The trade market was supposed to be the Yankees refuge from this year’s class of overpriced, and perhaps overrated, free agents. Brian Cashman has reportedly been kicking the tires on several young pitchers, but, at least at this point, the demands have been too extravagant. One of the names in which the Yankees were believed to have an interest was John Danks, but now even he is no longer eligible for consideration. After weeks of espousing a “rebuilding philosophy”, the White Sox did a semi-about face and signed Danks to a five-year, $65 million extension.
Beyond the disappointment expressed by Yankees’ fans, the Danks extension was greeted by two common reactions. The first was confusion, namely, why are the White Sox handing out lucrative contract extensions when GM Kenny Williams has repeatedly talked about being a seller this offseason? The second reaction was incredulity over the terms, especially when compared to two recent extensions for pitchers with a similar amount of service time (Chad Billingsley and Wandy Rodriguez). However, both of these responses seem to miss a key point. Danks is a uniquely talented young lefty.
At age 26, John Danks is not that much older than some of the prospects over which so many drool. The difference, of course, is the White Sox’ left hander has five full major league seasons under his belt, during which he has compiled a WAR of 19.2. Put in a historical context, only seven other left handers, age-26 or younger, had a higher WAR over their first five seasons, and most on the list that surround him went on to very successful careers (1,769 pitchers qualified for this screen). In other words, not only has Danks been pretty darn good, but the best may be yet to come.
Top-15 Young Southpaws, from 1901*
*Noodles Hahn’s career began in 1899, and his statistics before from 1899-1900 are excluded.
Note: Data is from first five seasons of left-handed pitchers age-26 or younger.
Although it should be noted that Danks’ performance has fallen off since his peak 2008 season, his peripherals are strong and, just as important, he is still relatively young. So, if his past performance and future potential are accurately depicted in the chart above, it’s easy to see why the White Sox would be willing to extend him even if in the midst of a rebuilding process. Talented young left handers are a very valuable commodity, and they tend to do very well in free agency. Had the White Sox allowed Danks to hit the open market after this season, there’s a good chance the then 28-year old would have commanded a contract well in excess of the extension he just signed. After all, the White Sox will be paying Danks over the next four years the same amount the Rangers just bid simply for the right to negotiate with Yu Darvish. And, if other teams agree that Danks’ contract is a relative bargain, the White Sox should have no problem trading him should the organization determine that its “retooling” will take longer than expected.
In contrast to my viewpoint, some have suggested that the White Sox were overzealous in their decision to extend Danks because Billingsley and Rodriguez, two pitchers who have been statistically similar, recently signed three-year deals for $35 million and $34 million, respectively. Off the bat, the comparison to Rodriguez fails because the Astros’ lefty was 32 when he signed his extension, or one year older than Danks will be when his new deal expires. Billingsley, however, is a good comparison, but since when does one contract define the market?
As mentioned above, there is every reason to believe Danks would have been a very popular free agent in 2012, which seems much more relevant than what Billingsley accepted last spring. Furthermore, a comparison of the two contracts requires that one look at risk in two ways. In addition to the increased exposure to injury and underperformance that comes from a longer-term deal, teams must also consider the risk of replacement cost. Assuming Billingsley and Danks perform up to expectations, which is the basis for offering an extension in the first place, both pitchers will likely command another lucrative contract when their current one expires. Should that scenario come to fruition, the White Sox will likely be enjoying Danks’ age-31 season at a discount, while the Dodgers are forced to re-extend Billingsley one year earlier (Los Angeles has a $14 million option for 2014). Although a myriad of variables must be considered, many based on conjecture, the possibility of Danks’ longer deal being more cost effective can’t be ignored.
Who knows how seriously the Yankees and White Sox discussed a deal for John Danks? For months, I have been advocating (and hoping) for such an exchange, but now it’s time to move on to another target. Without many attractive options remaining (maybe Gio Gonzalez and Matt Cain), however, the new question becomes just how far to look ahead? Yankees’ fans may not like to hear this, but it’s entirely possible this offseason is simply laying the groundwork for winters to come.