do you think that the Yankees were wise to give a 7 year contract (for big money) to a star Japanese pitcher who has yet to throw a pitch in the major leagues?
It's a risk, yes. But they've been scouting him for years, so they feel they think it will translate well.
As for the $$, one thing that's lost is the fact that he's 25, and there's really no baseline for 25 year old pitchers hitting the FA market. It doesn't really happen, so the fact that he's so young is going to inflate the totals he'll get.
Plus, given the fact the Yankees automatically drop 60M+ in revenues when they miss the playoffs, paying 1,2 or even 3M per year extra to acquire the player they want makes perfect sense. Tanaka was getting 20M per, even if the Yankees weren't involved.