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The Danger of Upside

Last year’s free agent market had a surplus of one thing – talented starting pitchers with health concerns. The market was flooded with guys who had previous success but were battling questions about the conditions of their arms, and were going to settle for one year deals because of it. And, pretty much without fail, they’ve all been busts.

Ben Sheets, Rich Harden, Justin Duchscherer, Chien-Ming Wang, and Erik Bedard were given a total of $25 million in guaranteed money as free agents. They have produced a grand total of +0.3 wins of value as a group, so they’re on pace to have bilked their teams out of $20 million over the course of the season. Now, things could change, and maybe Bedard or Wang will pitch well down the stretch or Sheets will have a great finish to the year, but so far, they’ve essentially been a waste of cash. It gets even worse if you include Brandon Webb‘s $8 million option that the Diamondbacks exercised to keep him from hitting the market.

I think most of us thought that these deals were, by and large, good risk/reward propositions. Sheets got a bit more money than expected, but still, his contract wasn’t seen as too far out of line with what he could produce. And yet, the whole group has basically been a failure. It makes me wonder if most of us are overvaluing perceived upside in pitcher valuations.

After all, arm injuries don’t just sideline players, but they also diminish velocity and command, leading to lower levels of effectiveness. Even though Sheets has avoided the DL, he’s still not what he used to be. Harden lost enough off his fastball that he can’t really challenge hitters anymore, leading his always problematic walk rate even higher. And the rest of the group has spent nearly the entire season on the DL.

Upside is a tricky thing. It is the perception of what a guy could be, not necessarily a realistic expectation of what he will be. So far, in 2010, teams who spent on upside have been burned by doing so. I would imagine the money won’t flow so freely for guys with health concerns this winter, and perhaps that reaction is the correct one.