On Long-Term Deals And The Boston Red Sox

The Megatrade Boston consummated with the Dodgers last year was a masterstroke by GM Ben Cherington. In one swoop he got rid of a quarter billion dollars in salary obligations, all to players in their 30s. In return, he recieved not one, not two, not even three, but four players who are young, promising, and cheap. Also they got James Loney who is none of those three things but his contract is now up so whatever.

The reaction to the deal was as far as I can tell is overwhelmingly positive. It seemed fans were as eager as the front office to hit the restart button on a team that wasn't performing. But in the rush to lionize the deal and condemn the departed players, there was some collateral damage: long-term contracts. The contracts the team had signed those now-L.A. Dodgers to were dubbed failures and with that, so were all long-term deals deemed undesirable. To cliche it up only two paragraphs in, I think that's throwing the baby out with the bathwater.

Like all contracts, long-term contracts are risks. The longer the contract the bigger the risk. But I'm not sure it's seen that way. There seems to be an idea that long-term deals are all bad and now after the Megatrade the Red Sox will avoid them. I don't think they are bad and I don't think the team should necessarily avoid them. Not all long-term deals turn out that badly, do they?

That's a fair question, actually. Are all long-term deals really bad? That's of course a ridiculously long-term and complicated question to answer and a bit out of my pay grade here at OTM. But, there is a lesser though I think just as pertinent question that I can try to answer, and that is, how have the Red Sox done when they've handed out long-term deals?

To find the answer, I looked back over the last decade of Red Sox signings. I tried to limit myself to this millennium when the free agent rules were roughly the same and the dollar figures weren't too antiquated and I could find specific information regarding the contracts signed. So the below covers roughly the late Duquette Era through Theo and now into Cherington's reign. For the purposes of my sanity I defined long-term deals as at least three years in length. I separated the contracts into three different categories, though really two plus Adrian Gonzalez: Free Agent Signings (signing a player who played for a different team the previous season), Contract Extensions (giving your own player to a longer term deal), and Somewhere In The Middle, which is Adrian Gonzalez's deal (a trade and an extension rolled up into one complicated ball).

Let's run through them quickly and then get to some conclusions. (I should note that this isn't scientific and I probably missed some.)

Free agency

• Daisuke Matsuzaka (6 years, $52 million)
  
• Julio Lugo (4 years, $36 million)
  
• Manny Ramirez (8 years, $160 million)
• John Lackey (5 years, $82.5 million)
• Johnny Damon (4 years, $31 million)
  
• Edgar Renteria (4 years, $40 million)
• Matt Clement (3 years, $25.5 million)
• Carl Crawford (7 years, $142 million)
• J.D. Drew (5 years, $70 million)

Notes: By my count the Red Sox have given three years or more to nine different free agents since roughly 2003. The hit-rate is slightly below 50 percent. Clement got hurt so you can give them a pass for that if you like, though injury is one of the risks of a long-term deal. The Manny deal worked out perfectly (I know the end wasn't ideal but two World Series championships? I'll take it). The Damon contract worked out well, too. The Drew contract had it's ups and downs, but I think was mostly worth it, though I can see an argument that it wasn't. The Lugo, Lackey, and Renteria deals were (or are) disasters. The Sox were able to off-load Renteria after just one season and Lugo got shuttled off to, what? Baltimore? Doesn't matter. The point is, on these deals, the rate of success isn't particularly high.

Yet, the Sox actually did alright on the bigger money deals. The Manny deal you'd have to do again. The guy was the best hitter in baseball for half a decade. The Drew contract seems unlucky in retrospect. Drew was beat up and or focused on his very sick child which cut into his productivity. Damon returned value for money and Matsuzaka actually came close in terms of pure value (via Fan Graphs) (not counting the $52 million they spent to sign the guy).

So, OK, it seems like it's not the most successful area for the Red Sox here, but not a barren wasteland either. Let's look at the extensions.

Extensions:

• Josh Beckett (4 years, $68 million)
  
• David Ortiz (4 years, $52 million)
• Pedro Martinez (6 years, $75 million (with team option for 7th season at $17, which was exercised)
  
• Dustin Pedrioa (6 years, $40 million)
• Clay Buchholz (4 years, $30 million)
  
• Jon Lester (5 years, $30 million)
  
• Kevin Youkilis (4 years, $41.25 million)
• Mike Lowell (3 years, $37.5 million)
• Curt Schilling (3 years, $40 million with a $13 million option which as picked up)
  
• Jason Varitek (5 years, $50 million)
• Trot Nixon (3 years, $19.5 million)
• Tim Wakefield ($4 million 'rolling' extension (That is, every time the Red Sox picked up his option it triggered another available option at the same price next season. The effect was the Red Sox could keep him for $4 million every year as long as they wanted to.)
  
• Coco Crisp (3 years, $15.5 million)

Notes: This is a decidedly better bunch. In fact, it's hard to find a real miss here. The Lowell deal ended badly, but that was only the last season (he had an .811 OPS the year before that). People lamented the Varitek deal when it was signed, but it worked out just fine. Pedro and Ortiz alone are worth the price of admission into this club. The one you could maybe quarrel with is the Beckett extension. These extensions kept productive players in Red Sox uniforms at reasonable or better salaries. Overall, you'd have to give this group a pretty high grade.

In the middle:

• Adrian Gonzalez (7 years, $154 million)

Notes: We won't get a chance to see the Gonzalez deal come to fruition, but it was the kind of deal that we were touting up until he was traded. Without getting into the whole thing, I'd say the contract is a fair one and were it in the Free Agent category above it would probably be one of the better moves the club made. Though maybe that's damning with faint praise.

Conclusion: The list of the biggest contracts in baseball history only includes one Red Sox player in the top 10 in Manny Ramirez. Adrian Gonzalez's contract is number 13 and Carl Crawford is 16, though those could change after this year's free agency. So, for a team perceived to be one of baseball's biggest spenders, having only three of the twenty biggest deals isn't particularly reckless.

I'm not sure there is a take-home point here. The extensions were far better on the whole than the free agent signings, so maybe that means the team should focus on holding on to it's own rather than going out on the market. I don't know. Maybe it doesn't meany anything at all. The sample is small and we're talking about three different GMs.

I went into this hoping to prove that long-term contracts aren't always a bad idea. I'm not sure I did. In fact, I know I didn't. That's because sometimes they are a bad idea. But sometimes they aren't. You see, it isn't the contract that is the real problem, it's who you give that contract to. That's what makes the real difference. Maybe that was the point I should have been trying to make all along.