Ricketts Spins Cubs’ (Un)Willingness(?) to Spend, Pitching Market Appears Poised for Tailspin
I believe it was Teddy Roosevelt who said to speak softly but talk out of both sides of your mouth. Or was it speak loudly while beating a dead horse with a big stick? Whether it was the Sammy Sosa estrangement or the team’s financial situation, Cubs owner Tom Ricketts did a little bit of both this past weekend at Cubs Convention.
We’ll leave that Sosa business off to the side for now, but I would like to get into Ricketts’ spin on his team’s ability and willingness to spend over the remainder of the winter. We’ve talked a lot here about the limitations of the new collective bargaining agreement and how the implementation of decidedly stiffer penalties have curtailed the desire to exceed the competitive balance tax threshold.
It’s important that we make the distinction here between can and will when it comes to a team going over the limit. The Cubs have constructed a mint in and around Wrigley Field and are perfectly flush with cash, but the prospect of taxes and surcharges that could reach as high as 95 percent of a team’s spending overages looms large.
The money isn’t the only issue, though, and it may not even be the biggest. Restrictions on international pool money and the reduction in the number or placement of draft picks present very significant red flags for would-be big spenders. With their increased focus on developing pitchers, the Cubs can ill afford to see their opportunities dry up when it comes to the draft and international free agency.
Yet, even taking all of that into account, it was a little odd to hear Ricketts explain the stagnant offseason (this piece from Patrick Mooney in his new gig at The Athletic requires a subscription) and how active the Cubs could still be in the market.
“I think everyone just has finite resources,” Ricketts explained when asked about the idea of collusion. “They’re looking at the playing field for the market and they’re all making whatever decision they want to make for their teams.”
“I think we’re just seeing a lot of teams out there would rather have dry powder a year from now. The luxury tax is a component. There aren’t like those kind of fresh revenues (from TV deals) this year. So there’s a lot of pieces and parts, but ultimately I think teams are just trying to keep their powder dry [all emphasis mine].”
At the risk of putting words in the chairman’s mouth, I think we can reasonably assume that “everyone” and “a lot of teams” are blanket terms that cover the Cubs as well. In other words, he could have substituted “we” in both cases and been just as accurate, probably more so. He even doubled down on those sentiments later, saying that “everybody’s got constrained resources.”
Then again, that last nugget came immediately after he’d seemingly said the exact opposite about his own team.
“Obviously, Theo (Epstein) has the resources to do whatever he needs to do to win on the field,” Ricketts admitted.
Wait, what? I don’t understand, is everyone constrained or does Epstein have carte blanche? Ricketts mentioned how TV deals have shifted the economics for teams in the past, but the Cubs won’t be launching a game-changing media network until at least 2020. And while the revenue share from the sale of BAMTech (the live-streaming service spun off of MLB Advanced Media) to Disney will line each team’s pockets with at least $50 million, that’s a one-off deal.
Mooney got some additional context from newly-promoted assistant general manager Scott Harris, who may be able to help us bridge the gap in congruity between what Ricketts said and what’s actually going on.
“I don’t know if we necessarily anticipated such a slow offseason,” Harris explained. “But we try to be aggressive early. We try to get the players that we really want. And then we try to remain opportunistic the rest of the offseason. That’s the mode we’re in right now.”
Like girls lyin’ on the beach perpetratin’ a tan, this opportunistic mindset is about money and getting their man. More specifically, it’s about spending much less money to get their man than they might have initially thought possible. The Cubs were indeed aggressive early, landing Tyler Chatwood at what some believed was more than he’d get before signing Brandon Morrow and Steve Cishek to bolster the bullpen. They’re even paying Drew Smyly $5 million AAV over two years even though he may not pitch at all in 2018.
But now that they’ve got one hole in the rotation and something in the neighborhood of $30 million with which to fill it, the Cubs have shifted back into wait-and-see mode. It may well pay off of them, as there’s potential for the starting pitching market to completely crater over the next couple weeks. If, that is, you believe the reports coming out of New York.
YES Network’s Michael Kay erroneously stated that Yu Darvish had turned down a seven-year, $160 million deal from the Yankees last week, though there apparently was some kind of offer. And the latest indications from John Harper of the New York Daily News are that “the Yankees seem to think it’s possible they could get him for five years, $80-90 million.”
Though there were no figures in Jeff Wilson’s column in the Ft. Worth Star-Telegram, the Rangers believe Darvish could fall back into their orbit. Either possibility would indicate a precipitous drop in the top end of the market. Even though it ended up being incorrect, the $22.86 million annual average of the bigger reported offer is around 20-25 percent less than Darvish was projected to get. And if the Yankees are correct in their assumptions, it could mean an AAV of $16-18 million.
At that point, you’re talking about the same kind of money Alex Cobb is said to be looking for. One of the latest reports on the former Rays righty had him seeking $70 million over four years. While I think Darvish going below $20 million AAV is enough of a stretch that you could make an iconic toy out of it, his doing so would severely limit the offers for Cobb and Jake Arrieta.
That $110 million the Cubs were reportedly willing to pay Arrieta over four years gets slashed and $42 million over three years might look a lot better to Cobb’s camp.
Which brings us back around to the Cubs’ (un)willingness to spend. Ricketts says he trusts his front office to “do what’s right with the dollars,” while also presumably keeping powder dry and navigating various other constraints. In the end, it’s not really a matter of not having money to spend or not wanting the spend the money they have, it’s more about a belief that they won’t need to blow through their existing reserves to get another starter.