Hey, Moderately Big Spenders...

With a nudge from Ryan Howard's arbitrators and some debatable accounting, the Phillies are now firmly over the $100 million payroll threshold for 2008. The Inquirer's Todd Zolecki yesterday pegged the club's Opening Day player expenditures at $106.1 million, a franchise record and a total that last year would have put the Phils in the top eight biggest payrolls in MLB.

As Zolecki acknowledges, different evaluators use different methodologies to determine payroll, and one can take issue with how he did it: Zolecki's total includes the $6 million the Phils pay Chicago for Jim Thome this year, as well as about $2 million in buyouts to Tom Gordon, Wes Helms and others for 2009 and $3-4 million in signing bonuses for the likes of Jimmy Rollins and Chase Utley (who were signed well before this season). Removing those outlays drops the total back into the $95 million range. On the other hand, appearance and performance incentives to the likes of Jamie Moyer and Kris Benson could add another $7 million to the payroll.

Zolecki makes a worthwhile point about the team's oft-discussed and oft-criticized financial practices:

I've heard about how cheap the Phillies are ever since I got on the beat. But that argument has become a bit of a cliche. I always say this to people, "If you want to rip the Phillies about money, don't rip them for not spending enough. If you can't win spending $90 million or more, you have bigger issues. You have front office issues. (The Diamondbacks, Rockies and Indians had some of the lowest payrolls in baseball last season, but they made their league championship series.) If you want to criticize the Phillies, criticize them about how they spend their money. Because they're spending enough money to give them a chance to win a World Series."

I think this is about two-thirds right.

The other piece of it is addressed by Bill Conlin in his column today. Much as I hate at this point to give ol' One-Chair for anything, Conlin nicely puts his finger on the team's dilemma just over the horizon:

While the Phillies have kept stiff upper lips following their $3 million arbitration hit, the feeling around baseball is that Howard bursting through barriers established by Albert Pujols and Carlos Lee and emulsifying existing service time guidelines will lead to the pastime's next major payroll spike. Few clubs will be willing or able to play in that league. A 15-to-18 win season by Cole Hamels could help the Phils to the Promised Land this season, but the thought of both their young lefthander and Howard lined up at the arbitration trough next February has to have the Teflonics bathed in soaking night sweats. What if Hamels wins more games than $137.5 million Met Johan Santana?

A normal Howard year - 45 homers, 125 RBI - looks like Phils offering $12 million, agent Casey Close and Ron Howard countering with $15 million. And while the Phillies like to say, somewhat smugly, "We have him for 4 more years," by then Ryan would be 32 years old, probably up to the $25 million range and could be rendered untradable by an injury or sudden erosion of skills. And somewhere in this costly process, a recent MVP shortstop named Jimmy Rollins might conclude that in 3 years, when his friend and teammate is making an insane amount of money, his own 2011 salary of $8.5 million might be considered a pittance. Chase Utley is due to make $15 million that year. Even with the third-base salary and the third baseman undetermined, Rollins, Utley and Howard could be earning a combined $48.5 million. As recently as 2001, the Phillies entire payroll was $41.67 million.

The Howard example is, in some ways, not the best one: actuarial reality suggests that the team would be perfectly justified to go year-by-year with the big fella and then let someone else pay for his "Mo Vaughn: The Late Years" period. But consider Hamels. He's a year behind Howard service-wise, which means the Phils will control him through 2012. Next season will be his first arbitration-eligible campaign; if in 2008 he more or less repeats what he did last year, that's an award of $5-6 million easy, and it goes up from there.

If Hamels averages 16 wins or so through the next five years, he'll hit free agency at age 29 with over 100 career victories; it's impossible to do more than speculate as to what his market value would be at that point, but five years, $120 million might be on the low side; at the maximum, take Johan Santana's Mets deal and adjust upward for inflation. Does that sound to you like a price the Phillies would pay, considering also that a team where Hamels' $25 million would constitute 20 percent of the payroll isn't very likely to contend?

Playing out Conlin's thought exercise, the almost-inevitable conclusion is that "Small Market" Giles and his crew of blue bloods choose to sell. The irony is that this ownership group, whose tenure has been such a nightmare, bought the team in 1981 after the Carpenter family--who had built a dynasty in their last half-decade of control--decided the economics of baseball were unsustainable and they didn't want to play anymore. What goes around...

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