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First Basemen and Outrageous Contracts

Prince Fielder shocked the baseball world yesterday when he agreed to a nine-year, $214 million contract with the Detroit Tigers. This excitement comes in the doldrums of a rather boring time in the off-season, when replacement-level players find new homes and spring training is on the horizon. Phillies fans watched from the sidelines, simply glad that yet another top-tier player moved from the National League to the American League.

However, as Fielder just signed his mega-deal and used to be considered in the same stratosphere as Howard (the two have since gone in opposite directions), comparisons were made and questions were asked. Is the Fielder deal worse than Ryan Howard‘s five-year, $125 million contract? Ruben Amaro actually feels quite content, believe it or not. Per Rich Hofmann of the Philadelphia Daily News:

“I’m kind of happy,” [Amaro] said. “Really happy. Because if I would have had to put an 8- or 9-year deal on Howard’s deal right now, that would be a little disconcerting. Right now, we have Howard for the next 5 years. I kind of like that idea rather than having to do an 8- or 9- or 10-year deal.

“You can say what you want about Ryan Howard and how he stacks up against those guys, but there’s not too many people who, over the last several years, have had this kind of production – and he’s right there in the mix with those guys.”

Obviously, a deal that is nearly twice as long and twice as rich comes with exponentially more risk, but there are three big factors at play here:

Because of Fielder’s young age, he can still be expected to improve slightly. The ten-year forecast from Baseball Prospectus saw Fielder posting a 5.0 WARP last year (he actually produced 5.3) and improving to 5.1 in 2012 and 5.3 in 2013 before dropping down to 5.2 in the next two seasons. Howard was expected to hit the slopes years ago; Prospectus projected 4.0 WARP last year (Howard posted 1.6 in reality) and expects gradually less with each coming season.

As details of Fielder’s contract have not been published yet, we will have to assume an average annual value of $24 million per season. Over the length of Howard’s contract, Fielder will make only $4 million more in the first two years. From 2014-16, Howard will earn $1 million more than Fielder. Should the Phillies pick up Howard’s $23 million option in 2017, Howard will make $1 million less than Fielder.

The following are two tables depicting the players’ projected WARP along with their salary, and how much their respective teams will pay for 1 WARP every season. Generally speaking, 1 WARP costs about $5 million in free agency.

Prince Fielder
Year Age PA WARP Salary $/WARP
2012 28 783 5.1 $24.0M $4.7M
2013 29 789 5.3 $24.0M $4.5M
2014 30 787 5.2 $24.0M $4.6M
2015 31 783 5.2 $24.0M $4.6M
2016 32 768 5.0 $24.0M $4.8M
2017 33 760 4.9 $24.0M $4.9M
2018 34 744 4.6 $24.0M $5.2M
2019 35 734 4.5 $24.0M $5.3M
2020 36 723 4.3 $24.0M $5.6M
Ryan Howard
Year Age PA WARP Salary $/WARP
2012 32 666 3.7 $20.0M $5.4M
2013 33 654 3.6 $20.0M $5.6M
2014 34 637 3.3 $25.0M $7.6M
2015 35 628 3.3 $25.0M $7.6M
2016 36 614 3.0 $25.0M $8.3M
2017 37 595 2.9 $23.0M $7.9M
2018 38 579 2.5
2019 39 563 2.5
2020 40 543 1.9

Here is a pretty chart that illustrates the difference:

Depending on the distribution of the $214 million in Fielder’s contract, his blue line can move up or down at either end (here is a hastily-thought-of example). Because the Phillies backloaded Howard’s contract and he is projected to decline precipitously into his late-30’s, the Phillies are paying significantly more per WARP than the Tigers will pay on average. An additional caveat is that Howard’s projections are likely optimistic as his 2011 was well below expectations and Prospectus has not updated their projections as of yet (as far as I know, anyway).

Yesterday, I saw some responses to the Fielder contract from Phillies fans that viewed the exorbitant price as a justification for the Howard contract. They were saying that the Howard contract looks less silly in comparison, but that isn’t the case. Spike Eskin put it best on Twitter yesterday:

If you buy an overpriced car, and someone else also buys an overpriced car, you still have an overpriced car.

The Fielder contract not only fails to justify the Howard contract, it makes it look even more silly. The Tigers bought a Mercedes-Benz for the sticker price; the Phillies bought a used Camry for a Mercedes-Benz sticker price.