I'll try putting into words what i'm trying to say, although I think I understand what you mean.
Let's assume just for the purpose of this example, that Corcoran decides three seasons from now, that he no longer wants to GM Vasty and steps down. Then I take his place, and Valiq has one last season before he retires. The season passes, Valiq retires, and I don't recreate but remain GM of Vasty. With Valiq's cap off the books (since they did count towards the cap), rather than recreate, and add my new players salary to the cap of Vasty, I could pursue a different free agent and use money that would have been used for my next player, towards said free agent.
In your reply that I quoted, you said yourself, we have tons and tons of active players. What's to say that I couldn't find an active player to sign and play where I would have with my next player. In response to your second statement, how would that put my team at a disadvantage by not having a semi-active welfare player, when instead I could sign someone else that could help benefit the team elsewhere.
Sorry if this is confusing, it was kind of hard putting into word what I meant.