CC Sabathia Signs Monster Deal: Does Free Agency Need Equally Big Changes?

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CC Sabathia Signs Monster Deal: Does Free Agency Need Equally Big Changes?

Yesterday, the Yankees reached an agreement on a seven year, $161-million deal with CC Sabathia.

Was there ever doubt that CC would end up in New York? Who wouldn't take a contract that big, especially with the seven-year length, which no other team offered?

The only question was: By how much would CC's contract break the record for largest ever offered to a pitcher?

And, predictably, the Bombers weren't done. Next up: A.J. Burnett, Derek Lowe, and possibly even Mark Teixeira.

Interestingly, without using Darth Boras as his agent, CC managed to get an escape clause, an option to become a free agent after just three years, at which time he can: A) Go to another team (San Francisco?)

B) Pretend to want to go to another team and receive a contract offer than would make his wife faint (I still think this is how CC was signed to the current contract, despite both Sabathia's desire to stay on the West Coast).

Not to be outdone, the Nationals (yes, the Nationals) are reportedly offering Teixeira eight years at $20 million per year.

Don't think that contract sounds that big? Note that the Nationals' seven highest-paid players make $20 million per year combined.

The Yankees, meanwhile, will have seven players making over $13 million next, and that's assuming that Sabathia is their only acquisition. In fact, it's conceivable that the Yanks could have double the payroll of the second-place Mets next season, even with K-Rod's new contract finalized.

But, as the saying goes, you can't buy championships.

For what it's worth, 2008 MLB salaries (from ESPN.com), with division and playoff finishes added:

(Bold indicates playoffs, bold italics indicates division winner)

1.  NY Yankees     207,108,489; 3rd place; AL East
2. NY Mets     137,391,376; 2nd place; NL East
3. Detroit     137,290,196; 5th place; AL Central
4. Boston     133,220,112; 2nd place; AL East - ALCS
5. Chicago White Sox     121,189,332; 1st place; AL Central - Division Series
6. LA Angels     118,825,333;  1st place; AL West - Division Series
7. LA Dodgers     118,188,536; 1st place; NL West - NLCS
8. Chicago Cubs     117,954,333; 1st place; NL Central - Division Series
9. Seattle     116,876,482; 4th place; AL West
10. Atlanta     102,849,666; 4th place; NL East
11. St. Louis     99,624,449; 4th place; NL Central
12. Toronto     97,001,500; 4th place; AL East
13. Philadelphia     95,479,880; 1st place; NL East - World Series Champions
14. Houston     88,930,414; 3rd place; NL Central
15. Cleveland     78,970,066; 3rd place; AL Central
16. San Francisco     76,194,000; 4th place; NL West
17. Milwaukee     74,687,499; 2nd place; NL Central - Division Series
18. Cincinnati     74,117,695; 5th place; NL Central
19. San Diego     72,626,616; 5th place; NL West
20. Colorado     68,655,500; 3rd place; NL West
21. Baltimore     66,806,249; 5th place; AL East
22. Texas     66,312,326; 2nd place; AL West
23. Arizona     66,202,712; 2nd place; NL West
24. Kansas City     57,855,500; 4th place; AL Central
25. Minnesota     56,932,766; 2nd place; AL Central
26. Washington     54,166,000; 5th place; NL East
27. Pittsburgh     48,689,783; 6th place; NL Central
28. Oakland     47,167,126; 3rd place; AL West
29. Tampa Bay     43,422,997; 1st place; AL East - World Series
30. Florida     22,650,000; 3rd place; NL East

So, four of the division winners were in the top eight in spending, with the obvious exceptions being World Series participants Philadelphia and Tampa Bay.

In other words, there appear to be three distinct approaches to MLB success:

  1. Build the team slowly, draft pick by draft pick, dumping busts on other teams through good trades for other prospects with higher potential. (Rays)
  2. Use payroll wisely, keeping superstars on the team while adding key, but not necessarily blockbuster, free agents. (Phillies)
  3. Heck with it, let's just buy the darn thing. (Yankees)

This sentence came up in one site's discussion of a potential Mike Cameron-for-Melky-Cabrera trade: "The Brewers became upset when the Yankees asked them to pay a portion of Cameron's $10-million salary for 2009, just a day after New York landed CC Sabathia with a seven year, $161-million deal by outbidding the Brewers by $61 million (and two years)" (rotowire.com). Who says the Yankees management doesn't have a sense of humor?

The Red Sox have, in recent years, become somewhat like the Yankees in that they afford to buy (or, via trade, take on the salary of) almost whomever they want. However, many key players have come through the system (such as new AL MVP Dustin Pedroia).

So, what should baseball do about all this?

Here, also, there is no obvious answer.

The Rays defied every projection/prediction and made a miracle run. Keeping the system the way it is has produced many different winners of the Fall Classic, and several surprise playoff runs, including the 2007 Rockies.

However, the fickle nature of fans, as well as the perception that salaries are just too big, even when there isn't a recession, suggests that baseball might need to make a few adjustments to the system.

Here are my suggestions:

(Disclaimer: I realize that neither the big-market owners nor the Player's Union would ever consider any of these proposals)

Problem No. 1: Free agent contract size

As Yogi Berra might say, baseball needs to cap salaries, but doesn't need a salary cap.

A cap on team salary (which is what a salary cap usually is) would artificially level the playing field. Baseball is a unique sport, and I think forcing the Yankees to have the same payroll as the Marlins would ruin the spirit of the division and pennant races.

Most teams can only hope to stay in the race into September, and when your favorite club makes a run, it's something that's remembered for a long time.

However, the size of contracts is a problem. It increases ticket prices, and, in some cases, turns off fans.

One radical solution would be for every player to be limited to one-year contracts. In an ideal world, every player would play as if every year was a contract year. But this would be a nightmare in practice: Hundreds of arbitration cases per year? Just what the world needs—more bureaucracy.

But what if the most a free agent was allowed to make was, say, $10 million?

This would put many small-market teams in the mix for Teixeira and Sabathia, for example. Ten million is less than 20 percent of Kansas City's budget, for example. There would be no limit on the number of years. If the Giants wanted to offer CC nine or 10 years, so be it. The age of free agents (27 or 28-year-olds are among the youngest this year) would help to naturally limit the length of contracts.

There are loopholes in this system, however.

Loophole No. 1: Small-market teams can't afford to keep their own players

If the Yankees can scoop up $150 million free agents like they're paperclips, how easy would it be for them to buy the best free agents every year?

For $10 million a year, the entire lineup, rotation, and bullpen could be stocked with talent from top to bottom with great players and not exceed 2008's payroll.

Also, what is to stop Boston or New York from offering an 18- or 20-year contract, blowing away every other offer? Small-market teams would still lose their superstars.

To combat this, two franchise players could be designated by each team for a year. The salary of this player would be over the salary limit (say, $15 million), giving the player an incentive to stay home. The franchise players’ salaries would be paid in varying degrees, determined by the revenue generated by the team.

Why two franchise players?

Because one great pitcher is better with a good hitter to compliment him, and vice-versa. One pitcher and one batter wouldn't automatically make a team good: the pitcher would only throw every four or five days, and a hitter can be walked (Lincecum and Bonds come to mind). But having at least a few exciting players on each team would increase revenue across the league.

A team could choose to put their franchise player into the free agent pool. The player would then become an "A+"-type free agent—any team that signed him would have to give up multiple picks.

In addition, the cost per year would rise. The team would have to pay $20 million per year for the length of the contract—$10 million to the player and $10 million to the team from whom they signed the free agent.

To discourage the selling of franchise players by greedy management (Marlins?), the team would then have to designate a new franchise player, as well as pay a cash penalty (rather than taking a cap hit as NFL teams do when releasing players).

Like the waiver wire, if no one was willing to pay the extra price, the original team would have to keep the player for a year.

But there would still be one major loophole.

Loophole No. 2: Draft picks are often based on affordability, not talent.

The NBA has guaranteed rookie contracts, so why not MLB? After all, the first pick should be the most talented, not the best player who doesn't have a crazy agent. A fixed scale would also stop cheap owners who want to maximize profit by keeping signing bonuses low.

However, I think that performance bonuses should be a sizable portion of a rookie's salary. Tim Lincecum should be making much more than his approximately $450,000 a year. He will get paid eventually, but look what a similar season did for Sabathia.

Under the new hypothetical scenario, the Yankees would be flush with cash, and could probably snatch up draft picks that other teams were unwilling to take, due to the demands of signing bonuses, etc. A fixed rookie contract system would take care of this problem.

Unlike the NBA, the number of years wouldn't be fixed. If a rookie wanted to be Ray or Yankee for life, so be it, if the team was willing to accommodate.

To further promote responsible farm team management, teams could receive a discount in franchising a player that played all of his major league games for that team.

These changes wouldn't fix all of baseball's problems, and they would probably never be adopted anyway, but as free agency season is in full swing, it's interesting to think of possible alternatives to the current system.

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