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“We’ll Pay For Your Intangibles With Intangible Money.”

[ 16 ] November 23, 2010 |

Shorter Brian Cashman: “Dear Derek: if you don’t like being only significantly overpaid rather than grossly overpaid, feel free to go out and see if Michael Kay has been made the general manager of another wealthy major league team and I haven’t noticed.”

My question: where does Jeter play once the Yanks figure out that he’s no longer even playable as a major league shortstop? The Yanks taking a relatively hard line makes sense, especially on contract length. And it’s hard to imagine a mainstream columnist being willing to say this even two years ago.

Update [Paul]: This is a pretty interesting situation in terms of straight economic analysis and game theory. As Scott notes it’s likely that the Yankees’ offer (reportedly $45 million over three years) is probably much more than what Jeter could expect to get as a free agent. Why would the team do that, and even more mysteriously, why would Jeter’s agent react by going into hurt-confused-offended mode? As to why the NYY would pay considerably more than any other team would for Jeter’s services at this point, the argument can be made (and no doubt his agent is making it at length) that Jeter is worth a lot more to the Yankees than any other team, because he’s an integral part of their current “branding,” to put it in MBA-speak. But how good is the evidence for this argument? The alternative for New York is to pay something like $15 million over the next three years for a shortstop of similar likely quality to Jeter over that time, or perhaps $30 million for a significantly better player (not necessarily a shortstop). In the former case they save $30 million, and have the same odds of having successful seasons in terms of actually winning games. In the latter case they save a lot less money but marginally increase their chances of winning big (and even a couple of wins at the margin are especially valuable to a team that’s very likely to be in championship contention anyway).

Are the economic benefits that the Yankees get from having Jeter in their lineup likely to outweigh the benefits of either of these alternative approaches? It seems at least questionable that they would . . . Which leads to the real possibility that Brian Cashman is playing a subtle game of chicken in game theory terms, where what he’s hoping for is precisely that Jeter rejects his final offer in an operatic huff, thus allowing the Yankees to play the “egotistical zillionaire athlete with no gratitude for the team and fans who made him what he is today” etc etc.

My guess is that Jeter and Casey Close understand this well enough, and that after a little bit more huffing and puffing they’ll take something very much like the offer on the table.

Comments (16)

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  1. wengler says:

    As someone with a passionate burning hatred of anything Yankees, this whole situation has made me quite happy.

    Use every tool at your disposal Jeter! Look over at third, ARod moved over to 3rd for you and he is going to be making almost twice as much as you. Appeal to the fans! You built the New Yankee Stadium! Who is the Cap’n? YOU ARE!

  2. Matt says:

    Do people who write for ESPN not count as “mainstream” now? That seems odd, but if they do count as mainstream, I have a hard time not seeing, say, Keith Law or Rob Neyer not writing columns like the above when appropriate. (The year before this one it wasn’t so clear that such an article was appropriate, which might be a reason one saw fewer of them.)

  3. Joe says:

    The Yanks want Jeter as much (more so now) as a “personality” and old timer than his talent, have for years. Sure let him go. Let A-Rod or whoever is in the outfielder serve as the public face along with Riveria. That will help pay for those tickets.

    The idea a star of the town since the mid-90s also will be a bit full of himself is also not shall we say shocking. I admit that looking elsewhere, like the not that exciting new manager of the Mets, is less emotionally satisfying. But, the Jeter stuff is getting a tad old. You know like the man.

  4. James E. Powell says:

    This is a classic example of both parties lacking the good sense to make a Big Happy Deal that helps them both in the long run. For one thing, all this should have been taken care of behind closed doors. The Yankees surely understand that if they want to keep one of their single-digit players in pinstripes for his entire career, it is going to cost them more than the player is worth as a player. Jeter surely understands that he is no longer the player who signed the last contract and that he is going to be paid less than that, but not exactly a pittance.

    So why can’t smart people determine in a matter of a few weeks at most where those two lines cross and make a deal?

    I don’t get it.

    • Scott Lemieux says:

      The Yankees surely understand that if they want to keep one of their single-digit players in pinstripes for his entire career, it is going to cost them more than the player is worth as a player.

      Right, but Cashman is correct — their initial offer is way over his market value already.

      • James E. Powell says:

        Cashman is absolutely right, so I am not sure I can fault him. One wonders if there have been any conversations about sober reality with Jeter’s agent over the last year or so. Jeter is harder to figure. Other teams are not going to pay the “All Time Yankee Great ” premium that Cashman is offering. So what exactly does he want?

        Is it all about the love? Or respect? Some sense of rivalry with his ex-BFF? It’s about money, isn’t it?

        • TT says:

          DJ, like any athlete who has been the “face” of a franchise for a good long while, probably believes that the club should show its respect for him by offering a contract that reflects 15 seasons of All-Star/WS-winning/Monument Park and HOF-bound service. He’s basically trying to call in his chits, and the “Yankee premium” makes them more expensive than they otherwise would be with a lesser club. But Cashman, at least in his public statements, isn’t having any. He believes that there is a premium to be paid, just not at the price DJ’s asking. If he walks, he walks.

        • What’s interesting here is not the value of Jeter to the Yanks, or to any other team; it’s that this negotiation is taking place in public. It looks like Jeter’s agent is the one to take it outside, and that is a very foolish move, I think. The team is paying a premium over market value (that’s pretty obvious I should think, even to the commodity). The Yankees are paying this premium because of the player’s popularity with the fan base, and are presumably not interested in running the player down. A good deal of that popularity comes from the perception that Jeter is such a class act. Jeter (or probably actually his agent) is imperiling this perception– and probably over a comparatively minor difference. The Yankees have cut plenty of iconic players loose in the past– from Babe Ruth to Bernie Williams. It seems to me there are a couple of big stars from recent World Series teams playing in different uniforms this year. I’m impressed by how foolish Jeter’s position seems to be.

  5. rea says:

    Actually, Jeter probably doesn’t ever get paid in tangible money–they probably just write him a check . . .

  6. LosGatosCA says:

    Someone would send a list of names for consideration:

    Babe Ruth
    Joe Montana
    Jerry Rice
    Brett Fav-rah
    Barry Bonds
    Every member of the 1980′s Oilers
    Most members of the 1970′s A’s
    Tom Seaver
    Dustin Byfuglien

    Gratitude for past performance is not always rewarded with respect, rarely put in monetary form, and even more rarely to the tune of $15m per.

    Don’t imagine yourself to be even the equal of about half the individuals on that list and they were all sent packing, no parting gifts bestowed.

  7. c u n d gulag says:

    Jeter’s learning a hard lesson here: Hal ain’t George!
    George would have given him a sweet 5 or 6 year deal, just for old time(ers) sake.
    As a diehard Yankee fan, I am amused that Cashman draws the line on Jeter, after years of signing pitchers like Pavano, who was hurt all 4 years, and Randy Johnson and Kevin Brown, who were on the downward slope of the mound.
    Jete’s wants respect on the A-Rod salary level. The problem is that the Yanks signed ‘Ster-Rod’ after a 50 homer season, expecting a big run-up to the Aaron record (since Bonds’ was tainted), only to find out Alex partook himself. And actually, the had let him go, smartly a lot of us Yankee fans thought, only to have him come back, Jason-like (and I don’t mean Giambi) and be given a new outlandish contract during the WS.
    I love Jeter, I know his failings, and that he was overpaid for 10 years, but you don’t draw your line in the sand over someone like him. You should have done it with Alex.
    But, Hell, it ain’t my money…
    I think he’ll put his tail between his legs and sign for the 3 years.
    But if the Mets were smart, with their sagging attendance, they might think about giving Jeter a huge contract, just to draw fans as he gets near 3,000 next year and to really piss-off the Yankees.
    My beloved NYC would resemble a baseball Gettysburg.

    • NBarnes says:

      But if the Mets were smart, with their sagging attendance, they might think about giving Jeter a huge contract, just to draw fans as he gets near 3,000 next year and to really piss-off the Yankees.

      My understanding is that Sandy Alderson wants to win, not sign 37-year-old ‘shortstops’ to multi-year contracts.

  8. CJColucci says:

    I don’t get Jeter’s agent’s strategy. Let’s assume they want 5 years at $20 million per. As a matter of negotiating, it’s not that hard to make a deal, especially since the Yanks have accepted the idea that they have to pay Jeter more than he seems to be worth purely as a player.
    A fourth year, a bunch of incentives that the Jeter of a year or so ago could reasonably expect to make (and for which the Yankees would not mind paying if he made them) to close the money gap. Maybe some career bonuses, like a few million for hit number 3500 (which would mean that Jeter has given them at least two years at a higher level than they expect). What’s hard about this? Did the negotiators just rub each other the wrong way?

  9. efgoldman says:

    Back cover of the Post: The ultimate Sox Fan schadenfreude.

    Won’t ever happen, nor should it, but still…

    http://www.nypost.com/rw/nypost/2010/11/24/covers/back112410.jpg

    (wish the image were bigger)

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