstripes. That has mostly been aided by the unlimited resources the organization has always seemed to have at their disbursement. In fact, they made a habit of spending so much in payroll that it was borderline pathetic when they didn't win the World Series. 
      Until recently. 
      Sort of.
      The luxury tax has strong-armed the Bombers into practicing relative fiscal responsibility. Now, more than ever, the Yankees could benefit from a team-friendly extension, but they haven't kept their prospects around long enough to contribute, let alone reach an arbitration hearing. The Steinbrenners have, with a few exceptions, always avoided extensions. In turn, they have avoided the risk that prevalently accompanies them…But, with the luxury tax at $189MM the Yanks will have to do some maneuvering to reach their goal of escaping it. They have spent $224.2MM in luxury taxes over the last ten years, more than their entire 2013 payroll.
      There are a few decent candidates on their roster (David Robertson, Michael Pineda, maybe Ivan Nova, and someday soon, perhaps Manny Banuelos,) but as of now, the Yankees don't do extensions. 
      Now, Brian Cashman may have to actually go to work and employ some strategy and restraint.  

Tampa Bay Rays

      Evan Longoria typifies arbitration buy out contracts more because of his high visibility and perceived altruism than the actual nuances of the paperwork. That's not to say the contract is garbage, only that a better example could possibly be argued. Anyway, Longo will have to do for now.
      The namesake of this fiction may be locked down for some time time, but the Rays have plenty of other players to worry about. They need these contracts more than most. David Price may have declined the idea from the beginning, but I'm sure Andrew Friedman tried his god-damnedest to make a Price extension happen. Instead, they will have to settle for a troop of premium prospects and the first-born child of the GM in a mid-market as he tries to keep up with the lavish upper crust. Poor Rays.
      The Rays may see it fit to extend some of their relatively marginal players rather than taking them through arbitration (as is their standard operating procedure from year to year.) And that may have something to do with the fact that Friedman was able to ditch the Wade Davis extension once the dollar amount failed to correlate with his most sensible role in the bullpen. There are many players this team will have to concern themselves with in their future budget, but for now, there are a handful of young players on the cusp of a back seat payday. 

       The Rays have Zobrist on a bafflingly discounted contract through this season with team-friendly options in 2015 and 2016. So, he's a bargain and a good example of the Rays foresight.The most he could earn on this deal is a team option for $7.5MM in 2015. He'll be 34. Just for a reference, the Dodgers paid Juan Uribe $8MM last year…and Zobrist won't even get the chance at that payday until he's been the ultra-utility walks machine in Tampa for another two years. Zobrist must be a benevolent and considerate person. His utilitarianism has allowed the team to further maintain their delicate balance. He'll continue popping up all over Joe Maddon's lineup card for some time. 

      In 2012, Jennings failed to find the plate discipline that was supposed to differentiate him from Carl Crawford. Due to the Rays model for avoiding Super 2, he isn't arbitration eligible until 2015, putting his free agency debut at 2018. He may, like Crawford, decide the Longoria deal isn't for him and jump ship for the open market. However, the Rays have since rewarded Longoria's continued promise with a mountain of cash. So the toolsy outfielder may see some opportunity for a fair shake in Tampa. He may have the pedigree and minor league numbers to boast at the moment, but an extension isn't likely until he cultivates his approach in the box. As you can see in the table below, Jennings' struggles seem to be handcuffed to his lack of patience.

2010 23 TBR 17 24 21 5 4 1 1 0 2 2 2 2 4 .190 .292 .333 .625 74
2011 24 TBR 63 287 247 44 64 9 4 10 25 20 6 31 59 .259 .356 .449 .805 127
2012 25 TBR 132 563 505 85 124 19 7 13 47 31 2 46 120 .246 .314 .388 .702 97
3 Yrs 212 874 773 134 192 29 12 23 74 53 10 79 183 .248 .327 .406 .733 106
162 Game Avg. 162 668 591 102 147 22 9 18 57 41 8 60 140 .248 .327 .406 .733 106
Provided by View Original Table
Generated 2/24/2013.

       This is where the Rays have been busy maneuvering. A contract worthy of notice in every front office in baseball. Moore signed a 5 year $14MM deal through 2016. A bargain on its own, but the club also has ascending options for 2017 through 2019 (Moore's age 30 season.) The contract is peppered with buyouts and bonuses over the team option years. If Moore thrives the way most predict he will, he will be an absolute steal over the last three years of this deal. And, contrarily, the club is never on the hook for more than $5MM guaranteed in a single season. Well worth the risk for a thoroughbred. Moore was originally set to hit arbitration in 2017, so the Rays front office presaged their future limitations and drafted the details of their pièce de résistance. 

       The reason for Hellickson's name being vaguely floated in trade rumors was probably closely tied to his impending arbitration hearing and subsequent free agency. He'll have the chance to go before the panel after the upcoming season. The likelihood of an extension of any kind probably depends on where David Price is pitching in the near future. Hellickson has a 3.02 ERA over 60 starts in the last two years combined. He'll be due a significant raise whether they reach the panel or settle on a one year pact as they did with Price. Friedman is likely in the lab boiling up potions or elixirs or whatever he has to use to get the 2011 Rookie of the Year under contract for the foreseeable future.

      Cobb is likely to miss out on Super 2. This will make him eligible for arbitration in 2015. This situation echoes Wade Davis for the time being. If Cobb can take a step forward in 2013, he may be on the receiving end of a similar extension, but Friedman may be a little gun-shy after narrowly escaping the albatross Davis was poised to become on his roster. Posturing Davis in the bullpen to camouflage his flaws in the collective glances of the trade market was almost Machiavellian.
      His left-handedness seems to give him an advantage, but he will still have to produce something significant for the Rays to consider locking down his presence in the scant truancy of Tropicana. 

     Tampa Bay kept their carousel churning. Shields off. Myers on. And Myers won't surpass their means for some time. It seems likely the Rays hold Myers in AAA until they're sure he won't acquire Super 2 status. The new CBA set the Super 2 status at 2 years 139 days for 2013, so the thrifty Rays may be planning on using Shelley Duncan or Brandon Guyer while Myers plays the waiting game in Durham. By the time Myers gets some work serious done, the Rays may be considering a long-term pact. Its hard to project what that will (with two Ls) look like without seeing him in a big league park. 

Toronto Blue Jays

      Alex Anthopoulus has been hard at work populating his roster with post-arbitration veterans that he hopes will elevate the organization to the top of the AL East. In doing so, he has thinned out many of his rosters on the farm. They still have some interesting prospects after the Miami deal, but a heist like that has to cost something. Nevertheless, Toronto has a few young players to consider coming to terms with while they can do so conservatively. One of those players could be Colby Rasmus at this point next year, but he may be pining for the open market.

      The Blue Jays avoided having to deal with the costly complications of Super 2 status with their young backstop, but Arencibia will be eligible next year. After their roster overhaul, they may not be looking to extend many players due to the risk of that player becoming a hindrance on their future flexibility.
      Arencibia is due a healthy raise next year. Although he doesn't hit for average, the Jays may want to avoid potentially losing him in 2017. Anthopoulus and the Jays have a default stance of going through with the hearings, so Arencibia will likely see the arbitration process first-hand.

      Another Super 2 shake and bake by AA. Lawrie struggled in 2012 (.729 OPS.) He is still finding a groove in the infield, but all you have to do is watch him play. There is something about his style of play that is reminiscent of the throwback third basemen in the 90s. The Jays will likely try to hang on to Lawrie as long as they can. A positive 2013 would go a long way toward starting a dialogue about some serious money for Lawrie. 

      The Jays finally got their man in the 2010 Roy Oswalt trade after coveting him since the Roy Halladay negotiations. Gose is still very young. He has a long road to travel to get to an extension. Speed and defense aren't the major attributes that arbitration panels consider. So, when and if the day comes, Gose may be had at a team-friendly premium.

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Other installments: ALCentral  &  ALWest  &  KCRoyals


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