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Thursday, December 22, 2011
John Danks
Danks: 5/65 (one year of arbitration, 4 years of free agency).
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John Danks’ salary in his first year of arbitration was close to the salary of the big guys (Felix, Verlander, JJ, Weaver) in their first year. His second year however was decidedly less (about 20% less).
In his third year, he’d have to settle for being one tier below those guys, if not lower. The big 4 were at around 13MM$, so 20% below that puts him at close to 10MM$. Let’s say that he would have signed for around that amount, either through arbitration, or as a result of negotiations (club submits 9, player submits 11) in 2012.
That really leaves us with a 4/55 extension, starting in 2013.
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Because it’s an extension that doesn’t start for one year, he has to sign at a discount. If he signs a 4/55 deal today, that starts in 2013, perhaps he signs a 4/61 deal today, that starts in 2012 (if he were a free agent today). Basically, he signs a guaranteed deal early, in exchange for lesser money. I don’t know if that discount is 10%. It’s a number I pulled out of my a$$. But, it seems to smell like a nice number.
So, the numbers you see below is based on delivering a performance consistent with a 4/61 deal in the years 2013-16.
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He’s a young pitcher, born April 1985, just one year older than Felix. Entering 2013, he’d be 28 years old, so we’re going to apply a somewhat modified aging curve.
So, this is what the Whitesox are paying for:
2012 3.7 wins
2013 3.4 wins
2014 3.0 wins
2015 2.5 wins
2016 2.0 wins
How much is a 3.7 WAR? If you give him 198 IP in 2012, his effective win% (i.e., runs allowed converted to winning percentage) would be .538 in the AL. A .538 win% means allowing runs at 8% below league average.
His career FIP is 7% better than league average and his career RA9 is 10% below league average. (You would adjust that for regression toward the mean, but you’d also need to adjust for his age, which will pretty much cancel out the regression.)
So, his career indicates he has the talent level to give up runs at 7% to 10% better than league average for the 2012 season, and the Sox are paying him for delivering 8% better.
This seems about as perfectly fair deal as you should expect from both sides.