In case you haven’t heard, the Padres and Peavy are close to an extension that would keep him in San Diego through 2012. It’s a glorious day, with root beer raining down from the heavens. But why am I not happy? Most other Padre fans are. We’re locking up our ace through his prime years for about $16.6M a season. That’s a steal, not a deal.

You may recall how Alex Rodriguez, poster boy for big time contracts, chose the same day as game 4 of the World Series to let everyone know that he was opting out of his contract with the Yankees. It was a non-story in the end, as Rodriguez re-signed with New York, but many in the media saw it as a shameless move by a blatant self-promoter. Among those who voiced their displeasure with Rodriguez was the incomparable Peter Gammons. During his deconstruction of A-Rod, Gammons threw out this tasty nugget:

If you go back to 1985, and I haven’t gone back any further than that, there hasn’t been one team that’s won the World Series with one player who’s made more than 16% of the team’s payroll. This isn’t basketball. This is baseball, where the money gets spread out and it’s about 25 guys and a team concept. And that notion that one star [can get you there]—it’s a great idea if you want to lead Entertainment Tonight or Sports Center, but it doesn’t always do a lot of good when it comes to win world championships.

Manny Ramirez, the highest paid player on the champion Boston Red Sox, made $17M. That’s only 12% of his team’s payroll. But the Red Sox payroll was at $143M, so what does that have to do with Peavy and the Padres?

The Padres are not the Red Sox.

Peavy might be Manny Ramirez but what I said right there is still true. Can the Padres afford to put so much of their money in one player? This year’s payroll was $58M, down from almost $70M last season. For argument’s sake, let’s say the payroll gets kicked up to $80M by the time Peavy starts cashing $16.6M checks. Almost 21% of this team’s payroll will go directly to him. Assuming that Mr. Gammons was careful with his fact checking, and that something not happening for 20 years constitutes it not being a coincidence, we’re not going to win the World Series until 2013.

I don’t hate this deal. I think there is something to be said about making a big splash. I think it’ll help calm the fans down and show the more outspoken members of the team, like Peavy, that this team is committed to winning. But it’s hard for me to shake the feeling that it’s no different than saying that So-and-so who never walks and hits for no power is valuable because he hustles and gets his jersey dirty and all the other clichés that are out there.

In other words, this is an Eric Owens extension.

The deal, which would lock up Peavy through 2012, will average between $17 million and $17.5 million per season, according to a major-league source. It also could include a club option for a fourth year.

Love the deal from both ends. Peavy gets near the money he deserves, but recognizes that San Diego will never match the resources available to a major market.

On the Padres side, the team rarely commits to long term deals of this magnitude. The organization knows how special Jake is, and uses what payroll flexibility it does have to reward and build around its home grown star.

He will be 31 years old on the last year of the contract, 32 if the option is exercised.

Melvin Edit: Wondering on the details. Does his salary stay at $6 million and $8 million in 2008 and 2009?

Melvin Edit 2 (12/3) : We have confirmation from Tom Krasovic of the UT on Peavy’s deal, a little over $50 million over 3 years. There is new news however, a mention of a no trade clause along with a player, not team option for 2013. Both will significantly reduce team flexibility against anything unexpected.

Padre fans need no reminder of the ills of giving up trade flexibility, having watched Phil Nevin under perform his contract in 2005. It may not seem like a factor after Peavy’s 2007 Cy Young season, but a max effort guy like Jake leaves a very real injury possibility. Although if he is injured, actually finding a trade parter will be difficult enough. And since the contract only covers Jake’s prime years, the front office may not see a comparison to the old age decline of Phil Nevin.

Melvin Edit 3 (12/4): Krasovic from the UT and The Associated Press update on the Peavy deal, $52 million for tres años, plus a $22 million dollar team option with a buyout for $4 mil on the fourth año. The team option looks good to me, though the buyout seems a little steep.

Here’s a breakdown from the AP

A person with knowledge of the deal, speaking on condition of anonymity because the deal hasn’t been finalized, said Peavy will earn $15 million in 2010, $16 million in 2011 and $17 million in 2012. If the club declines the $22 million option, Peavy will get a $4 million buyout.

The guaranteed money in Peavy’s extension will average $17.3 million a season.

Lets talk no trade clause:

For the next three years, Peavy can veto a trade to any club. In 2011 and 2012, he can veto a trade to a select group.

Word up. Sounds like something might be possible in an emergency, but it’s still a bit scary.