When the New York Yankees make a signing, it is big news in baseball. When the Yankees fail to make to a big signing, it is even bigger news. The Yankees targeted Yoan Moncada. They worked him out multiple times. They offered the potential star $25 million, willing to commit $50 million with penalties, showing they believed in his talent. Yet they let the rival Boston Red Sox outbid them by $13 million.

The Yankees are rich and they spend like it. In 2015, their payroll will grow past $200 million for the sixth time in seven years. One offseason ago, the Yankees made $483 million in salary commitments to free agents. Just last summer, the Yankees blew past the international spending limits to sign the biggest international free agent class in Major League Baseball. The high level of spending is confusing when the difference in offers to Moncada is less than the amount they committed to pay a 39-year old Carlos Beltran in 2016 and the total cost is roughly one-third of the commitment they made to obtain Masahiro Tanaka.

As Miles Wray pointed out earlier this month, with the exception of last offseason, the Yankees have used considerable restraint in free agency since winning their last World Series in 2009. The first few sensible years made sense. They went on a spree after 2008, signing Mark Teixeira, CC Sabathia, and A.J. Burnett to big contracts that helped them to the World Series. They continued winning, putting up 95 wins in 2010 and followed that season up with 97 wins and 95 wins the next two years. Even before the 95-win 2012 season, Yankees ownership put a plan in place to save the team millions of dollars.



The New York Times reported prior to the 2012 season that the Yankees aimed to get payroll under $189 million in 2014 due to potential luxury tax savings of around $50 million. As Miles noted, the Yankees were “borderline frugal.” Here is the chart from that piece showing the team’s offseason spending.

No long term commitments or big signings resulted in a 95-win season, and the Yankees repeated the same tactics that seemed to have worked the previous offseason. Again, from Miles’s post, here are the moves the Yankees made after 2012.

Another round of low-spending for the Yankees had them commit just $6.5 million beyond 2013. They let Russell Martin depart to the Pittsburgh Pirates for just two years and $17 million, a move that looks much worse with the benefit of hindsight. At the beginning of 2013, the Yankees had just $84 million in salaries committed to 2014 along with arbitration raises for David Robertson and Brett Gardner. The Yankees were two years into their plan to reduce payroll in 2014, but the Yankees found considerably less success in 2013, winning just 85 games. Age, injury, and a lack of fortification over the previous few years from either the minor leagues or free agency caught up with the Yankees. At the time, they were just one offseason away from meeting their goal of getting under $189 million in 2014.

The Yankees should have been prepared for losses in 2013. Large payrolls do not guarantee victories when the money is devoted to aging, injury-prone players. They still won 85 games, but their margin for error to make the playoffs was lower than it had been in previous seasons. Considering the offense had a wRC+ of 85, beating only the Chicago White Sox and Miami Marlins, they were lucky to win as many games they did. Here is the wRC+ by position player in 2013 for the Yankees.

Position wRC+ 2B 144 CF 117 LF 87 1B 86 RF 76 3B 73 C 62 SS 61 DH 56

Robinson Cano did his part and Brett Gardner chipped in, but the Yankees got poor production from every single other position. Dropping below 95 wins should have been expected in 2013, and their plan should have made them prepared to miss the playoffs again in 2014.

After two years of cutting costs and refusing to hand out long term contracts, the Yankees abandoned their plan. With Robinson Cano and Curtis Granderson declining qualifying offers, the Yankees were in position to reload through the draft and save a great deal of money through avoiding the luxury tax in 2014 and paying less into the luxury tax in the following years even if they completely reloaded.

The Yankees did miss the playoffs in 2014, and they did let their only star hitter go as Cano left for the Mariners. However, only winning 85 games appeared to be too much for management to take, and another year like 2013 would not be accepted. The Yankees were even given a golden opportunity to add some payroll without going over $189 million when Alex Rodriguez was suspended for the 2014 season. Instead, the Yankees decided to make a splash.

To join Derek Jeter on his victory tour, the Yankees signed Masahiro Tanaka, Jacoby Ellsbury, Brian McCann, Carlos Beltran, and others to contracts worth a total of $483 million. The Yankees hit slightly better in 2014, putting up a wRC+ of 92, and the Yankees pitching staff survived injuries to key players. Ultimately, the effort was not enough and the Yankees won 84 games. Refusing to re-stock the team after 2011 and 2012 likely cost the team the playoffs in 2013, and their mad bid for recovery fell short in 2014; it may in 2015 as well, given that they look like a middle-of-the-pack team this year.

Yoan Moncada was not going to help the Yankees this season, but letting him go after they set themselves up to make a run at him is confusing. The Yankees were one of a few teams — along with the Red Sox, Los Angeles Angels, Arizona Diamondbacks, and the Tampa Bay Rays — that had already blown past their international spending limits. By giving out roughly $15 million in signing bonuses last summer, had already paid $30 million for international talent in the past year, considerably more than any other team. They had already forfeited the right to sign any other international player for over $300,000 for the next two seasons. Without a top draft pick, Moncada was the last chance the Yankees had to sign a legitimate top international prospect until 2017.

There is no shame in being outbid. Most of the time, the winner’s curse means the highest bidder will come to regret the decision. In this case, the amount was a relatively small one. When the amount the Yankees refused to spend means very little to the bottom line, it is a reminder of their recent history when it comes to failing to follow-through on their last spending plan.

The Yankees decided the free agent model of the last decade was not working and great savings could be had by avoiding free agents, until they had one sub-90 win season. They decided a great advantage could be had by outspending rivals on international free agents and accumulating a ton of talent, until a player they wanted cost $13 million too much. The Yankees have incredible resources, and for the most part they are using them, but how and when they choose to spend causes befuddlement. Yoan Moncada may not be worth $63 million, but for a team that seems focused on getting younger and building up through the farm again, this seems like an odd place to start worrying about overspending.