Nobody can. The Yankees have the best ability to absorb, then the Red Sox, etc. It's simply a matter of percentage. The higher your operating payroll, the better your ability to absorb a bad contract.
The trick is to sign players to deals that are in line with their decline. Personally, if I had to choose, I'd rather take the higher deal for less years. This way, it's easy to cut the strings and not hamstring your team. I'd much rather take Damon at 13 million next year for one year than for two years at 20 million. I personally think that will be the going trend for the next few years.
Plus, deals look different over time.
The Red Sox looked like off-season winners when they signed Lugo, Drew, and Matsuzaka. This year, the deals look horrible.