On a superficial level, the New York Yankees spending nearly $500 million on Jacoby Ellsbury, Carlos Beltran, Brian McCann and Masahiro Tanaka this offseason makes sense because the team missed the playoffs last year and had significant questions about the future.
However, looking at the state of the Yankees on a much deeper level, spending all that money on four free agents was necessary due to how poorly the franchise has developed talent in recent years.
Even a team with pockets as deep as New York's can only rely on signing (mostly) 30-something free agents for so long before the bottom drops out. We saw it last year, when the team somehow managed to win 85 games with a patchwork lineup that included players like Travis Hafner and Vernon Wells.
One way to try and replenish a farm system is spending a lot of money on international free agents, which Andrew Marchand and Wallace Matthews of ESPN New York report is going to be the team's plan this summer:
However, according to a baseball insider, the Yankees could spend as much as $18 million this summer on players from Latin America, who already make up more than 27 percent of baseball's 30 active rosters, including some of its biggest stars, such as former Yankees second baseman Robinson Cano.
The same report also notes that the Yankees will have a little more than $2 million to spend on international free agents starting July 2.
Under the Collective Bargaining Agreement, teams that go over their spending total incur financial penalties and limit the total that can be spent on an individual player the next year, per MLB.com.
According to the ESPN New York report, since the Yankees reportedly plan to breeze past their allotted money, they could pay as much as $12 million in penalties and would be limited to spending no more than $250,000 per international signee in 2015.
With an aggressive plan apparently in place, will the Yankees come out ahead when we examine things after July 2?
Let's take a look at this from three different angles.
The good news for New York is that this year's crop of international players appears to be very rich in talent. The Yankees reportedly have agreed to verbal deals with several players already, according to Kiley McDaniel of Scout.com (subscription required).
Since players can't officially sign until July 2, McDaniel notes, a lot of deals get agreed to beforehand but will sometimes fall apart, which is why he didn't report the names of the players in New York's orbit.
For the Yankees to try their hand at adding talent to the farm system through the international market speaks to how desperate they are to fix some of their problems.
However, therein lies another problem that must be pointed out: Adding talent to the system hasn't been the issue for the Yankees. They've had plenty of talent in recent years, but getting that talent to reach its ceiling in the big leagues has been the issue.
In 2011, Baseball America ranked the Yankees' system fifth in baseball, yet among their top 10 prospects for that year, the only one to carve out any kind of MLB career to this point is backup shortstop Eduardo Nunez.
But even as we are talking about the Yankees spending millions of dollars on international players and how exciting some of these players can be, remember that we are talking about 16-year-old kids. It's going to be at least two or three years before they pop up in full-season leagues and four years before they make it to the big leagues—and that's only if everything goes right.
How often do things go 100 percent right with one prospect, let alone a handful of them?
The Yankees are potentially playing a dangerous game and betting a lot of money on their future in doing so.
We've reached a point in the offseason where every major baseball outlet is releasing its list of farm system and prospect rankings. It's an exciting time for fans everywhere who want to learn about the next generation of stars, but it's also a reality check for some fans, including those of the Yankees.
What has been the Yankees' biggest problem with young talent?
ESPN's Keith Law (Insider subscription required) ranked the Yankees' system 20th heading into 2014, while naming three prospects (Gary Sanchez, Tyler Austin and Mason Williams) in the back half of the Top 100.
MLB.com ranked Gary Sanchez as the 47th-best prospect in baseball but acknowledged that questions about his ability to play catcher (or lack thereof) limit his upside.
The Yankees have played in the international waters before, investing a lot of money in talent that has failed to develop as expected or still has a long way to go before reaching its full potential.
While the jury is still out on Sanchez, Montero has been a disaster in Seattle. Once a top-10 prospect, Montero has hit .258/.303/.396 in parts of three MLB seasons.
Since Montero was traded before playing full time in the big leagues, the Yankees don't have to claim him as their own, but it doesn't speak well on them that they gave him such a big bonus with nothing to show for it.
The point is that for all the money the Yankees can and do throw at their problems, as they have in free agency this winter, at some point heads have to roll in the scouting and development department.
If you are so desperate that players like Hafner, Wells, Lyle Overbay, Jayson Nix and Mark Reynolds are upgrades, something has clearly broken in your system.
Another problem the Yankees have had is bad drafting. Some of that can be explained by the fact they are usually one of the best teams in baseball, picking near the back of the first round when all the impact talent is off the board.
But let's look back through the last 10 years of New York Yankees draft classes. Since 2005, the only first-round pick they have drafted and developed is Joba Chamberlain (2006), who is now in Detroit.
Other players have had success in other organizations, like Ian Kennedy (2006) and Gerrit Cole (2008, didn't sign).
Cole wasn't their fault, as he reportedly told the Yankees that he wasn't going to sign with them because he wanted to go to UCLA, but the last 10 years of first-round picks are a series of failures on their part.
Cito Culver was one of the most surprising (in a bad way) picks of the 2010 draft. ESPN's Keith Law (Insider subscription required) wrote that scouts felt Culver was "a third- or fourth-rounder," but the Yankees popped him with the 32nd pick.
Dante Bichette Jr. was the 51st pick of the 2011 draft and has yet to make it out of Low-A, hitting a paltry .214/.292/.331 line in 114 games last season.
The jury is still out on Ty Hensley (2012), Eric Jagielo, Aaron Judge and Ian Clarkin (all 2013), but early reports from Bleacher Report Lead Prospect Writer Mike Rosenbaum infer that those four project more as average (at best) big leaguers than stars.
Much like it does with international spending, the new CBA prevents teams from overspending in the draft because Bud Selig hates clubs paying amateur talent a fraction of what free agents make to improve their future.
Despite these limitations, teams have found ways to make themselves better in the draft. The St. Louis Cardinals got major contributions from virtually all of their top prospects last year, including Shelby Miller (2009), Matt Adams (2009), Matt Carpenter (2009), Lance Lynn (2008), Trevor Rosenthal (2009) and Michael Wacha (2012).
Granted, most of those players were drafted before the new CBA was in place, but it still doesn't excuse what the Yankees have done.
That's just dating back to 2008 for the Cardinals, when there hasn't one viable first-round pick for the Yankees since 2005. They have to start drafting better while also playing the international free-agent game in order to repair their farm system.
The End Result
Much of the discussion so far has been about what's wrong with the Yankees' reported plan to spend big on international free agents or the faults within their scouting and development staff in recent years, yet there is some upside to this strategy.
Simple logic will tell you that the more talent you add to a system, the more likely you are to find at least one big leaguer.
There is always going to be volatility with prospects, especially when you are talking about 16-year-olds who haven't fully matured physically, but if you have four, five, six or seven different players in front of you, something is bound to stick.
Going on a spending spree this year to fix the farm system's problems, though, is like putting a Band-Aid on a broken leg. It might stop the bleeding temporarily and even increase their rankings on prospect lists in 2015 and possibly 2016, but eventually the development problems that have plagued the team for years must be addressed in order to get these players where they need to be.
Money masks problems; it doesn't fix them. The Yankees aren't going to change their system overnight. Changing the fortunes of a farm system is a long process that takes more than just signing teenagers to multimillion-dollar contracts.
Look at what the Astros have done in the last three years to replenish a depleted farm system. The Yankees didn't have to take things that far, but it takes time, effort and a lot of smart, talented people to bring a system back.
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