Life is Full of Options

Every time a major free agent signs with a new team the fans celebrate and begin dreaming about the future possibilities of the team. If you read the newspapers or internet after every blockbuster free agency signing, it would be difficult to believe anything other than that team is now destined to at least reach the World Series, if not win it all. This is especially true when starting pitchers sign major deals. While the debate over what the future holds for the player and their new team should ignite the passions of the fans and media, this offseason feels as though there is an additional layer to the hype and excitement.

The fans buying tickets, jerseys, hats, television packages, etc. are the driving force for the business of baseball. If fans were not willing to spend $10 for the cheap seats or hundreds of dollars for premium seats, not to mention food, clothing, and media, the players and owners would not see the financial benefits they do. Every free agent dreams of cashing in on their years of hard work for a contract like the one David Price has with the Red Sox. Price signed for seven years, $217 million contract. He does not have to worry about working another day in his life. The same is true for Jason Heyward with the Cubs (eight years, $184 million), Johnny Cueto with the Giants (six years, $130 million), and Justin Upton with the Tigers (six years, $132.75 million). Their talent on the diamond has more than secured each of their financial future.

Justin Upton
Justin Upton looks to turn the Tigers around quickly. (www.rollingstone.com)

Financial security also exists for those players not in the upper echelon of free agents. Non-ace starting pitchers can often dictate whether a team contends for a World Series, or even for the playoffs, as much as an ace like Felix Hernandez can. Excellent pitchers like Scott Kazmir can dictate how a team plays throughout the season. This reality has resulted in Scott Kazmir signing with the Dodgers (three years, $48 million). Fans in San Francisco, Los Angeles, Detroit, and the north side of Chicago should all rejoice in the talent their teams’ have signed during this offseason.

Before those dreams of World Series championships and parades permanently ingrain themselves into their minds, it would be best to temper those dreams. This offseason has shown that both the teams and the players want to win and win now. Owners are using deferred money to soften the burden of paying large contracts. Consider Chris Davis’ contract with the Orioles. He signed a seven-year, $161 million contract, with $42 million of the contract deferred. The Orioles will continue paying Davis until 2037. The financial deferment will enable the Orioles to spend money elsewhere in the hopes of winning more games and hopefully a World Series.

Scott Kazmir
Scott Kazmir proves the opt-out clause is not reserved strictly for top free agents. (Colin E. Braley/ AP)

Ownership is not alone in this win now mentality. Players understand they only have a small window to win at least one World Series during their career and they prefer not to waste valuable years playing for teams that have no chance of making the playoffs, much less winning a World Series. The no trade clause has long been the means by which players protected themselves against a trade to a terrible team. However, what if the team they are playing is that terrible team?

Not every player will want to opt out of their contract. Even some elite players may decide it is best to remain with a team despite not consistently contending for the playoffs. If Todd Helton had an opt-out clause in the nine year, $141.5 million contract that he signed in 2001, few would have blamed him if he had left the Rockies before the end of the contract. During Helton’s 17-year career, Colorado had five winning season, made the playoffs twice, getting swept by the Red Sox in the 2007 World Series and losing to the Phillies in the 2009 NLDS. Helton remained an elite player throughout his career, but he rarely played for a team that had a hope of making the playoffs. While Helton is a Rockies legend, having spent his entire career playing in Colorado, he could have moved on from the Rockies later in his career if he felt a better situation for winning was available. Given the option to leave the Rockies does not mean Helton would have left, but it could have pushed management to field a more competitive team in the short term instead of waiting for the team to rebuild through homegrown talent.

toddhelton
Would Todd Helton’s career be remembered differently if he could have opted out of Colorado? (www.beforeitwasnews.com)

Opt-out clauses seems to have gained enormous steam this offseason. Players will nearly always accept the large contracts from teams for their services, as they should. There does come a point for every player, when their financial future is secure, that enables them to prioritize winning and extending their careers. The opt-out clause empowers players to have more control regarding their career arc. They are no longer stuck with a team if the team’s plan for winning does not materialize. Players also gain time as they do not have to spend prime playing years waiting to become a free agent and lose interest from contending teams.

We may not see Johnny Cueto, Jason Heyward, Scott Kazmir, David Price, or Justin Upton fulfill the full length of their new contracts from free agency. Each player has an opt-out clause, enabling them to return to free agency in pursuit of a larger payday or joining another team they see as a better fit. All the big free agent signings of this offseason could be back on the market following the 2018 season.

Player

Team Years Contract Amount (Millions) Opt Out After Pre Opt-Out Seasons

Pre Opt-Out Salary (Millions)

Scott Kazmir Dodgers

3

$48 2016 1

$12.60

Johnny Cueto Giants

6

$130 2017 2

$37.60

Justin Upton Tigers

6

$132.75 2017 2

$44.25

David Price Red Sox

7

$217 2018 3

$90

Jason Heyward Cubs

8

$184 2018 3

$65.50

Jason Heyward Cubs

8

$184 2019 4

$88

The excitement from these free agent signings may only last a few seasons. The opt-out clause in these contracts could act as a player friendly way to rent their services to a new team, much like teams trading away soon-to-be free agents to contenders. Players are in a win-win situation with these contracts, as they can now maximize their potential to earn money, play for winning teams, and have longer careers. The focus has long been on the downside for the team when they sign players like Albert Pujols or Robinson Cano to long and expensive contracts. The final years of these contracts result in players receiving higher annual salaries than their abilities would garner them if they were up for a new contract. Such long contracts also handcuff most teams in their efforts to field a contending team. The Texas Rangers would have remained irrelevant had they not traded Alex Rodriguez to the Yankees. The Rodriguez contract (10 years, $252 million) was too large for the team to handle financially. Beyond the financial aspects, the rise in opt-out clauses means players have the opportunity to leave a team if they believe a better contract and situation exists for them elsewhere.

The contract signed by Giancarlo Stanton last offseason quietly signaled the shift away from gigantic contracts to shorter contracts that are more player friendly. The Marlins, aside from needing to regain some credibility with baseball fans in south Florida, solidified Stanton as the foundation they would use to build a contender. Stanton’s contract blended the old and new approaches to signing big free agent talent. Miami wanted to prevent Stanton from ever reaching free agency and signed him to a 13 year, $325 million contract. This means Stanton should be playing in South Florida until he is 37, maybe 38 if the Marlins exercise a team option for the 2028 season. The years and the money are comparable to the contracts for Albert Pujols, Robinson Cano, and Alex Rodriguez. These 10+ year contracts lock down a player well beyond their productive seasons.  While this contract may not seem like a move away from those other massive contracts, the inclusion of an opt-out clause was striking. However, Stanton received an opt-out clause following year six, the 2020 season. At the age of 30, Stanton could still command an enormous contract on the free agent market. The opt-out also prevents Stanton from playing the vast majority of his career for the Marlins, if ownership is not willing or able to put a winning product on the field. The Giancarlo Stanton contract gave the Marlins, and their fans, the stability of having their player signed long term yet it gave the player the ability to hold the team accountable.

giancarlo-stanton_tri
Giancarlo Stanton’s contract ushered in a new era of mega contracts but with an opt-out clause. (www.grantland.com)

The ability to opt out of a contract may transform the way free agency operates. Players now have the ability to hold their team accountable. Opting out means a team cannot place all of its faith in building a winning team in a single player, or simply building for the future. Baseball is a team sport and players expect and demand that management works to build a winning team. This new approach to signing players to contracts allows successful teams to sign premium players for the long-term, while giving players the ability to leave a team for a better situation or payday if they desire. No player wants to make less than they are worth or languish with a team going nowhere for their entire career. Fans must understand until a player decides not to opt out of the contract the new free agent has in reality signed for only a few years. Opt-out clauses create two contracts out of one. The player holds all the cards in deciding if the second contract comes into effect. Fans can dream, but their dreams need to focus more on short-term results instead of building a dynasty with their newly signed free agent.

DJ

Advertisements

One comment

  1. Pingback: Discover: Tuesday Takeaways « MLB.com Blogs

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s