How Sandy Alderson has leveraged the offseason for the Mets

While the Wipons are leveraged to the hilt, this offseason has been a textbook case about how a team and a general manager use leverage (or have it used against them.) While TNT canceled the TV show “Leverage,” that word is still being used more today than I’m guessing any of us would have imagined just five years ago.

So, what is leverage? The dictionary definition is as follows:
1.
a. The action of a lever.
b. The mechanical advantage of a lever.
2. Positional advantage; power to act effectively: “started his . . . career with far more social leverage than his father had enjoyed” (Doris Kearns Goodwin).
3. The use of credit or borrowed funds to improve one’s speculative capacity and increase the rate of return from an investment, as in buying securities on margin.

We’re focused more on the definitions listed second and third, although at this point it shouldn’t surprise us if the first definition makes it into our sports lexicon soon, too.

The Wilpons are leveraged to the hilt – this is explained in the third definition above. But right now let’s focus on the second definition.

Usually we think of a club having “positional advantage” on pre-arb players. The Mets are no different than most clubs in this regard and they will certainly use this power to issue way-below market contracts for the likes of Ruben Tejada, Matt Harvey and a bunch of other young players.

But the Mets have used leverage like perhaps no other team here this offseason. The most obvious example is with R.A. Dickey, a pitcher coming off the best season in his career which resulted in 20 Wins and the Cy Young award. However, the Mets had Dickey signed to a team-friendly contract that included an option for 2013, which they picked up.

In addition to the dirt-cheap option, the Mets had further leverage with Dickey because of three other issues. A) He had very little history of success, a position bolstered by B) His use of the knuckleball, which many people mistrust. Perhaps most important of all was his C) Advanced baseball age of 38.

This leverage prompted Dickey to ask for a 2-year/$26 million extension, which seems really low when you consider he provided $20.8 million of on-field value according to FanGraphs and undoubtedly additional off-field value. While this appeared low to the average fan, the Mets, who enjoyed the leverage in this situation, balked at meeting this demand.

Some did not understand how or why the Mets were acting this way towards such a good guy. But it was business, they held the hammer and they used it. In return for a few days of bad press, the Mets used their leverage with Dickey to complete what has been regarded industry-wide as an outstanding deal with the Blue Jays.

Not only did the Mets have leverage with Dickey, they also held leverage with the other teams in baseball. Sure, there may have been some potential suitors turned off by the knuckleball but there is always a market for a guy with a 4.26 K/BB ratio and a 1.05 WHIP. At the Winter Meetings the scuttlebutt was that teams were only going to offer one top level prospect but because he had leverage – and patience – Sandy Alderson walked away with two top prospects and a highly-regarded international player.

The latest indication of leverage comes in this morning’s report that the Mets offered free agent Scott Hairston a 1-year/$2 million deal.

Ouch.

Hairston entered the offseason with visions of a three-year deal at a substantial raise over the $1.1 million he earned the previous two seasons. And who could blame him? If Hairston was worth $1.1 million following a 2010 season in which he put up a .640 OPS in 336 PA, surely he would be worth significantly more coming off a season with an .803 OPS in 398 PA.

But despite speculation that this year’s free agent market would yield high dollar contracts across the board because of the huge increases in national TV money, reality has written a different story. Sure, some free agents hit paydirt. But many are still left holding the bag and in particular it looks like outfielders have not seen the money they were expecting, from the top of the market on down.

While Josh Hamilton got his money, after the Angels got involved in a bit of a surprise, the others have not fared quite so well. B.J. Upton signed a lower-than-expected deal and Michael Bourn is still available. The trickle-down effect has been the evaporation of a market for Hairston, at least at the terms he envisioned earlier.

Alderson and the Mets did not start out with leverage in the Hairston negotiation but circumstance has certainly given them exactly that. Earlier, there were no reports of the Mets offering a specific dollar amount. My guess is because Alderson did not want to insult Hairston when he could turn around and walk away. He kept the dialogue moving forward until the point he was comfortable that once again he held the proverbial hammer.

There’s little doubt that Hairston felt like the nail when he was hit with Alderson’s offer. If Alderson felt comfortable offering Hairston this, it must mean that other clubs are not offering much, if any, more. This is probably how Alderson hoped the negotiations with Jose Reyes would go, too. But the Marlins ruined that by coming up with their back-loaded deal that blew whatever the Mets might have been willing to pay out of the water.

Of course, leverage works both ways. We saw Reyes had leverage while the Marlins were operating in their “win-now” mode, which unfortunately for this year’s class of free agents, did not last very long. Another player who enjoyed leverage was David Wright.

Having parted ways with all of the other stars from the Omar Minaya era, the Mets were backed into a corner with Wright. Not only was he a star but unlike, say, Carlos Beltran – he was immensely popular with the fan base. On top of that, he was the dull, no-waves personality that the Wilpons have traditionally embraced.

The bottom line is that Wright had the leverage and used it to get a contract that he’s far from a slam dunk to live up to, at least from an on-field production point of view. The Mets balked at paying R.A. Dickey a below-average contract because they had leverage. They willingly signed a deal requiring more than five times the money Dickey was asking for with Wright because they did not have the leverage.

Earlier, many fans were fretting when the Mets did not make any moves. We heard time and time again how they were the only club not to sign a major league free agent. But we’ve seen first hand how being patient and using the leverage he has available has paid off for Alderson. First he exceeded the return many expected with the RA Dickey deal. Now it appears he’s going to get an outfielder at a fraction of the cost many anticipated.

Which leaves one final question: Which outfielder will it be? Offering $2 million to Hairston feels very much like offering the $20 million dollar extension to Dickey. It’s high enough of an offer not to completely piss off the player and agent and low enough that there’s no danger that the player will sign it immediately.

When Alderson made that offer to Dickey, he was simultaneously offering him around to every other club. Now it seems like while Alderson is making this offer to Hairston that he must be simultaneously fishing for a bigger catch. Is it Bourn? Is it Michael Morse? Or is it someone who hasn’t even been previously linked to the Mets?

In this offseason of leverage and patience, all we can do is wait to find out the answer.

30 comments for “How Sandy Alderson has leveraged the offseason for the Mets

  1. Jerry Grote
    January 16, 2013 at 1:17 pm

    good stuff Brian.

    • January 16, 2013 at 1:22 pm

      Thanks JG!

      I just wish I had the skills to superimpose Alderson’s face on Mario’s (or is it Luigi’s?) body…

      • January 16, 2013 at 5:11 pm

        “Or is it Luigi’s”?!?!?

        For shame…

        (I enjoyed the post, as well)

  2. Chris F
    January 16, 2013 at 2:36 pm

    Well written Brian, and at heart I see where you are. But leverage exists beyond Alderson’s actions, and highlighting that as the start and finish of the situation is only front office. Fans also have leverage. Quite a bit. Should Citi field turn into a morgue much like we saw in August and September, a number of baseball operations decisions will be questioned. Ive been a vocal opponent for the RA dump, mostly because of the way Alderson wielded his hammer and not because of the trade. During this time, Sandy has come across to the player market as someone who you wouldnt want to play for. That Anthopoulos said as much at the Dickey announcement makes that clear. Ok, so he drives a hard bargain by presenting embarrassing offers to players rather than being open and constructive. If d’Arnaud blows that knee, or Wheeler blows a UCL, bet money no one will be singing his praises. Alderson does not conduct himself in a manner that has the outward apprearence of saying “come play here”. Penny wise, pound foolish.

    • January 16, 2013 at 2:55 pm

      Chris – I didn’t follow the Dickey trade from Toronto’s POV. If you have a quote from Alex A. about how Alderson handled the trade, I’d be interested in you sending me a link. I would imagine that Toronto was frustrated about the numerous leaks around the deal.

      Regardless of who the GM was, if he made a trade where the key pieces suffered big injuries — no one would be singing his praises. I don’t expect Alderson to be any different in that regard.

      • Chris F
        January 16, 2013 at 3:08 pm

        After going 20-6 with a 2.73 ERA and leading the NL with 230 strikeouts, Dickey was scheduled to earn $5.25 million next year with the Mets. At first they offered a deal adding $14 million over two years. New York later increased its offer to an additional $20 million over two years, still short of what Dickey wanted.

        “I even told him this when I met him, I didn’t think he got the respect he deserved,” Anthopoulos said.

        Read more: http://www.nydailynews.com/sports/baseball/mets-offer-dickey-disrespectful-toronto-gm-article-1.1236045#ixzz2IAfLdRqr

        • January 17, 2013 at 8:29 am

          Thanks for the link.

          I’d say this was a nice PR move by Alex A. However, it’s hard not to notice that he didn’t give Dickey the contract he wanted, either.

          • Chris F
            January 17, 2013 at 10:53 am

            There were a few Toronto newspaper links too, but I couldn’t quickly find them. Nevertheless, that story was the point. Also, RA was not looking for a budget buster contract, something that was obvious to everyone. He has said he plans to continue to live a modest life and return much of his salary to charity. He has already maxed his donation to the Jays foundation before throwing a single pitch. I think AA got as bout as close as he needed to, and the unpleasant tone of the trade and deadline made the smallish money difference inconsequential. He would have stayed in Flushing for less I imagine. In any event, Alderson got what he wanted, leading us to the need for patience to see if this delivers as hoped for. Im afraid it will be a long ’13 however!

  3. Name
    January 16, 2013 at 3:02 pm

    What you call “leverage” is really just market value.

    The only real case of someone actually using leverage is the case of David Wright. Everything else is just examples of market value being much lower than the player’s percieved value.

    • January 16, 2013 at 3:15 pm

      I disagree.

      Otherwise, how do you explain how Johnny Gomes signs a 2-year/$10 million contract while Hairston is hoping for a better offer than 1/$2? Both are platoon players who hit well against LHP but are stretched as starters. They’re the same age. Gomes is a slightly better hitter, while Hairston is a better defender, who can play for brief stretches in either CF or 2B.

      If it was market value, Hairston should be looking at a deal similar to Gomes but that’s not what’s available to him.

      • Name
        January 16, 2013 at 6:01 pm

        In my opinion, that 1/$2 is basically Sandy’s first offer, and he always starts with a lowball offer(i guess they aren’t offended because they know that’s his style). As we saw from Dickey, Sandy first offered 2/$14, but went up to 2/$20, so his first offer isn’t really close to what he’s willing to pay.

    • Jerry Grote
      January 16, 2013 at 4:02 pm

      I’m sorry … explain to me where Sandy Alderson needed to give Dickey *any extension at all*.

      I must have missed that part. By some reports, *any* extension that Sandy gave to Dickey might have weakened his position at bargaining tables, because it would have limited the acquiring team’s options.

      The overall goal of the Mets front office, right from the gate, might well have been to retain either one of Dickey or Wright. Once it was decided to retain David, contract talks with Dickey had no point other than to maintain a charade to the outside world. I mean, it’s wonderful Mr. Himalaya wanted an extension.

      Mr. Alderson is not in this business to do anything other than improve the baseball team on the field to the best of his abilities. Nothing more. If his goal is to trade Dickey, then he most certainly maximized that output. That, to me, is leverage appropriately applied.

      And on one last issue, regarding players “wanting to play for” a GM … I hardly think that anyone goes or does not go to Oakland because of Beane, or SF because of Sabean. But even if that was the case, our own David Wright spoke glowingly and at length about the management and specifically about our GM.

      It didn’t seem to harm those negotations.

      • Chris F
        January 16, 2013 at 6:44 pm

        Alderson didn’t have to offer an extension and would have been better in my opinion not to. The embarrassing offer he made did not help land the prospects. He could have gotten the same and with substantially less drama by telling RA not to expect any kind of offer until trade options were considered first. The contract RA wanted would have only limited the Mets by him accepting it, not what other teams would offer. The Jays still got a big bargain. I would add the obvious as well with regard to the Alderson era Mets: they suck. This team gets worse every year, and this season won’t be any different. He is not fielding quality teams. By the way, David Wright also spoke glowingly about the Wilpon’s, who are only marginally worse owners than Jeff Loria. My overall point is that this is a human game as much as it is anything, and Aldersons “people skills” seem to rank among the bottom.

        • Jerry Grote
          January 16, 2013 at 8:01 pm

          Honestly? You are going to blame Sandy Alderson for the declining Mets teams?

          Wow. Talk about perspective … the depth of your insight is stunning.

          Tell you what, why don’t you give us an example of a GM where their “people skills” made any sort of difference in turning around a franchise. And perhaps you can help us all understand how Sandy Alderson is responsible for the destruction of the Mets finances, or how he helped the Mets to bring on the contracts of Jason Bay, Ollie Perez, or Luis Castillo. Or how he completely destroyed the Mets farm system.

          Oh wait. He didn’t do any of those things; all he’s done is turn around a franchise and give it purpose. What you are completely missing here is the concept of leverage, the whole point of the author. Everyone in baseball knows Sandy is working with a short hand. He’s rebuilt the farm system, given us some hope, retained the face of the franchise (for once), and done it while slicing the budget in half.

          Sorry if he had to trade your favorite player along the way and not wipe his Himalayan a$$ as he left.

          • Metsense
            January 16, 2013 at 10:21 pm

            Alderson has not turned around the franchise yet. 3 years in 4th place looks stagnant to me. When and if they start winning then he can take credit for turning around a franchise. The bottom line is what counts.

            • jerrygrote
              January 17, 2013 at 1:51 am

              fair enough. We’ll agree that Sandy’s given us hope, which brings to mind two good quotes from a favorite movie …

              Let me tell you something my friend. Hope is a dangerous thing. Hope can drive a man insane

              Remember Red, hope is a good thing, maybe the best of things, and no good thing ever dies …

              They might as well have been arguing about the value of trading minor league prospects.

          • BrooklynGirl
            January 16, 2013 at 10:31 pm

            yeah he retained the “brown nose” face of the franchise while letting go of the heart and soul of the franchise

          • January 17, 2013 at 5:46 am

            If the Yankees were so interested in Scott Hairston they would have signed him to a one year deal already. If Scott is looking for 2 years I believe he has no leverage against the Mets or for that matter any team interested in signing him.

          • January 17, 2013 at 5:54 am

            No one was complaining about the Mets farm system when they were winning. They should of beaten the Cardinals at home game 7. But they didn’t. They should of beaten the Marlins on the last day of the season. But they didn’t. I recall Johan pitching on short rest and pitching a 3 hit shutout against the Marlins. Being up 7 games with 17 to play and failing to make the playoffs falls squarely on the managers shoulders. Between Randolph and Manuel the Mets lost their window of opportunity to become the champions they could of been not the chumps they later turned out to be. So the team has to be rebuilt from the bottom up and it takes time. I know it stinks and we all want for the Mets to be successful in the long run.

  4. Acoustic567
    January 16, 2013 at 3:03 pm

    Great post. An especially important point is that Alderson had to string along Dickey with a lowball offer in order to have the time to make the deal he wanted. I’m pretty sure Dickey and any other player can understand that, even if they don’t like it, especially since they were not obliged to extend him at all. If I were a Met I would actually appreciate the fact that Alderson is exploiting his leverage to improve the team.

  5. Metsense
    January 16, 2013 at 10:17 pm

    Alderson is a hard ass negotiator who has the patience to wait for his own terms. I really admire him for that. He has put together a very uncompetitive team for 2013. Hopefully he has a .500 team by 2014 and a competitive team by 2015. Boy, I can’t wait !!! I think there are better ways to assemble a team, maintain a budget, and still be competitive. So far I’m not buying into sandy’s way. I hope he converts me and soon.

  6. BrooklynGirl
    January 16, 2013 at 10:36 pm

    Look I get it and I know Sandy is only doing his job. It could have, should have been handled with with respect and dignity.

  7. AJ
    January 16, 2013 at 11:01 pm

    Brian, I know you don’t put all the work you do into writing a piece like this just to get the standard “nice post” pat on the back reply, but… Nice post!

    The behind the scenes machinations that result in the team we eventually see on the field are intriguing. However, we in the cheap seats (there’s a phrase that has acquired some irony) never know all the stuff going on until after the fact, if ever. I think some of the information that’s out there in the media while the negotiating takes place is intentionally misleading, and a good deal of the rest of it is fabricated for the sake of satisfying the market. It’s a long way from the last game of the World Series to the first day of Spring Training. The people in the baseball media have to make a living and the baseball junkies need something to tide them over. Meanwhile, for management and the players and their agents, it’s business.

    • jerrygrote
      January 17, 2013 at 1:46 am

      …”some of the information that’s out there … while the negotiating takes place is intentionally misleading” … as you’d hear on Seinfeld …”That gold, Jerry! Gold!”

      bingo.

      I don’t believe for a minute that KT is going to hold out for a Mariner deal. I don’t honestly think the Mets FO would have failed to give Dickey a reasonable contract, when it got down to the final decision. But we won’t know. It all reminds me of the end of the Wizard of Oz. Pay no attention to the man behind the curtain.

    • January 17, 2013 at 8:47 am

      Thanks AJ!

      I welcome all sincere comments, both positive and negative. Unfortunately, it’s a lot easier to be negative about something, especially online.

      Mets360 has experienced tremendous growth – for which I am very grateful. One of the challenges the site faces moving forward is to keep the comments section both civil and enlightening.

      My goal is to have a community where we can disagree without being disagreeable. Perhaps if we learn how to “hate” it will make it easier to learn how to “love” – all apologies to Ozzy.

      • AJ
        January 17, 2013 at 3:26 pm

        Ozzie Guillen said that?

        • January 17, 2013 at 4:39 pm

          “Crazy, but that’s how it goes
          Millions of people living as foes
          Maybe it’s not too late
          To learn how to love
          And forget how to hate

          Mental wounds not healing
          Life’s a bitter shame
          I’m going off the rails on a crazy train”

          • AJ
            January 17, 2013 at 10:02 pm

            Ozzie Smith?

            • NormE
              January 18, 2013 at 12:34 am

              Try Ozzie Canseco.

              • Metsense
                January 18, 2013 at 7:18 am

                Ozzie Osbourne

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