The Red Sox Financial Picture

Last year, Matt Clement was signed to a 3-year deal worth $25.5 million. Edgar Renteria was worth 4 years and $40 million. Without question, Matt Clement (and to a lesser extent, Edgar Renteria) would have fetched a lot more on the open market today than a year ago. If Esteban Loaiza can get 3 years and $21 million this year … if Scott Eyre can get 2 years and $11 million … if Kyle Farnsworth can get 3 years and $17 million … then Matt Clement could have gotten at least $30 million over 3 years this off-season.
Matt Clement’s contract isn’t so outrageous now, is it? Clement was our ace pre-All Star break and fell off massively in the second-half but still finished 13-6 with a 4.57 ERA. Contrast that with Esteban Loaiza, who just signed a contract with the Athletics. He went 12-10 with a 3.77 ERA in a pitcher’s park and returns to the AL, from whence he left in disgrace a year ago. I’d have to say that Clement would have easily outpaced Loaiza in terms of money this year if he was a free agent.
It makes me wonder if the Red Sox knew that the market was going to fluctuate like this this impending year, so while they filled holes, they filled it quickly, with prices that seemed exorbitant last year but are actually quite reasonable this year. There certainly were warning signs that there was to be an economic boom. Not only has revenue sharing worked so effectively that mid-market teams were starting to turn good profits, but the fluctuation was heading back to fiscal insanity after a peroid of fiscal sanity.
The luxury tax in 2006 also only applies to the Yankees and Red Sox. There was a little loophole put in the Collective Bargaining Agreement when it was struck that said that in the final year of the CBA (2006) if a team did not go over the threshold in 2005, they could go over the limit in 2006 but not be charged a tax. This is why you see the Mets spending so aggressively (and will likely supplant the Red Sox as the #2 payroll shortly) … because they’ve no tax to be paid. There’s also talks they may roll the CBA over another year if the new talks don’t do anything (which is in the current language) … if that’s true and the Red Sox stay under the luxury tax threshold in 2006, they have free rein to do what they want in 2007 with no tax effects.
The relief pitching salary demands are spiraling out of control, and starting pitching has had some questionable signings. There’s already been big-money contracts signed for position players, with Damon demanding seven years. (I still can’t get over this. What a dream!) Money is certainly being tossed about. It’s possible it might continue this way, as revenue sharing will still be in gear. Eventually we’ll return to normalcy, but with the thin free agent market this year, I truly shudder to think about what a deep free agent class would fetch. I don’t believe the argument about the price being raised for free agents because it’s a thin market – even if it’s thin, you should strictly set guidelines for how high you will go. So far, teams are blowing past that threshold.
It’s also another important reason why the Red Sox made out like bandits with the Beckett trade. Let’s get something out of the way first. Beckett can be the next Pedro, or can continue being plagued by blister problems and make only 20 starts. Lowell may never return to his offensive form (or may only see a slight bounce because of the Green Monster) and Mota may be the 2005 version, not 2003 version. One irrefutable fact is this, though: This trade made them instantly better for 2005. And they did it knowing that contracts were spiraling out of control. With Mota’s promise, who doesn’t mind his pricetag (will be around $2-3 million)? Beckett’s still ridiculously cheap, and would command about $70 million on the open market. Lowell’s contract, while still hefty, doesn’t look all that hefty anymore.
We still need to find a shortstop, and all accounts point to Alex Gonzalez being that man. If we resign Johnny Damon and keep Manny Ramirez (the latter which seems extremely likely) then we can afford the dropoff Gonzalez would afford us. Stick him in the nine spot. Gonzalez is a lot like Mirabelli – low average, okay OBP, good power. We can use him at short for a year and have Pedroia and Cora back up the infield. If Gonzalez struggles while Pedroia succeeds, then let Pedroia play. The only question left is Andy Marte and Mike Lowell. Marte may need Tommy John surgery, so the Red Sox may decide to have him have the surgery now rather than later, which would solve that conundrom. If not, Marte would roam left, third, and first. The only problem is that Marte is averse to moving off third, but promises of a future job may solve that. It may also behoove us to not make a move for a firstbaseman and let Youkilis, Marte, and Lowell split these duties.
The only thing I don’t like about all of this is that this makes Youkilis, Marte, and Lowell all bouncing all over the place – never being able to “settle” in which may wear on them offensively as well. The Red Sox have been quiet as of late, so I’m hoping they’re working on creating a better picture as to what the 2006 lineup will look like. Meanwhile, they’re trying to get an extra arm for the bullpen, and have offered former Sox Rudy Seanez an incentive-laden one-year deal. However, the way the relief market is going, Seanez is likely to get two years. If we sign Seanez, hopefully that means Bradford is packaged. Don’t get me wrong, I like Chad Bradford, but Seanez is an upgrade over Bradford.
Our financial picture seems in better shape with the Renteria trade. Manny’s contract is off the books after three years, and we’re getting younger. As our financial picture improve and our young players develop, we’ll see the Renteria and eventual Manny savings put back into the younger players. Our payroll is not likely to move downward significantly at all these upcoming years, but they will be reinvested in the younger players that can contribute. Our moves this season have signalled that we are starting to see a new era in Boston. It may cost the same, but it’s going to be a different era.
A question for the readers. What team should Nomar Garciaparra sign with? The Yankees, Indians, Astros, or Dodgers? Personally, I like the Indians here. He’d get more at-bats because he could switch between 1B, SS, 3B, LF, RF, and DH – which he can’t do in the NL. In addition, his value is higher as a RF than it is a 1B on the free agent market, and the Yankees want him as a 1B. He’d get more at-bats as an Indian than a Yankee, and the quiet midwestern team suits his private personality more than the famed New York media.