Saturday, February 15, 2014

More than just a Bad Contract

Jonah Keri came out with his annual "bad contract" column last week.

The top (or bottom) five:
  1. Alex Rodruguez
  2. Albert Pujols
  3. Ryan Howard
  4. Mark Teixera
  5. B.J. Upton
  6. Josh Hamilton
  7. John Danks
  8. Chad Billingsley
  9. Carl Crawford
  10. Brandon League
  11. Jonathon Broxton
  12. Ricky Romero
  13. Dan Uggla
  14. Prince Fielder
  15. Adrian Gonzalez
What common thread runs through most of these teams?
  1. They were, at a time between 2-10 years ago, among the best players in the league, though they may not be now.
  2. They are mostly under contract with high-revenue teams.
Is such analysis valuable? Sure.

But I dissent from the emerging notion that this is the "sophisticated" way to analyze these players (or, more specifically, a team's decision to acquire that player or to extend a contract).  

First, there are several things a team is doing in acquiring a proven star player, and only one of them is paying for a particular level of performance.

In most professions, people's compensation increases as they gain more experience.  In part, this is because we think they bring more accumulated knowledge that will help them do a better job.  This only applies partially in the case of sports because the gain in experience is usually accompanied by at least as large a decline in athleticism (though as I get older I do find I have less mental stamina than I did before, and family obligations preclude insane hours).

These teams are also in the business of selling tickets and merchandise.  And recognizable starts will attract this type of business (though not as much as winning).

The other thing you are buying is some protection from variance in performance.   An experienced professional has established that she can handle a workload, and is less likely to flake out than a new hire. The same is true for athletes -- there is less uncertainty with a player who has established a certain level of performance over several years than a prospect.  Yes, that production is likely to decline, but you know this is someone who can take the heat.  So teams are paying a premium for a certain floor on production.  They may be paying too high a premium, but that is a separate question.  It is certainly a defensible option for a team like, say, the Dodgers, to overpay for established stars so they have fewer questions.

But my distaste for this has been somewhat visceral, more than a simple disagreement about optimal management policy.  This started to come together in the discussion of Kobe Bryant's contract -- why should Kobe Bryant be punished for the Lakers' decision to hand him a large contract?

This crystallized for me reading Bill Simmons's column today introducing the documentary of Steve Nash's year with the Lakers.  Because if the "contracts matter" fan culture, instead of spending this season celebrating Nash's great career and accomplishments, Lakes fans imagine how they might be able to dump or mitigate his contract.

Of course, if I were an owner, I would love this development.  It's not cheap to decline to extend a generous contract to a veteran star; it's smart.  Build up assets through the draft.  Don't go for the "quick fix" free agents.  The best players are young ones under "club control."

And when a player performs at a proper level and gets out of indentured servitude club control, he better perform or else he'll become a "bad contract."  He may end up that way anyway.

Albert Pujols was the best hitter in baseball for ten years, and led his team to two World Series championships.
Ryan Howard led the league in home runs and RBI two straight years, won an MVP, and helped the Phillies win their first World Series in 28 years, and the city's only championship since 1983.
Steve Nash won consecutive MVPs, captained the best offense many of us have ever seen.
Kobe Bryant won 5 championships and set several scoring records.

They deserve better than to work the rest of their careers as "bad contracts."

As I said before, I'm quite confident Keri and others intend to tip public opinion against veteran stars toward the owners.  Keri writes of Howard:

The Society of Baseball Nerds has dragged poor Ryan Howard’s name through the muck too many times already, so I won’t belabor the point here, except to say he’s not the one who offered himself this contract, and he’s not the one who put the Phillies in the mess they’re in.

I wouldn't want my favorite team to hire a GM who didn't understand the impact big contracts have on a team's ability to win.  But I don't think it's the best, or most "sophisticated" way for fans to think about the game.  And we forget that salary caps and luxury taxes are things the owners put in place to keep themselves from paying players as much as they would earn in a truly open market.  Kobe Bryant and Steve Nash aren't preventing the Lakers from winning; the rules the owners locked out the players to put in place are.
Post a Comment