Justin Verlander, soon to be in his forties, has just signed a contract that will earn him $ 1.27 million per presence on the mound in 2023 with the Mets. It’s the same deal as his new teammate Max Scherzer: $43.3 million per year. Aaron Judge will receive $40 million. Can you imagine how much your popcorn would cost you if the Expos came back?
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Basically, the pandemic will not have shaken major league baseball’s revenues so much. Despite a general decline in attendance for nearly 20 years, revenues still reached $11 billion this year, the same as before the pandemic.
And so teams can start upping the ante again to sign free agents. These auctions have taken on incredible proportions over the years.
Series hero and air conditioner fitter
In 1979, the most fascinating pitcher in history, Nolan Ryan, signed what was at the time the most lucrative contract in baseball history: $1.125 million a year.
It was exceptional. He became the first to pocket more than a million dollars a year. A few years earlier, Ryan, then with the Mets, had played hero at the World Series and still had to install air conditioners to make ends meet.
In 2000, Alex Rodriguez scored a crazy second leg of the salary climb. He signed an agreement of $25.2 million per year over 10 years.
PHOTO D’ARCHIVES, REUTERS
Alex Rodriguez signing with the Texas Rangers in 2000.
I remember it like it was yesterday. I was 12 years old, I did not listen to my course in high school and had fun calculating what it represented. I told everyone that it gave him $8 a minute, all the time. Even when he was going to the bathroom or sleeping.
Not all candidates for the Temple
We have reached another level in recent years. Since A-Rod, more than 100 players have signed contracts that allow them to earn $27 million or more per year. And I confirm to you that it will not all be members of the Hall of Fame.
In Nolan Ryan’s time (in 1979), the average American household salary was around $30,000. Today it is a little more than double. In baseball, players earn 39 times more on average. Of course, they touch what they generate. But it gives small markets nightmares.
The next intriguing step: when will a player sign a contract worth at least a billion dollars? Will we see it in our lifetime?
For a 12-year contract, we are talking about an annual contract of $83 million. The highest paid player received $15 million in 2000, $20 million in 2010, then $43 million this year.
Ohtani will set a new standard
Next to take salaries to another level will be phenom Shohei Ohtani, dominating at bat and on the mound. Experts estimate that he would be a bargain at $50 million per season, while he generates more than $60 million annually according to the American advanced statistics site FanGraphs.
A contract of $60 million per year, for 12 years, would earn him $720 million by the time he turns 41. It is unlikely. His contract is likely to run for about 8 years. But, you never know with some owner-collectors of Picassos, like Steve Cohen, of the Mets. Such a contract would allow Ohtani to become majority owner of half of major league baseball’s teams. That’s more than the GDP of 12 countries.
Photo d’archives, AFP
Shohei Ohtani
It’s less fashionable to talk about an Expos comeback these days. And such amounts have nothing to bring it back into fashion. Teams must keep pace with those in good financial health to earn revenue.
Unless there’s exceptional contract management and full player development (like the Rays), there’s no way to be in the running. And on top of that, you have to ask fans to pay top dollar for parking, hops, hot dogs. No choice.
Even there, the Rays have yet to win. Superstars don’t just sell tickets. They win. Think Verlander, who won the World Series and the Cy Young, or Bryce Harper, who slapped the year to bring his team to the World Series. This duo costs $70 million.
Back to Ohtani. It will lay a foundation for new superstar contracts. The $1 billion contract will be sooner rather than later.
After him, if the trend continues, baseball’s next phenom could become a billionaire on a single deal.
Billions in the MLB, minimum wage for the others
The manager and general manager of the Capitales de Québec, Patrick Scalabrini, is a fascinated observer of this jungle of salaries in the majors.
He has spent his life in professional baseball, as a player and manager. He has been witnessing this transformation for more than 20 years.
“I can’t believe we can have such a discussion in 2022. But I think we’re a lot closer than you think to a contract that’s approaching a billion dollars,” he said.
“If an aging pitcher like Verlander can have $43.3 million, imagine how much will Ohtani be?” he adds, denouncing in the same breath the meager salaries in the minor leagues affiliated with major baseball.
Less than $15,000 per season
Remember that during the pandemic, this is where MLB decided to cut back to limit its losses. They reduced the number of teams and contracts.
And that, while the players of the minors asked for better conditions. Many pocket less than $15,000 for the season. It’s not even the minimum wage in the United States.
Scalabrini is well placed to see this reality, he who was able to attract to Quebec some of these players whose dreams were cut short, after having sacrificed everything to hope to join the circle of millionaires in the big league.
“It’s just not smart,” he laments. And the day when everything ends for them and they want to do something else, it’s total panic. They have no diploma and no money. They have nothing in front of them after having sacrificed everything for their dream. They don’t know what to do in life.
Top 10: biggest sports contracts in history*
- Lionel Messi (soccer) 4 ans 674 M$
- Patrick Mahomes (football) 10 ans 503 M$
- Mike Trout (baseball) 12 ans, 426 M$
- Canelo Alvarez (boxing) 5 years, 365 M$
- Mookie Betts (baseball) 12 ans, 365 M$
- Aaron Judge (baseball) 9 ans, 360 M$
- Francisco Lindor (baseball) 10 ans, 341 M$
- Fernando Tati’s son (baseball), 14 years, $340 million
- Bryce Harper (baseball) 13 ans, 330 M$
- Giancarlo Stanton (baseball) 13 ans, 325 M$
*Other contracts could be part of this list, but the details have never been made public.
Highest paid baseball player per year
- 1985, Mike Schmidt, 2,1 M$
- 1990, Eddie Murray, 2,5 M$
- 1995, Barry Bonds, 8,2 M$
- 2000, Kevin Brown, 15,7 M$
- 2005, Barry Bonds, 22 M$
- 2010, Johan Santana, 20,1 M$
- 2015, Clayton Kershaw, 32,6 M$
- 2020, Max Scherzer, 35,9 M$
- 2022, Max Scherzer et Justin Verlander, 43,3 M$
