BOSTON -- John W. Henry cracks the cover of Bloomberg Businessweek’s “Success” issue, and in the course of Joshua Green’s terrific profile of the Red Sox majority owner, he makes the case that Henry has embraced the idea that “inexpensive players, not expensive ones, have become baseball’s prized commodity.”
That, of course, raises the question of how that philosophy will impact Boston’s willingness to retain prospective free agent Jon Lester.
In “Can’t Buy Much Love: Why Money Is Not Baseball’s Most Valuable Currency,” Martin Kleinbard arrives at a conclusion that mirrors Henry’s own thoughts about where the true value lies in baseball today. Kleinbard finds a weak correlation between payroll disparity and winning, arguing instead that “youth dominance” -- a team’s reliance on younger, cheaper players not yet eligible for free agency -- has become a much stronger predictor of success.
“To me, the most important thing this study shows is that virtually all of the underpaid players are under 30 and virtually all the overpaid players are over 30,” Henry says. “Yet teams continue to extravagantly overpay for players above the age of 30.”
And, in a later passage:
The scarcity of desirable free agents has sent the price of even middling players through the roof. “It’s gotten harder to spend money intelligently,” Henry concedes. This has shifted the premium in baseball toward drafting, developing, and extending future stars, which, since it can entail handing out multimillion-dollar extensions before players have fully proven themselves, adds a new dimension of risk. Henry says the Red Sox use as many as three “nonbaseball financial experts” to determine how much to spend on a particular player.
Red Sox general manager Ben Cherington also weighs in.
“There are fewer and fewer players getting to free agency, or even close, in their prime-age seasons,” says Cherington. “The average age of a free agent has continued to increase. It used to be 30. It’s now north of 32. That doesn’t seem like a big difference, but it’s actually a huge difference.”
Lester will be 31 in 2015, his first year of free-agency eligibility. The Red Sox this spring offered him a four-year deal in the neighborhood of $70 million; Lester and his agents, Sam and Seth Levinson, rejected that offer, and negotiations have been tabled until after the season.
The going rate for upper-tier starting pitchers has now exceeded an average annual value of $20 million a year, which, it appears, may fall within Henry’s notion of an extravagant overpay for a player over the age of 30. Especially when the Red Sox have a number of young, inexpensive arms that should be major-league ready by next season. Lester is a proven performer, and the Red Sox repeatedly have said they want to keep him, but the article seems to suggest that the Red Sox believe they will be better served betting on the young arms than overpaying for Lester.