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Major League Baseball teams are 30 different versions of Demi Moore in “Indecent Proposal” right now, rolling in beds of cash as the industry barrels toward $10 billion in annual revenue. Here’s how huge the money is: The two biggest-spending teams in a slow offseason are among the handful that Forbes said lost money in 2014.
When the teams ostensibly bleeding money find themselves empowered to throw around tens of millions like it’s no big deal, it is the greatest proof yet that the market has changed and a new reality is upon baseball. If it wasn’t evident in Toronto guaranteeing J.A. Happ and Marco Estrada $12 million and $13 million a year, respectively, the moment arrived Sunday, when the Detroit Tigers reportedly handed Jordan Zimmermann a five-year, $110 million deal.
Zimmermann, 29, has been a very good pitcher. Over the last five seasons, his adjusted ERA is 11th among starters with at least 700 innings. He is tied with Felix Hernandez, ahead of Max Scherzer and Jon Lester, who received a combined $365 million in free agency last year. At the same time, Zimmermann is coming off the worst full season of his career – and is more than half a decade separated from Tommy John surgery, which makes committing another half-decade that much riskier.
And yet here he is, a $22 million-a-year man, reminding us that neither $20 million-plus annual salaries nor nine-figure contracts mean quite what they used to. The going rate for a decent, healthy free agent starter is about what Happ and Estrada fetched, and anyone of Zimmermann’s ilk could well double it.
As much as this abhors some fans, they must understand: This is players getting their fair share. They are the product, the reason people watch the game, and the best players deserve the most money. So long as the agreed-upon system is backward enough that more money funnels into past-their-prime free agents and the best young talents are underpaid relative to their performance, this is how the system stays equitable and how labor wars are avoided.
Baseball’s 30 teams combined are worth nearly $40 billion, according to one high-ranking source familiar with the numbers, which dovetail with Forbes’ $36 billion estimate at the beginning of last season. Clubs are raking in an estimated $70 million more in annual revenue per season than less than half a decade ago, the success of cable TV contracts and baseball’s Internet arm fueling the boom.
Even a team like Detroit, with a pair of $25 million-plus-per-year players in Miguel Cabrera and Justin Verlander helping contribute to a reported loss in excess of $20 million in 2014, saw itself in a good enough position for a Greektown-style dice roll on Zimmermann. Surely the Tigers understand that a player with past arm troubles is likelier to experience ones in the future; they experienced it last season, with Anibal Sanchez – he of the Tommy John and labrum surgeries – struggling mightily before a rotator cuff injury shut him down for the season.
They’re banking on Zimmermann being different, and maybe he will be, and maybe he won’t. And perhaps the Tigers aren’t the finest example of free agent spending because owner Mike Ilitch has shown willful disregard for profit in pursuit of championships. For everyone who calls Rick Porcello’s $20.75 million-a-year extension an anomaly and Lester’s $25.8 million-a-year deal an overpay, though, there are the realists who look at Zimmermann becoming the first Tommy John survivor to reach nine figures and realize this is what baseball in 2015 looks like.
It is a stupidly rich game, and the men in boardrooms aren’t the only ones who deserve to partake. They’re as complicit in retrograde free agency as the union, so to turtle away from spending would be as hypocritical as it would collusive. No, teams are going to keep spending, and what makes the rest of the offseason so fascinating is that there’s a lot to spend on.
David Price may get Scherzer money – $30 million a year for seven years – and new Boston president Dave Dombrowski has done everything he can to convince Red Sox ownership to look past the restrictions on massive free agent contracts and let him spend, league sources told Yahoo Sports. Neither the Chicago Cubs nor St. Louis plans to go there, though they’ll pay a pretty penny – or a couple billion a year – for their shot at Price.
Zack Greinke could get even more per year, depending on how the war between the Los Angeles Dodgers and San Francisco Giants proceeds. They’re the distinct favorites for his services, sources say, and a deal for a dollar per year over Cabrera’s record-setting $31 million-per-annum contract would surprise nobody.
Even before Happ and Estrada and Zimmermann, they were going to get paid. More than anything, they embolden Johnny Cueto and John Lackey and Mike Leake and Jeff Samardzija and Hisashi Iwakuma and Kenta Maeda and Wei-Yin Chen and Scott Kazmir and Yovani Gallardo. Teams may scoff at the idea of giving them four and five and six years, of going $14 million and $18 million and $22 million, but when an entire system exists based on performance and each of the above has performed better than the Blue Jays’ signings (Maeda, coming from Japan, excepted) and, in Cueto’s case, far better than Zimmermann, something must give.
It can’t just be the Red Sox and Cubs and Cardinals and Dodgers and Giants in this market. Baseball can’t
work that way. The story of the next collective-bargaining agreement won’t be about an international draft or the qualifying offer. It’s about revenue shared, and whether MLB can placate three parties: the players, who want to make sure the levers remain in place to allow the big-market teams to spend; the big-market owners tired of being taxed because of their geography; and the small-market owners who reap the shared money, often hoard it – no team today, none, has any excuse for carrying a payroll below $100 million – and don’t want to be told how to spend it.
If any of the three sides disagrees, commissioner Rob Manfred, lead negotiator Dan Halem and the cadre of brilliant minds that runs baseball will need to dig deep into those brains and figure out how to navigate the political minefield that awaits. If the money spent this offseason is a sign that the owners have confidence in Manfred to do as much, all the better.
And yet with $20 million a year now the going rate for a decent free agent pitcher, that market cannot exist only for the big-spending teams, not if baseball under Manfred still desires the sort of competitive balance sought by his predecessor, Bud Selig. Recently crowned Kansas City needed to practically double its payroll before it became competitive, and while money no longer buys championships, it doesn’t hurt in the quest for them, either.
So get ready for the silly season. It’s officially upon us, and the Zimmermann contract was strong work in setting the market for the players. There’s money out there, money waiting to be spent, and it can’t spend its existence being tossed about with some high-thread-count sheets and pillows.