The $50 million line Kansas City should not cross

Baseball’s Hot Stove is more like Baseball’s Lukewarm Potatoes at this point. Other than the Los Angeles Angels winning the Shohei Ohtani sweepstakes and Derek Jeter’s jettisoning of Giancarlo Stanton to the New York Yankees, there hasn’t been a lot of movement. Exactly zero of MLB Trade Rumor’s top 11 free agents for this offseason have signed with a team, and the Winter Meetings are gone. And other than Stanton, the biggest trade so far is arguably the annual or biannual shipping of Matt Kemp and His Extraordinary Salary to a different team, and only so because of the sheer amount of dollars changing hands.

Just like a few years ago when the Kansas City Royals were pining after Alex Gordon, all eyes are on their recent free agents, specifically on Eric Hosmer and Mike Moustakas. Messaging from the Royals on their ability and desire to sign those two has been all over the place (though, make no mistake, they absolutely could sign both).

Just like with Alex Gordon, though, Hosmer and Moustakas might be coming into Kansas City’s price range.

The Boston Red Sox and Los Angeles Angels were the favorites to land Hosmer and Moustakas, respectively, and both teams could have outbid Kansas City if it came to a bidding war.

See, the trick with premier position players is that there are only so many viable teams that can make a reasonable and competitive offer. Every team in history can use more pitching, but you aren’t going to go out and grab two great first basemen.

And first base and third base are not exactly the most in demand positions. First base is traditionally where you stick your worst player, and third base is the least demanding of the other three infield spots.

So Hosmer and Moustakas are sort of at the mercy of what teams are interested. It could very well be the case that the game of musical chairs could end and both still be seeking their dream deal. The nightmare scenario is that either or both pick up one-year deals to boost their value and try again next year.

The temptation for the Royals, then, is to offer a nice deal as soon as it comes into a reasonable price range and then sit back, relaxed, as their homegrown guys get another crack at postseason glory.

Kansas City should not do this. They should only re-sign Hosmer, Cain or Moose if they do so for under $50 million. If they do so for over $50 million, they are doing it extremely wrong.

The reason is pretty simple, and is related to draft pick compensation for players who were given a qualifyong offer. It’s excellently explained by Manny Randhawa over at MLB.com:

If the team that loses the free agent was a revenue-sharing recipient the previous season, based on its revenues and market size, and if and only if the player it lost signs with another club for at least $50 million, that team's compensatory pick would land between the first round and Competitive Balance Round A of the 2018 MLB Draft. If the player signs for less than $50 million, the team that lost the player would receive draft pick compensation after Competitive Balance Round B.

Kansas City is a revenue-sharing recipient, so any player it offered a qualifying offer to that signs for over $50 million receives a compensatory pick after the first round; if that player signs with another team for less than $50 million then the team he is leaving gets that comp pick after Competitive Balance Round B.

To put it into raw draft order: if Hosmer, Moose, or Cain sign for over $50 million with a team other than Kansas City, the Royals will get an additional pick (or picks, if multiple sign elsewhere at that amount) as high as #31. If they sign for under $50 million, the highest compensatory pick Kansas City could get is pick #76, and will likely be at least #80.

That is a gigantic deal. While the baseball draft is much more of a crapshoot than any other draft, it still follows standard draft logic, in that players at the upper end of the draft are significantly more likely to succeed than the guys drafted dozens of spots below them.

Kansas City should be rebuilding, and information gleaned from interviews Dayton Moore has given suggests that they are moving towards that decision. The Royals already own picks #18 and #36, and have the chance to grab up to five of the first 45 or so picks in the draft.

Eric Hosmer at $150 million doesn’t make sense for the Royals. Eric Hosmer at $100 million doesn’t make sense for the Royals. Eric Hosmer at $50 million doesn’t even make sense for the Royals. But Eric Hosmer at $49 million does.

Maybe this is all moot, as it seems unlikely that Hosmer or Moose would sign a multi-year deal at that low of a price. If it comes down to watching Hosmer or Moose sign a one-year deal elsewhere or offering over $50 million, Kansas City could probably go over that line without feeling too bad.

Regardless, Kansas City ought to treat that $50 million line with almost religious reverence. If they can merely shepherd other teams along enough to get their former stars past that line, they will have done their part. If they are still available at a lower price, then so be it.