How Yankees' International Spending Spree Could Impact Farm, Future

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How Yankees' International Spending Spree Could Impact Farm, Future
Tom Szczerbowski/Getty Images
With a recent crop of talented international prospects, what could the future of the Yankees farm system and big league club look like after Derek Jeter turns away from a 20-year career?

All is not well in Yankee land, which you can tell from the expenditures even if you haven't witnessed the on-field display.

When the situation is sticky in the Bronx, the front office often turns to quick, expensive fixes—quite simply because it possesses the resources to do so. Through swift injections of talent, the Yankees typically hope to correct what just went wrong.

We saw it after the 2008 season. We saw it more recently this past offseason when there had been talk of a pesky $189 million luxury-tax threshold. Then New York opened the season with a payroll surpassing $197 million. The Yanks got their top targets, and no one got away. 

But since then, we've seen the other factors come into play at baseball's halfway point: team-wide underperformance; mediocrity—or worse—from most of their major signings; devastating injuries to three of their five Opening Day starters; lack of truly reliable, projectable in-house prospects. 

Despite the game's second-highest payroll, and in spite of the talent they injected into the lineup this winter, their win-loss record stands at 44-43. They're losers in 10 of their last 15 and sit in the bottom half of Major League Baseball in—just to name a few categories—hits (17th), home runs (17th), runs (20th), RBI (21st), opponent batting average (19th), ERA (21st) and runs allowed (22nd). 

And so the most recent reactionary spending spree—the latest rapid addition of talent—came this past week: MLB's international signing period opened July 2, and the Yankees went ahead and already spent upwards of $20 million on prospects aged 16 and higher. 

According to CBSSports.com's Mike Axisa, they signed nine of MLB.com's Top 30 international talents, including Nos. 1, 2, 5, 7, 9, 13, 14, 16 and 25. Tough to criticize them for wiping those numbers off the board in one fell swoop. 

"[I]n terms of both quality and quantity, this is the most impressive class by a considerable margin," remarks ESPN Insider (subscription required) Christopher Crawford, who labeled the Yankees an early "big winner" from baseball's international signing period.

Two looming problems, however: Via the terms of the newest collective bargaining agreement, Yanks brass blew past a $2-plus million spending threshold, as they're wont to do, leading to some hefty penalties and future spending restrictions (more on this later). And, more importantly, it will be at least several years before we see any of these teenagers don a big league uniform—and that's if any of them pan out. 

A few days removed from the period's opening—and with more signings potentially on the horizon and the All-Star break approaching—let's jump into how the most recent spending spree could affect the oft-maligned and oft-criticized farm, as well as what it means for the future of the big league ballclub.

 

Big-Name Signings, Farm Fit and Upside

"Over the past two seasons, as injuries have depleted the major league team, the Yankees have taken criticism for a lack of talent in the minors," wrote the New York Daily News' Andy Martino about a month ago. "In reality, their system is middle-of-the-pack, with Baseball America ranking it 16th this year. Still, no one disagrees that they could use an infusion of high-end talent."

We'll begin here with the most obvious repercussions: Who were the marquee signings from last week's crop? And if we water it down to a simple question of injecting talent into the weak farm, how might we see their additions fitting into the system?

Here are the five signees ranked inside MLB.com's top-10 international talents. 

Yankees' International Signings Inside MLB.com's Top 10
MLB.com Rank DOB (Age) Hometown Position Signing Bonus
Dermis Garcia 1 Jan. 7, 1998 (16) San Pedro, Dominican Republic SS $3M
Nelson Gomez 2 Oct. 8, 1997 (16) Nigua, Dominican Republic 3B $2.25M
Juan DeLeon 5 Sept. 13, 1997 (16) Santo Domingo, Dominican Republic OF $2M
Jonathan Amundaray 7 May 11, 1998 (16) Puerto la Cruz, Venezuela OF $1.5M
Antonio Arias 9 June 12, 1998 (16) San Juan de los Moros, Venezuela OF $800K

MLB.com

*Signing bonuses are reported and subject to change

These combined signings alone totaled north of $9 million. For some perspective, that's about $450,000 less than the combined $10 million contracts for established big leaguers Brian Roberts, Brendan Ryan and Kelly Johnson.

"'Big' is the operative word when discussing [Dermis] Garcia," according to MLB.com. The 6'2", 180-pounder trains in San Pedro de Marcoris and is considered to possess the best power and arm in this year's international class.

His effortless power (see above video), premier bat speed and large frame remind scouts of a "teenage Alex Rodriguez," and his lone weak spot appears to be his lack of speed on the basepaths.

With room to grow as he ages and defensive improvement expected as he rises, a move to third could be in his future, but the current shortstop is no doubt an incredible talent expected to be a phenomenal teammate and diligent worker. 

The No. 2-ranked player and now-Yankee signee, Nelson Gomez, is one of the largest prospects—and, of course, one of the best.

Many evaluators see the 6'2", 212-pound third baseman as one of the best all-around hitters in the class, noting his pure ability and his "knack for squaring up the ball." He has already shown "the ability to hit for power to all fields during Dominican Prospect League games."

Scouts love his baseball IQ in spite of his lack of speed and underdeveloped defense. Similarly to current farmhand Gary Sanchez, the talk is of his raw power and above-average arm.

Prior to the 2014 season, I profiled the Yankees' top positional prospects, noting Abiatal Avelino, a 19-year-old San Pedro de Macoris native, as the system's best shortstop, and Eric Jagielo, a 2013 first-rounder from Notre Dame, as the best third baseman

In three seasons, Avelino's batting .301/.382/.386, and this season he's hitting .294/.349/.387 in just 29 games for Low-A Charleston. His fielding has improved this season, committing just three errors in 22 games after 15 in 44 last season. Jagielo, currently rehabbing, was hitting just .256 in Tampa but had collected 10 homers, eight doubles and 31 RBI.

Beyond Avelino at shortstop, the Yanks have underwhelming 5'10", 155-pound Thairo Estrada in Staten Island (.274, 13 SB, 37 K in 66 G since 2013), decent 5'11" Connecticut native John Murphy in Charleston (.278/.348/.317 in 2014), struggling Cito Culver in Tampa (.219/.291/.290 in 79 G in 2014), average Dan Fiorito (.251) and underperforming Ali Castillo (.214) in Trenton and Carmen Angelini in Scranton (.236).

Past Jagielo at third, Ty McFarland plays third in Staten Island (.286 in 17 G), lackluster Miguel Andujar in Charleston (.240, 53 K in 79 G), Dante Bichette Jr., who may or may not finally be coming around in Tampa this season (.278, 67 K in 81 G), Rob Segedin in Trenton (.248) and the recently demoted Yangervis Solarte in Scranton.

Put simply, taking the two best international talents of this year's class was deft. With the short- and long-term Jeter and A-Rod successors currently undetermined, it was that much smarter. 

On to the three outfielders: Juan DeLeon, No. 5, is your typical five-tool stud outfielder. According to MLB.com, "There's a belief that DeLeon might have the best all-around combination of tools and body among outfielders in this year's class from the Dominican Republic."

The Santo Domingo native stands at just 6'1" and 175 pounds, but he displays raw power and better-than-average bat speed. He shows off a skill set described as "electric" and "explosive." The scouts' consensus is that DeLeon is sure to be an impact player, but his movement through the minors will hinge most significantly on his hit tool.  

The Yankees also signed two Venezuelan outfielders to round out their top-five choices, No. 7 Jonathan Amundaray (6'2", 175 lbs), considered the top talent from his country and a future Raul Mondesi (combination of raw power and arm), and No. 9 Antonio Arias (6'2", 180 lbs), whom scouts believe could project as a Cameron Maybin (covers ground, projectable power, quick hands and aggressiveness) if the pieces fall into place in his development.

The story of Yankee minor league outfielders has become a broken record. Not one of Double-A prospects, Tyler Austin (22 years old, .250), Mason Williams (22, .214) or Slade Heathcott—who was actually added to the 40-man this winter (23, .182, 13 K in 9 G, out for the entire season since May 27)—has panned out. 

In the Bronx, they have Ellsbury for seven years, Gardner for five and Carlos Beltran for three, Alfonso Soriano was just designated for assignment, Ichiro is the fourth outfielder and on the 40-man they have the solid, but less-than-compelling likes of Zoilo Almonte (.224 in 43 MLB G) and Ramon Flores (.261 in Scranton this season).

In short, the Yankees will take what they can get to roam the outfield, and they happened to pick up some of the best from this year's international prospects.

These five signings alone have to be looked upon as a success—even a steal by Yankee financial accounts—if one of them impacts the big league club in the best case. In the worst case, of course, each and every one is a bust.

But again, the Yanks' shopping list hardly ended with those teenagers:

More Yankees 2014 International Signings
MLB.com Rank DOB (Age) Hometown Position Signing Bonus
Hyo-Jun Park 13 April 7, 1996 (18) Seongnam, Korea SS $1.1M
Wilkerman Garcia 14 April 1, 1998 (16) Maracay, Venezuela SS $1.35M
Diego Castillo 16 Oct. 28, 1997 (16) Barquisimeto, Venezuela SS $750K

MLB.com

Miguel Flames 25 Sept. 14, 1997 (16) Maracay, Venezuela C $1M
Frederick Cuevas N/A N/A (16) N/A, Dominican Republic OF $300K
Servando Hernandez N/A N/A (16) N/A, Venezuela RHP $200K

SBNation.com

Somewhere in between complete boons and busts, the Yankees could sorely use more exciting, young talent to package for their pressing needs on the trade market should they encounter a similar situation to the current one. Desperate for starting pitching, the Yankees have largely found themselves on the outside looking in with their glaring inability to successfully scout, draft or develop sufficient examples of reliable blue-chip trade bait.

Without over-saturating the focus, recall: David Price has yet to be pried from the Rays, who perennially value top projectable prospects in return for expensive, expiring contracts; aces Jeff Samardzija and Jason Hammel were traded to the A's for Oakland's top two prospects; the Yankees ended up with Arizona's Brandon McCarthy, who owns just a 4.21 ERA, 4.09 FIP and 6.2 K/9 in nine seasons, by exchanging their worst "starter," Vidal Nuno, and cash to the worst team in baseball (37-53).

 

Financial Penalties and Burdens

John Minchillo/Associated Press
Yankees senior vice president and general manager Brian Cashman

Unfortunately, there is a double-edged sword in breaking the rules of the CBA, so to speak. You can't spend tens of millions on teenagers, come up with nine of (arguably) the 25 best international prospects and get off scot-free.

Think back to that 2014 luxury-tax threshold, however. It's not that the Yankees management isn't well aware of the consequences of extra spending; they simply throw up the blinders when their immediate needs trump their longer-term pragmatism.

CBSSports.com's Axisa brings us up to speed:

The Yankees did not break any rules, they just showed little regard for the league's penalty system.

Under the current system, each team is assigned a spending pool for international players that is based on their previous year's record. The Yankees were slotted roughly $2.2 million for this summer, but they blew right by that when the signing period opened Wednesday. They'll have to pay a 100 percent tax on whatever they spend over their pool.

MLB.com's Jesse Sanchez provides more specific insight, including a second side to consider about future signings:

In accordance with the Collective Bargaining Agreement, each team is allotted a $700,000 base and a bonus pool based on the team's record in 2013 for the international signing period. New York's bonus pool total for this year's signing period is $2,193,100...

Teams that exceed the pools by 10 to 15 percent are not allowed to sign a player for more than $300,000 during the next signing period and have to pay a 100 percent tax on the pool overage.

Not that it's a huge burden for the Yanks—given their resources, spending habits and public plans the past few months to exceed their limits—but you've read that correctly twice: 100 percent on their overages. That means the reported $13-14 million ends up costing somewhere between $23 and $26 million (by my own rough estimates). 

ESPN Insider Crawford hits the nail on the head: "There were reports that the Yankees were going to make a mockery of their allocated bonus funds this year, and to say they did that is to say that water is wet."

Seth Wenig/Associated Press
Managing general partner/co-chairperson Hal Steinbrenner (left) leans in to chat with Cashman in 2009.

But the penalties are not solely through taxes. The more detrimental ones are through their future restrictions on signing international talent. Per Sanchez: "In the most severe penalty, teams that exceed the pool by more than 15 percent are not allowed to sign a player for more than $300,000 during the next two signing periods."

The first prospect signed by New York for $300,000 or less this year did not rank in MLB.com's Top 25. That's not as much a prognostication as it is a reminder of the value being placed on these talented teenagers' heads—teenagers whom the Yankees may covet in the next two international signing periods but ultimately fall short of obtaining if they are outbid.

"Several developments in recent years have made it more difficult for the Yankees to flex the financial advantage they hold over most other teams," wrote the Daily News' Martino in June. "But the front office has clearly recognized one way it can toss its money around, just like in the old days: By far exceeding its bonus pool allotment for international signings, and shrugging at the steep financial penalties."

But now that they've flexed, they'll have to sit on their hands for the next two years—even if a 14-year-old kid turns 16 and without question is the next Alex Rodriguez.

As 2 Chainz once put it in his 2011 record "Spend It": "It's mine, I spend it."  

Or, as Martino more aptly writes: "Hey, when you have the cash, you want to spend it. It’s not as easy to act like the Yankees as it used to be, but they’re always looking for ways."

 

Baseball-Related Risks

RICH SCHULTZ/Associated Press
A young Robinson Cano, with Trenton in 2006, had a bright future ahead of him.

That brings us to the final takeaway of the Yankees' international spending spree: What are the on-field dangers?

Every single major league club must stockpile the farm with a surplus of whom they believe to be projectable prospects. No team is immune from the majority of their annual signings flaming out. New York does seem to be in the midst of a particularly poor recent spate of player development, however.

Based on the international price tags, the Yankees must know that all is not well despite entering Monday just 3.5 games back of the division-leading Orioles. And though 15 teams have a better winning percentage and 14 have a worse one, middle of the league is simply a failed experiment when 28 teams have a cheaper Opening Day payroll.

The expenditures also signal that they probably don't trust their in-house options. What is 100 percent certain, though, is that they love this year's international class. As Martino writes: "The Yankees' scouts obviously see players they want to sign, and believe are worth the commitment."

Unfortunately, there's a great chance that the scouting and player development department has overvalued a bunch of 16- and 17-year-olds and has concluded a hasty reactionary spending spree as a result of 2014's early returns. And coming away with nine of the top 25 carries further implications than winning a bidding war.

There have to be skeptics present.

"Talking to people with deep contacts in the Latin American scouting community," wrote Martino, "some expressed a feeling that this year’s crop of talent is not the greatest...remember, there are few hard truths in scouting, just educated, subjective opinions."

Even if—pardon the hyperbole—all 30 ballclubs believed this crop of talent could be the greatest in a decade, there remain inherent risks.

"Generally, international prospects are far more difficult to project than domestic ones, not least because most are scouted when they are 15, and signed when they are 16," adds Martino. "[T]hat is a lot farther from adulthood than a high school senior, or college junior. You might find the next Robinson Cano, but you also might find the next Fernando Martinez."

Common sense says you shouldn't spend upwards of $20 million on players who may or may not help you five to 10 years from now—be that in pinstripes or as trade bait. But common sense is tempered as soon as expectations are as well.

SBNation's Craig Goldstein spoke with ESPN Insider and draft expert Crawford about the Yankees' signings and strategy. Here's what he had to say:

I think it's fantastic. The punishment is less than a slap on a wrist. They took advantage of other [teams'] fear and ran with it. Would I spend $30 million on guys that might not help this decade? Probably not, but there are worse ways to spend the money. They picked up five of the best eight talents in Dermis Garcia, Juan De Leon, Jonathan Amundaray, Nelson Gomez and Wilkerman Garcia. It's hard to look on that in a negative light.

In other words: If so much as one or two of these teenagers have everything go right en route to becoming big leaguers, we won't be scoffing at the price—or the risks.

 

Sense of Urgency

Ann Heisenfelt/Associated Press
Francisco Cervelli's (right) throwing error caused Minnesota's walk-off victory on Saturday, July 5.

In 2014, whether you drink in sabermetrics or disgustedly spit them out, perhaps you're still a proponent of the timeless, ageless microcosm. 

Just 24 hours after Francisco Cervelli stepped on home and airmailed his throw to first, the Bombers held a 9-0 lead after just 3.5 innings of play. That the same game ended in a save situation, and a 9-7 victory, sums up the very shaky picture.

The Bombers have just keenly traded Nuno for a pitcher actually classified as a starter capable of giving you innings and, hopefully, confidence as we await the final word on Sabathia's future. They've intelligently designated Soriano, a move that could bring about another helpful arm from another team thirsty for some pop.

And yes, injuries are expected over six months of everyday baseball; but the extent and severity—Nova's Tommy John, CC's degenerative knee—were not. Circumstance, misfortune, struggles and slumps are relative; somehow in the Bronx those have seemed nearly absolute after three months. And they simply don't have the prospects capable of bailing themselves out.

They're not quite emptying out the water to survive—they have until July 31 to continue mixing and matching through the trade market, searching for extra flotation devices. But it's simply not the Yankee way to notify us they've decided to go down with the ship. That, too, would be hardly fathomable given the actual captain's final year with the team.

It will be a few short years before we understand the true pragmatism of this international spending spree on the farm. It will be another several after that to determine the decision-making process for the future of the Bronx.

For now, the sense of urgency and the Yankee tradition would not have called for anything other than going out and acquiring the best available by any means necessary.

 

Statistics accurate as of July 7, 2014 and are courtesy of Baseball-Reference, and salary/contract figures via Cot's Baseball Contracts unless otherwise noted. Scouting profiles and rankings via MLB.com's 2014 Prospect Watch.

Peter F. Richman is a New York Yankees Featured Columnist and Bleacher Report Copy Editor. For more NYY opinions, discussion, debate and analysis, feel free to reach out via Twitter:  

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