When Manny Machado agreed to a $300 million contract with the San Diego Padres last week, it prompted the evergreen sports discussion about whether any person is worth $30 million annually. When Bryce Harper finally signs his free-agent contract – which will likely exceed the 10-year deal that Machado signed in terms of financial value – the discussion will ramp up again. And it’s an interesting debate to have, especially when you focus on a micro level, as opposed to casting the net that no player is worth such a deal.
But on a macro level, it’s as simple as supply and demand. There are so few people in the world physically capable of producing at the level of world-class athletes. And those athletes – unlike school teachers, brain surgeons and virtually any other profession – generate billions of dollars for their respective employers. And so millions – and hundreds of millions, in the case of extreme examples – trickle down on the players who create the product that leads to billion dollar television deals, ticket sales and jerseys being sold, among other things.
Alex Rodriguez is one of nine players in baseball history to have hit over 600 home runs. He also, for whatever personal flaws he may have had, was a trail-blazer in terms of superstar talents, as the kids say, “securing the bag.” Already a four-time All-Star, Rodriguez signed a record-shattering 10-year/$252 million free-agent contract with the Texas Rangers ahead of his age-25 season in 2001. Seven seasons later, coming off of winning his third American League MVP Award, Rodriguez opted out of the final three years of his initial 10-year deal, ultimately forcing the New York Yankees, who had acquired him ahead of the 2004 season, to sign him to a new 10-year/$275 million deal.
There’s still a notion that stems from Rodriguez’s three seasons in Texas that signing a player to a deal that pays them in excess of $30 million can cripple a franchise. In three seasons with the Rangers, Rodriguez hit 156 home runs, but the Rangers finished in last place in the American League West in each season he spent in Arlington. Still, Rodriguez was making $25 million annually nearly two decades ago – there’s been quite a bit of inflation since then. With television contracts, smaller and medium market teams, such as the Padres, can afford to make major investments they couldn’t have at the outset of the millennium. And for deep-pocketed teams like the Yankees and Philadelphia Phillies, such investments are even more doable now, which is why Rodriguez isn’t fond of the notion that signing a player to such a deal could deplete a franchise.
“It’s interesting, I’m always going to take the side of the players because what we have to do with our players is we have to draft them, we have to develop them and then we have to pay them,” Rodriguez told Colin Cowherd on The Herd on FS1. “That arc is called the American dream. That works in Hollywood, it works in baseball and it works in America.”
Again, there are times where it doesn’t make sense for a team to make a major investment in a star. If Machado and Harper had become free-agents after the 2015 season, when the Phillies had just begun a rebuild, it may not have been the best time for them to cash their chips in. After a postseason that turned into a public relations nightmare, it was fair to wonder how Machado would have fared in a media market like Philadelphia. Rodriguez dealt with multiple major scandals throughout his career, from rumors of an affair to performance-enhancing drug connections. When a player is making a record-setting amount of money, they are the face of the franchise and all their actions reflect on the organization that employs them. So it’s true, there are ways to talk yourself out of investing major money on individual star talents.
But in the big picture, teams are raking in as much money as they ever have. In January of 2014, the Phillies agreed to a 25-year extension with NBC Sports Philadelphia to televise their games worth $2.5 billion. Jeffrey Loria bought the Miami Marlins in 2002 for $158.5 million, and despite limited success and fan support during his time as owner, he sold the team for $1.2 billion in September of 2017. So while it’s understandable for the regular working-class person not to understand how a player could hold out for $350 million if they have an offer for $275 million on the table, Rodriguez believes that scapegoating players for trying to maximize their earning potential is a way of allowing owners to run out the back door with the money they’ve made off of said players.
“You know, it’s funny, people scream and shout when a player signs for $300 million, but when the Los Angeles Dodgers trade [are sold] for more than $2 billion, or the Marlins trade [are sold] for more than a billion, nobody says anything,” Rodriguez continued. “It should be more democratic. And if the industry has gone from more than a billion to $10 billion, it’s good for it to be spread around and for players to get paid in a big way.”
Machado ultimately signed what is currently the largest contract in North American sports history, something that didn’t seem overly likely at times this offseason. If Harper signs with the Phillies, he seems likely to take that title from Machado. But it took until February for Machado to sign, and Harper is still a free-agent as we approach March. Both Machado and Harper are 26 and have a combined 10 All-Star Game appearances. The system that allows them to be free-agents this deep into the offseason is flawed, at the very least.
That says nothing of Dallas Keuchel, who FanGraphs says was worth $47.2 million in terms of fWAR in 2015, when he won the American League Cy Young Award. He, like Jake Arrieta last offseason, is a free-agent into Spring Training because he didn’t become a free-agent until his early 30s, a few seasons after he peaked. In the minds of some that may just be how the cookie crumbles, but both of these starters won Cy Young Awards and World Series titles, and their thought is that the MLB’s arbitration system probably kept them from maximizing their earnings at that time. If that isn’t made up for when they become free-agents, perhaps it’s time to make adjustments to the idea that a player can’t become a free-agent until after he’s spent six seasons in the league.
There is something disheartening about discussing the finances of baseball during Spring Training, as opposed to actual on-field baseball matters. But it’s unavoidable. So too are major changes to how baseball deals with paying players. The MLB’s current collective bargaining agreement expires at the conclusion of the 2021 season, and it won’t be lost on players that it took 18 years to get from Rodriguez’s $252 million over 10 years to Machado’s $300 million over 10 years while the value of teams across the sport has exploded over the same period.
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