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July 9, 2009
Packaging the Canadian Ace
On Tuesday afternoon the Blue Jays' general manager, J.P. Ricciardi, said that while he's not shopping the pitcher, he will listen to offers for ace Roy Halladay. This is the only sensible approach. Ricciardi's team was one of the six best in baseball last year, and never really appeared in a race for a post-season berth. It's one of the seven or eight best teams in baseball this year…and is nevertheless the fourth-best team in its own division. It's likely to be fourth-best in its division next year. Despite some young talent on hand, the competition level of the AL East means that Ricciardi has to try and build the best team in baseball, and his current core, even with Halladay and some young players, won't become that team. Trading Halladay is his way to do what the Rangers did by trading Mark Teixeira, and accelerate the construction of a championship-caliber roster.
There's no question that Halladay is a Teixeira-type player, arguably even more valuable. While his stat lines don't show durability, a number of his recent injuries have been flukes rather than reflective of fragility. If he's not the best pitcher in baseball, he's on the short list for the honor. Like Teixeira at the time of that trade, Halladay is signed through next season, making him an even more attractive trade option than, say, CC Sabathia was a year ago.
Now, you'd normally try and figure out which teams have the prospects and the motivation to make an offer for a pitcher such as Halladay. This is complicated slightly by the fact that three of those teams-the Yankees, Red Sox, and Rays-reside in the AL East with the Jays. It's not out of the question to suggest that Ricciardi would deal Halladay within the division, but it's probably in his mind to send him out of the AL East-and perhaps out of the AL altogether-if he can. None of those three teams has a burning need for a starting pitcher, though Halladay would front all of their rotations, and all could assemble a package that would rival what the Braves assembled when they traded for Teixeira. Outside of the division, you'd look at the Rangers, in a dogfight in the AL West and in dire need of a true number-one starter, with staggering amounts of pitching in their system. The Cardinals and Braves could assemble competitive offers, but both teams have such dire need for a bat that trading for Halladay would likely be off of their radars. The same goes for the Giants, and to a lesser extent the Marlins. Certainly every team in baseball could use a Roy Halladay, but some would be better off allocating resources elsewhere.
Let's run at this from another direction. What if a team offered the Blue Jays not its very best prospects, but offered it the kind of payroll relief that would pay off for years to come? What if a team took Vernon Wells off of its hands?
When the Blue Jays signed Vernon Wells after the 2006 season, it was very clearly a case of buying high. The center fielder was coming off his age-27 season, his fifth as a full-time player, and just his second of those with an OBP above .340. Wells' core skills showed him to be a good-not-great player, whose value was buoyed by excellent defense in center field, but lacking the on-base skills to be a true middle-of-the-order anchor, and with speed that was more perceived than actual (he was at 53/15 SB/CS to that point in his career). The contract was doomed the moment it was signed, massively backloaded to make it affordable to the team, but ensuring that Wells would eventually be an albatross. Here's what's left on it after this year:
2010: $12.5 million + $8.5 million share of signing bonus
That's five years and $107 million, or about $11 million less than what's left on Johan Santana's contract. It's just a bit less than what Sabathia will make in those years. It's more than what's left on the laughingstock contracts signed by Alfonso Soriano and Barry Zito. If it's not the worst contract in the game, it's certainly in the discussion, and it threatens the Jays' payroll for the next half-decade. Wells has rarely been worth $10 million in a season; the chance that he'll be worth $21 million in any remaining season of his career is basically nil, and there's some chance he won't be worth that much in all five years combined. Just to look at one data point via MORP, PECOTA projects Wells to be worth $14.3 million… in those five seasons combined.
As you would expect from a player who wasn't terribly fast entering his thirties, Wells' range in center field is declining. The Jays will soon have to choose between making Wells a below-average center fielder or an average to average-plus corner man. Should they move him, though, his bat will be even more a relative handicap. Wells' career line of .282/.330/.475, given the era and park in which he's played, would be adequate in a corner. There's not much reason to think he can match those numbers going forward, however. He hasn't had an OBP of .350 or a SLG of .500 since that 2006 season that earned him the ridiculous contract. Give their young core, the number of expiring contracts they have and their likely path after a Halladay trade, Wells could be consuming a third of the payroll by Opening Day 2011 while hitting like a fourth outfielder.
How much would it be worth to a team to bite that bullet? If Wells were worth $14.3 million while making $107 million, Halladay would have to be worth more than $90 million in the next year and a half to balance it out. That's probably not reasonable. What is? Halladay has been worth 3.7 WARP in a bit more than a half-season, while missing a couple of starts along the way. PECOTA projected him to be worth 5.2 wins, or about 2.7 to date. Let's split the difference and suggest that Halladay is worth about three wins to whatever team trades for him-a conservative estimate given that he'd probably be replacing sub-replacement performance-and five wins next season. That's eight all told, which means the marginal value of each win would have to be about $12.5 just to make taking on Wells' contract a breakeven proposition, and before considering Halladay's salary and any prospects required to close the deal.
You can't get there. The peak of the marginal-win graph was $4.5 million back in 2006, as published in Baseball Between the Numbers. I can make a case for pushing that number higher, to about $5.5 million, maybe $6 million at the outside, given the increased industry revenues and the possibility that individual teams may have steeper curves. Teams with particularly weak outfields, such as the Braves or Mets, would potentially see a boost from adding Wells that a typical team wouldn't. These bumps could make Halladay and Wells worth something shy of $50 million to their new team, or about $40 million less than the expected loss on Wells' deal. I cannot get to the value of Wells' contract; I'm stretched to get to half.
Now, you can play with the numbers, push Halladay's projection higher, push Wells' projection higher, maybe estimated high marginal revenues (if a team with a lot of room to grow, such as the Rangers, were to acquire him and reach the postseason). Still, I think it's fair to say that the economic case for taking Vernon Wells in a Roy Halladay deal is weak, and again, this ignores the probably need to include at least some talent in return.
This actually strengthens the case for the Jays trying to do this kind of deal. Wells is a massive albatross, a roadblock to the construction of a championship team-he's clearly not good enough to build around-and a payroll sink. Virtually no single prospect they can get back in a deal is going to provide more value than the $20 million a year they would get back by dumping Wells into a Halladay trade. A package of prospects that hits, like the one the Rangers got for Teixeira, could make up that value; of course, sometimes you try to make that trade and you get Carlos Gomez and nothing.
All of this sidesteps Vernon Wells' no-trade clause, which may be the largest barrier to a deal. Then again, if you offer Wells a chance to go with Halladay to a contender, he might be willing to waive it. He has no option year to guarantee, and given how bad his contract is, no team is going to extend it just for the privilege of taking it on. If this type of deal were available, you'd probably have to rely on Wells wanting to play for a winning team, wanting to go with Halladay to a contender, and to not be perceived as the player who blocked a positive-if likely unpopular-step for the Jays.
Given all of this, which teams would come to the forefront in bidding for Halladay?
Every team in baseball could use Roy Halladay. Just one will end up with him. That team is probably going to be one with a deep farm system, but a willingness to be creative and to solve the organization's single biggest problem might go further than a long list of prospects. A contract as damaging as Wells' is rare-it is what people thought the Alex Rodriguez contract was-and it's so bad that the Jays actually have to consider the idea that trading it away, rather than acquiring prospects, is the end goal of shopping Roy Halladay.