What will market bear for Pujols?
Feb 14, 2011 at 12:00a ET
Having spent the better part of two decades in what euphemistically is known as “sports journalism,” I ask you to accept the following generalizations for their basic accuracy.
First, the owners cheat worse than the players. Hence, you have stuff like collusion, $8 hot dogs, and, as is currently the case in the NFL, a steadfast refusal to open up the ledgers.
Second, owners like to be known as fearless businessmen, self-made apostles of market law, when, in fact, they really want to be insulated from the consequences of their bad decisions. That’s why you have salary caps and luxury taxes. Owners are laissez-faire when it comes to parking, concessions and, in the case of certain big-market baseball and basketball clubs, television revenues. But most of them are really angling for welfare, the most preposterous form of which is the publicly financed stadium with an overabundance of luxury boxes.
Just the same, assumptions being made on behalf of Albert Pujols in his already acrimonious renegotiations with the St. Louis Cardinals deserve to be challenged for the inanities they are.
Look, I hope the guy gets everything he can. And all things being equal, I hope he stays in St. Louis, too. Pujols seems like a good guy, an authentic family man who does some great charity work for kids. Also, he’s the best position player in baseball and, without question, the best hitter.
Still, the idea that he somehow deserves $30 million a year is preposterous.
Before I get to that, however, there’s this “distraction” issue. Pujols refuses to negotiate once he arrives for spring training. God forbid he should be distracted. It’s not clear if he’s referring to distractions that would hinder his own batting average or his team’s chances, or both. Either way, his stance (or that of Dan Lozano, his agent) is more ploy than principle. As my colleague Ken Rosenthal points out, it’s not as if Pujols would turn down $40 million per year just because the offer came in, say, July.
(By the way, just for kicks, try this experiment in your real life: Tell your boss you refuse to renegotiate in the last year of your contract. Tell him you don’t want the distraction, for you or, being the class act you are, the guys you work with. There’s a good chance he’ll soon become your ex-boss.)
But the real issue here remains that sacred, if misunderstood notion of The Market. It is said — almost without question — that Alex Rodriguez established the market for Albert Pujols. A-Rod was the best hitter in baseball and 32 years old when he re-upped with the Yankees at the end of 2007, and Pujols, 31, is the best hitter today.
I don’t blame Lozano for making this argument. It’s his job. And while it might convince the seamheads, as a matter of economics, it’s just plain ignorant.
The market is what the market is now. For example, on Feb. 19, 2004, when Pujols signed his contract extension, Citigroup was selling for $49.12 a share. On Monday, it closed at $4.91. There goes your free market.
But back to A-Rod’s deal. It’s not the basis for comparison; at least, it shouldn’t be. It’s an anomaly. First of all, the guy who so proudly cut the deal on behalf of the New York Yankees — Hank Steinbrenner — since has been relieved of his responsibilities in favor of his kid brother, who, in addition to the good fortune imparted by his DNA, also has an MBA.
Also, it’s worth reminding people that Rodriguez was actually a free agent — not, like Pujols, a season removed — when he got his current contract. The deal called for 10 more years at $275 million and another $30 million payable as Rodriguez made his way to the all-time home run mark. The agreement was an attempt to monetize the most famous record in sports. But now, a couple of years after the news that Rodriguez tested positive for steroids, the record itself has been devalued. In essence, those home runs don’t have the value they did when A-Rod signed in 2007.
But I keep seeing pieces like this one in Monday’s WSJ.com arguing that Pujols “is worth what would be a record-breaking contract.” This would be based on — what else? — his WAR numbers. For the uninitiated, or un-sabermetric, WAR is short for Wins Above Replacement.
I don’t exactly understand this. I wasn’t a math major. Just the same, let me accept that Pujols has better WAR numbers than A-Rod. It still doesn’t change the current market conditions. To wit:
The rates for superstar first basemen don't figure to be what they were. A lot of the usual suspects — those big-market teams that agents rely on to bid up their player's price — lack either the need or the cash flow.
The Yankees have Mark Teixeira.
The Red Sox have Adrian Gonzalez.
The Mets have Bernie Madoff to thank for their dismal fortunes, while the Dodgers have Frank and Jamie McCourt.
So what will the market bear for the best hitter in baseball?
I don’t know. But I promise you Pujols and his agent would trade all the fancy numbers and economic theories for just one Hank Steinbrenner.