The Phillies might talk long-term deal with Hamels down the road. But, the Phillies general manager said, “right now, it isn’t going to happen.” Gillick said he is wary of giving out long-term deals, particularly one like the Brewers gave Braun. “If at some point, if [Hamels is] performing to the level, you’re going to have to talk multiyear at some point,” Gillick said. “These guys, maybe they are smarter giving guys 8-year deals. I don’t know.”
The baseball contract world is a tricky one. For your first 3 years in the league, you are at the mercy of your team. They designate your salary, and you take what they give you. Doesn’t matter if you won the MVP (Ryan Howard in 2006) or Cy Young (Barry Zito in 2002) - you take what they give you. Once you’ve had more than 3 years, but less than 6 years, service in the league, you are eligible for arbitration. This means you either come to terms on a 1-year contract with your team, or, you reject their offers and take them to arbitration, where you can present your case for more money. The exception to this is called a “super 2″ player, who has 2 years and change of service, and is a good player. Ryan Howard fell into that category this year and was granted arbitration. Once you have 6 years of service in the league, you become a free agent.
Ryan Howard is locked in to the Phillies for 2009 and 2010. He will be a free agent in the Winter of 2010.
Cole Hamels is locked in for 2009, 2010, 2011 and 2012. He will be a free agent in the Winter of 2012.
There has been a trend this year of teams bypassing this entire process and signing the players to long term deals very early on. The Rockies signed Troy Tulowitzki, in his 2nd year, to a 6-year deal. The Brewers signed Ryan Braun, in his 2nd year, to an 8-year deal. The Rays signed Evan Longoria, in his 6th GAME, to a six-year contract with options for 3 more years. So what is the benefit of these types of contracts? The logic by the teams is that you are adding a year or two onto the amount of time you have control over a player, and assuming they play as well as you think, the contract wouldn’t be for much more than if you were paying year by year with arbitration anyway. From the players perspective, you are guarding yourself against injury or poor play, and getting guaranteed money, kind of like getting your arbitration ahead of time and eliminating the need to play well for it.
There is risk on both sides as well. From a teams perspective, you are locked in, and if the player gets hurt, and struggles once the league adjusts to them, you are overpaying for a player you didn’t even have to pay to start with. From a player’s perspective, if you continue to improve, you will likely be underpaid in the later years of the contract, and by delaying your entrance into true free agency, you might be costing yourself a lot of money.
The Phillies have had situations like this recently where they didn’t want to let their homegrown talent hit free agency.
Chase Utley signed a 7 year, $85 million deal after 3 years in the league. This took care of his 3 arbitration years, and first 4 years of free agency
Jimmy Rollins signed a 6 year, $46.5 million deal after 4.5 years in the league. This took care of 2 arbitration years, and the first 4 years of free agency
Brett Myers signed a 3 year, $25.75 million deal after 4.5 years in the league. This took care of 2 arbitration years, and his first year of free agency
So, given the level of control they have, the league-wide trends, and the history of signing their own players, what should the Phillies do with Howard and Hamels? Here is what I think the answer is.
Ryan Howard - Offer him a 6 year, $80 million extension right now. Include escalator clauses for MVP/All-Star/Silver Slugger’s that could bring the value up to $85-90 million. This is more than you gave Utley (who is the better player) but less than he wants. Howard thinks he deserves Miguel Cabrera type money (8 years, $150 million), which is just ridiculous. He is 3.5 years older, strikes out at a historic level and his defense has somehow declined since his rookie year. Honestly, I believe Howard is a slightly better version of Adam Dunn, which isn’t bad at all, it’s just not $150 million good. My proposed contract would give him a $13-$15 million a year salary, take care of 2 arbitration years, and 4 free agency years. From Howard’s perspective, it will eliminate the risk of him hitting the FA market after 2010, (at age 31) and finding out no one wants to give anyone that old, and injury prone (historically, people his size don’t hold up) a long term deal of any kind. For the Phillies, it keeps Howard, Utley and Rollins together through their primes. 6 year, 80 million. It’s a fair deal. Howard needs to understand that when he hits the market in 2010, there is no one who will give a 31-year old player who owns the top-3 single-season strikeout marks (by that point, he will) $150 million.
Cole Hamels - Hamels is a wait and see. Yes, there have been all of these early-bird contracts signed, but ALL of them have been position players. Starting pitchers are far too risky to lock up to long-term deals, especially when you have them under your control for 4 more years. If Hamels continues to pitch well this year and next, I would sign him at the same time you did Utley, before his arbitration years. Give him $10 million for each of his arbitration years, and then $15 for the next 3 with a team option for the 7th year. Round up and you get a 6 year, $75 million extension. He gets his guaranteed money early so it doesn’t matter if he gets injured, and the Phillies take a risk with a long-term deal for a pitcher, but do so with the best pitcher to come up through their system since Robin Roberts (Carlton came up through the Cardinals system, Schilling through the Orioles, Bunning through the Tigers). Maybe you wait another year, give him one year of arbitration and really get comfortable with his durability, but the longer you wait, you bigger the deal is going to have to be.
Who knows if either of these guys would accept those deals, but I think that is what the Phillies strategy should be. What do you think? Be the GM, when (if at all) should we extend them, and how much do you think they are worth?
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6 comments ↓
PETE: I would say you are on the mark. With Howard, the concern is whether or not he can maintain the same level of productivity. As you said, his strikeouts and defense are major concerns. Added to that, his traditional slow starts are becoming more severe and are lasting deeper into the season each year. I would prefer the Phils to be extremely cautious. I think waiting until after this season would be wise on their part.
The question with Hamels is not productivity rather durability. Waiting on him, as you say, is also the way the Phils should proceed. He hasn’t made it through an entire season injury free yet. He needs to put up a couple complete seasons of work before the Phils go long term with him.
bski, this is off the topic of this post, but I really wanted to comment briefly on how to build teams.
My biggest gripe with sports in general is that sports management teams tend to be very conservative in their thinking, preferring to stick with tried and true instead of trying bold new ideas. I think the main reason for this, as you said, the pressure to win NOW.
This is why I’m a huge fan of Billy Beane and his methods. It hasn’t won a championship yet, I get that, but his thinking was a step in the right direction - how do you win with a really low payroll? The next step was taken by the Red Sox, what if you removed the restriction of a low payroll, what could you do then? I firmly believe, that without Billy Bean’s work, the Red Sox aren’t what they are now, a powerhouse baseball franchise that has the chance to win it all every year.
You’re a big fan of Bill James - did you know that he works for the Red Sox? He’d been doing all this work for the past 20 or so years, but in that time, not one single organization thought, “This guy is pretty smart when it comes to baseball, I think he could really contribute to our organization.” It’s really great for Boston that the Red Sox owner, John Henry, is a really smart guy, and knows how important it is to surround yourself with smart, outside-the-box thinkers when trying to accomplish a dauting goal, like winning a championship.
What do the Phils have? Ruben Amaro, Jr.? What DID they have - Ed Wade? Who was here before that? Pat Gillick isn’t the greatest, but in the past decade or so, he’s been the only progressive thing about them. And after he leaves, we’re going back to Amaro, a relic from the Phils’ past of “just good enough to miss the playoffs”? I have this horrible, gut feeling that last year and this year will be as good as it gets for the Phils, and a decline is upcoming, starting with next year.
I have similar gripes with the NBA and the Sixers, but I just don’t have time to get into it, I have too much to gripe about…
SIXERZGUY: We’ve been all over the Howard issue on the last blog so I guess it’s ok to go off topic for a bit.
I would love for teams to be bold in their approach, but that doesn’t happen often for many reasons. It has to start from the top down. If the owner doesn’t support bold moves they will not happen. First of all the owner has to hire the GM. If the GM’s ideas are to far afield the owner won’t hire him to run his team. Bold is risky. As the GM, manager, coach, etc…you are putting your neck on the line. I don’t think ownership gives management as much leeway with bold moves either. The other thing going against bold moves is that most GMs, managers, coaches, etc…all came up through the system. They are insiders and that colors their perceptions. The Phils are a perfect example of this in who they hire as GMs, managers, and the rest. They place a high value on promoting from within. It is uncommon in many organizations to see an outsider get a top management job and be given a free hand to implement ideas outside the norm. That’s why a guy like Bill James(yes I know he works for the Red Sox) has not gotten a shot for so long. He’s an outsider. He never played, managed, coached, scouted…nothing. He had no history on the inside of the game so nobody valued his ideas enough to truly listen and try them.
The Phils have who they have at GM because that’s what ownership wants. The only way we will see major change with the Phils is if we get a new owner who is willing to do things differently and supports bold moves.
I admire Billy Beane as well. His is a very innovative way to try and field a winner on a shoe string budget. However, like I said before, he did not, nor is there any indication he will be able to, win a championship solely by his method.
Bringing up the Red Sox is exactly the point. Tried and true(the Phils) may be to stale to get the job done many times, but innovation by itself(the A’s) is not always enough either. The Red Sox have combined innovation with lots of money and have found success. What I said previously still holds true. You do not guarantee yourself a championship by spending lots of money, but you almost certainly guarantee you will not win a championship if you don’t. The combination approach is the key.
If you feel the need, review my last few posts on the old blog and we can finish up with Howard(and move on to Hamels). I’m sure Pete would appreciate us getting back on this topic.
SIXERZGUY: Since you haven’t responded yet, I’d like to go a bit further with the GM’s and bold moves idea we are talking about.
Like I said in my previous post, I admire Billy Beane and his innovative way in trying to get productive players on the cheap. My two main problems are 1) The A’s have not even made it to the WS, let alone won a title. and 2) Because of the low payroll he was saddled with, he was more or less forced to think outside the box, as it were. You know, necessity is the mother of invention. In any event, he’s been using his “Moneyball” approach for about ten years now without any major success, unless you consider keeping a low payroll team competitive a major success. I don’t mean to sound dismissive. It’s just that the results speak for themselves.
Let me give you another example. The Marlins have only been around since 1993 and they have won 2 WS titles. Their approach is to continually unload all of their high priced players and keep their payroll ridiculously low (this year it stands at $21 million). In order to keep it that low they are forced to bring up a bunch of cheap minor leaguers to fill the roster. They put all these young kids on the field and play out the season. I would say that approach is pretty bold, wouldn’t you? If you start counting after the 1997 WS, the Marlins have been using this approach for about the same amount of time that the A’s have been using the “Moneyball” approach. In that time the Marlins have 1 WS title and the A’s have none. So I ask you, which approach has been more successful? Why should other teams emulate the A’s and not the Marlins?
I will say that I believe the “Moneyball” approach to be the better way to go. The Red Sox have added to the validity of this approach. BUT(this is a big but), as I stated earlier, the Red Sox augmented the “Moneyball” approach by also spending a lot of money.
bski, in case this would interest you - I heard on the radio this morning that the upcoming Philadelphia Magazine is gonna have a feature on the Phillies’ owners.
SIXERZGUY: Thanks. I may check that out. I’d like to learn about the “Teflonics” as Bill Conlin calls them, although I suspect it will just be a PR piece.
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