Compare two small-market organizations:
The Pittsburgh Pirates renewed Gerrit Cole -- as is their right for a pre-arbitration player -- but gave the 18-game winner a $541,000 contract, the same amount he earned last season (which included a $10,000 bonus for making the All-Star team). Most teams in that situation would have at least given a small reward for such a terrific season, offering a $100,000 or $150,000 raise. Cole wasn't happy.
Back in the spring of 2012, after Salvador Perez had played just 39 games in the majors, the Kansas City Royals signed their young catcher to a five-year, $7 million contract, with club options for 2017, 2018 and 2019. It proved, of course, to be one of the best contracts in the game. Perez was set to make just $14.75 million over those three seasons. The Royals just tore up those three club options and signed Perez to a new deal that will pay him $52.5 million over the five seasons from 2017 to 2021.
The Royals were under no obligation to rework their contract with Perez. Hey, it's just business. They took a chance on a young player -- although a $7 million investment was hardly much of a risk -- and reaped the benefits. Perez could have bet on himself and gone year by year but instead signed what turned out to be a below-market, but guaranteed, contract. The Pirates seemed unconcerned about rewarding their player, over a trifle sum of money in today's game. Perez, a three-time All-Star, will make "just" $2 million in 2016; the Royals made sure to reward their player and keep him happy.
Maybe it doesn't matter. I doubt Cole's contract will affect his performance in 2016, though John Smoltz talked on Monday about how he had won 14 games for an awful Braves team in 1990 and had expected a bigger raise for 1991. He didn't get it and he posted a 5.16 ERA in the first half; he said the contract had bothered him.
From a business standpoint, the smart move for the Royals would have been to let the contract play out. Perez will be 29 at the end of it, and considering his heavy workload -- he's started 137 and 143 games the past two seasons plus 31 games in the playoffs -- it will be interesting to see how he ages into his 30s. Plus, his free-swinging approach at the plate has to cut into his offensive value. After hitting .301/.331/.451 from 2011 to 2013, he's hit .260/.285/.414 the past two seasons. He had 4.1 WAR in 2013 but was down to 2.2 in 2015.
That's still a good player and perhaps underestimates Perez's handling of the pitching, not to mention his intangibles off the field. Even with a sub-.300 OBP, giving Perez $10 million a year is still a relative bargain for the Royals, assuming he maintains his durability.
Most importantly, it keeps Perez happy. And it tells other Royals -- Eric Hosmer, Mike Moustakas, Lorenzo Cain -- that the organization is about winning now and into the future. Whether the Royals can afford to keep all those guys together as they hit free agency is an unknown, but if they're willing to stay around for below market rates, maybe that can happen.
Meanwhile, when Gerrit Cole hits free agency down the road, what do you think his mindset will be?