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Money And Rock And Roll Part One - The Value Of A Dollar

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Moneyball was a huge influence in my baseball life. If I hadn't read it, it's safe to say that this blog wouldn't exist. It taught me the value of on base percentage, how to look for inefficiencies in the market, and so many other basic principles of sabermetrics. However, there's one thing it did that I feel hurt me dearly from an analysis stand point, and it took me until just recently to learn this lesson. It made me care too much about if a guy is overpaid when dealing with a big market team like the Dodgers.

Money only becomes an issue in two places: when not having enough of it prevents you from making a different move, and when a player's salary keeps him in the starting lineup. Even that second one doesn't have to be an issue, but it would take a front office with more stones than any one currently in business to pull it off.

To make an extreme example, let's say you have infinite money, and can sign one of two players to a one year deal. One will be 20 runs over replacement, and will make the league minimum, the other will be 21 runs over replacement and will cost 175 million dollars per year. They are equal in every other way, and you don't have anyone of value at that position in your system. Which guy do you sign? The correct answer is the second one. Yes, he's terribly inefficient for his cost, but why wouldn't you? The money doesn't prevent you from making another move, you've got infinite amounts of it, and you aren't going to block a better player in the system. With the second player, your team is better, and that's the goal of baseball, to make the best team, not make the best team on a per dollar basis. That lesson is something that even the best analysts fail to take into account.

The Dodgers are not the Oakland A's. Billy Beane was forced to get as much value for his dollar as possible, even offering to pay for a player himself if his deal didn't work out. The Dodgers are on a completely different level. Despite having a team stacked with young talent, the Dodgers still will have a 124 million dollar payroll this year, which, if you think about it, is pretty absurd. However, since we haven't seemed to hit a limit, it doesn't really matter. Juan Pierre is horribly overpaid, but did his signing prevent us from going out and doing what Ned wanted to this off season? Judging by what happened so far, no. The money that we are paying Juan Pierre didn't hurt us. The only way that contract actually is damaging to the Dodgers is that it is forcing us to put him in left this year instead of Andre Ethier. If Pierre ends up on the bench, then as dumb as that contract was, it hasn't hurt us one bit. We didn't give up any talent for Juan Pierre, and no young player was blocked because of him (possibly a debatable point depending on how realistic Kemp in center is). The end result of Pierre's contract that we're siphoning money towards him, but it's not hurting us in any way.

Now, if the Dodgers end up not being able to aggressively pursue Johan Santana or C.C. Sabathia if they became available next off-season, then money becomes an issue. Then we can start fretting about guy receiving too much coin. However, since money hasn't proven to be a stopping point for Ned as far as we know, then we shouldn't worry.

When you insert a potentially talented young player into the mix is when things start to get complicated. For example, I'm pretty confident that Rafael Furcal will out perform Chin-Lung Hu for the next few years. The Dodgers have approximately 75 million committed to the team in 2009 giving us 40-50 million dollars to spend. If we signed Furcal to a three year, 45 million dollar extension, we'd be a better team than we would be with Hu for the life of the contract, plus we'd probably be able to acquire something shiny if we traded Hu. However, you have to consider other factors as well. How much better will Hu get if he's allowed to face big league pitching for the next three years? What do you do three years from now when Furcal's contract runs out and Hu is just entering his arbitration years? Can you draft another player of Hu's caliber and have him be big league ready in three years? Who can you sign to take Furcal's place if you can't develop an answer? How easy this is comes down to when you're trying to win. If you're trying to make it big in the next three years, then the answer is easy: sign Furcal be happy, you're going to be a better team for it. After that, it's complicated, but I'd still probably sign Furcal, then look to develop, trade for or sign a solution when the time comes. Heck, from the realistic perspective of a G.M., you'll probably be fired by then anyway, so it probably won't be your problem.

People have commented on my criticism of the Kuroda deal, saying that I shouldn't worry if he's overpaid. It's not the money that worries me, it's the fact that I don't think Kuroda will be one of our five best pitchers in 2009 and 2010. If there was a guarantee that Kuroda would be deserving of a rotation spot over the next three years, I'd think it was a great deal. If a guy makes your team better throughout the duration of his contract, and that money doesn't prevent you from doing other things, it's a great deal, no matter what formulas say how overpaid he is. When you're a big market team, making the team better is all that matters.

Part two of this series will look at Blue Jay Syndrome, or what happens when you care too much about not overpaying players.