Lucas Giolito shows limitations of White Sox’s approach to extensions

(Photo by Rick Scuteri/USA TODAY Sports)

Sure, White Sox fans might be irritated that excitement over the most promising White Sox season in 15 years has been sidelined by a grotesquely swollen investment in second-tier relievers and a salary squabble with their staff ace.

But if you just wrote about how early-career bargain extensions look like over-tilled soil for Rick Hahn and the White Sox, then you’re ever so slightly satisfied by the White Sox and Lucas Giolito heading to arbitration over a difference of $200,000, or $50,000 if they had settled earlier.

The lesson here: If you root for yourself, you always control your own destiny.

PERTINENT: Tim Anderson, last of the White Sox’s big-time bargains

In James Fegan’s detailed assessment of Giolito’s salary situation, he wrote about a four-year, $50 million contract extension the White Sox offered Giolito, and the way it nudged a very specific high-water mark ever so slightly higher.

Sources indicate that last spring the White Sox offered Giolito a contract extension before the 2021 season, which would have taken the place of the $4.15 million deal he and the team reached for his first arbitration-eligible season. The contract offer was for four years, $50 million guaranteed, and would have bought out Giolito’s three arbitration-eligible seasons and his first year of free agency. The offer also included a club option for the 2025 season.

The deal would not have set an MLB record for the largest extension for a starting pitcher with three full years of service time. That was set by Carlos Martínez’s five-year, $51 million deal (with two option years) with the Cardinals in 2017, and surpassed by Sandy Alcantara’s five-year, $56 million agreement with the Marlins reached this offseason. But it would be the largest four-year guarantee to a starting pitcher at a similar cutoff in their service time accumulation, surpassing Aaron Nola’s 2019 agreement with the Phillies for four years, $45 million with an additional club option year.

As I noted with Tim Anderson and the extension-signers who preceded him, this is how the market used to work. The level of guaranteed money was new and stunning, and as long as it represented the best a player had received at that point in a career, both sides could claim success. Then it became abundantly clear that the best players were selling their services for way too little, and such deals became much harder to strike.

In this case, $50 million isn’t actually low-balling Giolito’s earning potential over his next four years. He still has some achieving to do in order to beat that sum by himself. It’d have to look something like this:

  • Arb 1: $4.15M
  • Arb 2: $7.5M
  • Arb 3: $13M
  • FA1: $25M

That’s the argument the White Sox would make in putting forth this offer. The disconnect is that somebody like Giolito sees the fourth year and the subsequent club option as getting in the way of locking in several $25 million salaries as soon as possible.

He has his reasons. Looking only at the White Sox, those club options prevented Gavin Floyd and José Quintana from reaching free agency at or near the height of their powers. If the Red Sox could’ve held off on extending Chris Sale during the last year of control they inherited from Chicago, he’d be in far more uncertain territory at this stage in his career. On the other side, Carlos Rodón just showed everybody how one can make up for a few lost moderate raises with just one well-timed season.

PERTINENT: Circling back to Dylan Cease’s future after Carlos Rodón’s contract

Summing it up, the White Sox want Giolito to take the bird in the hand, and Giolito is going for five to seven in the bush, treating one as a decent fallback. This is why I noted José Berríos’ seven-year, $131 million extension with the Blue Jays as noteworthy back in November, because it shows what it looks like when a team addresses that particular desire.

If you’re going to draw up a contract extension for Giolito at this time, you can probably count on the first two years taking about $20 million, because that’s a nice round number reasonably approximating arbitration projections. The same total outlay to Berríos goes a little further in Giolito’s case, because that post-arb commitment would be five years and $111 million (AAV of $22.2 million), but Giolito can probably nudge that price tag higher if [the Noah Syndergaard signing] shows where the pitching market is headed.

The White Sox offered Giolito four years and $50 million before Berríos was even a Blue Jay, so we can’t say the White Sox stridently ignored obvious market indicators, but it’s fair to say it didn’t anticipate desires, either. Fegan says Giolito’s camp didn’t respond to the White Sox’s offer, as it was so far from what he wanted that offering a direct counter risked letting that 4/$50M anchor the negotiations.

Back when the White Sox achieved their ostensibly desired second-place finish in the Manny Machado derby, I wrote that the White Sox were Major League Baseball’s Blackberry. Three years later, Blackberry’s finally dead and the White Sox are very much not, but the tendencies that inspired that analogy remain alive. Market leaders maintain or gain share by doing things they said they’d never do, usually by acting as if they never said those things. Hahn has had to wrestle with his old, bold statements because he hasn’t figured out a way to make them happen within his organization’s self-imposed constraints.

“Innovate or die” falls short of an ultimatum in baseball as long as the Colorado Rockies are worth more than ever, but the methods the White Sox used to build this roster have gone stale, so extending this window is going to require some sort of shift, be it in paradigms or vibes. Then again, if the next one of those involves persistent anxiety and restlessness, perhaps the White Sox are truly the team for these times after all.

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This season just needs to get started already. I commend you guys on being able to provide so much quality content when the team seems dead set on being as boring and uninspiring as possible this offseason.

ayeitsfabes

Gio is ultimately betting on himself, and unless Jerry isn’t the owner we’re not resigning.

roke1960

I really thought the Sox were set up for long-term success, but now I’m not so sure. I don’t think Jerry will change his ways- if they can’t get guys on early long term deals like they did with Timmy, Yoan, Robert and Eloy, I don’t see them handing out multiple $100+ million dollar contracts in the coming years. Gio’s contract is up after ’23, Timmy after ’24, Yoan after ’25. He’d have to pay each of those guys well over $100M to keep them. I don’t see that happening. In fact, I’m betting he would trade Yoan before picking up his $25M in 2025. So the window will definitely start to close soon, especially with Detroit and KC on the rise. This year was so well set up for them to go for it all, and not only did they not get better than last year, you could make a good argument that they will be worse. This is inexcusable.

knoxfire30

The remaining window opening is 2022 and 2023 its hard to see how they have a better chance after that time frame given where the division still is and how they will quickly become hamstrung in who they can keep and at what price.

HallofFrank

This strikes me as overly pessimistic. The question is: will JR be willing to keep the payroll where it is now for the foreseeable future? If the answer is yes, there’s no reason they can’t build a winner in ’24 and beyond. In ’25, for example, they have Moncada, Jimenez, Robert, Bummer, Kopech, Cease, and Vaughn under control for around $100m (that’s also assuming Kopech, Cease, and Vaughn are so good that the arb amounts rise quickly). Of course, the trajectory of many of these guys careers is still to be determined—but that’s a really good start. So maybe the “window will close soon” stuff is just because of (understandable) pessimism that JR will continue to spend, but the internal options alone suggest the Sox have a bright future—if they want one. 

roke1960

I’m just going on the fact that Jerry has never given out a long term contract averaging $20M per year. I don’t see him spending big bucks to keep Gio, Moncada and Timmy over the next 3-4 years. Your last sentence says it all. The Sox do indeed have a bright future- if they want one. And of course they want one, but I’m not sure they will spend to keep one.

HallofFrank

They might not keep those three guys. But that doesn’t mean they can’t win. The Sox have enough young, internal options that they should have no trouble keeping a good team for at least the next 5 years if JR is willing to stay around the current payroll.

soxfan1959

Yes, but win what? A division? The goal should be to win a WS. Win a pennant at the very least. A division title doesn’t cut it after this rebuild.

HallofFrank

Sure, but it’s difficult to build a team specifically for that. You don’t know who you’ll be playing, for one, and in such a small sample size, you don’t know who’ll be good and who’ll be bad. For example: Lynn and Giolito last year. So, you build the best team you can and hope for the best.

Foulkelore

Serious question: has he ever even given out a short term contract for $20 million? Has any White Sox player ever had a $20 million salary? Grandal, Keuchel, Lynn, and Abreu are all close, but under that. Am I forgetting somebody?

roke1960

I’m pretty sure they haven’t. Keuchel will get $20M next year if his contract vests, Moncada will get $24M in ’24 and has a $25M option in ’25. And Robert has $20M options in ’26-’27. If they don’t win in the next two years, I could easily see Jerry letting Giolito walk and trading Moncada before the ’24 season.

knoxfire30

Every single team in the central will be hands down better in the next season or two as they are coming out of their own rebuilds/reloads

The sox just lost an ace in rodon

This year they could potentially lose keuchel kimbrel abreu harrison

Next year they could potentially lose giolito, lynn, grandal

They currently have the worst farm system in baseball

This isn’t to say they cant repurpose some of that money and that they won’t have a decent core in Eloy, Robert, Vaughn, Cease but the division will never be easier to win then it is now. They have shown absolutely no willingness to spend on tier 1 or tier 2 free agents and if they are uncomfortable re-signing their own stars at market rates you can count on Giolito and other to walk. 2022 and 2023 represent far better chances then 2024-2025. Sox window is closing…. they got 2 more bites at the apple IMO

a-t

Keuchel, Kimbrel, and Harrison’s combined ~$30M off the books will probably be addition by subtraction. Abreu will either retire or probably resign for a year at presumably less than his $17M salary. The ‘23 roster will be fine.

HallofFrank

This is a weak argument for the “Sox window is closing” for several reasons.

The AL Central will get better… sure? So what? Welcome to the rest of the league, where there may be real competition in the division. Even if there are other good teams, that doesn’t mean they can’t make the playoffs (especially in this expanded format) nor win the division.

But also, really? Are you that worried about these teams for ’24 and beyond? The Twins and Guardians may be entering rebuilds soon, not leaving them. And go look at who the Tigers and Royals have controlled in ’25. It’s… unimpressive. Those farm systems better show up *big*. If I had to guess, the Sox are the projected favorites in the division from now through *at least* 2025. 

Finally – every team will lose good players to free agency over the next few years. And everyone you named except Giolito is an aging vet getting paid market rate. They can pay some other vet market rate to replace them. 

soxfan1959

2025? Not a chance. No way are they the favorites through 2025. Half the team will be traded by then.

HallofFrank

Why will they trade half the team?

roke1960

It really depends on the next two years. As I said above, Moncada is owed $24M in ’24. If they don’t win in the next two years, then they will lose Grandal, Lynn and very possibly Giolito, with Anderson in an option year and Moncada having by far the biggest single season salary in Sox history. I have my doubts about Jerry paying that. So by ’25, they may have to fill at least 2 rotation spots, 2B, 3B, SS, RF and C. If Jerry continues his aversion to long term deals at premium positions, that a lot of holes to fill. They better hope a few of Burger, Rodriguez, Colas, Cespedes can fill those slots.

HallofFrank

The ifs and mays here are doing a lot of heavy lifting. Yes—if Jerry decides $200m is too much for a baseball team and cuts the payroll to $100m, this team will be bad. I’ve already said: my point depends on Jerry keeping the payroll about where it is. If he does, this team should absolutely be a consistent contender over the next 5 or so years.

Qubort

Grandal and Lynn will be 36 & 37 by then. The Sox should be thinking of ways to replace them before their contracts are up. I doubt there is any lineup in baseball that won’t be drastically different over a three year span.

Matt Verplaetse

Your logic about the bright future of the Sox seems to consistently ignore the consensus that they have the worst farm system in all of baseball. For a team that won’t spend on elite talent in free agency and likely won’t spend what it takes to keep any of their own players that reach an elite level, that’s a major facet of this argument to overlook.

HallofFrank

People keep bringing up the spending: *again* I’m saying if JR keeps the payroll where it is now, the Sox should be good in 3+ years based on what they have internally. If they cut the payroll by $100m, then yes- the white Sox will be bad.

As for the farm system, it’s not good, but it also doesn’t worry me. This isn’t your white Sox farm systems when Spencer Adams was a top 2 prospect. There are a lot of interesting prospects here. And because the Sox already have loads of young talent on hand, hitting on even a couple of these prospects would be a huge addition. Certainly, there are enough guys there you could see adding to the current core.

Matt Verplaetse

You’re ascribing certainty to guys being good that have proven nothing. Haven’t we seen enough of these high strikeout, low OBP guys come through the system and fail? If there were a “lot of interesting prospects” you wouldn’t have a farm system that is universally considered to be the worst in the game.

jhomeslice

It’s worth repeating someone’s comment “how did the Sox go from being in on Machado to this bullshit?”. They signed that dude’s family and friends, even if they weren’t “all in” it’s hard to believe they did not have at least SOME desire to actually sign him. Ditto Wheeler. It’s easy to say they missed out on both on purpose, but that’s probably a bit unfair.

But after that, what gives? They’ve just done next to nothing after that, basically throwing in the towel on all free agents of any real substance. Not even a peep connecting them to anybody, literally. I mean Liam was ok, but even great relievers have a WAR of like 3, they are way cheaper than position players for a reason and simply don’t have the impact of a stud position player like Springer. It’s just unbelievable how cheap they’ve been about what contracts they give out, after seemingly coming close to Machado and Wheeler. Springer was the one that got away, really. He got a very fair 5 year deal and was not overpriced, and is one reason why the Jays are close to the AL favorites, my opinion. For what the Sox are paying Kimbrel and Kelly, that’s Springers 2022 salary right there. There is no comparison between our lineup and theirs. I don’t see Giolito/Cease/Lynn shutting down the Jays, I’m sorry. And there is little reason to believe the Sox won’t struggle against RHP again because we’ve seen them do that since the start of 2020. The Sox offseason was just inexcusable as you said, and last years was as well because of Eaton.

Last edited 2 years ago by jhomeslice
karkovice squad

Leaving aside contract bull, the signs that this wasn’t sustainable have been evident for at least 3 offsessons. They have not solved their prospect acquisition and development woes, as Jim’s recent post documented all the extraordinary advantages they’ve needed in order to get major league talent outside of free agency.

To Err is Herrmann

This is puzzling evidence, but par for the course for the White Sox. It is what it is.I don’t know how many teams are skillfully run. The A’s, Rays and Cardinals are all impressive. The Mets, Dodgers and Yankees throw obscene amounts of money at players. The Cubs and Astros set the blueprint for the tear-down-and-rebuild. Hahn is a middling GM, no Theo Epstein, and is of course hamstrung by an owner with no ambition. The White Sox as presently run are kind of middle of the pack. There are worse franchises. I still hold out hope for more moves, and the trade deadline could be interesting (as Sox fans may be outside the front office with pitchforks), but with Hahnsdorf you kind of know you will always be Carls Jr. rather than McDonalds, or even Burger King. Our best hope is always the ineptitude and lack of ambition of other franchises.

metasox

Carls Jr has always had some pretty good ads. Not going to give the Sox org that much credit.

To Err is Herrmann

Sorry, I misspoke. I just recalled that the traditional Sox fan catchphrase has always been, “Eat at Arby’s.”

lifelongjd

In the grand scheme of things, locking up young talent at cheap rates has been what the Sox do best. It not only kicked off the rebuild with the Sale and Quintana trades, but also will hopefully extend the competitive window a bit.
I am hoping the strategy can still be an effective tool for the Sox. The Giolito attempt was never going to work, at least not in the same vein as he didn’t come from the same background as most others (ie, didn’t truly “need” the money) and had pretty immediate success and could track his arb years spend better.
It does annoy me to no end that the FO relies on the strategy so heavily to enable successful team building. Wish they would just operate the team like any other organization and just commit to paying for talent, but as Jim and others have pointed out, that’s just not their way.

BenwithVen

It just feels like he’s fated to end up in Southern CA. He’s from there, his family and friends are there, and (per Chuck’s interview with him last week) his wife took a veterinary position in San Diego during the offseason.

Unless the Sox clearly give him the highest offer, it’s hard to see how he stays.

Wayne

At this point, Giolito pitchs like an ace for 2 years, and the White Sox offer him a 5 year deal when he hits free agency, and he laughs as he signs a 6 or 7 year deal at high yearly.

Trooper Galactus

And Hahn and Williams will talk about how the three option years in their proposal makes their offer superior.

dongutteridge

I’m okay with the Sox moving on from Gio. Nothing at all that I don’t like about him. He’s just always seemed like a guy that wanted to be paid the most that he could possibly get and it was important to him.

Teams are not often going to be able to keep guys like that.

a-t

Meh, it’s not that hard. Lucas has never expressed anything but positive impressions of the franchise before this stupid contract stuff, which is the White Sox lowballing him and him being understandably unhappy about it. They can afford to pay Gio what he’s worth in the ‘23-‘24 offseason, declining Lynn and Kelly’s options that year approximately frees up the required space.

Gio’s smart, he sees that he’s quite likely to get a $150M deal come UFA. If I were Hahn— specifically Hahn without Jerry’s evident contractual restrictions, I would offer him a true long-term deal, something like 7 years/$180M, after this year. I have a suspicion that Lucas may find another level this year and be a real Cy Young contender if he’s sitting 96-97 this early in ST.

Greg Nix

On the other hand, teams could absolutely keep guys like that if they had desire to whatsoever. The Rockies apparently couldn’t afford Nolan Arenado but can easily afford Kris Bryant. It’s all about the owner’s desires.

BenwithVen

tbf, They could afford Arenado. They just couldn’t afford a competent supporting cast around him. Arenado realized he was sold a fake bill of goods and wanted out.

a-t

The four guaranteed years are reasonable compensation, give or take, sure. I imagine the club option was the problem point— even if it were for $25M, it’s Lucas and his agent are entirely correct to realize that hitting free agency two years earlier— at age 31 instead of 29– will cut significantly into the overall value of his deal.

The arb stuff is just stupid on multiple levels. Nothing more to say about that.

soxfan1959

If the Sox aren’t going to pay players the going rate for their talent level, then they should trade each one while they still have top trade value…meaning two years or more control. That’s the only way they’ll get something decent in return. I doubt this regime will ever be all in on paying top talent.

Foulkelore

Mercedes is having surgery on a fractured hand (hamate bone). He’s out 6 to 8 weeks. That rules out him taking advantage of the expanded rosters to start the season.

jhomeslice

He wasn’t high on my list of guys I was hoping would get a shot. I think he has very little future in MLB. I hope that maybe both Burger and Adolfo make the team. Burger would be a nice right handed platoon partner at DH with Sheets, Adolfo is out of options so let’s see what he can do if Engel doesn’t break camp with the team.

metasox

Adolfo might have a little run in him before the league adjusts. Plenty of Ks but a few flashes of power.

jorgefabregas

Audio webcast for tonight’s game https://www.mlb.com/mariners