Do Owners, GMs Learn From Bad Contracts?

Earlier this season, Mets owner Fred Wilpon explicitly compared the impending free agency of Jose Reyes to the contract that Carl Crawford signed last winter. That seven-year, $142MM deal was supposed to be beyond Reyes' reach.

But as the season has worn on, it has been Crawford who hasn't been worth "Carl Crawford money". The disappointing left fielder has tallied an OPS+ of 86 and just 18 stolen bases entering Monday's games, and so it has become fashionable to declare that general managers and owners will learn from Crawford, an admittedly similar player to Reyes, and avoid a similar payout in both length and worth of contract to Reyes this coming offseason.

This led me to wonder: had owners ever learned from a disastrous free agent deal before? Simply put, had any first-year collapses in performance by one player kept another, similar player from receiving a similar amount of money?

Take Darren Dreifort, for example. Through the 2000 season, the 28-year-old Dreifort had mediocre career totals – an ERA+ of 98 – but posted a 105 ERA+ just prior to hitting free agency. The Dodgers, intent on keeping him, signed Dreifort to a five-year, $55MM contract.

It didn't take long for the deal to look like a loser – Dreifort pitched to an ERA+ of 78 over half of 2001, then missed the rest of that season and the next one with an elbow injury. If the Crawford/Reyes thesis is to be believed, all of baseball shied away from such contracts for pitchers, particularly ones roughly Dreifort's age with a similar track record of success, right?

Not even if we narrow it to Los Angeles' own division. In the winter of 2001, the San Francisco Giants, who had a front row seat for Dreifort's failings, signed Jason Schmidt to a five-year, $41MM contract. Schmidt was 28, the same age as Dreifort, and his career ERA+ was 99 to Dreifort's 98. Even his breakout season was similar, with a 107 ERA+ to Dreifort's 105. That the Schmidt contract worked out far better than Dreifort's is beside the point; the Giants had no way to know that at the time. They simply had Dreifort's celebrated contract in their short-term memory, and did not hesitate to commit to Schmidt for the same duration anyway.

In reality, we can play a similar game with virtually every terrible free agent contract. Vince Coleman, for instance, signed a four-year, $11.95MM contract with the New York Mets prior to the 1991 season. He played in only 72 games during his first season in New York and saw his stolen base total drop from 77 to 37. Nevertheless, Otis Nixon, a speed-reliant player three years older than Coleman, signed with the Braves a year later for three years, $8.1MM.

That lesson didn't take a decade earlier, either. Speedy outfielder Dave Collins, fresh off of a 108 OPS+ age-28 season, signed a three-year, $2.475MM contract with the Yankees to help replace Reggie Jackson prior to the 1982 season. A year later, the Yankees dumped Collins (along with a package of players that included Fred McGriff) on the Blue Jays when he put up an OPS+ of 80 in New York. And yet, even as Collins was getting dumped, the Houston Astros signed Omar Moreno, an inferior player to Collins (also speed-reliant, and a year older than Collins when he signed) to a five-year, $3.5 million contract.

So forgive me if I don't believe that Jose Reyes will receive a lesser payday thanks to the struggles of Carl Crawford. As usual, Reyes' contract will be dictated by the market for players at his position and whether teams with money have a desire for Reyes, not owners and GMs mindful of recent comps that soured. If a team wants Reyes, that team will conclude this situation is different. It wouldn't particularly surprise me if that team even turned out to be the same one that signed Crawford.


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36 Comments on "Do Owners, GMs Learn From Bad Contracts?"


Isaac
3 years 11 months ago

No look at Theo

ZAK
ZAK
3 years 11 months ago

Oh but the glaring contract that’s having more negative effect than Crawford is that 126 mil man in San Francisco. With pitching that clearly eliminates the need for Zito. If they had that 18 mil extra this year (45 over the next 2 with a 7 mil buyout for 2014) for position players they might get taken seriously this year and last. 

tacko
3 years 11 months ago

Every big market team has their dead-weight contracts. The Yankees have Posada and  Soriano, the Sox have Lackey and Dice-K, the Mets have Bay, the Phillies have Lidge and Ibanez, and the list goes on. 

Giants fans should feel lucky their only BIG bust is Zito. 

Bled Orange
3 years 11 months ago

Dont forget rowand

Bled Orange
3 years 11 months ago

And it wasn’t as bad, but tajada for 6.5 mil are you kidding me

nostocksjustbonds
3 years 11 months ago

at least Tejada is only one year. The, 2/$22 to Huff isn’t looking so hot now either. But Zito and Rowand are the worst. I’m just glad they didn’t give 3 years to Juan Uribe.

Bled Orange
3 years 11 months ago

The zito contract feels like it has handcuffed the giants for a decade. Every year it just feels like were no closer to the end with that guy. It’s so fustrating. It’s rediculous when you are hoping your team throws your highest paid player so deep in the bullpen that you only have to see his face is in a blowout.

On the bright side sabean only signed one multi year deal even after wining the world series so maybe he is learning

dirtydez
3 years 11 months ago

No.  Cashman gave A-Rod 10 years/275 mil at 31 years old. 

Wek
3 years 11 months ago

Not Cashman. I dont understand why people like to bash on him. I dont like they guy but I dont hate him like some people do. The A-rod deal was done by Hank Steinbrenner. I believe Cashman even said he would not resign A-rod if he opted out.

Gator4444
3 years 11 months ago

To Hank’s defense they wouldn’t have won it all if he left.  But now his body is breaking down and he has 5 years left.  If the Yanks didn’t re-sign A-Rod in 07′  it would’ve been interesting if another team came even close to that offer.  My guess is not even close, Yanks got shafted by Boras on that one. 

Wek
3 years 11 months ago

I don’t have a problem with the signing, it is not my money after all but I don’t like when people bash Cashman (or anyone else) without even know the facts. And you cant really give all the credit to Boras, I mean it shouldn’t be hard to get a massive contract when you have a retarded owner willing to get pounded from behind.

fitz
3 years 11 months ago

I wonder if GM’s have noticed that not many of these 100+ million dollar deals usually play out well for their ball clubs. ..

MattCMoore
3 years 11 months ago

Yea, thats what ive been thinking…

East Coast Bias
3 years 11 months ago

Depends on your definition of “play out well” though, fitz. If you win a championship from it, even one championship, maybe it’s worth it. Owners and GMs know the player won’t produce what he’s being paid in the latter years, but they have to overpay to guarantee they sign the player during his prime years.

MetsFanXXIII
3 years 11 months ago

Crawford wouldn’t have gotten Crawford money if Werth hadn’t signed that insane deal in the first place. Obviously, as the better player at the time, Crawford had to top it.

melonis_rex
3 years 11 months ago

Not necessarily. Signing early can mean more money, and the factor of overvalued vs.undervalued skill sets and park factors.

See: the DH market.

MetsFanXXIII
3 years 11 months ago

I’m not sure what you’re saying really applies to this specific circumstance. Crawford was the best available outfielder, he could’ve signed whenever, it wasn’t going to hurt his value either way. Crawford was good, but I don’t think he became $142 million good until the market dictated that Werth was $126 million good. If you’ll remember, Crawford signed a few days after Werth. Clearly, the Werth deal was used as a barometer in negotiations. We knew heading in to the offseason that Crawford would get more than Werth, and a crazy deal for Jayson pretty much ensured a crazy one for Carl as well.

3 years 11 months ago

and also that’s why Werth wanted/needed to sign first. Knowing that there were teams who didn’t think they could land Crawford but could probably land Werth, it was essential to sign a deal first otherwise he would probably made significantly less than whatever Crawford would have made had Crawford signed first, ie 90 mil to Craw’s 110. The Nats were the ones to overextend themselves to keep the fans in the wake of Strasburg’s injury thus raising the market for Crawford and all other deals after that. 
Boras new this was the way to play it too. 

My problem is that each year you hear talk of how Gm’s are gonna cut back on large deals etc and then when the market opens up one of them blows their respective load right off the bat, souring the rest of the winter. Essentially it’s a game of jealousy. Each GM/Owner/Management team wants to get the best players they can. They have X amount of money they can/are willing to spend. When one domino falls, not in their favor, then they freak out and sign the Adam Dunn’s of the league.

3 years 11 months ago

they’re both going to make vernon wells look like a bargain

Lastings
3 years 11 months ago

Tony Reagins has never heard of a bad contract.

chico65
3 years 11 months ago

I’m as guilty as anyone else on here for raggin’ on Reagins, but isn’t it just a bit too easy?  It’s starting to lose its fun for me :( 

Lastings
3 years 11 months ago

Yeah, but you gotta make light of another Angels season where they have come up short. He is like the George Costanza of GMs. He does everything the opposite of what is considered “right.” Only the opposite has yet to work for Tony.

chico65
3 years 11 months ago

It’s like he thinks he’s in some Bizzaro world

Lookouts400
3 years 11 months ago

Soon to be former Orioles President of Baseball Operations Andy MacPhail says there is no such thing as a bad one year contract.  Someone above mentioned Tejada’s 6.5 mil, how about Vlad Guerrero’s eight million for this year?  If Lee had stayed in Baltimore, he likely would have ended up in the 25 HR range, with 75-90 RBI, not horrible, but Vlad is no where near that level, and of course, is strictly a DH.  The only thing going for him is that he is a Type B FA, so if they offer arbitration and he signs elsewhere, they’ll get a pick.  But will they take the chance on him accepting arbitration?

Then there’s two huge contracts coming up in the off-season, and both have definite possibilities of becoming bad contracts, Fielder and Pujuls.  They might be worth all that money in the short term, but both are expected to get at least six years, what will they be worth in years five or six?

BlueSkyLA
BlueSkyLA
3 years 11 months ago

The reason players get overly long contracts, beyond any reasonable expectation that they can still perform, is the huge inequity in spending power between the teams. The wealthy teams can afford to dump the last few years of a bad contract at a loss and move on to the next big contract. So I think the practical reality is, these so-called “bad contracts” only really matter to the teams with modest spending power. The wealthy teams are driving contract lengths.

johnsilver
3 years 11 months ago

I always was amazed way back that the Omar Moreno/otis Nixon type players who could do nothing but slap down at the ball, hope it found a hole, then if they got on base try to steal were so valuable back then.

Neither of them could throw, were terrific or anything CF even. Glorified Joey Gaithright types is it. Neijer Morgan types at best, yet back then, the Pirates and Braves thought they were great.

3 years 11 months ago

Dontrell Willis, $ 29 million, 3 years
Carlos Guillen, $ 48 million, 4 years
Gary Sheffield, $ 42 million, 3 years
Nate Robertson, $ 21 million, 3 years
Jeremy Bonderman, $ 40 million, 4 years
Pudge Rodriguez, $ 13 million option picked up
Magglio Ordonez, $ 18 million option vested, and a $ 10 million extension
Brandon Inge, $ 24 million, 4 years- and a $ 5.5 million extension
Kenny Rogers, $ 8 million extension
Todd Jones, $ 6 million extension
Over $ 72 million a year in “bad contracts”- and not a single new free agent player among them.   Looks like somebody learned his lesson.

kimofromkauai
3 years 11 months ago

Those that fail to learn from history, are doomed to repeat it. – Winston Churchill

BlueSkyLA
BlueSkyLA
3 years 11 months ago

Churchill’s misquote of Santayana. Anyhow, the premise of the question is a little strange. You might as well ask why people continue to invest in the stock markets even though they go down a lot of the time. You cannot win if you do not play. GMs understand the risks, which not the same thing as not taking the chance.

TheFreak2011
3 years 11 months ago

I think Crawford, with his .253, 11 Hr, 53 RBI totals so far has hurt the top free agents this winter.  People will be leery in this economy to offer any of the top guys, Fielder and Pujols, this kind of money.  Crawford’s been gawd awful for a $20 million a year player, decent for a $4 million a year player.

chico65
3 years 11 months ago

Yeah, that’s right, because the Sox were paying Crawford to hit HRs and be among the team leaders in RBI 

TheFreak2011
3 years 11 months ago

It was interesting to read his diary, apologizing for his terrible year.  He has 18 stolen bases, not very many when you consider Jacoby Ellsbury, who is hitting .319 with 28 HR, 98 RBI and has 37 stolen bases.  So, it begs the question, what is Ellsbury worth???  I’m sure Scott Boras won’t have any problem doing the comparison.

chico65
3 years 11 months ago

Luckily Ellsbury still has one more arbitration year.  Arbs love the counting stats, so I think his career SB totals and seasons of 70+ and 50+ will help alot.  I think 10 mil is in reach through arbitration, especially with a handful more each of HRs and RBIs and an MVP (or top 3 finish, which is a lock IMO).  He’s having the best leadoff season since Rickey was in his prime, so you know Boras is just salivating at the thought of when he does hit FA.  If he comes anywhere close to repeating it next season, I’d have to think 7 years, 160 mil minimum just to stay in the conversation.

3 years 11 months ago

Crawford is one of the most overrated players in the MLB. He didn’t deserve half the cash he was given by Boston. Crawford is nothing but a non-OBP speedy guy with a moderate amount of
power. He’s never been worth more than $8MM per, nevertheless $20MM+. The only difference in the degree of terrible that this deal is when compared to Alfonso Soriano’s contract is the fact that Crawford signed at a time when he was going into his 29 yo season, where Soriano signed going into his 31 yo season. I’d even rate this contract worse than the one given to Vernon Wells. At least Wells had shown true signs of being good enough to earn that kind of a salary. There was justification in giving Wells the massive contract, as he was looked upon as one of the absolute best players in the game all around. His example should have shone a massive light on the major risk at giving guys such long term, ridiculous deals.

I’m actually glad to see deals like this go sour. Maybe the GMs will take note and learn and finally begin reeling in the outrageous salary hikes. When a guys like Jorge de la Rosa get $10MM per, John Grabow gets nearly $5MM, John Buck gets $6M, and Miguel Cairo and Matt Diaz are making $2MM+ it shows that even the basic salaries are out of whack.

Only the truly elite players with excellent all around games and a reasonable amount of youth deserve such a contract. But they are beginning to be handed out a couple of times a year as if they are required to keep the MLB operating.

nostocksjustbonds
3 years 11 months ago

Some GMs are just bad at negotiation, particularly with upper tier free agents, though. Brian Sabean is a good example. He gets credit, for example, for signing Huff to a 1 year deal in 2010, but let’s not forget that was after he went after Nick Johnson and was turned down by Adam LaRoche on a multi year offer. He had to get somebody. Then he rewarded Huff with a stupid deal to keep him from going to the Dodgers. He matched the Dodgers’ offer to Uribe, only to be turned down. He got lucky there. 

Casor_Greener
3 years 11 months ago

So I guess the answer to the question is “NO”