Caution Surrounds Baseball During Free Agency

The Yankees were not embarrassed to offer free-agent left-hander CC Sabathia $140 million in the middle of an economic crisis.

Sabathia should not be embarrassed to accept such an offer, or an even larger one after other teams start bidding.

Free agents get paid what the market will bear. Major League Baseball generated a record $6.5 billion in revenues last season. Obviously, next season could be worse, but at this point no one knows for sure.

The Yankees are not cutting ticket prices as they move into the new Yankee Stadium. Neither are the Angels, another potential Sabathia bidder, nor the Dodgers, who will charge $90 for many seats in their new spring-training home in Glendale, Ariz., according to research by bizofbaseball.com.

Why should Sabathia — or any other elite free agent — sacrifice?

The harsh economy is affecting the free-agent market, but any top player who signs a lesser contract might find himself undervalued once conditions improve — which they presumably (hopefully?) would over the course of a long-term deal.

There is one issue, and one issue only, in the Sabathia negotiations — whether the Angels, Dodgers and Giants can come close enough to the Yankees' final offer for Sabathia to justify him moving to the West Coast.

The Brewers offered Sabathia $100 million for five years, so any of the interested West Coast clubs also would need to significantly trump that proposal to become a serious player.

Union pressure? Please. Clubs often portray union officials as evil boogeymen, whispering, "raise the bar, raise the bar" in players' ears. Such concerns are overstated. Sabathia is not under union hypnosis; he will make the decision that is best for him.

One way or another, he figures to beat Johan Santana's record deal for a pitcher — six years, $137.5 million in actual dollars, or $123.1 million in present-day value according to the union's calculations, which include deferrals.

The union's bigger problem, by far, will be the second-tier free agents who already were getting squeezed. Teams now might take even more of a hard-line position with such players, again forcing them to scramble for jobs.

Several general managers mentioned to me last week that they plan to wait out the market, believing that bargains will develop. As for major signings, it's still early. But one prominent agent says the market is indeed moving more slowly than usual.

"Everyone is afraid to make a decision," the agent says. "Agents are afraid to do a deal now and then see the market explode for their premier players. General managers are afraid to do a deal with the chance that the market will collapse."

Meanwhile, agent Scott Boras — the representative for several top free agents, including Mark Teixeira, Manny Ramirez and Derek Lowe — finds it ludicrous that anyone would confuse MLB with GM or any other struggling company.

At the request of commissioner Bud Selig, owners received an update on the economy last week from Paul Volcker, the former chairman of the Federal Reserve. But as Boras points out, many of the game's revenues are fixed.

Baseball maintains long-term contracts with corporate sponsors, and local and national TV and radio networks. Continued growth on the Internet, the launch of the MLB Network and the World Baseball Classic should generate additional revenue next season.

The big concern, though, is attendance.

"I'm not sure the agents watch TV," one general manager says. "The people getting laid off are the people who are going to be buying tickets from us."

Well, winning is the best way to boost attendance — and Sabathia, at least in the early years of his contract, could transform his next team the same way he helped transform the Brewers last season.

Think of Sabathia at the top of the Yankees' rotation, reducing the burden on Joba Chamberlain, Phil Hughes and even Chien-Ming Wang.

Think of him doing the same for the Dodgers' Chad Billingsley, Clayton Kershaw and James McDonald — or even the Giants' Tim Lincecum, Matt Cain and Barry Zito.

The Angels, if they fail to retain free-agent first baseman Mark Teixeira, could sign Sabathia and then trade Ervin Santana or Joe Saunders for an impact hitter such as Rockies third baseman Garrett Atkins.

Sabathia will get his money, as will Teixeira and other top free agents. Free-agent contracts in the hundreds of millions will look all the more outrageous at a time when so many Americans losing jobs. Yet, baseball economics rarely bear any resemblance to the real-world economics, in good times or bad.

It's not embarrassing. It's just the way it is.

This article originally published on FOXSports.com.

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