A Lesson for Giants, A's
by Glenn Dickey
Feb 08, 2006

THE BOSTON Red Sox have little in common with the Giants and A’s, but their offseason travails are an interesting lesson in baseball economics that has relevance for both Bay Area teams.

When Theo Epstein resigned as general manager of the Red Sox on October 31, the original speculation was that he had had a personal conflict with team CEO Larry Lucchino. In the period before his recent return, it became clear that there was a philosophical dispute between the two – and Epstein has won that battle.

Basically, Epstein worried that the Red Sox were following the Yankee model of throwing money and long-term contracts at aging players. The Red Sox had four regulars – Johnny Damon, Edgar Renteria, Jason Varitek and Manny Ramirez – on contracts totaling $50 million a year.

The Yankees and Red Sox can both afford those salaries because they each have their own sports cable television networks which bring in an enormous amount of money. (For a more detailed explanation of this, look in “Archive” for my April 7, 2005 column.)

But, frankly, the formula doesn’t even work that well for the Yankees.

When free agency hit baseball, Yankees owner George Steinbrenner naturally made the big splurges, picking up Catfish Hunter, Reggie Jackson and Dave Winfield, among others. The signing of Jackson, especially, paid early dividends; Reggie hit three home runs in three at-bats in the sixth and deciding game of the 1977 World Series. The next year, the Yankeees won their second straight World Championship.

But soon, the Yankees hit a 13-year dry spell in which they did not make the playoffs.

The stretch ended in 1995 – because in the ‘90s, the Yankees strengthened their farm system. A young executive named Brian Sabean was director of scouting, 1986-90, and vice president of player development the next two years. In the ‘90s, they brought up Bernie Williams, Derek Jeter, Andy Pettite, Jorge Posada, Mariano Rivera and Alfonso Soriano. They formed the nucleus of a team that won four out of five World Series in the 1996-2000 period, the last three consecutively.

But Steinbrenner can’t help himself. Soon, he was going after high-priced free agents again and letting the farm system deteriorate. The Yankees are still a strong team, but they’ve slipped from the top level as they’ve gotten older.

Epstein didn’t want that to happen to the Red Sox. So, the team made only a half-hearted attempt to retain Damon, who got a better offer from the Yankees (surprise!). They traded Renteria to Atlanta for third base prospect Andy Marte, who was then included in a trade with Cleveland which got them center fielder Coco Crisp. They signed 25-year-old pitcher Josh Beckett and shortstop Alex Gonzalex to a one-year deal. They have a much younger team, and they’ll have the payroll flexibility to go after top free agent pitchers next season.

IN ONE OF those ironic twists of fate, Sabean, once the main builder of a great farm system, is shepherding a team which rivals the Yankees in age, if not talent.

This was probably not Sabean’s intention. In his first big trade as the Giants general manager, he traded Matt Williams because he didn’t want to tie up too much of the payroll in two players and he thought Barry Bonds would be the one to keep, which has certainly proven to be the right decision.

As Bonds has aged, though, the Giants have fallen into the same pattern as the 49ers after 1995. As long as they had Steve Young, the Niners felt they had a chance at the Super Bowl, and they tried to fill in around him with veteran free agents. The Giants have done the same with Bonds. In both cases, the decisions on free agents have not been the best. When Young went down in 1999, the 49ers collapsed into a 4-12 season. When Bonds missed almost all the season in 2005, the Giants also collapsed.

Meanwhile, the Giants farm system has produced two excellent pitchers, Noah Lowry and Matt Cain, and several others Sabean has used in trades to, yes, bring in veterans. Meanwhile, they’re getting virtually no position players out of the minor league system.

Perhaps they will be able to hold everything together for one more good season – if Bonds can play as many as 120 games. More likely, he won’t be able to play that many and the Giants will again miss the playoffs. And with their unproductive farm system, the future is not bright.

The A’s, of course, have played it quite differently. Their whole organization is based on their minor league system. They draft well and they develop both pitchers and position players. Last year, they had four rookies in key positions – Huston Street, the American League Rookie of the Year as a closer, starter Joe Blanton, first baseman Dan Johnson and right fielder Nick Swisher. The year before, they also had the AL Rookie of the Year, shortstop Bobby Crosby.

The A’s are not inventing the wheel. They’re simply following the formula developed by Branch Rickey with the St. Louis Cardinals in the ‘30s. Nor are they alone in the majors. The Minnesota Twins have had success in the same way, with a relatively low budget but a productive farm system. The Atlanta Braves turned over much of their roster this last season but once again made the playoffs. The Cleveland Indians had gone on a youth movement a couple of years ago, and only a late season collapse kept them out of the playoffs last season.

TEAMS LIKE the A’s and Twins, which have relatively low revenue streams, have had no choice but to rely on their farm systems to produce a continuous flow of quality players. What’s significant in this story is that the Red Sox, who have no problem paying high salaries, also think that staying young is important to success, for both the short- and long-term.

Let’s hope the Giants get the message.

LETTERS: I’ll be updating this section later this morning.

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