As a thought experiment, consider a world in which ballclubs get a choice. Every November, they receive a three-option menu. They can take $10 million from a central fund, to spend as they please. They can accept a $10-million voucher, or credit, against the luxury-tax cap, such that they need not pay that tax on anything under the new number, $10 million north of the standard line. The catch is that, if they accept either of those options, they must agree to play the season with a 24-man roster. Otherwise, they can stand pat, keeping their roster intact but missing out on the incentives offered.

Very few are the teams who would take that deal. It would make it hard to carry any player picked up in the Rule 5 Draft. It would make you drop players due to exhausted options more often. It would put extra pressure on your players and training staff to give specific timelines on day-to-day injuries, so you’re not dragging two roster spots while a guy misses a week with a bruised knee. Of course, it also shortens your bullpen or bench by some percentage.

I point this out in order to make clear that just carrying a player has real cost. While teams focus mostly on buying wins at certain costs, there’s a substantial opportunity and flexibility cost to carrying any given player.

That’s what’s wrong with the deal the Kansas City Royals doled out to Jason Vargas Thursday. They’ll pay him just $8 million per year, which is reasonable, and he’s a reliable, if boring, pitcher. He falls slightly short of league-average status, but he’s a fly-ball pitcher, and Kansas City is the right place to be a fly-ball pitcher.

It’s not that the Royals are overpaying for that. It’s for how long they’re paying for it that makes this a misstep. Vargas got four guaranteed seasons from the Royals, and while they might be able to trade him or release him, they’ll almost certainly owe him all $32 million, and right now, anyway, they have that roster spot committed to him even in 2017.

If I gave you $16 million and two years to spend it, I’ll bet half of you could find a pitcher with higher short- and long-term value, starting in 2016, than Jason Vargas, and none of you are paid anything by professional baseball teams, let alone the handsome salary Royals GM Dayton Moore pulls down. The Royals either got lazy or overestimated Vargas. They’ve committed a valuable resource—two, really, if you count the money—to Vargas, for the next four seasons, and he just doesn’t advance them toward the playoffs, or a World Series title, or whatever the goal of this front office is. Vargas is the guy you hope doesn’t even make an October start for you, if you do reach the playoffs. When spending roster spots two or three years ahead of time, you have to make sure you do so only on guys who will make major impact during the playoffs, if and when you get there. Happily, perhaps, I don’t foresee that the Royals are going to have any playoff rosters into which they will have to pencil Vargas during this stretch, anyway.

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