Caveat Emptor

A troubling line of thinking has emerged as news that the Indians have made an initial contract extension offer to their reigning Cy Young Award winner C.C. Sabathia was recently reported. As most know, with Sabathia’s contract expiring at the end of the 2008 season, this off-season (though negotiations can continue throughout the season) represents the Tribe’s last chance to hold exclusive negotiations with The Hefty Lefty, meaning that Sabathia’s agents are simply not able to weigh offers on the table as the Tribe remains the sole bidder for Sabathia…for now.

The movement that seems to be gaining steam among a number of Tribe fans is that Sabathia should be signed “at all costs”, that his importance to the team outweighs any perceived overpayment (in terms of years or money) by the Indians because the Tribe NEED him on this team going forward and he’ll likely get a groundbreaking offer in Free Agency from a team that doesn’t play its home games on the corner of Carnegie and Ontario if he hits the open market after the 2008 season.

Now, despite the fact that he is not a Free Agent on that open market and the contracts signed by similar pitchers to Sabathia in similar situations has already been addressed here (not included in the linked article is Jake Peavy’s 3-year, $52M extension signed December 12th), many fans seem to be subscribing to the Blank Check mentality to “give C.C. what he wants” to keep him on the team, regardless of the long-term effect on the team or how relevant contracts provide a road map for negotiations.

The argument goes that “if he wants 6 years guaranteed…give him 6, if he wants 7 guaranteed…give him 7” and so on and so on to the point that Sabathia enters Wayne Garland territory. Seeing as how Sabathia is only 27 years old (he’ll be 28 in July) and has matured to the point that he is a legitimate top-of-the-rotation starter (in a Tribe uniform, which hasn’t happened since…well…) with the hardware to prove it, without a pattern of injury or ineffectiveness in his career, the argument is not without some merit. That is, of course, until the contracts of those lengths are examined to determine exactly how successful the long-term contracts (namely 5 years or more) for pitchers have worked out in the past 10 years in MLB.

As we all know, those who forget the lessons of history are doomed to repeat them, so what can the history of long-term contracts signed by pitchers tell us about the wisdom of inking Sabathia, or any other pitcher for that matter, to a long-term deal? Taking into consideration that a contract of 4 years is generally thought of as the “comfortable” period of time for starting pitchers, how have the pitchers signed to longer contracts performed over the course of those contracts?

With all of the talk of 6 and 7 year contracts fluttering around in some people’s heads in regards to C.C., please consider the longest MLB contracts (with some help from Jeff Euston of Cot’s Baseball Contracts) signed by Starting Pitchers in the last 10 years, the annual salaries associated with the contract, and the pitcher’s performance over those years:

Mike Hampton – 8 years, $121M
2001 - $8M, 14-13, 5.41 ERA, 1.58 WHIP
2002 - $8.5M, 7-15, 6.15 ERA, 1.78 WHIP
2003 - $11M, 14-8, 3.84 ERA, 1.39 WHIP
2004 - $12M, 13-9, 4.28 ERA, 1.52 WHIP
2005 - $12.5M, 5-3, 3.50 ERA, 1.33 WHIP
2006 - $13M, did not pitch
2007 - $14.5M, did not pitch
2008 - $15M
2009 - $6M buyout or $20M option
Every GM should keep a copy of this contract on his refrigerator to remind him to exert some fiscal responsibility when negotiating a contract as, no matter how well a player has performed or how young said player is (Hampton was 27 with 6 straight seasons with an ERA below 3.60 in each of those years when he signed this deal), past results do not guarantee future success.

The deal Hampton signed with the Rockies, which included a $20M signing bonus (of which $19M will be paid to him from 2009-2018 at 3% interest), remains the great cautionary tale that baseball players are human beings and not above prolonged slumps, significant drop-offs, or injury. No matter how bad this contract looked at the time, it looks worse in hindsight. So bad, in fact, that three teams paid Hampton’s 2005 salary (Colorado - $2.5M, Florida - $8.5M, Atlanta - $1.5M) when he threw all of 69 1/3 innings and earned 5 wins for the combined $12.5M paid to him. With Hampton having a slight possibility of making the Atlanta rotation out of Spring Training, there is a very real chance that the $121M that will be paid to him when all of the checks will be cashed essentially netted 53 MLB wins or more than $2.25M a win.

As numbers like 7 and 8 are so irresponsibly thrown out there in regards to the Crooked Cap and others, it is important to remember the Lesson of Mike Hampton.

Barry Zito – 7 years, $126M
2007 - $10M, 11-13, 4.53 ERA, 1.35 WHIP
2008 - $14.5M
2009 - $18.5M
2010 - $18.5M
2011 - $18.5M
2012 - $19M
2013 - $20M
Giants’ GM Brian Sabean, apparently blissfully unaware of the Hampton debacle, went out to “make a splash” last off-season, despite an aging lineup and a farm system flush with young, talented arms. That “big splash” came in the form of Zito heading across the Bay from Oakland to San Francisco, with the $126M likely covering the BART fare (one way fare of $3.55) to get him to AT&T Park (raise your hand if you knew that was where the Giants played their home games).

Prior to signing the deal, Zito posted an ERA under 4.00 in 6 of his first 7 seasons with a Cy Young Award in 2002 (at the age of 24) on his impressive resume. Zito signed the deal as a 28-year-old, seemingly poised to enter the prime of his career. He rewarded the Giants in the 1st year of the deal by posting the worst ERA among their 5 main starters and coming up short of 200 innings pitched. After his dubious 2007, the Giants must really be looking forward to 6 more guaranteed years and Zito cashing $116M more of their money, praying that Zito will post better results than he did in 2007. Although it is a bit early to categorize the deal as historically terrible after only one year, the first year did not exactly invoke the names of Sandy Koufax or Warren Spahn.

With the stark regression by Zito in 2007, a consistent pitcher if there was one in MLB, the deal is startling in the lesson that starting pitching is rarely a given. While some point to Zito’s deal as the harbinger of the direction of contracts for starting pitchers, I can only hope that it comes to represent something of the Hampton deal redux, the aberration to the trend that ultimately serves as a lesson. For if Zito’s contract is the guideline for new deals and represents “A Brave New World” in terms of pitchers’ contracts, I’m going to need a dose of soma to get to a happier place.

Kevin Brown – 7 years, $105M
1999 - $10M, 18-9, 3.00 ERA, 1.06 WHIP
2000 - $15M, 13-6, 2.58 ERA, 0.99 WHIP
2001 - $15M, 10-4, 2.65 ERA, 1.14 WHIP
2002 - $15M, 3-4, 4.81 ERA, 1.42 WHIP
2003 - $15M, 14-9, 2.39 ERA, 1.14 WHIP
2004 - $15M, 10-6, 4.09 ERA, 1.27 WHIP
2005 - $15M, 4-7, 6.50 ERA, 1.72 WHIP
Not a great comparison to Sabathia’s situation as this contract was signed when Brown was 34 (with a $5M signing bonus) and while Brown put up great numbers when healthy, he rarely was throughout the contract. After 3 straight seasons of more than 230 IP prior to the deal, Brown logged 200 innings only 3 times over the course of the 7 year contract, twice pitching less than 75 innings.

When healthy, Brown was certainly worth the annual salary, but age and injury caught up with him as the advanced age at which he signed the deal eventually made the contract about two years too long. In the final year of the deal, which he played in New York, Brown was a shell of the pitcher that he was when the deal was signed – injured and ineffective.

Mike Mussina – 6 years, $88.5M
2001 - $8M, 17-11, 3.15 ERA, 1.07 WHIP
2002 - $9M, 18-10, 4.05 ERA, 1.19 WHIP
2003 - $10M, 17-8, 4.05 ERA, 1.19 WHIP
2004 - $14M, 12-9, 4.59 ERA, 1.32 WHIP
2005 - $17M, 13-8, 4.41 ERA, 1.36 WHIP
2006 - $17M, 15-7, 3.51 ERA, 1.11 WHIP
Perhaps the first example of a long-term deal proving to be a prudent move of the ones examined thus far, as the Moose stayed startlingly consistent throughout the life of the contract, pitching between 164 and 228 innings in each year. Of course, outside of his terrific 2006 campaign (the last year of the deal which earned him another 2-year contract worth $23M), Mussina was definitely trending in the wrong direction as the contract wore on.

The contract was signed when Mussina was 32 and his reputation as an innings-eater that was earned in Baltimore stood up in the Bronx, though it is interesting that Mussina finished in the top 5 of Cy Young voting only once in all of the years of the contract. As arbitrary and ridiculous as that voting can be (see Cliff Lee, circa 2005), the fact that he was viewed as one of the top 5 pitchers in the AL only once over the course of the 6 years while being a steady contributor speaks only to the consistency, and not brilliance, of Mussina.

Pedro Martinez – 6 years, $75M
1998 - $7M, 19-7, 2.89 ERA, 1.09 WHIP
1999 - $10.5M, 23-4, 2.07 ERA, 0.92 WHIP
2000 - $11M, 18-6, 1.74 ERA, 0.74 WHIP
2001 - $12.5M, 7-3, 2.39 ERA, 0.93 WHIP
2002 - $13.5M, 20-4, 2.26 ERA, 0.92 WHIP
2003 - $15M, 14-4, 2.22 ERA, 1.04 WHIP
2004 - $17.5M, 16-9, 3.90 ERA, 1.17 WHIP
If you’re wondering how Mussina didn’t get many Cy Young votes all those years, look at this oil on canvas painted by Sweet Pete in Boston. If ever there could be an argument that a pitcher can not only perform, but excel, over a long-term deal, these numbers present a pretty convincing case. Missing the 185 inning pitch mark only once in the 7 years, winning two Cy Youngs (with two 2nd place finishes, a 3rd place, and a 4th place), and posting sub-1.00 WHIPs for four straight years gives the idea of what type of results a contract bestowed on an “ace” should reap.

The final two years represent club options that were picked up, which stretched the deal to 7 years and $87M in total; so the performance of Pedro has to be the report pulled out of any agent’s folio to show that a pitcher can excel over the course of a 7-year deal.
That, ladies and gentleman, is an example of best case scenario…and how.

Daisuke Matsuzaka – 6 years, $52M
2007 - $6M, 15-12, 4.40 ERA, 1.33 WHIP
2008 - $8M
2009- $8M
2010 - $8M
2011 - $10M
2012 - $12M
The Japanese import’s first year in MLB was solid, but certainly not spectacular, though the Red Sox almost HAD to make sure that he was signed to a deal after posting over $51M just to get exclusive negotiating rights with him. The Red Sox, while being the only team able to negotiate with Dice-K, found themselves in the unenviable position of trying to project Matsuzaka to MLB and finding a comparable contract to use as a basis, when little was known about how Dice-K would translate.

After last year’s performance, 6 years looks excessive until you consider that Dice-K earned a reputation as an innings-eating horse in Japan and his salary numbers (as long as you don’t include the posting fee, which did not get paid to Matsuzaka) really aren’t that atrocious for a #3 starter, compared to the salaries being paid to lesser middle-of-the rotation starters.

Carlos Zambrano – 5 years, $91M
2008 - $15M
2009 - $17.75M
2010 - $17.875M
2011 - $17.875M
2012 - $18M
Obviously, Big Z has yet to throw a pitch under this contract, but the deal (which includes a vesting player option for $19.25M) will always be an interesting point of comparison for whatever happens with Sabathia. Both were in similar situations (though a year apart), with comparable success at comparable ages. Zambrano decided to eschew the FA market after receiving what he felt was a fair-market deal from the only team he had ever known.

Had he passed on the Cubs’ offer, he would have inarguably been the biggest prize on the FA market this off-season for starting pitching (just a tick above Carlos Silva and Kyle Lohse…right?) and surely could have commanded more on the open market. Zambrano didn’t though, perhaps paving the way for other pitchers (like, maybe a big LH who wears his hat slightly cockeyed) to do the same.

Roy Oswalt – 5 years, $73M
2007 - $13M, 14-7, 3.18 ERA, 1.33 WHIP
2008 - $13M
2009 - $14M
2010 - $15M
2011 - $16M
Speaking of similar situations and possible paths, Oswalt set the standard for pitchers re-upping with their current club before hitting FA when he signed this deal, which includes a $16M club option for 2012. Again, like Zambrano, Oswalt found himself in a similar situation to Sabathia and decided to take what was likely less money to stay with his current employer.

Again, like Zambrano (and, truly, to be fair Zito), it is extremely early to judge how this contract stacks up based on such a short timeframe. But, if 2007 is any indication, it looks like more of the same consistent excellence for Oswalt that they’ve grown accustomed to in Houston.

Chan Ho Park – 5 years, $65M
2002 - $11M, 9-8, 5.75 ERA, 1.59 WHIP
2003 - $12M, 1-3, 7.58 ERA, 1.99 WHIP
2004 - $13M, 4-7, 5.46 ERA, 1.44 WHIP
2005 - $14M, 12-8, 5.74 ERA, 1.67 WHIP
2006 - $15M, 7-7, 4.81 ERA, 1.39 WHIP
If the Mike Hampton deal taught everyone a lesson, GM’s should take a semester’s worth of classes examining the atrocious results of this deal. Chan Ho Park, inked by the Rangers after the 2001 season, proceeded to pitch more than 150 innings only once (2005) and pitched less than 100 innings twice in the 5 years over the course of this deal. Considering that the most productive year of the deal included him posting a 4.81 ERA (while “earning” $15M) in Petco Park, this is arguably the most horrific deal that’s ever been handed out to an MLB player.

Whether Park succumbed to injuries or was simply unable to adjust to the AL or the launching pad that the Rangers call home, the deal was ill-conceived from the beginning and should serve as a reminder that the seemingly simple solution of throwing money at a problem often solves very little.

Chris Carpenter – 5 years, $63.5M
2007 - $8.5M, 0-1, 7.50 ERA, 1.67 WHIP
2008 - $10.5M
2009 - $14M
2010 - $14.5M
2011 - $15M
2012 - $15M club option
Now we get to the sad, sad tale of Chris Carpenter, who pitched only 6 IP in 2007, after singing this deal based off of two straight seasons with over 220 IP and WHIPs under 1.07, and is not expected to pitch until late in the 2008 season…at the earliest. Prior to Carpenter signing the deal, he posted three phenomenal seasons with St. Louis, finishing in the Top 10 in wins in the NL and finishing in the Top 5 in the NL in ERA for 2005 (Cy Young winner) and 2006 (3rd in Cy Young voting).

But, as we all know, unforeseen injuries remain the worst case scenario for teams after these types of deals are done and, early in the 2007 season, Carpenter’s elbow acted up, causing him to have surgery to correct a ligament in his right elbow, calling into question whether he will ever be the dominant pitcher that he was just prior to the contract being signed, much less when he will even be coming back at all.

Kevin Millwood – 5 years, $60M
2006 - $6M, 16-12, 4.52 ERA, 1.31 WHIP
2007 - $7.5M, 10-14, 5.16 ERA, 1.62 WHIP
2008 - $8.5M
2009 - $11M
2010 - $12M
Somehow this seems very relevant to discuss the length of Millwood’s deal in comparison to C.C.’s deal as most Tribe fans are acutely aware of the background that the Indians, after the 2005 season, were not willing to give Millwood the 4th and 5th years on a contract proposal, allowing Millwood to explore the open market, eventually inking this deal (that also has a $15M signing bonus that will continue to pay him $3M annually from 2011 to 2015) a year after winning the ERA title in Cleveland. The Indians, meanwhile, used the money set aside for Millwood to sign Paul Byrd to less years and comparable money.

In hindsight, it is a hard strategy to argue with as Millwood has certainly not done much in his first two years in Texas, performing below league average while Byrd (while not much better) is at least a Free Agent after this year, even after the Tribe picked up a club option, and will come off the books after 2008. In contrast, Millwood is still slated to earn $31.5M guaranteed over the next 3 years, doing nothing thus far to justify the monies owed to him over that timeframe.

Greg Maddux – 5 years, $57.5M
1998 - $9M, 18-9, 2.22 ERA, 0.98 WHIP
1999 - $10M, 19-9, 3.57 ERA, 1.35 WHIP
2000 - $10.5M, 19-9, 3.00 ERA, 1.07 WHIP
2001 - $12.5M, 17-11, 3.05 ERA, 1.06 WHIP
2002 - $12.5M, 16-6, 2.62 ERA, 1.20 WHIP
Consistency, thy name is Maddux. Over the course of this contract, Maddux was a veritable machine – logging more than 199 IP in all five seasons, posting ERAs under 3.60, and walking a total of 196 batters in the 1,152 innings that he logged over the 5 years of the contract. By any measure, the results are nothing short of astounding, particularly considering that this contract was signed when he was 32 (on the heels of the expiration of the first contract with the Braves for 5 years and $28M) and ended when he was 37.

While the numbers are consistent and consistently tremendous, they pale in comparison to what he put down for the first 5-year contract (4 times posting an ERA of 3.00 or lower, never having a WHIP over 1.05, and winning 3 straight Cy Young Awards), which compare to Pedro Martinez’s performance as how a pitcher, just hitting his prime and staying healthy, can thrive throughout the life of a contract…much less two.

For those willing to anoint anyone but this man as the “Greatest Pitcher of His Generation”, please consider these statistics and realize that the consistency that he Maddux achieved is something that we may never enjoy again. Maddux is a unique pitcher and any young pitcher who even comes close to replicating what he has accomplished, in terms of overall performance and consistency, will likely be ticketed to join him one day in Cooperstown.

A.J. Burnett – 5 years, $55M
2006 - $7M, 10-8, 3.98 ERA, 1.31 WHIP
2007 - $12M, 10-8, 3.75 ERA, 1.19 WHIP
2008 - $12M
2009 - $12M
2010 - $12M
Illustrating the classic case of a pitcher being signed on potential, as opposed to achievement, Burnett was offered this deal from Toronto despite pitching more than 200 innings only twice in the previous 5 years and never winning more than 12 games in a season. While wins are a somewhat arbitrary way to judge pitchers as a certain amount of factors lie outside of their control (run support, bullpen, etc.), Burnett looked to be a talented pitcher who had never been able to stay healthy in his time in Florida.

After the deal was signed, the reputation proved to be true as he has battled through two injury-riddled seasons (135 IP in 2006 and 165 IP in 2007) flashing the same intermittent brilliance (1.19 WHIP in 2007) that caused the Blue Jays to open their checkbook, hoping that he could stay healthy. Alas, he has not to this point and even holds an opt-out clause after the 2008 season; so if he is able to stay healthy and produce over the course of a whole season, he will have the opportunity to rip up his Blue Jays’ contract and capitalize on his potential again. If his 2008 follows the pattern of his career and injuries prevent an opt-out performance, he can still sleep well knowing that he will be receiving $24M more in guaranteed dollars from Toronto.

Gil Meche – 5 years, $55M
2007 - $7M, 9-13, 3.67 ERA, 1.27 WHIP
2008 - $11M
2009 - $11M
2010 - $12M
2011 - $12M
The contract signed last off-season that trumpeted that the wheels were off the starting pitching market, Meche had never pitched more than 185 innings in a season and hadn’t posted an ERA under 4.40 in any of the previous 4 seasons, not to mention topping the 1.40 WHIP mark in the previous 3 seasons. Unbelievably, the Royals inked the 27-year-old who (surprising virtually everyone not in the Kansas City Front Office) posted career highs in innings pitched, ERA, WHIP, and tied his 2006 season strikeout total in his first year in KC.

While Meche’s 2007 constituted a pleasant surprise for Royals fans (desperate for one), Meche remains vastly overpaid in terms of dollars and years. When it’s all said and done, is it possible that his 2007 could be the year that Meche figured it out and will only improve from here, justifying this contract by the end of the 2011? In a word – no.

Darren Dreifort - 5 years, $55M
2001 - $9M, 4-7, 5.13 ERA, 1.44 WHIP
2002 - $9M, did not pitch
2003 - $11M, 4-4, 4.03 ERA, 1.38 WHIP
2004 - $11M, 1-4, 4.44 ERA, 1.56 WHIP
2005 - $13M, did not pitch
See Park, Chan Ho…but worse.
That would be 9 wins and 205 2/3 innings pitched over 5 years and $55M, which includes the $2M signing bonus.
Not much more to say here except, of course, “did anyone get the license number on the getaway car?”

Denny Neagle – 5 years, $51M
2001 - $7M, 9-8, 5.38 ERA, 1.48 WHIP
2002 - $7M, 8-11 ERA, 5.26 ERA, 1.42 WHIP
2003 - $9M, 2-4, 7.90 ERA, 1.67 WHIP
2004 - $9M, did not pitch
2005 - $10M, did not pitch (contract terminated)
2006 - $12.5M club option ($9M buyout)
Neagle’s first two years, when he pitched 170 innings and 164 innings while posting WHIPs over 1.40 were, sadly, the best years of this contract that ended unceremoniously as Neagle’s 2005 and 2006 salaries were settled by an arbitrator after the Rockies terminated his contract after he was issued a citation for soliciting sex from a prostitute.

After writing that I feel a little dirty and…just…want to move on.

Kei Igawa – 5 years, $20M
2007 - $4M, 2-3, 6.25 ERA, 1.67 WHIP
2008 - $4M
2009 - $4M
2010 - $4M
2011 - $4M
Though not outrageous in terms of annual salary, the fact that the Yankees are paying a player that simply couldn’t help the team in his first year of the deal shows how risky it can be to sign a player to a long-term deal in that if the player proves to be ineffective early in the deal, it becomes nearly impossible to move his contract as the committed (and guaranteed) years are just too much to pawn off on anyone.

That’s it!
Those seventeen are the only contracts that have been signed by starting pitchers for 5 years or more in the last 10 years, only six for 6 years or more, and merely three for 7 years or more.

Regardless of the rhetoric coming out of the Johan Santana camp regarding contract demands, it is important to know that the likes of Randy Johnson, Curt Schilling, John Smoltz, Tom Glavine, David Wells, Jaime Moyer, Andy Pettitte, Bartolo Colon, and Roger Clemens never worked under contracts longer than 4 years…EVER in their careers. Even some of the most dreadful contracts in recent memory, like those handed out to Russ Ortiz and Carl Pavano were “only” inked for 4 forgettable years. Perhaps there’s something to that which has been ignored by GM’s interested in locking up pitchers “at all costs”.

Now, will C.C. suddenly become ineffective after years of success? Not likely.
Will he get injured and become unavailable or have diminished skills upon his return? Lord knows that nobody wishes that upon him…but it is a possibility as risk needs to be weighed against reward for any contract.

Of course, for every Pedro Martinez, who sparkles throughout the life of a contract, continuing the success that merited that contract, there are the Mike Hamptons (who, prior to signing his deal had won 85 career games and just turned 27) or Chris Carpenters (who won 51 games with WHIPs under 1.13 in the 3 years leading up to his deal, only to see his arm blow up) that serve as the reminders that sometimes even the best-laid plans can quickly go awry.

Also, from the consistency standpoint and the idea that Sabathia’s history of staying healthy and effective portends future health and excellence, it is important to remember that for every Greg Maddux, there are pitchers like Dan Petry, Larry Dierker, and Dave McNally (all 4 being comparable pitchers to Sabathia at this point in his career) who have broken down in their early 30’s due to injury or simple ineffectiveness. While it is fun to think that Sabathia’s career arc will follow that of Maddux, with consistently excellent seasons with tremendous health, it is unfortunately more likely (history tells us) that Maddux is the exception to the rule and few pitchers will ever be able to match his health and results.

Could Sabathia be an exception, like Martinez or Maddux?
Certainly, but just playing the percentages, it is more likely that he’s not. So, if past is truly prologue, the debate regarding Sabathia’s signability falls to the wisdom, or lack thereof, of signing a pitcher to more than 4 or 5 years of guaranteed money, not the money. Given what is known about the long-term contracts handed out to starting pitchers and the performances of those pitchers, is the potential reward that C.C. is headed for 6 or 7 full years of health and success worth the risk of carrying an injured or ineffective pitcher on the roster for a substantial amount of money for an extended period of time?

Those guaranteed years and the expected performance over those years, not the annual salary associated with the contract, is the question that the Tribe brass (and Indians’ fans) should be asking instead of simply ascribing to the belief that Sabathia MUST be signed to a contract extension this off-season.

Unfortunately for the Indians, there will be a team willing to take on the risks associated with giving a 6 or 7 year deal to Sabathia on the open market, with a GM happy to ignore the lessons of the past to ink the aCCe. If it gets to that point (and C.C.’s agents stick to a hard line of ignoring the frameworks established by the Zambrano, Oswalt, and Peavy deals, demanding a 6 or 7 year deal) – that GM, fortunately or unfortunately for Tribe fans depending on where you fall in the debate, isn’t likely to be Mark Shapiro.