Posted by: Mike Cornelius | January 18, 2018

Why The Hot Stove Went Out

As Stephen Stills wrote in a decidedly different context, “there’s something happening here, what it is ain’t exactly clear.” In less than four weeks, training camps in Florida and Arizona will come alive as pitchers and catchers for all thirty major league clubs report and another Spring Training gets underway. Much of the country may be blanketed with snow, but the offseason is winding down, and fans of the Great Game are starting to dream about Opening Day. But despite the reality of the calendar, baseball’s hot stove has been anything but. By this time in prior years most if not all the leading free agents would have signed new contracts and been introduced at press conferences, smiling as they donned the jersey and cap of their new team.

In sharp contrast to that familiar pattern of past winters, for this year’s free agents the months since Houston’s championship parade have been as stark as a snow-covered field in twilight. The pundits at CBS Sports ranked this season’s top fifty players who have earned the right to offer their services to the highest bidder. As this is written just twenty-five have agreed to new contracts. While the ranking exercise is subjective, and fans might argue about the specific placement of a player on the list, a consensus of the top-tier free agents has existed since the offseason began. Thus, even more telling than the many who remain unsigned is the fact that eight of the top nine on the CBS Sports list are still available at a time when they no doubt expected to be making travel plans for next month. The only leading free agent to have inked a contract is 23-year old Japanese phenom Shohei Ohtani, whose decision to leave Japan before he turned 25 meant he could only sign a minor league international free agent contract. Other than the posting fee to his Japanese team, Ohtani cost the L.A. Angels just $2.3 million.

Meanwhile starting pitchers like 2016 Cy Young Award winner Jake Arrieta and four-time All-Star Yu Darvish are still waiting, as are sluggers like J.D. Martinez and Eric Hosmer and talented all-around position players like Lorenzo Cain. If what little information about potential offers is accurate, the wait for many of these stars may not be about to end. The Red Sox have long been assumed as the likely landing spot for Martinez. After ranking 27th in home runs and 26th in slugging percentage last season, Boston would obviously benefit from the power swing of the 30-year old, who swatted 45 homers in 2016, including 29 in just 62 games with the Diamondbacks after a midseason trade from the Tigers. But just this week it was reported that Boston’s offer to Martinez was in the range of $100 million over five years. That’s certainly not pocket change, but it shrinks when set next to the $200 million over seven years that Martinez and his agent Scott Boras are said to be seeking.

The icy free agent market has led some to whisper the word collusion, calling to mind the labor strife and court cases of the mid-80s. While it’s not impossible that the owners have secretly agreed to hold down salaries, a more likely explanation is more complex.

First, the actual market for these players is smaller than normal. While it’s always been true that teams in small markets have trouble competing for top free agents, the recent success of the Cubs and Astros have made the “tear down to build up” model of team development all the rage. Chicago won 103 games on the way to the 2016 World Series title, and Houston won 101 before taking the 2017 crown. But both of those accomplishments came shortly after multiple losing seasons, including more than 90 losses twice for the Cubs and more than 100 three times for the Astros. It isn’t just Tampa Bay or Kansas City that can’t afford to offer big contracts, but also teams like Miami, Pittsburgh, Detroit, Atlanta and two or three others, all of which are at some point in the multiyear process of gutting their roster, assembling prospects, and hoping to rebuild from within. Add to that wealthy teams like the Dodgers and Yankees that are trying to get under the luxury tax threshold for at least one season to reset their tax rate, and more than one-third of big league franchises are all but out of this market.

Then there is the perception that whatever this free agent class has to offer pales in comparison to a 2018 group that will include Bryce Harper, Manny Machado, and Clayton Kershaw. Some teams may be husbanding their resources for the bigger prizes that appear to be just one season off, and many general managers may be reluctant to offer lavish contracts to this year’s free agents for fear that doing so will only drive the asking prices for next season’s superstars even further into the stratosphere.

But most important, the dearth of long-term offers with values well north of $100 million reflects the extent to which advanced metrics have become entrenched throughout the Great Game. It’s been fourteen years since Moneyball, Michael Lewis’s seminal work on the power of sabermetric analytics was published, and the naysayers have long since been vanquished. Modern metrics make plain what many in baseball have instinctively understood for some time, that the current economic model for paying players makes no sense. A player is under total team control for three years, then is eligible for arbitration for another three, and finally, typically about the time he turns 30, qualifies for the bonanza of free agency. He then signs a fat long-term contract based on his past performance, and as his skills decline over the term of the deal, never matches the numbers of his youth.

Players, GMs, fans and pundits have all known this reality for years. But now every front office has an entire department that churns out the statistics proving what we have all seen with our own eyes. Like all our games, baseball belongs to the young, and the plethora of proof has finally impacted decisions both on the field and in the front office. Since the start of this century, plate appearances by batters over 30 have declined 18 percent, and innings thrown by pitchers over 30 are down 13 percent.

That this shift on the field is finally followed by a reluctance to meet the traditional demands of free agents should not come as a surprise. The problem for the Players’ Association is that it is stuck with the terms of the current Collective Bargaining Agreement until 2021. Come the next negotiations, the players can demand things like higher salaries for young players and a shorter window to free agency. But until then, the economics of the Great Game have turned decidedly in favor of the owners.

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Responses

  1. A very balanced look at the Free Agency/salary situation, Mike. I would be willing to bet that when August comes around, any of those 25 players sitting at home would get a fat paycheck to sign on for the rest of the season with some team that’s in the hunt for a pennant. Something’s gotta give, and it would suck to be in the group that is caught up in the changeover.
    Ω

    • Thanks Allan. You make an excellent point. At least one free agent (most of the media say it’s J.D. Martinez) has indicated privately he may sit out until the stretch drive, following your logic exactly. But there’s no question the balance has shifted, and this group is the first to face this new reality. I suspect that all the talk of $400 million contracts next year for Harper and Machado can also go in the dustbin.

      M-


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