The Deshaun Watson Deal: A Historical Perspective

There are a couple of rules of life I live by in situations like this. The first rule is that gut reactions to major changes always swing wildly one way or another. So, it is usually best to let things sit for awhile and then have a more measured reaction. Secondly, I try not to criticize someone else unless I know exactly what goes into doing their job. This is more of a work related rule, but it applies here as it pertains to grading any kind of move for Nick Caserio,

Evaluating trades is normally easy. You find a relative comp and make the direct comparison. For instance, you could look at the Deandre Hopkins trade and compare it directly to the recent Davante Adams and Stefon Diggs trades. We know Adams was traded for a first and second round pick. Diggs was traded along with a 7th round pick for a first, fifth, and sixth round pick in 2020, and a fourth rounder from 2021. You could effectively argue that Hopkins was superior to both of those receivers. You could also claim that he would be the second or third best from that group.

However it would be impossible to think that David Johnson and a second round pick is worth anywhere near what those two teams got. This is not to relitigate the Hopkins trade. We all know it was terrible. What it is is an illustration of how you can fairly gauge whether you got fair market value in a trade.

What is the fair market value for Watson?

We would have to look at how often a quarterback in his prime has been traded. I can’t think of too many times that has happened. Both Matthew Stafford and Russell Wilson were traded for multiple picks, but neither quarterback is in his prime. That makes the return for Watson seem that much more underwhelming. However, let’s consider the full history of quarterbacks traded during their career for multiple picks.

1. Jim Everett to the Rams for Kent Hill, William Fuller, first and fifth round 1987, and a first rounder in 1988.
2. Jeff George to the Falcons for a 1995 first and third rounder and a first rounder in 1996.
3. Jay Cutler was traded to the Bears for Kyle Orton, two first rounders, and a third rounder
4. Matthew Stafford traded to Detroit for Jared Goff, a 2021 third rounder, 2022 first rounder, 2023 first rounder
5. Russell Wilson traded to Denver Broncos with a fourth round pick in exchange for two first, two second, a fifth round pick, and three players.

So, obviously the last two are the most relevant. Depending on how you feel about Jared Goff, you could see him as a positive or negative asset. So, if we take him out, that’s two firsts and a third. Watson netted the Texans more than that since they received three first rounders, a third rounder, a fourth rounder, and what amounts to a pick swap from a sixth to a fourth fourth. Even if you discount the players involved in the Seahawks trade it is hard to say that the Texans fared better.

You could definitely say that the Texans did better than the Broncos and the Colts did with Jay Cutler and Jeff George. Of course, you could claim that Watson is a better quarterback than either of those guys as well. Considering William Fuller’s success in Houston, it is hard to argue with Jim Everett’s haul, but he also hadn’t played a down in the NFL, so the Rams effectively got a good quarterback on his rookie contract.

What about the mitigating factors?

So, if we consider those five trades (and not draft day trades for Eli Manning and John Elway) then we would consider Watson to be somewhere in the middle of that group in terms of compensation. Everything else being equal that’s not terrible, but it also assumes that everything else is equal. We know that isn’t true. You could argue that based on age and skill level that Watson should have fetched more.

However, that ignores two relevant factors we know all too much about. The first factor is the no trade clause that Jack Easterby negotiated with Watson. It was so ridiculous that it will likely come up in the next collective bargaining negotiations. Instead of approving a list of teams he would be traded to, Watson was able to whittle the list to one team not once but twice throughout the process. He used that no trade clause to net himself an extra 80 million dollars and an additional year on his contract. I can’t imagine that helped increase his trade value.

Then, there are the 22 civil cases that are still staring him down. Civil cases are civil cases and how that impacts receiving teams in a public relations sense is impossible to calculate. What isn’t impossible to calculate is the likelihood that Watson will be suspended for at least four games if not more. That has to cut into the cost returning to the Texans as well.

A method to the madness

Photo by Bob Levey/Getty Images

Nick Caserio did two things right. The first thing he did was wait out the uncertainty of the possibility of criminal charges. He could have made a trade with the Dolphins last year, but it would have certainly been for less. He could have nervously done it at the beginning of the offseason. It also would have turned out worse. Instead, he waited until the grand jury came back with no bills.

The second thing he did was have the four finalists submit reasonable offers before getting to talk to Watson. The likelihood of Cleveland giving them more once Watson picked them was zero. One of the core concepts in Economics is opportunity costs. There is no better example than on a deal like this. Fans became excited by all of the different packages that got thrown around. Unfortunately, they can only accept one. Unfortunately, they likely couldn’t even accept the one they deemed to be the best. They had to accept the one that Watson would allow them to accept.