Saturday, February 5, 2011

The Hardest Part is Knowing When to Let Go

Albert Pujols is likely the greatest baseball player many of us will ever have the pleasure of watching in our lifetime. I know that is not the most controversial statement I have ever made on this site (Minnesota Twins, anyone?). However, as we move closer to the Pujols designated end of negotiations, it has become clear that the hometown discount given in his previous 7 year, 100 million dollar contract will not be in effect this time around. Numbers as high as 300 million for the next ten seasons have been discussed by reputable writers at mainstream sites. In light of these numbers, it would seem that the time has come for St. Louis to make the difficult but necessary move and allow Albert to find another home after the 2011 season.

The St Louis Cardinals, despite their prominent stature within the game, have never been one of the high end teams in terms of payroll. The Cardinals' did not break the 100 million dollar barrier until 2011 and had the 13th highest payroll in baseball in the 2009-2010 per both Cot's Baseball Contracts and They are on the hook for 17 million per season for Matt Holliday until the beginning of the second term of the Palin administration (keep your fingers crossed on that one kids, for the comedy value if nothing else). Adam Wainwright has two cost effective team options for 2012 and 2013 for a combined 21 million but will also be in line for a significant increase when the next contract gets signed. I think it is safe to say that as a 31 year old elite starting pitcher the absolute lowest yearly figure for Wainwright would work out to somewhere in the 16 to 18 million dollar range. I am assuming a minimum yearly figure of 25 million a year when all is said and done for Pujols. Conservatively, this would leave the Cardinals committing 58 million dollars a year for only three players through 2016 at the minimum. This troika would consume almost 50 percent of the team's working budget making the fielding of a competitive team almost impossible.

The second issue with this contract lies with the expected performance of Albert Pujols' over the assumed life of the contract. In a previous blog post, "Pujols Negotiation not Going Well", Chip referenced an article by Dave Cameron that estimated Pujols WAR over a ten year contract to be 42.5. Cameron arrived at this number by estimating Pujols' WAR for this season and applying a standard 1/2 win regression for each year of the contract. He also estimates the total value of these wins at 267.5 Million dollars, a figure that would seem to justify the numbers sought by Pujols. However, it is exceedingly rare, for a player to receive a contract that exactly mirrors their value to their team as too many economic and perceptual variables exist to prevent this from happening. For example, Joey Votto, a player with an almost identical WAR in 2010, just received a contract with a yearly value of 12.6 million dollars. This contract pays him almost 17 million dollars a year less than his value to the team in 2010-11. Evan Longoria would be able to buy Wyoming with the difference between his actual contract and his value to the Tampa Bay Rays since 2008.

Additionally, we as baseball fans, have become smarter over time. We know that a player's prime years fall between 25-30 years old. Pujols would begin his 10 year deal at the age of 32. This is assuming that his birth certificate did not receive the Danny Almonte treatment some time before his arrival in 2001. There is no evidence, anecdotal or otherwise, to indicate any duplicity in Pujols' stated age but one does have to bring up concerns like these when dealing with Latin American players. Stricter rules against amphetamines and other PED's have restored the usual career arc for even elite baseball players. The likelihood of a 39 year old slugger like Barry Bonds (Pujols' best career comp and his only real competition for the title of greatest player of our lifetime) hitting 45 homers and posting 10 WAR again is almost nonexistent. It does not behoove the Cardinals to make the same mistake the Yankees' did with the most recent A-Rod contract. This is especially true as the Cardinals don't have the 100 million dollar buffer in payroll that the Yankees possess on a yearly basis.

Albert Pujols is the face of the Cardinals' franchise and a potential all time great. However, that does not mean that you sign him to a 10 year, 250 million dollar contract when that contract would cripple your team economcially and serve only to purchase the declining years of that player. If you make a mistake of that magnitude with a payroll like the Cardinals, you can all but end your team's ability to contend for several seasons.

P.S., For the record, I hate Titanic more than almost anyone. However, the picture fits the theme of knowing when to let go and has the awesome secondary benefit of allowing me to post a Titanic reference on a blog of Chip's creation.


  1. @Josh - Yeah, everyone except for me. That movie is a righteous piece of trash.

    Additionally, I don't know if the Votto is contract is a good comp. (The Longoria definitely isn't, but that's because the Rays straight up played his agent.) Votto's contract bought out all three of his arbitration seasons, and players during those years typically only receive 40%, 60%, and 80% of their value. Furthermore, Votto had little contract leverage other than deciding to go year-to-year. The Reds weren't competing anyone for his services, so the cost of the contract was significantly lower than if he'd been on the FA market.

    Pujols will become a free agent next year. When that happens, all bets are off. I'm not saying I disagree with your premise (it's a huge risk for the Cardinals), but the Cards need to be realistic about the situation. They're not going to get him for Teixeira money, so it's time they stop pretending, and offer him a real contract. Otherwise, agree to let him become a FA, and let it play out that way.

  2. I know they are not the same players I was just pointing out that players never actually get their value as stipulated by WAR. I could have used Holliday, Youkilis, or any elite player.

    I just think that it is impossible for a middle of the road franchise like the Cards to succeed with that much money tied up in one player.

  3. @Josh - I don't doubt that. My problem is that there's a school of thought that says STL actually brings in enough revenue to support a much higher payroll. As of 2010, Forbes ranked the Cardinals as the eighth most valuable team in baseball at $488M with revenues on par with the Angels (#7), Giants (#9), and White Sox (#10). For some reason, the Cardinals payroll always seems to be lower than the above three named teams. While I'm not saying that the Cards can or can not support a player with Pujols's salary, I am saying that I think Cardinals ownership chooses not to put more money into their major league payroll. They try to play the small to mid-market club excuse, but it's not really a fair comparison. They're a mid-to-high revenue club which has a much greater affect on a team's ability to construct a high end payroll.