Let’s say you go to a restaurant and eat a good meal. The meat is responsibly sourced from a local farm. The vegetables were grown locally as well. The chef knows how to make a good meal. The beer and wine list are good, as is the service. You enjoy a great meal and let’s say you spend $100. If you are in to that sort of thing, it is probably well worth it.
Now let’s repeat the same scenario with the same locally sourced meat and vegetables. Another good chef here. The beer and wine list perhaps isn’t as diverse, but it is solid. The service is decent. They charge you $100. Again, if you are into that sort of thing, probably worth it. Except this time, the farm that provided the meat actually runs the restaurant.
The second restaurant found a cheaper way to provide just as good of a meal, and honestly, you probably feel better about supporting them given their extra work involved in bringing the food to you. As analogies are filled with holes and rarely fit the point you are trying to make, let’s make this more convoluted.
Let’s say that continue to go to this restaurant for years, and they almost always give you that same great meal. Maybe sometimes the dessert isn’t as nice as you want it, but when you go there, you still get a really good meal and they changed their menu over the years so as not to get stale.
Now there’s been a restaurant space across the street the entire time, but nobody can seem to find much traction. Some successes popped up briefly, but everybody generally agreed it wasn’t as good as your restaurant. Your restaurant continued to be a success and the owners did quite well.
Then a new restaurant opened up across the street that was different from the ones that seemed to come and go. The restaurant struggled for a long time, but they stayed open despite struggles with the menu, the staff, the chef. The struggles seemed to make them better as they slowly finetuned things. Everybody agreed this restaurant was better than your restaurant. You keep getting the same good meal from your restaurant, but it simply isn’t as good as the restaurant across the street. You’re not sure what the restaurant should do.
They could hire a new chef. They could get more expensive meats from places a little further away. They certainly have the resources to make changes that might help. Those changes might make them a little better in the short term, but the long-term benefit is more questionable. They could start over, but that would probably mean a lot of struggles. On some nights, they still serve a better meal than the place across the street.
You never much cared how much the owners were making until the place across the street started doing well. When the other restaurant began to succeed, you saw that your restaurant was making changes, spending money. They upgraded the stove, got a nice, new door and they’ve changed the waitstaff to ensure there is as little dead weight as possible. For some reason, they keep the incompetent host around, but everybody else treats you well. You begin to wonder if it is enough.
You had a good meal last time you went there, but it left a little to be desired. It made you wonder how good your meal would be the next time. So the next time you went, you ordered an appetizer and it was good, not great. You talked with somebody at the place across the street and apparently, the appetizer there that night was pretty mediocre.
You wait for the main course. You know it will probably be good, but you want great and you continue to wonder if the restaurant could be doing more to make sure your main course was great. Ultimately, you aren’t really sure what to do. If the restaurant serves mediocre fare over a number of visits, you’ll probably stop going, but you will probably never care about how well the owners are doing if they continue to provide a quality product.
Complaining about the revenues alone is probably worthless. For one, the owners probably don’t care. Make your criticisms constructive and specific: Bad meal, rude server, excessively long wait times. These are good complaints to make, and if you decide you no longer wish to support the restaurant, you will have a laundry list of examples about how they lost you as a customer.
The Cardinals just missed out on Luis Robert and it stings a bit. The White Sox will sign him for $26 million or $27 million and pay another $24 million to $25 million in penalties. If we assume it would have taken more for the Cardinals to sign him, then the Cardinals would have had to spend around $56 million. That valuation would place Robert around the back end of the top-20 prospects in baseball, roughly Eloy Jimenez territory.
Alex went over why signing Robert hurt yesterday so I don’t want to belabor the point, but the Cardinals missed out on another fairly valued free agent who had the potential to be a star, something the Cardinals have had trouble finding, whether in the system or out of it. The cost of Robert appears to have been fair value in free agency terms, and not the typical bargain we generally associate with younger players.
Robert’s most likely outcome is probably around 12 wins, a two-win player, providing a $60 million surplus over his salary, and netting out his signing bonus. The market worked pretty rationally in this case. If Robert were a four-win player, having the career of Matt Carpenter thus far, then he would need to be one of the top two prospects in baseball right now, basically Andrew Benintendi. If you believe Yoan Moncada’s tools grade out even higher than Benintendi, a rare 70 on the future value scale out of 80, then we are talking about a five-win player, essentially what Buster Posey and Joey Votto have done over the last six years. Robert is good, but he isn’t projected anywhere near a 4-5 win player when we are talking about the most likely projected outcome. A $60 million is supported by facts.
It’s okay to fault the Cardinals for not spending an extra $10 million or so in what is a fairly unique opportunity. Acting seemingly irrational in this case to win a bidding war might have been the more prudent decision, but it also isn’t going to do much to help them this season or next or even in 2020. It was a long-term play.
It’s been my position for some time that the Cardinals missed out after 2015 in transforming their roster. They missed out on David Price and Jason Heyward and couldn’t find a star to replace them. Of course, Heyward hasn’t worked out well yet in Chicago and Price hasn’t pitched an inning this season. It’s possible for this season that signing Mike Leake and Dexter Fowler instead will make them better overall.
The bullpen hasn’t great this year, but you can’t argue they didn’t try to spend to make it better. There was a great deal of clamoring for Dexter Fowler and they signed Dexter Fowler. Yadi got his extension. Carlos Martinez and Stephen Piscotty got theirs, too. I’ve advocated for a major trade, but that hasn’t come to fruition. Finishing second in free agency is fine as long as the team understands the alternatives. That strategy probably cost them the playoffs last season, and it could cost them a potential star in Robert.
This past offseason’s crop of free agents was mostly bad, and it is obviusly early, but they have played to those expectations thus far. Complaining about money is valid, but the Cardinals still have a good team, they still have a really good shot at making the playoffs, and most of the options the Cardinals had in the offseason weren’t going to improve the team. The Cubs being good has caused everybody to freak out, but short term thinking is what leads teams like the Cubs, and the Phillies and soon the Tigers to flame out and undergo rebuilds that take half a decade.
I’m not overjoyed with the Cardinals current competitive situation, but the franchise still finds itself in a good position to compete in the short and long term. They have a group of young, cost-controlled talent that should provide a solid base. Their farm system is solid and some players are making big gains this season. While some might argue about whether they’ve spent enough, 2016 did see a sizeable increase in payroll and over the last year, the team has spent another $20 million or so internationally.
I can’t say whether or not the spending is enough, but based on the alternatives over the past year, I can say spending more wasn’t very likely to make the Cardinals much better than they are right now, and it would probably make them worse in the future. Robert certainly seemed like a good use of the Cardinals money, but he wasn’t some sort of bargain, either. The Cardinals mistakes have hurt them over the past year or so, but their record is the ultimate test, not their profits.