Patience Isn’t Always a Virtue
I try to teach my kids patience. It is an uphill battle — has been since birth — but I constantly try.
Delayed gratification, I explain to them, is the best kind. A bird in the hand is only half as much as two in the bush, I calculate for them. Just wait another minute/hour/day or so. All good things come to those who wait, I try to reassure them. I tell them we can walk down the hill and fuck them all. (Okay, I don’t actually tell them that.)
[**Bonus points if you can pull that reference. The answer is below.]
But sometimes patience can be its own worst enemy. Patience isn’t always a virtue.
Take free agents. Each year I make a mental note of guys who simply “blew it” by being patient, by not taking the bird in the hand.
I started this after the 2008 season, with Jason Varitek and my beloved Red Sox. The Boston captain was finishing up a 4/$40M contract, and was offered salary arbitration. By all reported accounts, an arbitrator would have awarded Varitek between $8-$10M for a single season. Jason and his overlord (er, agent), Scott Boras, decided it would be better to test the free agent market. Guess what, there were no takers for a 37-year old catcher who hit .220 the previous season. He then came back to the BoSox, hat in hand. The Red Sox offered a 1-year deal at $5M, with a team option for the second year at another $5M, or a player option for $3M. Simply put, Varitek cost himself at least $3M, and potentially $5M, in 2009 alone. And, in all likelihood, gave the Red Sox the lovely buy-one/get-one free deal, because the Red Sox got Varitek for two years at $10M. Well played sir, well played.
This issue has come into specific relief the last few seasons with advent of the Qualifying Offer (“QO”). For the uninitiated, it goes like this: when a player’s contract is over, his current team has the right to make him a Qualifying Offer, which would be a 1-year deal at the average salary of the top 125 players from the previous season. The player has one week to accept or reject. If he rejects, he becomes a free agent, and — this is the kicker — any team that signs him must forfeit — to the other team — their highest available draft pick in the upcoming draft. In addition to losing the draft pick, the acquiring team also loses the dollar allocation that goes with that pick. So, come June, the free-agent acquiring team will not only have less draft picks, they will have less money to spend on the picks they retain. In short, there is a high price to pay for any free agent who previously rejected a QO.
In some cases, losing the pick and the compensation is a no-brainer. If you are spending $200M+ on David Price or Zack Greinke, you are not going to let a little thing like a few hundred grand and a prospect stand in the way. But, if you are looking at a fringe guy, you will think twice about signing him.
With that as the backdrop, through the 2012 off-season, not only had no player ever accepted a Qualifying Offer, no player had ever felt negative repercussions for not doing so. That all changed after the 2013 season. In 2013, general managers started getting smart.
Here is the thinking:
From the current team’s perspective, there is no issue with making a Qualifying Offer. General Managers live by the credo that there is no such thing as a bad 1-year deal. You liked the guy enough to pay him last season, so why not pay him again. If you wouldn’t offer him a deal anywhere near the value of the Qualifying Offer (again, the average of the top 125 salaries), then you let him run off into free agency. But if he is worth the price, you make the offer and you win either way. (And, in many cases, you hope he signs elsewhere, as you then get the draft pick and the financial allocation attached thereto).
From the acquiring team’s perspective, you put a great deal of value into your draft picks and your draft dollar allocations. If the player isn’t worth both the money and the loss of a prospect down the road, you hold your water.
After the 2013 season, teams made Qualifying Offers to 13 players. Say yes, and the player was guaranteed $14.1M. Not too shabby. Some guys decided to roll the dice; and three, in particular, crapped out:
Stephen Drew, coming off a lackluster season with the Red Sox in which he hit .253, thought more than $14.1M was waiting on the open market. By May he (and his overlord, er, agent, Scott Boras) figured out there wasn’t. The Red Sox threw him a lifeline and signed him to a 1-year deal at $10.2M. That would be a loss of $3.9M. But, it gets worse for Drew. Since he missed all of Spring Training and had to come in cold in mid-May, he had another lackluster season in 2014. He was traded midway through the season from Boston to the Yankees (think how bad he must have been for the BoSox to send a player to Bombers mid-season), and hit a swarthy .162. The Yankees resigned him for 2015 for $5M (a gift). Drew, too, liked the buy-one/get-one concept, as he could have played 2014 for $14.1M, but chose to play 2014 and 2015 for $15.2M. Poorly played sir, both in the boardroom and on the field.
Maybe playing in Seattle is really that bad. How else to explain thatKendrys Morales could have stayed in the Pacific Northwest and earned $14.1M in 2014. Instead, he played the field. On June 7th, the Twins finally threw him a life raft, and signed him for $7.4M. He did hit .218 with 8 homers, so that worked out pretty well. And you want the best irony: six weeks after he signed, the Twins traded Morales back to the Mariners. Enjoy Starbucks, Kendrys, you just have $6.7M less to spend at Pike Place Market. (Ed. Note: Morales was also represented by Scott Boras in this catastrophe.) (Ed. Note #2: I guess Morales got the last laugh, as he signed with the Royals in 2015 and won the World Series. That said, he got paid $6.5M in 2015; another 2 for the price of 1 deal.)
The Boom Stick was also feeling his oats after the 2013 season. The Rangers offered Nelson Cruz $14.1M to play mediocre left field and hit homers in North Texas for another season. Cruz said no. When no multi-year offers were forthcoming, Cruz accepted a 1/$8M deal with the Orioles. Simple math: Cruz left $6.1M on the table. He did end up leading the league in dingers, and got himself yet another qualifying offer of $15.3M, which, of course, he turned down. He eventually signed a 4/$57M contract with the Mariners, so I guess all’s well that ends well.
Talk about your life lines. The Royals went way outside their comfort zone after the 2013 season (remember, this was pre-World Series appearances), and made a Qualifying Offer to Ervin Santana. Santana said no, and went to market. Unfortunately for him, the market was closed. A month into Spring Training, the Braves offered Santana a 1-year deal at, you guessed it, $14.1M. Literally/financially, nothing lost/nothing gained. Incidentally, the Braves finished 17 games out of first place; the Royals went to the World Series. I hope Santana enjoyed his baseball-free October.
After the 2014 season, 12 Qualifying Offers were made, and none were accepted. Here is a list of the players to whom QOs were made, and the deals they eventually closed:
- Max Scherzer: Turned down the Tigers, signed with the Nationals for 7/$210M
- Victor Martinez: Turned down the Tigers, but then re-negotiated with them and closed at 4/$68M
- Hanley Ramirez: Turned down the Dodgers and suckered the Red Sox into 4/$88M
- Pablo Sandoval: For reasons that may never be known, rejected the Giants QO and then the Giants $100M offer, and signed with the Red Sox for 5/$95M
- James Shields: Everyone expected Shields to be the first player to accept a QO, but he declined, and signed with the Padres for 4/$75M
- Russell Martin: The Pirates broke their bank in an attempt to retain Martin, but he chose to go home to Canada for 5/$82M
- Nelson Cruz: This guy’s got nothing on Kenny Rogers (the singer) — he gambled again, and, as stated above, was rewarded with a 4/$57M deal with the Mariners
- David Robertson: Bailed on the Yankees and signed with the White Sox for 4/$46M
- Ervin Santana: Like Britney Spears, he did it again; this time he got what we wanted: 4/$55M with the Twins
- Francisco Liriano: Rejected the QO, but worked out a 3/$39M deal with the Pirates
- Melky Cabrera: Turned down the Blue Jays, and chose the White Sox for 3/$42M
- Michael Cuddyer: This one is fascinating. Coming off a 4/$42M deal with the Rockies, he received a QO, and turned it down. He ended up signing a 1-year deal with the Mets for $8.5M, and then retired. Granted, he made more than $79M in his 13-year career. But who couldn’t use an extra $6.8M as they ride off into the sunset? Apparently Michael Cuddyer, that’s who.
Finally, after the 2015 season, some players (agents?) started to wise up — but not that many. Teams made 20 Qualifying Offers, and 17 were rejected. But, that means that 3 players took the money and stayed:
Matt Wieters of the Orioles was the Jackie Robinson of Qualifying Offers. Coming off of Tommy John surgery, the catcher decided $15.8M for a season in the comfy confines of Baltimore, rehabbing and getting himself in position for a bigger payday, made a lot of fiscal sense.
Colby Ramus quickly followed suit with the Astros. He has bounced around a bit (3 teams in 8 seasons), worn out some managers (see, LaRussa, Tony), but then found a home on Tal’s Hill. $15.8M with a team that has a great shot of winning its division was a safe bet.
Brett Anderson decided, after going 10–9 with a 3.69 ERA, to take Guggenheim’s $15.8M to stay in Southern California. Seems like a good choice — especially since (a) there weren’t (m)any suitors and (b) he may be one of the best (of the bleak list of) free agent pitchers available next season (after Stephen Strasburg, the quality falls off precipitously).
Which brings me to my favorite story of this young season, and the inspiration for this post: the curious and costly case of one Dexter Fowler. Fowler roamed centerfield for the Cubbies last season, and got a taste of success with this young core. Theo Epstein offered Fowler $15.8M to do it again in 2016; Fowler said no. And then no one called. After pitchers and catchers reported, there was word that Fowler’s patience was about to be rewarded: the Orioles were going to give Fowler a 3/$33M deal. But then, out of nowhere, Fowler resigned with Cubs — for WAY less money. The Orioles were mad — they thought they had a deal; the Cubs were ecstatic — they saved a bunch of money (see below); and reporters and teammates were confounded — they were all duped.
If, during the first week of November, Fowler had simply said “yes”, he would be paid $15.8M for this season. But, as we know, he didn’t. Instead, four months later, he decided to take that same 1-year deal, but just for $7.8M less. What?!? The deal has a mutual option for 2017 at $9M, and a buyout of $5M. So, in essence, Fowler could get $13M for this season, and still be a free agent next season (i.e., only a loss of $2.8M (not counting the time value of money)); or he can be paid $17M for 2016–17, or just $1.2M more than he would have received for 2016 alone. And his agent had the temerity to send out an incendiary press release about the deal!?
Fowler may be happy to be “home” and playing for history, but I am sure he would rather be doing that with another $7.8M in his pocket over the course of the next few months.
And just when you thought it was safe to go back to the diamond, we have the case of Ian Desmond. Desmond turned down $15.8M to play SS for the Nationals in 2016. Spring Training is now two weeks in, and Desmond is still looking for work — he is unsigned. Oops!! Oh, and it bears mentioning that after the 2013 season, Desmond turned down a 7/$107M offer from the Nats. He thought it made more sense to sign for 2/$17.5M, and keep his options open. Double oops (actually $89.5M oops)!!
Hisashi Iwakuma turned down the $15.8M QO from the Mariners, and thought life was good with the Dodgers. The Bums were going to sign him for 3/$45M, but then he failed his physical. The Mariners took him back for $12M. Net loss, $3.8M.
Howie Kendrick turned down the Dodgers’ QO, tested the market, and got no takers. He resigned with the Dodgers for 2/$20M (or, just $4.2M more than he would have gotten for 2016 alone). But, alas, there is always a kicker. The Dodgers 2-year deal actually has deferred money, with no interest. Howie gets $5M/year over four years. Thus, Kendrick is playing 2016 for $10.8M less than if he had just said “yes”.
Axl Rose preached “just a little patience”. But some of these guys have been walking the streets at night, just trying to get it right, and they have failed . . . miserably.
Now, don’t shed any tears for any of these millionaires; and maybe these decisions seem inconsequential when you have eight figures in the bank. But I still don’t understand (a) how players let these things happen and (b) why more agents aren’t fired every season.
Okay, now we all have to go back to our pedestrian lives, spend $109 to renew our MLB.TV accounts, and get ready for that underpaid umpire (average salary: $120-$350K/year) to say:
p.s. The answer to the trivia question can be found here.