Mar
10

Buying out A-Rod

By

Late last week, word spread that the Giants would “consider” buying Barry Zito out of the final three years and $64.5M left on his contract. It all turned out to be nothing but speculation, and the team has repeatedly denied the report. It doesn’t make a lick of sense for them either; Zito’s overpaid but not useless. Guys that you can pencil in for at least 180 IP with a FIP in the mid-4.00′s have value, especially when your rotation is a bunch of 20-somethings coming off career high workloads following a World Series run. Anyway, hearing that stuff made me think about the Yankees’ own albatross contract, the one belonging to Alex Rodriguez.

My bank is that-a-way. (AP Photo/David Goldman)

As many of you may know, I’m also a pretty big hockey fan, and unlike MLB, the NHL has a system in place that allows a team to buy out a player’s contract. It’s complicated and I won’t bore you with the gory details, but the general idea is that the player gets two-thirds of the money spread out over twice the years. There’s salary cap ramifications and all that, plus the actual year-to-year distribution of the cash is a little tricky, but the general idea is two-thirds the money, twice the years. If you want to read more about the process, check out the Understanding The Cap page at Blue Seat Blogs.

I wanted to have a little fun, so I applied the NHL buyout rules to the remainder of Alex Rodriguez’s contract. We’re a little too late in the game to buy out the 2011 season, so let’s just assume that this would occur next offseason. At that point, Alex will have six years and $143M left on his deal (yikes), so we’re converting it to 12 years and $95.3M. Here’s the breakdown of the annual payouts and savings, so make sure you click the graph for a larger view…

If the Yankees were to buy out Alex as per the NHL rules in my completely hypothetical situation, it would clearly be a trade of long-term pain for short-term gain. The team would save upwards of $20M in both 2012 and 2013, plus another $14M in 2014 before single-digit savings in each of the next three seasons. That brings us to when the contract is supposed to expire, but per the terms of the buyout, the Yankees would still have to pay A-Rod close to $8M a year for the next six seasons. That’s chump change for the Yanks, but $8M is still $8M.

So with Alex bought out, what would the Yankees do at the hot corner? I suppose they could always give Brandon Laird a shot, but that’s pretty much it for the in-house candidates. There aren’t many third baseman on the free agent market next offseason, with Bill Hall representing the only option that jumps out as affordable and reasonably productive. The Yankees aren’t going to buy out A-Rod only to sign Aramis Ramirez (another older and declining third baseman) to a big contract, so that rules him out.

The smart move would probably involve sliding Derek Jeter over to third and finding a new shortstop. That would open the door for Jose Reyes or J.J. Hardy, two guys scheduled to hit the open market after the season. The end result would be a younger team, certainly, but probably one lacking a big bat in the middle of the lineup, something A-Rod still provides at his age.

Would I do it? Eh, probably not. I guess it really depends on how Alex looks in 2011. If he has a big rebound year, say .290/.380/.530 with 35 homers or so, then I’d keep him. If he continues his slide and puts up something like .250/.335/.475 with 25 homers, I’d probably buy him out and take the savings. What about you?

Would you buy out A-Rod per the terms above?
Total Votes: 1051 Started: March 9, 2011 Back to Vote Screen
Categories : Whimsy

56 Comments»

  1. Will says:

    Let’s just go with “No” and cease all further comment.

    (Sheesh.)

  2. camilo Gerardo says:

    Would rather buy out Jeter, jaja

    • Gonzo says:

      Don’t all bash me at once, but here’s your head explodes moment.

      Jeter has out-fWAR’d A-Rod the past 2 years by 1.2 fWAR!

      A-Rod has out-fWAR’d Jeter by 1.1 if you go back 3 years.

      #arbitraryendpoints

      • bexarama says:

        Don’t all bash me at once, but here’s your head explodes moment.
        Jeter has out-fWAR’d A-Rod the past 2 years by 1.2 fWAR!

        That’s not really that surprising, considering Jeter’s monster 2009 and the fact that A-Rod missed a significant chunk of time that year.

  3. Accent Shallow says:

    No.

    I would only start to consider it a few years down the road, since he’s likely to remain a very productive player for longer than most people (such as Jeter)

  4. RL says:

    Wow, this is a really tough call. Since the yearly payout goes down, if Alex puts up somewhat pedestrian years by his standards (.265, .350, .490 with 25-30HRs) beginning in 2013 or so, there’s probably no reason to talk about this. There will be adequate room at DH. I can’t see him remaining in the field into the 2014 season. If he falls off a cliff this year,then I’d probably have to consider it.

    Then again, this is purely hypothetical. These rules don’t exist in baseball!

  5. Tripp says:

    Who would replace him? Brandon Laird…

    • Fair Weather Freddy says:

      Can Nunez play third?

      • Monteroisdinero says:

        of course he can. He can play outfield too and he is 23. A good cheap player to have on the roster. He can also hit a homer every now and then.

        • bexarama says:

          His main benefit is that he’s cheap, and “we will put you in the OF for a game in Spring Training” does not mean he can play the OF.

          • JAG says:

            Agreed. Technically, anyone CAN play the OF. It’s a question of whether he can play it well or not, which nobody really knows because Nunez has never done that.

          • Monteroisdinero says:

            gotta start sometime. He will play a decent OF. This is my opinion and you are entitled to yours. He has speed, a good arm. Not as good as Golsons though. Golson had a tremendous throw on the fly from CF monday night to cut a runner down trying to score from second on a single.

            Nobody likes Nunez around here but I do.

  6. A.D. says:

    Would be interesting how all the HR bonuses would be handled since that’s a big potential swing.

  7. Slugger27 says:

    So if this chart is accurate, we are deciding between paying arod 143M over 6 years to play for us and paying him 116M over 12 years to not play for us? There HAS to be something im not understanding

    Also, 2/3 of 143 would be 95, right? Even ignoring the chart and going with that, I don’t see how it makes sense

    • 24fan says:

      This.

      It comes down to is Arod worth 27M over those 6 years according to the chart (barring major injury of course he is). Even by the other numbers, is Arod, who will be chasing Bonds, worth 48M over those 6 years? Again, he almost certainly will be, even if a big chuck of that value needs to come from the HR record chase.

      • Mike says:

        The difference is time value of money. 8 million in 2023 is worth 5 or 6 million today. There is also separate inflation in the baseball market that could make that less. I don’t know how to predict that, though.

        I would still keep him. He’s still an integral part of a team that will be competing for a championship over at least the next few years of the contract.

        • 24fan says:

          True, however if they buy out Arod they aren’t pocketing that money, they are going to have to put that saved 48M into his replacement. So in this case, I don’t think the time value of money becomes a factor.

        • Urban says:

          As a fan, I’m not worried about Accounting 101.

          Keep him.

  8. Anchen says:

    Jeter to third sounds bad defensively to me. Isn’t the whole reason Jeter has bad range is he is a bit slow on reading the ball/takes a bad first step? Cause that is the majority of the plays a third basemen makes. The quicker reaction would give jeter less time to try to make up some distance with his athleticism I assume, but I might be wrong.

  9. Angryankee says:

    Your analysis doesn’t factor the cost of a suitable replacement. Buy me out instead…

  10. Like the weather... says:

    trying to forecast future performance in sports is part science and part hypothetical speculation, perhaps more the latter and less the former. We won’t know how Arod will play until plays. Yes, he is getting older, yes, physical ability declines with age, and yes, his contract guarantees him an obnoxious amount of money. Does his fame, the likelihood of breaking 700 home runs, and the possibility of him eclipsing Bonds for all time home run king justify the money? I don’t know. The point is he is a productive hitter and an excellent third baseman, and, baseball being an entertainment business, he draws fans to games and sells memorabilia. I think over the life of his contract, however Arod is paid, the Yanks will earn a tidy profit on their investment.

  11. Monteroisdinero says:

    Jeter at 6 years 34M (give or take) buyout would have some appeal.

    More important to line up a “new” Cameron Diaz every year x6. The stats will take care of themselves.

  12. PaulF says:

    A buyout only makes sense if you don’t think Arod can produce 10 WAR in the last six years of his deal. That shouldn’t be a problem for him.

  13. YankeesJunkie says:

    One of the factors that actually goes in A-Rod’s favor is the inflation for one WAR. When he signed the contract after 07′ 1 WAR=4 million and now that it close to five. This means if A-Rod can somehow put up a 6 WAR season (in the realm of possibilities) he will be worth his salary.

  14. throwstrikes says:

    Playing a player who can no longer do the job not paying a player who can no longer do the job is the only way the contract becomes an albatross.

    For the Yankees, the money is easier to make than the plays.

  15. Gonzo says:

    Too soon. I would revisit in a year or two. I wouldn’t HATE the contract so much if it was 2 years shorter.

  16. MannyGeee says:

    First thing: I would not buy out A-Rod until he is really no good. Lets say if he has 3 useful years left, I would buy him out in 2014 at $47.65M. Axisa is right, 2011/2012 A-Rod still has value.

    Second Thing: Imagine all the contracts we woulda bought out if this rule was in effect in the past decade?

    Yeah, Giambi and Pavano would still be on the books…

  17. A-rod#1fan says:

    Noooooo never

  18. John says:

    Could he then go play for someone else? That might be the most painful thing of all.

  19. aluis says:

    Slow day at RAB? Must be becuase this was assinine!

  20. Guest says:

    Paying A-Rod two thirds of his salary (albeit over a longer period of time) while having to pay someone else to play the position AND he could be playing somewhere else? No dice. Plus, I think there is a fair shot that rumors of his decline may be greatly exaggerrated.

    While A-Rod’s numbers the last few years LOOKED like your protoypical age related decline, perhaps they were actually nothing of the sort. Perhaps it was all about the hip injury and nothing but the hip injury. A-Rod has always generated his power (and neutralized the inside fastball) by generating great torque in his lower half and clearing his hips quickly. He simply could not do this in ’08-’10 at the same level he did before.

    As for age: A-Rod, for his entire career, has been an outlier. Like Hank Aaron, like Ted Williams, like Mariano Rivera. These other outliers hit their primes early and stayed in them long after last call. Elite outliers have historically defied expectations of age related decline longer than their peers, and A-Rod is undoubtedly an elite outlier. In addition, A-Rod has been known to be obsessive about training and keeping himself in shape since he was pre-pubescent. Guys like that are also able to fight off the effects of aging better than others (see Vizquel, Omar and Moyer, Jamie). A-Rod is a card carrying member of the both groups of baseball players that tend to age more like wine than like keg beer (see Vaughn, Mo).

    Now, A-Rod says the hip is healed, everyone sees more flexibility in his swing, more fluidity in his movements, and he’s in his best baseball shape since…oh…what’s the year everyone’s been saying? Right, 2007 (aka one of the three best seasons of his magnificent career).

    This is a long winded way of saying don’t let A-Rods age over the last three years obscure the other factors that went into his subpar (for him) performance. I admit that I may be wrong and the age was indeed the overwhelming factor (including in his getting the hip injury in the first place). But if I’m right that it was primarily the hip, and Phillibon, A-Rod, Long, etc. are right that the hip is all good now: watch out.

    For hardwork outlying elites like A-Rod, age ain’t nuthin’ but a number.

    • Guest says:

      To amend my statement slightly, age ain’t nuthin but a number until the early forties, and then all bets are off.

      My main point still holds, I think there is a fair shot we might get five more elite years from A-Rod and a couple more good ones after that.

      Williams, Musial, Aaron 36-39= damn amazing. (And Williams and Musial each had one or two amazing seasons 40-42…Aaron not so much).

  21. steven says:

    i dont want to buy him out now but in 2 or 3 years i would do it

  22. bobmac says:

    Slow news day,eh.

  23. Jonathan says:

    I’m not sure what the rules are, but could you just resign him to a smaller deal?

  24. Dave mincer says:

    Paying him 2/3 salary ($18mil) to play somewhere else v. Paying him full salary ($27 mil) to play in NY is really saying would you pay him $9 mil/yr to play for NYY? Of course you would. Not just this yr or next but for the length of his contract. I can’t believe this is even a debate. Furthermore, watch Alex hit 40+ HR this year with his

  25. XX XX says:

    Mike
    You are an idiot and thankfully I never will read anything else you write. You give bloggers a bad name.

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