I'm in that generation that is pretty much computer illiterate, so I can't copy a link here, but I'll do a copy/paste from the ESPN website.
Baseball's next great economic disparity
Sunday, November 1, 2009 | Feedback | Print Entry
Baseball's financial structure appears to have reached a tipping point that can be defined simply. "The arbitration process is now outdated," said a highly ranked executive, "because the players can get more money in arbitration than they would through free agency."
So now teams are about to adjust to this reality, and this is why multiple general managers expect that dozens of young players with three, four and five years of major league experience will be cut loose rather than offered arbitration in the next 41 days. Not a handful, but dozens.
During the past 48 hours, I went through the rosters with some executives and counted 93 solid non-tender candidates -- players whose current teams simply won't offer them contracts for 2010. If the final numbers come close to that figure, close to 300 veteran players will be looking for jobs in the winter, a staggering number that will inevitably depress the asking prices for free agents.
Here are a couple of players whose contractual situations might warrant consideration for a non-tender:
J.J. Hardy, Milwaukee Brewers shortstop: He is 27 years old and theoretically entering the prime of his career, having hit 26 and 24 homers in 2007 and 2008. But Hardy hit .229 with 11 homers in 2009 while earning $4.65 million. He has five years of service time and is, of course, eligible for arbitration. Through that process, he could earn a salary close to $7 million.
Now, if Hardy were a free agent, it would seem unlikely he would land a multiyear deal for anything close to $7 million, given his history of injury and inconsistency. This past winter, veteran shortstop Orlando Cabrera signed for $4 million. Cesar Izturis got a two-year deal for $5 million.
Before the trade deadline, the Brewers asked the Red Sox for what Boston considered to be excellent prospects in return for Hardy, and part of the reason the Red Sox rejected the overture was their sense that Hardy was about to become vastly overpriced in the market. With Alcides Escobar expected to take over at shortstop, the Brewers are said to be very willing to move Hardy. But what could they get for him? And is there necessarily a market for him, when the team acquiring him knows he probably would be paid more than what a player with his track record would be paid later in the winter?
The next-best option for the Brewers, perhaps, would be simply not to tender him a contract.
Bobby Jenks, Chicago White Sox closer: At age 28, Jenks had a mediocre season, converting 29 of 35 save chances in 52 games while making $5.6 million. Through arbitration, he probably could get $7.5 million for 2010.
Similarly, all-time saves leader Trevor Hoffman signed for $6 million when he joined Milwaukee, coming off a season in which his performance was almost perfect. And in the winter, literally more than a dozen closers will be available. If you are the White Sox, you probably won't find takers for Jenks because other teams will be leery of his arbitration eligibility. Would you want to pay Jenks top-of-the-market price for 2010, coming off a less-than-inspiring season, or would you rather just throw him back into the pool of non-tenders and identify a cheaper closer?
These are the kinds of decisions that will be made in the weeks ahead, and what some executives believe is that this is the next place where baseball's economic disparity will manifest itself. Big-budget teams are in position to pluck the best non-tender candidates who might be unwieldy for small-budget teams but would be nice luxury items for the big-money teams.
For example: If Jason Varitek leaves the Red Sox, Boston will look for a backup catcher. The Red Sox simply could give up a Grade B prospect for one of the catchers who might not be tendered a contract by his current team. If the Yankees like Jeremy Hermida, maybe they could give the Marlins a secondary prospect and take the gamble that the 25-year-old outfielder will realize his potential in the next year or two.
The Marlins really can't afford to wait and see whether Hermida takes the next step. Hermida made $2.25 million last season and probably will make something close to $4 million in 2010.
The flood of free agents could help the small-market and midmarket teams because the players' asking prices will have to come down. You can bet on this: A team such as the Twins will be able to take a flier on a non-tendered player and wind up receiving excellent value.
But this is the latest example of a seismic shift in baseball's economic structure -- and part of the reason for it is some teams are waving the competitive white flag, executives say. Rather than expanding their payroll in an effort to win, they are simply downsizing to a budget size that will ensure they won't lose money. It appears the gap between the haves and have-nots will continue to grow in the winter -- an evolution that will cause some young players not to be tendered contracts in the next 41 days.
Large-market teams have dominated baseball, writes Ron Blum.
