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August 3, 2011

Contractual Matters

The Trade Deadline Money Trail

by Jeff Euston

Every trade deadline has its winners and losers in terms of wins and losses, some of which change categories between August 1 and the end of the season. But the deadline also provides another yardstick: cash.

Since June 30, more than $30 million was transferred between clubs in 26 trades involving active-roster players earning guaranteed money. Though hard figures on trades involving cash considerations are not always public, a quick back-of-the-napkin estimate shows that seven teams added $2 million or more in salary in deadline deals this season. As you might expect, buyers and sellers were evenly divided—at least with regard to the bottom line—with 13 teams adding payroll and 13 others shedding salaries. Four clubs made no significant financial moves.                                                                             

The Indians took on the most money at this year’s deadline, adding more than $6.5 million. That’s no surprise, given that Cleveland took on $6 million in acquiring the club-friendly contract of Ubaldo Jimenez alone. General manager Chris Antonetti paid a steep price in prospects, but he added only about $1.3 million to his 2011 payroll. The Indians will pay $775,000 to ex-Cub Kosuke Fukudome but figure to save about $330,000 in shipping Orlando Cabrera to the Giants. Jimenez will cost Cleveland about $920,000 for the rest of this season, then $4.2 million in 2012, though the trade from Colorado triggers a clause allowing Jimenez to eliminate the 2014 club option in his deal.

St. Louis made the biggest bet on this season, taking on nearly $5 million in 2011 salaries. Though the Cards will save about $1 million by not paying Colby Rasmus and three relievers for the next two months, they agreed to pay roughly $1.4 million for new shortstop Rafael Furcal and will spend about $4.5 million for Edwin Jackson and the rest of the package they received from Toronto. As a result of those swaps, the Cardinals’ payroll topped the $100 million mark for the first time this season. Ownership green-lighting an additional $5 million for the stretch run makes it clear that the priority in St. Louis is winning now.

Only two of the eight clubs taking on the most cash at the deadline were American League teams. While the Indians bolstered their rotation with an eye on both October and the future, the Rangers took the same approach in supplementing their bullpen. Texas added about $3.5 million in acquiring relievers Mike Adams and Koji Uehara, assuming the latter’s option for 2012 becomes guaranteed as expected. Meanwhile, the Yankees, Rays, and Angels largely stood pat, and the Tigers (about $400,000) and Red Sox (about $340,000) took on modest amounts to shore up their benches and pitching staffs.

Spending at the deadline was all the rage in the National League, particularly the NL Central, home to three of the top four big-dollar buyers. One surprise entry in the buyers’ club was the Pirates, who celebrated a five-day, first-place run in mid-July by adding about $4 million to their $42 million payroll with trades for free-agents-to-be Derrek Lee and Ryan Ludwick. This season’s 20-percent increase in attendance will help Pittsburgh offset the added costs as the Pirates battle to stay in the race or at least snap their streak of 18 losing seasons in a row.

Milwaukee took on more than $3.6 million in salary with the additions of Jerry Hairston Jr. (about $670,000) and Francisco Rodriguez. The Mets helped facilitate K-Rod’s move from New York by paying half of his remaining salary and the buyout on his 2012 option. Rodriguez himself agreed to take a $500,000 payment from Milwaukee in exchange for dropping vesting language in his contract that might have triggered the option, giving the Brewers a significant bullpen upgrade for less than $3 million.

Mets GM Sandy Alderson ranked as one of the deadline’s biggest savers, cutting a total of about $5 million from the books by dealing K-Rod and Carlos Beltran. The Mets agreed to pay $4 million of the nearly $6.5 million remaining on Beltran’s contract, helping make it possible to get a high-ceiling prospect like San Francisco’s Zack Wheeler in return. The Giants added another $1.2 million in salary with trades for Jeff Keppinger and Orlando Cabrera, bringing San Francisco’s total payroll increase to about $3.6 million. The Diamondbacks, the Giants’ remaining competition for the NL West crown, brought in pitchers Jason Marquis and Brad Ziegler at a cost of $2.9 million.

Seven clubs shaved $2 million or more from their books with deadline deals. The sellers included the Rockies, the Mets, and four last-place teams: Washington, Baltimore, Houston, and San Diego. The seventh seller—the White Sox—came as something of a surprise, with the AL Central race still very much in doubt. The Sox absorbed the salary of Jason Frasor ($1.2 million remaining) but got out from under contracts for Edwin Jackson ($2.9 million left) and Mark Teahen ($7.1 million remaining) for a savings of about $8.8 million.

If the White Sox manage to rally and win their division, they will have one-upped the Phillies and Braves, who made significant trades with only slim payroll increases.

Estimated payroll added in July:

Indians +$6.5 million
Cardinals +$4.8 million
Pirates +$4.2 million
Brewers +$3.7 million
Giants +$3.6 million
Rangers +$3.5 million
D’backs +$2.9 million
Braves +$1.4 million *
Tigers +$403,000
Red Sox +$343,000
Phillies +$312,000
Blue Jays +$203,000
Marlins +$195,000
Yankees $0
Angels $0
Twins $0
Rays $0
Mariners -$337,000
Royals -$604,000
Reds -$615,000
Cubs -$775,000
Dodgers - $1.2 million
Oakland - $1.4 million
Astros - $2.6 million *
Nationals - $2.8 million ^
Padres - $3.0 million
Orioles - $4.7 million
Mets - $4.9 million
Rockies - $5.1 million
White Sox - $8.8 million

* - does not include undisclosed amount sent from Astros to Braves
^ - does not include undisclosed amount sent from Reds to Nationals

Jeff Euston is an author of Baseball Prospectus. 
Click here to see Jeff's other articles. You can contact Jeff by clicking here

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