An inevitable flash point of a broken hot stove

Keith Allison / Flickr

The Manny Machado front flared up on Wednesday under the tension of reporting news without … well, news.

The situation remains what it’s been: Some reporters say the White Sox are low-balling Machado yet winning (seven years, $175 million). Some reporters say the top offer is at least eight years and $200 million, and can go higher.

It just so happened on Wednesday that the ones reporting the lower figure had the floor, and Machado’s agent Dan Lozano decided to put his foot down with an extraordinary screed:

For those that can’t access the tweet to make the text larger, the gist is that Lozano called out Bob Nightengale and Buster Olney for carrying water for teams, and raised the question as to whether the clubs are “blatantly violating the collective bargaining agreement by intentionally misleading them to try and affect negotiations through the public.”

Of course there’s undeserved self-righteousness in play. Lozano and other agents had benefited from the same rumor mill previous seasons, so he’s effectively letting everybody know the horse has left the barn well after cashing in a few trifectas.

But it’s good symbolism, if nothing else. The hot stove season used to be fun because of the leaks, with both sides giving and getting a little before finding a compromise over a few weeks. Lozano’s thesis is the result of one side getting a little too into it after realizing the CBA didn’t codify a safe word.

When weeks turn into months, the process is as productive as trench warfare and half as fun. I suppose the lack of action over such well-regarded players is indeed newsworthy, but what’s news without progress?

That’s what some writers are wrestling with. Henry Schulman of the San Francisco Chronicle used a power outage for a tweet thread calling this reporting of non-news the “logical continuation of a trend that I absolutely hate.” Using the Giants as an example, Schulman says the prevalence of leaks is so high that the lack of them is seen as inaction, even though a lot of moves end up as public knowledge only after they’re complete, with the team a complete surprise.

On the analyst front, Jonah Keri has turned his annual “worst contracts” column into the “Get-Paid All-Stars,” because “looking at every deal through the prism of saving billionaire owners a few million dollars stops making sense when players aren’t getting their fair share.” As you might guess, the White Sox have no entries.

And at Baseball Prospectus, Patrick Dubuque makes the case of ditching the idea of breaking down deals in terms of dollars per WAR, calling it a byproduct of the pre-luxury tax, David-Goliath era when smaller markets really needed to make every dollar count. He even goes a little further, wondering if it’s ethical to report or ponder contract values when the rest of baseball’s financial picture is so incomplete.

It seems that we’re unable, in the public discourse, to extricate the trivial details of player salaries from the connotations that come with them. If that’s the case, then, can we ever accept a specific and limited budget by which to apply that salary as a useful detail?

I don’t think it’s possible. The financial equation of baseball was once fairly simple: teams made money by selling tickets, and sold tickets by fielding good baseball players. Buying the rights to stars, or after 1975, signing them, was a simple investment calculation: will he be worth it? Now there are television deals, MLB Advanced Media, concessions and merchandising and jersey sales and suites and foreign markets and subsidiaries. Ticket sales are only loosely tied to revenue. Even with open books, baseball teams could lose money while still making their owners (who own the local TV network) wealthy.

I’d love to be on the side of ignoring it, except it just so happens to directly involve the White Sox. And not only does it involve the White Sox, but signing Machado would be the most momentous personnel decision they’ve ever made by far, even at the depressed/suppressed prices. Should it come to fruition, it’ll warrant its own chapter in the franchise’s history book, and so it’s necessary to document the push and pull.

But yes, these nine-figure deals are supposed to be a little more exciting. The Cubs officially signed Jon Lester on Dec. 15, 2014, and unofficially on Dec. 10. They signed Jayson Heyward on Dec. 15, 2014, and unofficially on Dec. 11. They landed them because they offered them the combination of the most favorable contract terms and encouraging situations, but it was all handled expediently enough to downplay the business aspects in service of winning some games.

With Machado and the White Sox, it’s now Jan. 17, and all we get is one side screaming at the other over the finer points of negotiation etiquette. Have you bought your SoxFest tickets yet?

If they end up together, it’s with the hopes that resignation won’t hang heavy over the proceedings. Then again, such a development falls in line with the rebuild’s delayed gratification, starting with the stunted debuts of Yoan Moncada and Lucas Giolito, and continuing with the manipulation of Eloy Jimenez’s service time. None of it is fun when at least a little of it is supposed to be, even accounting for the rebuild. The entertainment business indeed involves both words, but when the latter is so heavily prioritized over the former, it’s natural for those invested in it to start asking for earning reports. Those aren’t fun either, but at least one can actually learn something along the way.

Author

  • Jim Margalus

    Writing about the White Sox for a 16th season, first here, then at South Side Sox, and now here again. Let’s talk curling.

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Marty34

Crazy stuff. My latest take is they’ll take Machado at their price, but Harper is the primary target. Manny is just going to have to wait.

soxfanpa

On a more fundamental, what does this CBA violation actually look like? Would there be some sort of recourse if this turns out actually hurting Machado or the White Sox, and what would it look like?

karkovice squad

It would look like the previous collusion settlements.

gibby32

I am hoping that Jimenez is on the Opening Day roster keeping the White Sox in actual compliance with the CBA.

yinkadoubledare

If there was any idea of that happening, they’d have brought him up in August/September. If they took the heat for not bringing him up in August/September, they aren’t going to quit on it now, they’ll finish the job and put him on the Kris Bryant Schedule.

GreatjonHumber

I mean at this point why bother. You already took the lumps last year, just grit your teeth and get the extra year.

soxfanpa

Sure, why not? That extra year of control is totally worth it… adding more fuel to the potential fire of a work stoppage and losing a year from his prime.

GreatjonHumber

Those are good arguments for calling him up last year, but 2 weeks this year won’t matter.

rhubarb

Dour is as dour does but I fully expect Eloy to be injured in Spring Training.

zerobs

Ignoring the possibility that the team offered a multi-year contract that was rejected, prompting them to take this route.

karkovice squad

Which would be a CBA violation, hence why we got Jimenez’s defense as an excuse rather than Hahn saying he was trying to force Jimenez to sign a contract extension under duress.

gibby32

Why bother? You know, to not breach the CBA. And while it’s true that other teams have done so, that’s hardly a good reason for joining them. Yes, it would mean a change in heart from last September, but, in my judgment, it would be worth it. I don’t expect it to happen, however. Hahn might take too much heat in five years or so, and the fact that other teams have gotten away with unjustifiably extending their control, SO FAR, would be a significant deterrent. But I think it ought to happen. Just pay the man in five years or earlier and you get as much control as you want.

roke1960

This is bizarre. I really don’t know what to think anymore. I really believe when all is said and done, the White Sox will sign Machado. If teams haven’t gotten in yet, they are probably not going to offer him a contract. Jerry/Rick and Lozano just need to sit down and negotiate a fair price. Then announce it at Sox fest. Hahn will be a hero.

GoGoSoxFan

“the process is as productive as trench warfare and half as much fun”

Margalus, you truly are the best. (Of course we already knew that.)

asinwreck

White Sox Baseball 2019: Think Christy Mathewson (After He Got Gassed a Century Ago).

MrTopaz

Dulce et decorum est…

zerobs

For players projecting at 5 WAR, 25 million AAV doesn’t seem like lowballing when you account for the number of years they are asking for and the expected decline after age 30. A team might be willing to pay 6 WAR money for the first couple years as an enticement, but that sounds like 2/64 to me. Extend the term and the AAV goes down. 3/90, 4/116, 5/140, 6/162, 7/182… Throw some incentives in there, front load a little, offer an opt-out, etc. The fact is right now nobody is jumping in offering 7 WAR money to either player. The ceiling is going to be about 8/240, and the initial offers are going to be lower. I don’t think teams want to budge off the initial offers until Mookie Betts’ arbitration status is cleared up because his settlement or arbitration award is going to go a long way towards establishing a ceiling on position players.

Marty34

Yep and the Sox need either Harper or Machado, not both, as a catalyst for the rebuild. Machado does next to nothing for the franchise off the field when compared to Harper. Not too mention that after handing Machado $250M he’s going to have to answer some really awkward questions about his “Johnny Hustle” comments. Not a look the Sox prefer.

soxfanpa

What awkward questions? The Venn diagram of people who care about those comments and those would never go to a Sox game anyway might as well be a circle.

MadManx

Aren’t those the same people boycotting the NFL for kneeling? Seems like they run in the same crowds.

roke1960

If Ricky benches Machado for not busting it down the line on a routine two hopper to 2nd, he should be fired on the spot.

MrStealYoBase

@MadManx thinly-veiled racism? Yeah I’d say they are pretty close to the same people.

zerobs

I have no problem with the Johnny Hustle comments. The season is a marathon, not a sprint. It bothers me that our manager doesn’t understand that. For a borderline player like Engel, hustling is the difference between making the roster and getting sent to the minors. For a bonafide major leaguer, hustling may make the difference between playing 160 games and playing 130 games. Engel needs to bust ass down the first base line on a two hop chopper to second, Tim Anderson does not. Avi busted ass on all those and his hustle got him DL stints and non-tendered.

Lurker Laura

Don’t disagree with your overall opinion here, but that’s not why Avi was non-tendered.

Neat_on_the_rocks

You could argue that it is. A huge part of his relative “Failure” as a prospect was just health.

Marty34

It’s one of those things you can’t say when your looking for a payday in the range Machado is. Some franchises have a track record of success where they can absorb player missteps, the Sox do not.

Trooper Galactus

I don’t get why fans give a flying fuck about who is more marketable. Sign the better, more valuable player at the position of greater need, PERIOD.

karkovice squad

You’re leaving out the time value of money, which means teams get a discounted loan by not paying full-freight on the early years. You’re leaving out the short- and long-term revenue boost from the playoff appearances free agents are expected to deliver, which both increases the value of regular season production and is affected by time value. You’re leaving out the historical trend of $/WAR inflation which is noticeable over a long-term deal and makes the later years less of an overpay than they appear to be on signing day.

And you’re getting the relationship between arb and free agent compensation backwards.

The problem here isn’t that Machado isn’t worth the money or that teams don’t have the revenue. It’s that teams have decided they aren’t going to improve.

zerobs

You’re leaving out the historical trend of $/WAR inflation

I leave it out because there isn’t any proof of what that inflation rate is. I also leave it out because the inflation rate would have to exceed the age decline rate. Besides, opt-outs make it mostly moot.

I don’t pretend that free agent compensation is expected to make up for any possible underpayment the reserve clause may cause. The arbitrator picks either the player’s submitted figure or the team’s submitted figure – Mookie Betts (averaging over 6 WAR the last 3 years, projecting at 7 for 2019) could justifiably submit a $30 million dollar figure and if the Red Sox submitted a $15 million figure the arbitrator has to pick one of those. If neither side wants to take the risk of getting blown away by the arbitrator’s decision, then they can come to terms before the hearing. No team – and no agent – is expecting the new team to cover any shortfall of a previous contract or arbitration decision. Both sides are projecting productivity and coming to agreements on what the productivity is worth. And this stuff gets less and less mysterious as time goes by as projection data and age decline data are discussed and posted on independent web sites.

35Shields

I leave it out because there isn’t any proof of what that inflation rate is. I also leave it out because the inflation rate would have to exceed the age decline rate.

No proof other than, ya know, the last decade and a half of free agency. Inflation was about 7-9% annually from 2006 to 2017. Maybe that won’t hold in the future, but suggesting there’s no evidence of it is just plain wrong.

And it actually might exceed the age decline rate. A pretty typical age curve would be +0.25 WAR until age 27 and then a decline of 0.5 WAR from age 31 onwards.

If you go with Machado to produce 4.4 WAR next season (which is what PECOTA, the low-guy out of the systems we have now, expects), $8m/WAR, no inflation and no age curve, he’d be worth $352m.

If you did the same but with the typical age curve above and 3% inflation, he’d be worth $349.

zerobs

If you go with Machado to produce 4.4 WAR next season (which is what PECOTA, the low-guy out of the systems we have now, expects), $8m/WAR, no inflation and no age curve, he’d be worth $352m.

Why should I go with 8M per WAR? There is no evidence of that. The market is closer to 3M per WAR. For the players expected to be over 2 WAR it may go up to 4M per WAR (Ottavino for example), and the guys expecting to be 4+ WAR players it may be 5M per WAR. That puts Machado in the 25-30 million AAV range. He might be able to stretch it a little beyond that, but not for more than 5 years.

karkovice squad

$4m/WAR? Based on what?

Giancarlo Stanton isn’t projected to produce 80 WAR over his contract. The Marlins didn’t expect Greinke to produce 50 WAR. And the Cubs weren’t expecting 46 WAR out of Heyward.

And looking at the middle of the market, Cleveland wasn’t expecting 15 WAR out of Encarnacion.

What teams average across their entire payroll using league minimum and arb isn’t what they expect to pay in free agency.

35Shields

Your argument is ridiculous. There’s no evidence that Adam Ottavino is an actual person that exists let alone is someone who is valued at $4m/WAR.

In fact, as long as I choose to ignore. all. evidence and just rely on my goofy anecdata, how do we know that dollars even exist?

35Shields

Also, here’s some more definitely not evidence that the cost of a win doesn’t change based on how many wins the player is expected to produce.

karkovice squad

I also leave it out because the inflation rate would have to exceed the age decline rate. Besides, opt-outs make it mostly moot.

35Shields covered the evidence for inflation below. The inflation rates (both $/WAR and in the overall economy) don’t have to exceed the rate of decline. They just have to make future dollars worth less than present dollars.

Opt-outs don’t moot it either since they’re granted in exchange for reduced guaranteed salary.

And agents absolutely are negotiating to make up the shortfall from arb and league minimum. Because the agreement is that teams get cheap early years in return for revenue going to free agent veterans.

The arbitrator picks either the player’s submitted figure or the team’s submitted figure

They do so based on comparison to service time peers which suppresses salaries compared to free agency.

e.g. Betts just agreed to $20m.

Willardmarshall

How far might we be from “Agent: Machado To Sit Out Season”?

GreatjonHumber

I think the bigger threat is a 1 year deal.

knoxfire30

Id put the odds at 30 percent takes 1 year deal, 30 signs with sox, 20 phils, 20 yanks….

roke1960

He won’t take a 1-year contract. Maybe a four or five year deal at $35M per year if nobody gets to $250M. I think the Sox odds of signing him at greater than 50 percent. I think they’ve come too far to lose him to anyone but the Phillies, and that’s only if the Phils lose out on Harper.

knoxfire30

IDK 1 for 35-40… is he really not gonna be offered a 7 year deal again next offseason at age 27 ….

We dont know the exact offers out there but if its 7-8 for 175-225 I think he looks into the 1 year market

If the offer is actually 7-8 in the 250-275 range I think he eventually accepts.

roke1960

What changes next year when some combination of Donaldson/Arenado/Gregorius/Bogaerts/Rendon will also be available? If nobody’s offering 8-10 years when he’s coming off a career year, why would thy do it next year when there will be other options?

roke1960

That being said, I’m pretty sure he will get 7-8 years in the 250-275 range this year.

knoxfire30

Well, I think he waits til mid to late feb and signs then

knoxfire30

Its not who is available. Its what teams may be more likely to spend such as dodgers, redsox, yanks, cubs… plus you could get teams getting closer to contention like the mets, braves, twins, sox, to name a few. Im astonished his market is only kind of 3 teams but I dont see that happening 2 years in a row.

MrStealYoBase

Im astonished his market is only kind of 3 teams but I dont see that happening 2 years in a row.

 

That’s what everyone said last year.

knoxfire30

I dont see anyone last year in the Harper/Machado mold. 26 year old future hall of famers… Erik Hosmer got a huge deal last year…. and he is a glove first first basemen

GreatjonHumber

In a wildly derided deal, especially by the crowd who is now complaining that more teams aren’t giving Erik Hosmers big contracts.

MrStealYoBase

It wasn’t meant to be an apples to apples comparison. The market last year was deflated and uncompetitive and everyone said that was because teams were holding out for this year. Then, lo’ and behold, the market is deflated and uncompetitive again this year. Outside of Hosmer and Darvish, nobody got the deal they wanted last year.

knoxfire30

I think Cain made out well too, again though really thought no matter what this offseason for these two special players was gonna be different. Im shocked it hasnt been.

Trooper Galactus

Cain made out well only in the sense that he’s the sort of player the market typically undervalues. He’s still worth more than he’s getting paid.

johnnyg83

I felt like the Padres were the only bidder on Hosmer.

Trooper Galactus

The Royals wanted to keep him, but even Dayton Moore wasn’t gonna get that stupid for the sake of retaining Eric Hosmer.

Trooper Galactus

The stupid thing is that Eric Hosmer’s contract is being put forth as some sort of cautionary tale on why teams should avoid long-term contracts when EVERYBODY EXCEPT THE PADRES knew that deal was stupid the day it was signed; not because of the term or money involved, but because they gave it to ERIC FUCKING HOSMER.

seven11

And wouldn’t he be eligible to turn down a qualifying offer at the end of threat one year deal? That would theoretically make him less attractive next year as well. I can’t see him taking a one year deal.

Neat_on_the_rocks

If he gets hurt he wont get a similar mega offer. As recently as 2017 he has a slight down year. If he repeated his 2017 his value would definitively decrease.

a year deal strikes me as a huuuuge gamble

HallofFrank

Right, I just don’t understand how a 1-year deal makes sense for Machado. The risks are too high. He’s 26 and coming off a 5.7 WAR season, but in 2017 he was at 3.4 and generally unimpressive (relatively). If he does that again, his chances at getting $200m+ decline significantly (I would imagine). He’ll get a $200m+ offer this year, and likely already has one. A 1-year deal makes more sense for Harper, whose coming off a very down year. Machado takes what he can get, I think. 

Josh Nelson

No joke – Harold Reynolds on MLB Network suggested the idea for both Harper and Machado to continue the holdout into the season if they don’t get what they want.

zerobs

Harold Reynolds is a joke.

roke1960

That does nobody any good.

As Cirensica

I am amazed he still finds people that pay him to say dumb things

GreatjonHumber

This business will get out of control. It will get out of control and we’ll be lucky to live through it.

Neat_on_the_rocks

If the offer is somehow “only” 175M for Machado there might actually be some merit to that as crazy as it sounds. Maybe some team has a major injury and Machado is like a deadline acquisition? Who knows honestly. That would be crazy.

MrStealYoBase

Dubuque’s comment about Moneyball being twisted from “building a team without being able to spend” to “building a team without having to spend” hits the nail right on the head.

There was a Yankees blog the other day that traced how player salaries have gone from taking up 92% or team revenue in 2002 to just 34% last year (as estimated by Forbes). When teams like the Yankees and Dodgers can use the luxury tax as an excuse to not spend, it puts no pressure on anyone else to.

There is no award for building the most efficient team, just the one that wins the most games through October. It’s utter insanity to see just how uncompetitive teams have become. The new market inefficiency is actually paying good players what they’re worth. If one team figures that out and breaks the trend, they could build a team of all-stars at market value and still make their owners money.

knoxfire30

that first line is everything

ParisSox

Brewers 

Yolmer

I think it’s perfectly reasonable for the Sox to make an initial offer of 7/$210 or even 7/$175, but tell Machado come back to us if you receive a higher offer because we’ll beat it. If no other team has made a legally binding offer to Machado, then I think the leak was done to hurt Machado’s leverage not help it. What helps Machado’s leverage is another higher legally binding offer.

roke1960

I’m pretty certain that’s where we are now. The Sox have an offer on the table (most likely above $200M), and an agreement with Lozano to come back to them if someone goes higher. The pressure is now on Lozano to find another bidder.

PopeDonnPall

Ottavino to Yankees 3/27. With another 9 mill committed, does this at least make Yankees even less likely to sign Manny now?

roke1960

Pretty sure the Sox bid has knocked the Yankees out.

MrTopaz

We’ll see how serious the Yankees are about playing in the limits of the luxury tax if they make a trade for Kluber. I threw this idea at Josh on twitter the other night when he asked if a three way trade between the Padres, Indians and Yankees that sent Andujar to San Diego meant the Yankees might be in on Machado again. If it’s prospects from San Diego to the Indians for Kluber, then Kluber to the Yankees for a deal centered around Andujar, we’ll learn how serious New York is by the nature of the package they send back to the Padres. If it’s Andujar and some prospects, then they’re replacing a rookie making league minimum with a pitcher who’s gonna make $17 million+ in 2019. On top of the Ottavino money, I think they’d definitely be over the threshold, and if, after all their talk of staying under the threshold, they make those moves? Well then, we shouldn’t discount the possibility that they’ll basically say, “fuck it, in for a penny,” and just sign Machado, and we should all start pissing our boots because those damn yankees are taking the price high enough to crowd us out of the market.

If, on the other hand, they send Andujar and some offsetting salary to San Diego, then I think we should start believing that they really have changed their spots, and an extra commitment in the neighborhood of $30 million isn’t palatable to them.

If no deal gets done, well. I don’t know if we can draw any real conclusions from that.

*edit for some punctuation and clarity*

soxexile

Can someone please explain this to me? Machado’s agent issues a statement indicating that the press reports of the White Sox interest aren’t accurate. Specifically, he calls out the reports of a 7/175 offer, with the apparent implication that the real Sox offer is larger than that.

Why does he want to address this in the press? If the Sox genuinely have a larger offer out there, he can certainly say so to other teams who may be interested. I don’t understand what advantage he’s trying to get by putting this out in public.