August 11, 2009

Prospectus Today

Blame it on Rios?

by Joe Sheehan

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"We'd rather have the money."

That's what the Toronto Blue Jays decided this week, looking at Alex Rios on the one hand, and about $61 million on the other. They decided that they would rather have the cash, and they preferred the cash so much that they didn't even need to get a prospect or a player or so much as a thank-you card in exchange for Rios. They simply let him be claimed on waivers by the Chicago White Sox, and just like that, they executed the largest salary dump in baseball history.

The seven-year, $69 million contract Rios signed back in April of 2008 looks ridiculous now, of course. He's been durable and good defensively since that point, but he just hasn't hit: .280/.328/.447 with just 72 unintentional walks in 1162 plate appearances. While that kind of production is acceptable for a corner outfielder who plays plus defense, it represents Rios' line for his age-27 and age-28 seasons, and is far below what the Jays expected when they signed him to the contract coming off his best season in 2007. In that year, Rios played in 161 games and hit .297/.354/.498. It was the second straight year in which he'd hit for both average and power, following some early-career issues with getting the ball in the air. His walk rate and K/BB had improved for the second straight season. He looked like a player coming into his peak with developing skills to match his impressive tools.

It wasn't unreasonable, 16 months ago, to regard Rios as good enough to be a core player on a championship-caliber team. There was the issue of his value to the Blue Jays, who with Vernon Wells' contract in center field wouldn't play Rios at the position where he'd be worth the most to them. There was his already being signed for 2008, although a back-loaded long-term deal made that a non-issue-his salary actually fell significantly that year. There was, and this may be most important, Rios' advanced age; the Jays were signing him not for his early peak through late peak, but for his entire peak on into his decline. That Rios was 27 on the day the deal was signed limited the upside he could provide during it. Even at that, the clear improvement in his skills from 2005 through 2007 gave the deal an echo of the John Hart-era Indians, where a team was investing in its future by locking up its homegrown players to long-term deals.

Unfortunately, Rios stopped developing. He went back to walking less and striking out more, not radically so, but enough to alter the value of a player who had marginal rates in those categories to begin with. He went back to hitting the ball on the ground, again not as much as he used to, but enough to make him a less-valuable batter. The problem with his 2006 and 2007 weren't the seasons themselves, but that he had no room for error off of them. Any regression-and regression is always a possibility-would cripple his value. When Rios went back to walking 40 times a year (instead of 55) and hitting ground balls 41 percent of the time (versus 37 percent), it was enough to turn a fledgling star into a disappointment-but one now being paid at a very high rate of pay.

In retrospect, we also know where the market for corner outfielders went. Had the Jays waited a year, they would not only have been signing a less-impressive version of Rios, but they would have had the backdrop of Adam Dunn and Bobby Abreu and Manny Ramirez struggling to find suitors in their favor, as opposed to the silly market that made Jose Guillen a very wealthy man. You can't blame J.P. Ricciardi for not seeing that developing 16 months ago.

What you can blame Ricciardi for is the one flaw that crops up time and again in his tenure: his uncanny ability to pay for a player at the absolute peak of his market value. He signed Rios when he was coming off of the best year of his career, which followed his second-best. The appalling Wells extension happened after 2006, which was just the second year in his career that Vernon Wells was a star. As Keith Law points out at ESPN.com, Ricciardi has repeatedly made bad financial decisions, both on players in-house such as Rios and Wells and on free agents like Corey Koskie and B.J. Ryan. Ricciardi signs players coming off of huge years, and contracts such as those have nothing to do but turn out as overpays. Ricciardi is never the guy signing Frank Thomas to a one-year, make-good deal and watching him become an MVP candidate; he's the guy who signs Thomas for $18 million a year later and hopes he does it twice.

It's not like Ricciardi is the only GM in baseball history to have this flaw. The fundamental error in the free-agent market, going back 30 years, is paying players for the year they just had as if it represents their level of performance going forward, when even a cursory look at the evidence will tell you otherwise. Rios, Wells, Ryan, and Burnett were all cases of signing a player coming off of a career year and mistaking that career year for something more. Exacerbating the problem is that Ricciardi, whether through necessity or preference, backloaded his biggest deals, so that three-quarters of Wells' money gets paid in the last four years of the deal, and 70 percent of Rios' deal is paid in the last four years; Ryan also got (and will get) most of his money on the back end. The further from the player's peak you get, the more money the Blue Jays owe them. That's a problem in the best of circumstances and it's a disaster when the players aren't good enough to earn their salaries.

Alex Rios is a decent baseball player, largely because he's a terrific defensive right fielder and would be a good center fielder. He doesn't draw enough walks or hit the ball in the air enough to fully capitalize on his talents, and because of this, he falls short of being a superstar. His contract, signed at the apex of his perceived value, only makes sense if he performs at the level at which he peaked, and few players sustain that kind of work. The Blue Jays will be rebuilding to one extent or another, and are better off for the $61 million that they'll save and for now being able to get both Adam Lind and Travis Snider into the lineup simultaneously. The White Sox threw them a rope this time; however, it's high time J.P. Ricciardi stopped doing things that require him to be rescued.

Joe Sheehan is an author of Baseball Prospectus. 
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