Tuesday, April 27, 2010
The Timing of the Ryan Howard Contract ExtensionPosted by Josh Levitt
I thought that there would be no better way to start off a piece about Ryan Howard's $125 million dollar contract extension then with this telling quote from Phillies GM Ruben Amaro regarding the timing of the extension:
"We just felt it was good timing for us," Amaro said. "We felt No. 1, he's one of the elite offensive players in the game. We could have waited another year and a half or so and dealt with it later on, but the fact of the matter is we decided he is that important to our organization and to our club and to our future."
Let's break that statement down. From Amaro's point of view, timing played a crucial role in his decision to hand Howard a nine figure contract extension. But what timing exactly is Amaro referring to? According to Cots Baseball Contracts, under the terms of the previous deal Howard signed with the Phillies, he was under contract with the Phillies through the 2011 season, when he will be turning 32 years old. Was there a threat that Howard was going to leave before 2011? Absolutely not.
So then what exactly is Amaro referring to when he talks about timing? Could it be cost? Did GM Ruben Amaro honestly think that if he did not lock up Ryan Howard right now than his price tag was sure to go up astronomically in the future? This point does not make much sense either. If the Phillies let Howard play out the remainder of his contract and become a free agent after the 2011 season, then how likely is it right now that Howard, in the same free agent class as Prince Fielder and Adrian Gonzalez, would have earned $125 million guaranteed? When you take into account that the Yankees and Tigers already have their first baseman for the next decade, and that the Red Sox have been linked to Adrian Gonzalez for what seems like years at this point, the answer is not very likely. In addition, despite all of his offensive firepower, Ryan Howard would have been the third most demanded free agent first baseman if he hit the market (after Gonzalez and Fielder), which certainly would have hurt his leverage on the market and ability to negotiate with suitors.
One final point regarding the 2012 free agent class, if the Cardinals pick up their 2011 option on Albert Pujols after the season, than Pujols would set to join the 2012 free agent class. With his free agent competition so steep, how can anyone believe that Ryan Howard would have landed anything in excess of $125 million?
It's obvious that the Phillies would have faced a sharp backlash in the short term if Howard left the Phillies after the 2011 season. Howard is a fan favorite in Philadelphia and has been a wonderful player for the Phillies during his tenure with the club, but this extension speaks to desperation to keep Howard in a Phillies uniform long term. In my opinion, the reason why Amaro felt that the timing was perfect now to lock up Howard until he's 36 years old is because Howard was the first one of the 2012 free agent group (Fielder, Gonzalez) to sign a contract. In theory, if Prince Fielder had signed with the Brewers for $150 million dollars this spring, then there is no doubt in my mind that Howard would have used that number as a starting point/reference in his negotiations. And while the price tag ultimately could have gone down to a level that the Phillies felt more comfortable paying, locking up Howard now gives the Phillies good will with their slugging first baseman, with whom they have had tension filled negotiations with in the past.
The art of the deal is all about timing. While Ruben Amaro is getting ripped apart today for this contract, I'm sure that somewhere in his head, he can justify to himself that the timing of this deal was correct. As for the general public and most devout baseball fans, we are left to wonder: what exactly was Amaro thinking?
Josh Levitt also operates MLBFreeAgency.com. Feel free to e-mail with any questions or comments.