Okay, let's again stipulate that the Red Sox should be compensated and that this is a lateral move.
Let's throw aside all the silly issues of leverage and who has to do what. Let's just look at marginal cost and marginal value.
Theo Epstein is the candidate at hand. There are other candidates who could be had for less. They are young, saber-savvy, ambitious, and come with no strings attached. We'll personify them as Candidate B. We'll use dollars as a handy currency for cost and value (we could just as easily use wins or something).
The Cubs are already willing to pay Epstein $18.5 million over five years (including assuming the conclusion bonus with Boston). Candidate B would likely cost, at most, $5 million for five years.
So the marginal cost of Theo Epstein is now $13.5 million to the Cubs.
What is the marginal value of a prospect like McNutt? He's very close to MLB ready, maybe even by the end of 2012. At this point, I'd say a 50% chance of becoming an MLB contributor is reasonable and probably even pessimistic (how much of a contributor is still to be seen, of course).
For the first three years of his career, the Cubs will be able to pay McNutt less than $1.5 million in total. Let's say he averages even 1.5 WAR during those three seasons (a below-average pitcher). 4.5 WAR will generally cost you around $20 million on the open market. So his marginal value to the Cubs at that point is $18.5 million. For the sake of simplicity, let's just take that number and assume that the chances he flames out and becomes an above-average pitcher roughly cancel out. We won't even consider his arbitration years, either. All in all, I'd say we are undervaluing him, but that's fine.
So by giving up McNutt, you are now asking the Cubs to value Epstein at $31.5 million over Candidate B.
Do you consider that a reasonable value? It's not even close. If Epstein's contract were up this year, would you want to see the Red Sox pay $31.5 million to him over 5 years to keep him instead of settling for Cherington?
If the cost is McNutt or more, then Epstein simply no longer makes sense for the Cubs and they'll have to move on.
Unfortunately, I have to run to parent-teacher conferences, or I'd provide a more detailed response. I'll just throw out these basic thoughts. First, Epstein has a track record few can match. How many current GMs have 2 WS titles on their resume? How many had to go through the $200M Yankees to get there? You can hope and pray that Candidate B ends up good, but even some of Theo's proteges, as well as other saber-minded youg guns, have had their struggles. You wan to relive the hendry years? You good with the Cubds previous 8 decades of performance. Go get Candidate B. I'm not saying that Theo is the only one who can save Chicago, but you are underselling him and the Cubs' desire to get him.
And as for Theo's value... He had help, to be sure, but he had some remarkable success finding guys like Pedroia, Ellsbury, Bard et al in the draft. How much is that player acquisition skill worth? A lot more than McNutt.