Stephen Strasburg's New Contract Is Risky for Everyone Involved

The Washington Nationals have signed their young starter to a contract extension, but it's not a sure thing for anyone.

Well, it's not all that often a Scott Boras client eschews free agency and signs an extension with a team before hitting the open market. But then again, Stephen Strasburg has always been special.

According to a source familiar with the negotiations, the Washington Nationals have signed the 27-year-old right-hander to a seven-year deal worth $175 million. Reports also indicate there are rolling options after the third and fourth years, meaning Strasburg could hit the open market at the age of 31.

The deal carries with it benefits and risk for both parties.

What It Means for the Nationals

For the Nationals, they've just committed $175 million to a player who has had only one season in which he's pitched more than 200 innings. It is also the richest contract ever signed by a pitcher who has undergone Tommy John surgery (although judging by how many pitchers are having this procedure done, the record won't last for long).

Make no mistake, contracts with opt-out clauses in them benefit only the player. Yes, the Nationals appear to be in position to have one of the most electrifying young starters in the game to themselves for the next three to four years at least. But if Strasburg performs well, he will leave. If he gets hurt again or struggles, the Nats are on the hook for a ton of money and a ton of years.

But he's also one of the best young arms in all of baseball.

Strasburg in 2016

While he hasn't yet put together that Cy Young caliber season, he is off to a hot start in 2016. And even if his stats haven't been as gaudy as some would like, he has performed well in his young career.

He wasn't at his best against the Detroit Tigers on Monday night, perhaps with the contract issue weighing on his mind. He went 7 innings and gave up 4 runs on 6 hits. But he also piled up the strikeouts, tallying 11, while walking 3. And for the season he's 5-0 with a 2.76 ERA and a 2.24 fielding independent pitching (FIP), striking out 10.65 batters per nine innings while walking 2.20.

The big difference for Strasburg this year is the disappearance of home runs allowed. Last year, 12.4% of all fly balls against him went for dingers, and for his career, that number is 11.0%. This year, that number is down to 3.0%.

Coming into his game on Monday, he was tied for second in fWAR at 1.7, and his 58 strikeouts after the Tigers game were second-most in the Majors.

And here's what he did last week against the defending world champs.

He's really, really good, folks.

What It Means for Strasburg

For Strasburg, the deal is a tremendous security blanket for a pitcher who underwent Tommy John surgery just a few years ago. As Yahoo!'s Jeff Passan noted in his excellent book The Arm, pitchers who have sustained a serious arm or elbow injury have a higher risk of being hurt again than other pitchers. Taking this money now ensures a huge payday no matter what.

However, Strasburg did likely leave some money on the table. Just last season, David Price landed a seven-year, $217 million contract, and Zack Greinke inked a six-year, $206.5 million deal.

Strasburg is younger than both those pitchers by at least three years, and Price and Greinke had accomplished more with a longer track record. However, Strasburg would have had the free agent market all to himself at the end of the year.

With Strasburg off the board, look at who's left to choose from this offseason.

So, Stras was going to get paid by somebody, injury risk and all. But in the end, he and his agent thought it was wiser to take the money now and give himself another chance to hit the open market while still a relatively young man.

And there is one other underlying wrinkle to his deal.

With Strasburg on board for potentially $175 million and Max Scherzer signed for $210 million, have the Nats priced themselves out from signing Bryce Harper to an extension before he becomes a free agent after the 2018 season? That is still a few years away, and it's too soon to tell that yet.

But the Nationals apparently feel like this is where they want to invest their money right now. They are taking on a ton of risk but also could have an incredibly dangerous rotation of Scherzer, Strasburg, Lucas Giolito and Joe Ross for the next few years, one that stacks up with the New York Mets' fearsome arms and the staff the Philadelphia Phillies could be building in the NL East.

And hey, if it ends up in a World Series parade, then whatever happens afterwards doesn't matter.