18 January 2014

A Solution to Contracts

Big contracts are all the rage when it comes to sports.  Whether it is baseball, hockey, football, or basketball, you see athletes signing seven and eight year contracts for hundreds of millions of dollars.  Even soccer players in Europe sign multi-year, multi-million dollar contracts.  The most recent of these contracts is Clayton Kershaw of the Los Angels Dodgers who signed a seven year, two hundred fifteen million dollar contract.  That's a lot of bank.  And he's worth it.  He is one of the top pitchers in the game right now.  Big name players get big time contracts.  That's just how it works.  On the same day, Max Scherzer of the Tigers signed a one year, fifteen million dollar contract.  Most believe that Scherzer is going to test the free market once the year long contract is up.  And he'll be looking for just about the same, if not more, amount of money and length of contract.  This got me thinking about something.  What if sports moved away from the longtime contracts and went with just one year contracts for everyone?  Of course, there are pros and cons to this idea.

The first problem is contracts themselves.  Especially the contracts that are in the seven year plus range.  Unless the players are getting signed to these monster contracts in their first couple of years, as the years go on, the player gets older and production typically goes south.  Most of the money is in the beginning or middle of the contract and tapers off near the end, so that makes sense.  But there are those contracts that are seen as absolutely horrible.  A player comes off a monster two years and signs a ten year contract and then is bitten by the injury bug for the next five years.  It's considered a bust move and the team is stuck with the player and the contract because no one wants a broken down player or the money he is owed.  That doesn't always happen, but when it does, it is scrutinized by everyone.  A few names that come to mind with contracts that don't seem to be worth it are Carl Crawford (Red Sox), Veron Wells (Blue Jays/Angels), Andruw Jones (Dodgers), and Albert Pujols (Angels).
 
Each year, teams go to arbitration with players on the roster that have been playing for six full years in the MLB.  There are more details to it than that, but that is the basic idea behind it.  Basic idea:  player comes to the bargaining table with what they think they should be paid (say five million dollars) and the organization comes to the table with what they think the player should be paid (say three million dollars).  They then negotiate with each other.  Sometimes they reach an agreement (say four million dollars) and everyone is happy.  Other times they don't reach an agreement and have to go before a panel of three arbitrators.  Again, there is more to it than that, but that's the basic idea.  You see players come out with long contracts and players come out with one or two year contracts.  It all depends.  Players and organizations usually reach an agreement.  They look at how well the player  played over the last few years and base their offer on that.  Of course the player wants to up-sell themselves and usually send a number that is worth more.  They gots ta get paid.  As long as everyone thinks the offers are fair, then they sign it and go about their business. 

So why can't organizations do this every year for every player?  Start with your stars or upcoming players that you definitely want to keep on your team and go from there.  You have the salary cap so you know where you need to spend the money.  Plus, it keeps the organization away from those long contracts.  Players who have monster years can benefit from it, but not so much that four years later, the organization is trying to move the player to free up salary cap space.  It would make the off season that much more interesting.  Can you imagine each winter wondering how your favorite team will keep their roster together?  Or, if there is a big name player that wouldn't be resigning with their team, could you imagine the frenzy to sign him?  So how would this work?  The way I see it:  the organization has until February 1st to sign the players that they want on their team.  Let's say there are four players that underwhelmed the previous year, the organization gives them the option to either take a demotion to AAA or become a free agent.  If you have a prospect that is ready to play, you can sign him to a contract.  After February 1st, all free agents can start talking to any team that they want. 

Big name players are still going to get a ton of money because of who they are and how good they are.  But the lesser known players could also get what is due to them based on their ability.  It may not be with your favorite team, but another team might see their ability and give them a chance.  It gives a team a chance to retool each year if they want.  Plus, they could sit down with the team and discuss how they are going to go about signing their players.  And, how awesome would it be for players to stand up and say 'I'll take less money this year if it'll help sign another guy.'  Hey, I can dream can't I? 

5/120

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