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Baseball's New Landscape
The 'Sugar Daddy' Era Is Over as Even the Richest Teams Are Making an Effort to Keep a Young Crop of Players

By Dave Sheinin
Washington Post Staff Writer
Wednesday, March 28, 2007

In the offseason, almost imperceptibly, the very foundation of baseball's talent-flow system -- the means by which rich and poor teams amass players and move them among each other -- was jolted by a tectonic shift. When the New York Yankees not only held onto their best pitching prospect, right-hander Philip Hughes, but also traded away two potential Hall of Fame veterans, Randy Johnson and Gary Sheffield, for six prospects, it may have marked the end of an era -- one that we shall call what?

"We're not going to be anybody's sugar daddy anymore," Yankees General Manager Brian Cashman said this spring, when asked about this shift.

So there it is: The Sugar Daddy Era. And it's over, thanks largely to Cashman and the Yankees.

For generations, the Yankees drove the talent marketplace. Agents flocked to them to coax big paydays for their clients, which raised the market value of other free agents. Small-market teams, unable to afford to keep their players once they reached higher salary levels, knew they could always count on the Yankees -- and at times, other large-market teams -- to give away the fruits of their farm system to take those higher-priced players off their hands.

Even as smaller market teams such as Oakland and Minnesota began to figure out that the key to sustained success was through a healthy farm system -- which, if properly maintained, could continually replenish the major league roster with new, fresh talent wherever it was needed -- the Yankees remained willing to plunder their own farm system for the sake of the quick fix.

But not anymore. The Sugar Daddy Era is over. When even the Yankees have wised up to the proper notion of long-term success through a thriving farm system, all that can be done is to close the books on one era, and herald the dawn of a new one. The old paradigm, fueled by the Yankees' largesse, no longer applies.

"Small-market teams used to get their players, keep them until they couldn't afford them, then trade them to the Yankees and get prospects," said ESPN baseball analyst Steve Phillips, formerly the general manager of the New York Mets. "But now, large-market teams are holding on to their prospects. You can still trade your players but you're going to get less talent in return. And that cycle of large-market teams funneling prospects to small markets -- which is another form of revenue sharing, because prospects are assets -- isn't there now."

It is clear now throughout baseball, even among the largest-payroll teams, that the key to sustained long-term success is through the farm system. A thriving farm system is a constant source of young, cheap talent. And as the size of free agent contracts has skyrocketed, the relative value of the "zero-to-three" player -- one in his first three years in the majors, who typically makes less than $500,000 annually -- has grown exponentially.

"The best teams are a blend of youth and experience," Washington Nationals General Manager Jim Bowden said. "You need to have both. You can't pay everybody $10 million."

Think of it this way: If a team's payroll is $100 million (an average of $4 million per player on a 25-man roster), every cheap zero-to-three player that you carry -- at, say, the major league minimum of $380,000 -- gives you the leeway within your budget to carry an established, borderline-star veteran at close to $8 million.

Smart teams also have figured out how to hoard draft picks by signing relatively cheap free agents whose inevitable departures at the end of the season bring the team extra picks as compensation -- a system Oakland Athletics General Manager Billy Beane is widely credited with perfecting.

And while there always is a team trying to spend its way to a championship -- such as the Yankees, Baltimore Orioles or Texas Rangers of the early 2000s, and of late the Chicago Cubs, who spent around $300 million in contracts this winter -- recent history has proven that spending big money typically does not work, and makes the failures that much more painful.

"If you don't grow your own talent, you have to allocate a lot of resources -- either players or money -- to get it," said Larry Beinfest, general manager of the Florida Marlins. "And it's very expensive. Young pitching, especially, is so coveted in today's game. We draft heavy on pitching and put a lot of premium on it because we think that's how you win."

Last year, the Marlins proved that a massive rebuilding effort with prospects did not have to be a long-term process. In the fire sale that followed their 2005 season, they traded away star players such as Carlos Delgado, Paul Lo Duca and Josh Beckett -- getting a total of 15 players in return, most of them prospects, including 11 pitchers. Widely predicted to finish in last place in 2006, the Marlins, fueled by rookies, remained in playoff contention until mid-September and wound up finishing fourth.

"We traded away premium guys," Beinfest said. "That's the price you have to pay to acquire young pitching nowadays."

In Washington, fans may be hoping for a repeat of the Marlins' model in 2007, as the Nationals undertake a difficult rebuilding -- featuring a payroll that will fall from $60 million in 2006 to around $33 million this year -- that is predicated upon their farm system. Seven of the top 10 prospects in the organization, as rated by Baseball America, have been acquired since new ownership took over last summer, and the team spent a total of $5.3 million in draft bonuses to get its picks signed, the 10th-highest figure in the majors.

However, the Marlins of 2006 had a healthy advantage over the Nationals in 2007, in that their farm system already was in good shape, and that they had premium major league stars available to trade. Their trade of Beckett to the Boston Red Sox, for example, netted them both shortstop Hanley Ramirez, who wound up being named the NL rookie of the year, and right-hander Anibal Sanchez, who won 10 games in 2006.

Of course, the Nationals did have one premium player to trade last summer -- left fielder Alfonso Soriano -- but they failed to do so, much to the chagrin of some fans and analysts, and instead allowed him to walk away via free agency, receiving two extra draft picks as a compensation.

In their inability to find a palatable offer for Soriano, the Nationals found themselves face-to-face with the new paradigm in baseball: Teams are no longer willing to give up their top pitching prospects in trades, particularly for what would have amounted to a two- to three-month rental of a player on the verge of free agency.

"They had a view of the market from the past," Phillips said, "and the game has evolved to the point where that's not the market anymore."

Here is how the market works now: One of the teams the Nationals spoke with extensively last summer regarding Soriano was the Minnesota Twins, according to industry sources. In return for Soriano, the Nationals asked for a package headed by one of the Twins' top pitching prospects, either left-hander Glen Perkins or right-hander Matt Garza -- rated the Twins' fourth- and seventh-best prospects in 2006 -- but the Twins' best offer was for right-hander Kevin Slowey, a control specialist who was not among the team's top 10 prospects in 2006.

The Nationals passed. Slowey, however, after an impressive 2006 season, has climbed to the Twins' third-best prospect in the 2007 Baseball America rankings and received consideration in the Twins' camp this spring for promotion to the majors.

"All these months later, and knowing everything I know now," Nationals President Stan Kasten said, with regard to the Soriano non-trade, "I'd still do the same thing."

This spring, a version of the same trend likely has kept closer Chad Cordero in Washington. As recently as a couple of years ago, the Boston Red Sox might have given the Nationals what they wanted for Cordero -- multiple top prospects -- but this time the Red Sox held firm.

And it isn't just the Nationals who have witnessed the new paradigm since last summer. It seems relatively clear now that the days of the blockbuster superstar-for-prospects deal at the trade deadline -- think: David Cone from the Blue Jays to the Yankees in 1995, or Johnson from the Mariners to the Astros in 1998 -- are over.

Of the 35 trades made last July, only seven involved a player ranked among an organization's top 10 prospects, and only two of those prospects were ranked in the top five.

This winter, a few more top prospects, including pitchers, changed hands. Most prominently, the Houston Astros sent No. 1 prospect Jason Hirsh in a package of players to Colorado for veteran pitcher Jason Jennings -- but that deal was widely criticized in Houston and elsewhere.

And in another notable trade last November, the Detroit Tigers shipped three pitching prospects, including two top 10s -- Humberto Sanchez (rated No. 6) and Kevin Whelan (No. 10) -- to acquire Sheffield from . . .

The New York Yankees.

That trade, like the similar one two months later that sent Johnson to the Arizona Diamondbacks for three prospects, represented a complete 180-degree turn for baseball's onetime sugar daddies. The Yankees used to trade away their prospects for aging stars, not the other way around.

According to Cashman, the Yankees' shift in philosophy began in May 2005, when Cashman responded to a public challenge from owner George Steinbrenner -- irked by the team's slow start, he said the responsibility for fixing the team rested with Cashman -- by insisting upon total power over the team's baseball operations, which to that point had been split between New York and Steinbrenner's Tampa headquarters.

"I told him," Cashman said, " 'If it's up to me to fix it, I'm going to do it my way.' "

Soon, the team had called up two top prospects, second baseman Robinson Cano and pitcher Chien-Ming Wang. It promoted another minor leaguer, pitcher Aaron Small, and made a minor deal for pitcher Shawn Chacon. "We didn't do anything drastic," Cashman said, "and we ended up winning the division."

When the Yankees did make a big trade last year, for Bobby Abreu, they did so without sacrificing any of their top prospects. And when they have signed free agents -- such as lefty reliever Mike Myers and starter Andy Pettitte -- they have carefully waited until their former teams failed to offer them arbitration, which means the Yankees did not have to give up draft picks to sign them.

In the meantime, the Yankees' payroll has actually decreased in each of the past two years, from a high of around $204 million to about $175 million -- still the highest in the game, but moving ever closer to the rest of the pack. Steinbrenner may appreciate that, but Cashman's plan will never be seen as a success by The Boss until it produces the Yankees' first World Series title since 2000.

"Those are more examples of what I've been publicly saying for two years," Cashman said. "We're going to build from within. We're going to lower our payroll, get flexible. We haven't been big-game hunters on the free agent market. But at the same time we're going to continue trying to win championships. People heard what I said, but I don't think they really believed it."

But folks believe Cashman now, after a winter in which the Yankees moved into a bizarro world -- where they kept their top prospects, dumped high-salaried stars and telegraphed to the rest of baseball that the Sugar Daddy Era officially was over.

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