Owners are again handing out silly money

Sometime over the next few days, Cliff Lee(notes) will decide which team earns the privilege of paying him more than $20 million per annum for the next seven years. It is Major League baseball's silly season, where billionaires spread their wealth to millionaires and they laugh the laugh of rich men. Recession? What recession?

Baseball is back to profligate spending, banking not as much on the nation's recovery as in its faith in itself as a stalwart business. MLB believes in MLB enough that within the last calendar year, teams have given out six contracts in excess of $120 million. Each. Lee's will make seven, Adrian Gonzalez's(notes) eight and, by the end of next offseason at latest, No. 9 will go to Albert Pujols(notes) and No. 10 could go to Prince Fielder(notes).

Which means that over a two-year span, owners will have given out 40 percent of the total $120 million-plus deals in baseball history.

Once Lee signs his $150 million-or-so contract, this year's market already will have surpassed 2009's in dollars spent. Perhaps the greatest move of the last year was the MLB Players Association's decision not to file a collusion grievance against the owners for spending $846.8 million last offseason, compared to $1.16 billion in 2008, $1.07 billion in 2007 and the stark-raving-mad hot stove of 2006, in which owners dropped $1.66 billion on players, including three all-time albatrosses: Alfonso Soriano(notes) (eight years, $136 million), Barry Zito(notes) (seven years, $126 million) and Carlos Lee(notes) (six years, $100 million).

By not waging war leading up the expiration of the collective bargaining agreement in 2011, the union allowed the owners to revel in a victory and figured their collective eagerness would get the best of them. And though it started off with a trickle – first setup reliever Joaquin Benoit(notes) at three years and $16.5 million, then infielder Juan Uribe(notes) at three years and $21 million – the fire hose opened the moment outfielder Jayson Werth(notes) took pen to paper on a seven-year, $126 million deal with the Washington Nationals.

Baseball's collective gasp wasn't so much because Werth's bounty was going to have a profound impact on other contracts, but that it signaled a return to the gold panning of '06, where not only the dollars turned irrational but the years attached to them, too.

One look back at that market begs a serious question: Did the union spend an entire offseason illicitly drugging owners? Gary Matthews Jr.(notes) for five years and $50 million? Jason Schmidt(notes) at three years and $47 million? Five years for Juan Pierre(notes) and Kei Igawa(notes)? Four for Jeff Suppan(notes), Julio Lugo(notes) and Justin Speier(notes)? Owners handed out 57 multiyear contracts that offseason, including 33 for three years or more. Never will either of those numbers come close to being equaled.

With 26 multiyear deals already this offseason, and perhaps another dozen to come, owners are taking the most long-term risk they have since 2006. Nine of those contracts are for three years or more, and with Lee, Adrian Beltre(notes), Carl Pavano(notes), Rafael Soriano(notes) and at least one more reliever sure to fetch three years or more, that number will be the highest since '06, too.

Whether this is a market correction or an outlier won't be known for years. All of the lessons gleaned from the steroid era – particularly that players who aren't chemically enhanced tend not to produce into their late 30s – seem lost amid the fury to win now, an attitude that makes agents emulate the Cheshire Cat.

Owners' bets on increased revenues to cover the contracts, one official said, come not just because of baseball's ability to weather the recession. Unstable labor situations in football and basketball give MLB confidence that it can siphon off disgruntled NFL and NBA fans – and the dollars that accompany them.

In addition, MLB's television contracts with Fox, ESPN and TBS expire in 2013, leaving the postseason, Sunday nights, Saturday afternoons and weeknights open to bidding. How MLB structures its rights deals – and whether it packages them with Web-based properties, which it hasn't – will determine just how big an increase in revenues it sees.

Already MLB Advanced Media, the sport's Internet arm, and MLB Network, its TV station, are experiencing marked growth. Though some owners fear stagnation, enough are willing to spend that the market kicks on with a strong heartbeat, hundreds of millions more ready to be spent.

No, it's not 2001, with 10-year deals for Alex Rodriguez(notes) and Derek Jeter(notes) and eight-year deals for Manny Ramirez(notes) and Mike Hampton(notes), and it's not even '06. It is lavish, though, the sort of year on which we'll look back and wonder what, exactly, the owners were thinking. Joe Mauer(notes) and Troy Tulowitzki(notes) and Ryan Howard(notes) and Matt Holliday(notes) and Lee and Werth and Crawford and Gonzalez and Pujols and Fielder, all $120 million men, all long-term risks in a sport where such deals so often turn the aggressive into fools.

The Great Recession? Ha. Could've fooled baseball.