The first thing we need to do is find out why these trades don’t work for the selling team (I’m essentially going to stick with selling teams, but as Yankee fans, you’re interested in the buying teams. Guess what? You win. What? You were expecting something different?). The original theory is a nice one. You turn one really good player into several good ones, and in the swap, you switch out future value for present value. However, the idea is flawed. The theory assumes that the 6-win player traded brings back 2 or 3 4-win (the numbers don’t exactly match up, but you get the point) players, but in practice, the 6-win player continues to be the 6-win player while the prospects never make it or turn into 2-win players or worse. So how do we change this?
One, start demanding top prospects back when you can. I’m going to use the Oswalt trade for the rest of the piece to illustrate my points. In this instance, the Astros have an ace pitcher that should bring top prospects back, but the Astros brought back a league-average pitcher (2 wins) and two prospects that are really far away and risky. One of those was used to bring in Brett Wallace, but we’ll get back to him in a moment. Instead, the Astros should have used their leverage (they ate money, and therefore, the lone minus to the deal was gone) to get a team’s top prospects back, who are much more likely to reach the majors and contribute. Of course, this means that the receiving team is going to get fewer players.
Which brings me to the second point—accept quality over quantity. This is easier said than done. If you swap a guy one-for-one, it essentially means that the prospect coming back has to perform just as well as the guy leaving, which is really hard because the guy leaving has already become a very good player and they don’t just grow on trees. It’s easier to rationalize a one-for-three swap because you can convince yourself that all of them, or at least, two will contribute and make up for the lost player. The problem, as Goldman notes, is that prospects coming back have rarely worked out. This isn’t because prospects are flawed in general. It’s because those prospects are flawed. People like to ask Keith Law, Kevin Goldstein, John Sickles, Jim Callis, etc. what a player’s ceiling is, but instead of realizing it as a ceiling, they see it as a probability. It’s not. It’s a long-shot. They’re more likely to be worse. So those 4th and 5th starters become AAA lifers, and those aces turn into number threes. Instead, the teams should have taken fewer but better prospects, who are bound to at least have value. Yes, sometimes this won’t work out, but I’m guessing it works out a helluva lot more. So go ahead armchair GM, accept the two great ones for the four mediocre ones.
Third, remember roster politics. The Oswalt trade isn’t a one-for-three swap because those prospects don’t get to count for only one roster spot. It doesn’t work that way. Essentially, Happ takes Oswalt’s space while Wallace takes Berkman’s (you can say this because he was traded, whether Wade admits it or not, to take Berkman’s spot on the team). The difference is that Wallace doesn’t directly substitute for Berkman, only his space (Berkman’s value has to be recouped by his trade). But when you assess the value of the Oswalt trade, you can’t just combine all the potential WARs of the players coming back to put on top of Oswalt’s one spot, which is essentially what we do now. Instead, you have to realize that real value is placed on Berkman’s spot. The usual assumption is that Berkman would have been replaced by a replacement-level player, but that’s not likely. The Astros, in the off-season, would likely have picked up someone off the scrap heap to give them 1 or 2 wins of value. Wallace isn’t replacing the AAA guy. He’s replacing whatever other guy the Astros would eventually get, but because it’s unlikely that the Astros could get someone now, Wallace is replacing that replacement-level guy for the rest of the season. I realize most of this is context, but you can’t ignore context because it’s always there.
In summation, here’s the idea. Trade major-league stars for minor-league stars when you can. Eat money, take fewer prospects, etc. to make this happen. Usually we give value to any minor-league player, but I think it’s time to stop doing that so often. They have value, but I think they get too much. Also, stop trading people for trading’s sake. People like to criticize the Orioles for not trading Wigginton, but I’m not sure it was the wrong decision. What would you have given for Wigginton? Probably nothing significant, and if it’s nothing significant, then why get it back? Why not hold on to Wigginton, maybe try to resign him, and get more value from him? Because that prospect isn’t going to bring back value.
That brings up trading lesser players, and not the stars we have been talking about. What do you do about them? Again, stop trading them just to trade them. If you don’t get anything back of value, then keep him unless you absolutely have to get rid of him (I imagine the need to shed payroll is a bit overplayed). Of course, you need to scale back your desires. Wigginton isn’t Oswalt. But Wigginton gives the team real value whereas the bit guy coming back likely won’t.
But we have to look at the other side. It’s not good to just look at one side of the deal. Most teams are starting to value prospects a lot more than they used to, so would they give them up? I don’t know the answer. Some teams may value them that much, but I imagine that selling teams aren’t taking a hard enough stance. They want to shed payroll. They want to get young players back because, otherwise, they just lose the guy (but again, I’m not sure having a body is worth having a body). If the selling teams started demanding better, the buying teams would have to acquiesce in some manner, most likely somewhere in the middle. But the selling teams have the leverage. They have what the other teams need. The players are sunk costs to the selling teams, and the selling teams need to realize this. If you have to eat some money to get the deal done, you should. But get the talent back. But yes, I realize that the buying teams don’t like to give up top prospects, but they are more willing to because of the desire to win now. Selling teams need to be better at demanding more. It’s supply and demand. Demand more.
I, of course, realize that I could be wrong in all this (sorry if this is really stream of consciousness, but I’ve been trying to wrap my head around it. Ever feel like you’re onto something but can’t quite get it to the end?). The desire is to get into more of a discussion about trades and how we evaluate them because there seems to be something wrong, as Goldman notes, but the theory seems to make sense. Is there something wrong in the theory? Practice? What’s going wrong?
My essential argument is that selling teams aren’t wrong for trying to turn one player into several. They’re wrong for not asking for the right things back. Sometimes the limitations are practical (no team will just hand over the farm, thus limiting what you get back). Sometimes they are social (“I don’t want to get fired because I traded our star for two stud prospects that didn’t happen to work out”). But trading away major league talent for essentially nothing only helps the other team, and this business isn’t altruistic.
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