The upshot of all that is that Lee's next contract will likely be for at least six years. That leads to at least two important questions: 1) How wise is it to give an expensive six-year contract to a 32-year-old pitcher? and 2) Can the team that signs Lee really expect to get their money's worth when he will be 38 when his new deal finally expires? There are two ways to examine these issues. One is to look at how other pitching contracts of similar length have played out in the past. The other is to look at how Lee's career projects over the next six years.
The latter is theoretically more valuable and informative, but given that it's based entirely on projection and conjecture, it can only tell us so much. The best way to project a player's future performance is to trace the career trajectories of similar players from the past. Unfortunately, the available lists of comparable players don't do us much good. Baseball-Reference.com lists Mark Mulder, Teddy Higuera and LaMarr Hoyt as Lee's three most similar players, but Mulder and Hoyt didn't pitch past the age of 31, and Higuera was effectively done at the same age. One could see that as a huge red flag, but I see it as confirmation that Baseball-Reference's comparable-player listings are faulty. Baseball Prospectus's PECOTA projection system, which does indeed base its projections on past performances by similar players, generates a list of top comparable players, but those lists are only updated once a year, and the current listings are from before the 2010 season, making them decidedly out-of-date, given that the just-completed season accounts for a full third of Lee's three-season run as one of the best pitchers in baseball.
That said, PECOTA projected Lee to be worth 4.9 wins above a replacement player (WARP) in 2010 and he actually came in at 4.6 WARP. If we take that as evidence that PECOTA had a good peg on Lee prior to the season, we can use its 10-year forecast to take a look at how Lee could be expected to perform over the length of a six- or seven-year contract. What PECOTA predicts is that Lee will rather quickly regress to league average, but that he'll maintain that level of production for a good four or five years before his proper decline begins to set in, and that he'll keep his head above replacement through six years, though he'll veer dangerously close to replacement level, roughly defined as the level of production that can be expected from a non-prospect minor leaguer or waiver-wire acquisition, thereafter.
Helpfully, Baseball Prospectus has a handy statistic called Marginal Value Above Replacement Player (confusingly abbreviated as "MORP") that estimates the free-agent value of a player's projected performance in actual dollars. For example, Lee's projected 4.9 wins above replacement in 2010 would have been worth $22.8 million according to MORP. Lee's next six seasons, then, are projected to be worth a combined $68.3 million, which is big money, but nothing like the nine-figure payday that's likely awaiting Lee this holiday season.
PECOTA tends to be a bit pessimistic, as well it should be given that attrition is the dominant factor in any long-term performance evaluation. One could argue that, based on that projection, if Lee stays healthy, he could well be worth $70 million, if not more, over the next six seasons, and that the difference between that amount and the actual value of his next contract will simply be the premium paid by the team that signs him to keep him away from his other suitors (not unlike a posting fee for a Japanese player).
Of course, the key phrase in that last sentence is "if Lee stays healthy." That's the catch in any long-term contract, particularly one for an aging pitcher whose comparables, faulty or not, cough up names like Mulder, Higuera, Hoyt, and the all-time leader in days spent on the disabled list, Bret Saberhagen.
That brings us back to a discussion of past long-term pitching contracts. Since 1998, when Greg Maddux and Pedro Martinez each received five-year deals from the Braves and Red Sox, respectively, there have been 20 contracts of five or more guaranteed years worth $50 million or more in total value given to pitchers. Of those 20, just five would be 32 years old or older in the first year of the deal. One of those five was the five-year, $82.5 million contract the Yankees gave a 32-year-old A.J. Burnett, which because it came just two years ago is of little use as a data point, save for the fact that Burnett's replacement-level performance in 2010 has already cast serious doubt on the likelihood of the Yankees receiving equal value from him.
Of the other four, the most disastrous was the five-year, $51 million deal the Rockies gave a 32-year-old Denny Neagle in 2001, the same year Colorado gave then-28-year-old Mike Hampton a $121 million, eight-year deal, which at the time was the biggest pitching contract in the game's history. Neagle was worth a combined 2.4 runs above replacement in his first two seasons in Colorado, got hurt in his third, and after just seven starts that year, never pitched again, though the Rockies were able to void the final year of his contract based on a morals clause after Neagle was ticketed for solicitation and driving under the influence in December 2004. Hampton, meanwhile, was worth just 1.5 WARP over his first two seasons in Colorado, after which the Rockies managed to trade the final six years of his contract by including $49 million in the deal that sent him to the Braves. Hampton had two more healthy seasons worth a combined 4.1 WARP, then managed just 25 more starts over the final four years of his contract, missing his age-33 and -34 seasons entirely due to injury.
In stark contrast to those two deals, the five-year, $57.5 million contract the Braves gave a 32-year-old Greg Maddux in 1998 was a fantastic investment. Maddux averaged 5.7 WARP over the life of the deal and was worth four wins above replacement in his worst of those five seasons. Of course, Maddux was one of the greatest pitchers in the game's history. Still, it's worth noting that, in the five seasons prior to his big contract, he averaged 8.46 WARP, a number suppressed by the games lost to the 1994 players' strike, so even Maddux delivered less than the Braves might have expected heading into the deal.
One can't reasonably compare Lee to Maddux, who posted a 2.14 ERA in the six seasons prior to signing his five-year contract, nor are Hampton, Neagle, or even Burnett particularly good comparisons. The last two names on the list of pitchers 32 years old and older to receive five-plus-year contracts, however, are much better matches. One is Kevin Brown, who became the first major leaguer to be given a nine-figure contract when he signed with the Dodgers for $105 million over seven years in December 1998. Amazingly, Brown was the oldest of all of the pitchers given a long-term deal in either era as he turned 34 before his first Opening Day in Dodger Blue.
In raw numbers, Brown appeared to pitch well over the life of his contract, posting a 3.23 ERA (131 ERA+), 1.16 WHIP, 3.31 K/BB, and a .615 winning percentage, but he only managed to stay healthy throughout three of its seven seasons. Brown was great in those three years, averaging 5.1 WARP, but his contract is best remembered for the fact that he averaged just 16 starts in the other four seasons. Before signing with the Dodgers, Brown had averaged 32 starts over eight seasons, with only one brief stay on the disabled list that came after a fluke injury when he dislocated a finger on his pitching hand trying to catch a comebacker.
The most recent name on that list of five pitchers is Mike Mussina, who signed a six-year, $88.5 million contract with the Yankees in December 2000. Mussina's contract is generally regarded as a success in part because he stayed healthy, averaging 31 starts and failing to start 30 games just once in its six seasons (he started 27 games in 2004). Mussina posted a .634 winning percentage over the life of the deal, and the Yankees made the postseason every year, twice winning the American league pennant. However, like Maddux, Mussina's performance over the course of his big contract was down relative to his peak-era performance in the years leading up to it. Mussina surpassed 3.5 WARP just twice during those six seasons, averaging 3.87 WARP, a figure buoyed by outstanding performances in the first and third year of the deal. In the six years leading up to that contract, Mussina had averaged a more consistent 4.57 WARP, surpassing 3.5 WARP in eight of his nine seasons prior to joining the Yankees.
That pattern falls right in line with what PECOTA projects for Lee, a slow but steady decline during which he should continue to be a valuable starter, but not an elite one. For some teams, such as the free-spending Yankees or even a Rangers team that just won its first pennant and has longed for a reliable rotation anchor since Brown left as a free agent in 1995 and now finds itself under new ownership and flush with cash from a new local television contract, that might well be worth a big investment. For most, it isn't. It's worth bearing in mind that the threat of injury is ever-present, and Lee did miss most of last April while he was with the Mariners with an abdominal strain. In fact, any team pursuing Lee should be advised that what they're bidding on is a lesser version of him than the one that has generated all of this excitement in the first place.