This is an excellent FanPost. Bumped. ~Slow
Jim Bowden put an article on ESPN yesterday listing the top ten best contracts in baseball. It’s behind the insider pay wall, but apparently he listed Longoria third. Here’s his number one:
This got me thinking, is there any way that Cano’s contract could be more valuable than Longo’s?
Let’s start with where we are currently:
From 2008-2011 Cano was worth 16.6 WAR (he was terrible in 2008 with a WAR of 0.3). This means that the Yankees paid $30M for 16.6 WAR or $1.8M per WAR. That’s pretty good since free agents have cost around $4M per WAR to sign. Basically, if the Yankees had replaced Cano with an equivalent free agent, they would have had to pay around $66.4M. Based on his contract, Cano has provided a surplus value of $36.4M for the team.
Evan Longoria’s contract is 6 years (2008-2013)/17.5M plus three years of club options for 2014-2016 (7.5M, 11M, 11.5M). He also has some award bonuses (50K for all-star, 25K for GG, 2016 options could increase to 14M depending on MVP vote). From 2008-2011, Longoria has been worth 26.9 WAR while being paid $4M in salary. That comes out to 149K per WAR and also means that Longo has provided $107.6 in surplus value. However, there is still another $13.5M guaranteed. So let’s add that in to Longo’s contract too. That still comes to 650K per WAR with a surplus value of $90.1M.
So between the two, Longo has provided $53.7M more than Cano in surplus value. Is it even possible for Cano to make up that difference during their current contracts? Let’s lay out the most favorable scenario for Cano’s case. Let’s say that Longo suddenly becomes a replacement level player and produces 0 WAR for the next two seasons. We’ve already found that even in that scenario, Longo has still created a surplus value of $90.1M. So what it take for Cano to make up the difference in his two option years?
Cano’s Contract has two club options for 14M and 15M. The numbers above included a $2 buyout for 2012, so we’ll be sure to drop his salary by $2M to compensate. When the Yankees pick up his options, it will cost them another $27M which Cano will also have to make up. Because of inflation, I’m going to assume $5M per WAR going forward, rather than $4M. That means that to match Longo, he’d have to be worth $80.7M in two seasons or just over 8 WAR per season. As a comparison, Jose Bautista was worth 8.3 WAR last season.
So to match Longo’s surplus value, Cano would have to, roughly, double his performance (assuming that Longo would plays at a replacement level). But let’s make it even more favorable to Cano. Let’s say the Rays decided that, even though Longo has been replacement level in 2012 and 2013, they’re going to pick up his option anyway. Then in 2014, wouldn’t you know it, he’s plays at replacement level again. How would that change things? Well, that would still mean that Cano would have to be worth $76.2M in 2012-2013, which would be 7.6 WAR per season.
What if the Rays picked up the 2015 and 2016 options and Longoria still played at replacement level? In that case, Cano would still need to produce 5.4 WAR per season. Cano has played at that level during the last few seasons (4.2, 6.5, and 5.6) and he’s still only 29, so it’s not unrealistic that he could continue that trend. Finally, Longoria has a clause in his contract that ups the 2016 option by $2.5M depending on MVP rankings. So let’s say that Longo (while playing at a replacement level) meets that threshold for MVP votes somehow. Then Cano would only need to be worth 5.1 WAR each season. If I was walking down the street and someone asked me "Hey, do you think that Cano could produce around 10 WAR over the next two seasons?" I’d probably say yes, assuming no major injuries.
Let’s put this whole thing in perspective. In order for Cano’s contract to be more valuable than Longoria’s, Longoria would have to suddenly become a replacement level player, the Rays would have to decide that they want to keep that replacement level player on for another three years at a cost of $27M, and Cano still has to produce over 5 WAR for the next two seasons. So either Jim Bowden thinks very poorly of Longoria, or he can’t do math.