Prospectus Today: Sox Fumble Pedro’s Option Play

Monday, the Red Sox picked up the option on Pedro Martinez‘s contract.
The move, which Martinez had been agitating for since last winter, guarantees
Martinez $17.5 million in 2004.

To understand just how far through the looking glass we are on this issue,
consider the headline on ESPN.com’s baseball page: “Red Sox finally pick
up Pedro’s 2004 option.” Finally. An option with a deadline
of November 5 gets picked up on April 7, and the word used to describe this is
“finally”?

I guess it’s a credit to how well Martinez manipulated the situation. More
than a year ago, he dangled a threat that he would leave after 2004 if the Sox
didn’t pick up his option well in advance of the deadline. This spring, with a
season to go before the original term of his contract would expire and likely
two years before he would become a free agent, he continued to press for the
pickup, although he couched his demand in terms of wanting to avoid the media’s
speculation about his future. It calls to mind Darva Conger faxing media
outlets demanding that they leave her alone.

Keep in mind that Martinez was demanding that the Red Sox assume a
$17.5-million obligation despite his being a year removed from spending two
months on the DL, and following four years of being handled like a Faberge
egg.

I don’t like the decision to pick up the option. I just don’t trust pitchers,
especially ones who have to be babied just to get them to 200 innings. As
great a pitcher as Martinez has been, he hasn’t been a workhorse since 1998,
and as recently as 2001 was limited to 18 starts and 116 2/3 innings. The Red
Sox have had to constantly monitor his pitch count and usually have kept him
pretty far from the league leaders in innings pitched and starts. Just
Saturday, the Sox removed him from a 1-1 tie in which he’d thrown just 94
pitches. In just one season in Boston has Martinez been a reliable member of
the rotation from April through September, which is reflected in where he
ranks among his peers in workload:

Rank, American League innings pitched, 1998-2002: 7, 8, 7, 60, 20
Rank, American League games started, 1998-2002: 6, 33, 29, 55, 23

Given that history, I really liked the idea that the Sox could now get two
years of treating Pedro Martinez like a short-timer after five years of
coddling him. As important as he is to their hopes, and as important as the
next two seasons are to the franchise, I thought that they could, given the
short-term nature of their investment, run him out there for 35 starts and 240
innings this year. If he got through that, then they could pick up his option
and do the same thing next year, and then, with Martinez becoming a free agent
at 33, consider whether signing him made sense.

Now, they have to be careful in 2003. They have to manage Martinez knowing
that their investment in him runs past October, and that they’re on the hook
for $17.5 million in 2004 no matter what his arm feels like next year. That’s
a strong disincentive to maximize his usage in 2003, and every inning that
Martinez doesn’t throw–such as the ninth inning in Baltimore on Saturday–is
one small step that the Red Sox take away from the postseason.

What do the Red Sox get for their $15 million? (The option year came with a
$2.5 million buyout, so the marginal cost of picking it up is $15 million.) Well, they do
end the media circus that was developing. Actually, I don’t like the passive
voice; they end the media circus that Martinez had instigated. They avoid
whatever small chance there was that Martinez’s performance would have been
affected by his contract status. They generate goodwill among Red Sox fans,
although given that the Sox already play to capacity despite the highest
ticket prices in baseball, it’s hard to see how much that’s going to be worth.

One popular notion is that by picking up Martinez’s option now, the Red Sox
give themselves a leg up in signing him beyond 2004. (It’s popular because the
converse, that Martinez would leave if he didn’t get his payoff right now, was
the right-hander’s threat of choice.) I think that’s an expensive risk to
take, not the least because is there any pitcher, save perhaps Mark
Prior, you want to place a bet on 400 innings down the road? The Red Sox
have risked $15 million so they could enhance their chance–already pretty
good–of “winning” a five-year, $90 million commitment to a pitcher in his
decline phase. With all due respect to Martinez’s substantial track
record and amazing ability, his next contract has a better than even chance of
being a boondoggle. The Sox have assumed a risk so they can be first in line
to assume an even greater risk.

The fact is, this move by the Red Sox guarantees nothing, and I would look at
Martinez’s behavior over the past year as clear evidence of that. Why should
the Red Sox expect goodwill, or quid pro quo, from someone whose whining
created this problem in the first place? The most likely scenario is that
eight months from now, Martinez will be talking about how the Red Sox have to
give him a contract extension over the winter, or he’ll walk at the end of
2004.

The Red Sox have given away a strategic advantage in 2003, and assumed an
unnecessary risk for 2004, all to placate the prima donna who created this
entire situation. Perhaps this will work out for them, but even if it does,
all they’ve done is set themselves up to go through it again, both with
Martinez and with Nomar Garciaparra, a free agent after 2004 who has
certainly watched the whole exchange carefully.