It's been a rough few months for the Yankees, dating back to their elimination by the Tigers last October via a humiliating four-game sweep in the American League Championship Series. From Alex Rodriguez's various controversies to the offseason surgeries of Derek Jeter and CC Sabathia to the free agent departures of Nick Swisher, Rafael Soriano and Russell Martin to the incomplete patch-up job executed by general manager Brian Cashman, they've appeared to be on something of a losing streak, as age and austerity catch up to them. As Cliff Corcoran put it, the 2013 Yankees lineup is optimized for 2007.
Even so, the Yankees are forecast to be one of the AL's top two teams according to Baseball Prospectus' PECOTA projection system, with nearly a 70 percent chance of making the playoffs, and already a strong sign has emerged that they're willing to reconsider not only the fiscal belt-tightening that limited them this winter, but also a longstanding policy regarding player contracts. According to ESPN New York, they've approached pending free agent Robinson Cano about a contract extension.
Not that it's likely to get done before the four-time All-Star second baseman hits the market, because Cano's agent, Scott Boras, almost always steers his clients into free agency and seeks top dollar, Jered Weaver's 2011 extension being the rare exception. With the Dodgers taking over the Yankees' spot as the game's top spenders, and the game generally awash in unprecedented television rights revenue, other teams could drive the price of Cano even higher into the stratosphere, though it's still tough to imagine any willing to go 10 years on such a pact.
Particularly with Rodriguez's health and career crumbling in his late 30s, and Mark Teixiera's pricey age-related decline offering another cautionary tale, the Yankees might understandably be cautious when it comes to such a deal. The problem is that the 30-year-old Cano has evolved into their most valuable position player by a wide margin. According to Baseball-Reference.com, over the past four seasons, he has produced a team-high 25.3 Wins Above Replacement. Teixera is a distant second, nearly 10 wins behind at 15.6, followed by Rodriguez at 13.5 and Brett Gardner — the only current lineup regular younger than Cano (save for the TBA starting catcher) — fourth at 13.0. Shorten the window to the past three seasons and the advantage is even wider on a per-year basis, with Cano's 21.2 trumping Curtis Granderson's 12.1, Gardner's 10.9 and Teixiera's 10.5. Cano led the team in 2010 (7.8) and 2012 (8.2), and finished just 0.1 WAR behind Granderson in 2011 (5.2).
In fact, Cano has been the majors' fourth-most valuable position player over the past four seasons, behind only Ben Zobrist (26.5), Albert Pujols (26.4) and Ryan Braun (25.9), and the most valuable such player over the past three. He's definitely going to get paid, particularly if he can produce at a similar level in 2013 as he has during that span (.314/.365/.534 with an average of 197 hits, 46 doubles and 29 homers since 2009).
It's not as though he's on the decline, either. Last year he set career highs in WAR, homers (33) and slugging percentage (.550) and his on-base percentage (.379) was just two points off his career high. His .318 True Average — his production per plate appearance, expressed on a batting average scale after adjusting for park and league scoring levels — also set a personal best while ranking 10th among all major league hitters and third among up-the-middle players (catchers, second basemen, shortstops and centerfielders) behind only Mike Trout (.357) and Buster Posey (.350).
The Yankees have historically been unwilling to discuss extensions with their pending free agents; recall that both Rodriguez and Sabathia opted out of their deals and briefly hit the market. Jeter became a free agent after the expiration of his 10-year deal following the 2010 season, even though the likelihood of him leaving the team was incredibly slim. Mariano Rivera has reached free agency three times. New York worked out intermediate extensions with arbitration-eligible players to buy out initial years of free agency for players such as Swisher and Cano, both of which included relatively inexpensive club options; Cano's four-year, $30 million deal, which he signed in February 2008, included a $14 million club option for 2012 and a $15 million one for 2013, both of which were no-brainers to exercise — and likely frustrating for the second baseman, whose performance justified much higher salaries.
Whether it's 10 years or a more reasonable seven or eight, there are plenty of reason for the Yankees to fear a long-term extension, not only since most of those deals haven't aged well, but also because neither do second basemen. A 2005 study by Nate Silver at Baseball Prospectus showed that second basemen tended to peak earlier and decline more quickly than the average position player, with the quality of the player pool — infielders without the arm or range for shortstop or the bat for third base — and the higher likelihood of injuries due to double play contact both likely to figure into the equation. Silver's study hasn't been updated, but one need only look at how top-flight second basemen from just a few years back such as Chase Utley, Brian Roberts, Dan Uggla, Luis Castillo and Orlando Hudson have fallen off in their 30s to appreciate that the likelihood of decline is very real.
If the Yankees do pony up for Cano, they may be able to dodge a 10-year commitment if they make him the game's highest-paid position player this side of Rodriguez. That's the type of deal that would allow Boras to claim victory for his client, and it would mean surpassing the $25 million average annual values of Ryan Howard and Josh Hamilton, if not Rodriguez's $27.5 million. Alternatively, Boras and Cano could set their sights on surpassing the totals of Jeter ($189 million) and/or Teixeira ($180 million); a seven-year, $193 million deal (averaging $27.57 million) would hit the sweet spot by surpassing Jeter, Teixeira and Rodriguez one way or another.
That would be steep and risky, but it would likely fit within the Yankees' budget. The Collective Bargaining Agreement passed last winter created significant incentives for them to target a $189 million payroll for 2014, not only to reset their luxury tax rate from 50 percent to 17.5 percent on any expenditure above that figure but also allow them to receive significant rebates with regards to revenue sharing. Reports that the latter savings may not be as significant as previously believed appear to have changed that $189 million mark from "an absolute mandate" to a goal, as a source told ESPN New York. Because of the way the Yankees have conducted their business this past winter, they'll have a ton of money coming off their current $207.7 million payroll. In addition to Cano's $15 million, Granderson ($15 million), Hiroki Kuroda ($15 million), Andy Pettitte ($12 million), Kevin Youkilis ($12 million), Rivera ($10 million), Phil Hughes ($7.15 million), Boone Logan ($3.15 million), Travis Hafner ($2 million) and Joba Chamberlain ($2 million) are all eligible for free agency, and not all will be retained, giving Cashman considerable flexibility.
Considering further that Rodriguez's salary drops by $3 million, and that Jeter's will probably as well — currently earning $17 million, he has an $8 million player option that could increase slightly if he wins an award or places high in the voting — that's almost $100 million freed up. Next winter's free agent market isn't much to write home about, either. Virtually all of the big-name free agents -- pitchers Roy Halladay, Johan Santana and Josh Johnson, catcher Brian McCann and outfielders Jacoby Ellsbury and Nelson Cruz -- have causes for concern due to age or recent injuries.
The lack of solutions available to buy off the rack increases New York's incentive to keep Cano, if not Granderson, whom the Yankees can more easily replace in the long run given that most of their top position player prospects are outfielders; flychasers Mason Williams, Slade Heathcott and Tyler Austin all cracked Baseball America's latest Top 100 Prospects list, while catcher Gary Sanchez was the team's only other farmhand to do so. Even then, all three outfielders spent part of last year at High-A Tampa, with Austin's two games at Double-A Trenton the only experience above that, suggesting that none are likely to contribute significantly until 2015 barring rapid development this year. That the homegrown Cano is more central to the brand than any of their current players beyond Jeter and Rivera, both of whom are nearing the end of their careers, and the now-toxic Rodriguez only increases the likelihood of them retaining him. In the end, the expectation here is that Cano will reach free agency, but that the Yankees will retain him with a contract that grants him some level of status among the game's highest-paid players. That's how they do business in the Bronx, whether or not the rules have changed.