The Tanaka Market Effect

[mabrowndog]

The primary domino has finally fallen for every GM of teams in need of starting pitching. Masahiro Tanaka's deal with the Yankees (reportedly 7 yrs at $155M) would represent an AAV of $22.143M.
 
Here are the best available starting pitchers as ranked on Hardball Talk's list of the Top 150 Free Agents at all positions (# = tied to draft pick compensation; ages are as of April 1, 2014). After the ages, I've added their 2013 fWAR and 2014 Steamer projections for WAR:
 

 
Williams & Hanson were added to the rankings after they were non-tendered.
 
So how will the new bar set by Tanaka be reflected in the market value for these guys?

 

[Morgan's Magic Snowplow]

From a Red Sox trade value perspective, Steamer projects Dempster at 0.9 fWAR but in only 88 innings.  With a clear path to a starting job, he's probably projects at double those values, which would make him 6th on this list.  Peavy projects at 2.5 WAR in 144 innings, or tied for 4th on the list.  And the clear cut #1 guy in Burnett may retire.
 
The pickings are slim and I think the Sox would be fools not to explore whether some desperate team is willing to pay an unreasonable sum for Dempster or Peavy.

 

[Hoplite]

Not only will Tanaka's actual salary inflate the market, but the 28 teams that are under the luxury tax threshold will be getting larger revenue sharing rebates since the Yankees are no longer eligible for one. And that could potentially benefit us in multiple ways. It would increase the trade value for all of our pitchers (including Lackey, Buchholz and Doubront). It also puts us in a pretty good position for 2015. Buchholz is due roughly $12 million, Doubront will be in his first year of arbitration eligibility, Lackey and all of our minor league options will be due the major league minimum.
 
Realistically, I could see Workman, Webster, Barnes, Owens, etc. competing for a rotation spot in 2015. And we could either extend Lester or sign a free agent pitcher. But given how cheap the rest of our rotation is, and how much money we have coming off the books after 2014, we'd be in a pretty good position to do so.

 

[Morgan's Magic Snowplow]

Garza is apparently going to the Brewers for 4/52.  I thought he might get a little bit more. 

 

[YTF]

I did as well and am also a little surprised that he sign THAT deal so quickly after the Tanana signing. Not that it's a horrible contract.

 

[MyDaughterLovesTomGordon]

That Tanaka contract is, I think, the 10th highest by AAV ever given out to a starting pitcher, just slightly ahead of what Matt Cain is getting. 
 
I expect plenty of GMs around the league think that's insanity. 
 
I think the contract that more free agents will point at is Lincecum's 17.5m over the next two years. After two years of 68 and 76 ERA+? Arroyo must look at that and think he should be getting $20m per for a two-year deal. 
 
Kuroda's 1-year deal for $16m works in the other direction, obviously. Jiminez/Santana could get $17m if they're willing to only go two years or something, maybe. But they probably want four/five like Garza.