Baseball fans around the U.S. always groan in frustration whenever the Los Angeles Dodgers sign a big name free agent. To be honest, they really don’t need them. The Dodgers won the World Series in November of 2024 and were one of the best teams in baseball until they won the World Series in 2020, then they became the best. Yet they still signed these big name players. Despite some people’s frustration, what they’re doing is actually smart.
As a San Francisco Giants fan, I despise the Dodgers. I especially despise how they keep signing the biggest free agents on the market, even though it’s really smart. In the 2023-2024 offseason, they signed potentially the biggest named free agent ever and potentially the best player in baseball history when his career is over, Shohei Ohtani. Ohtani signed a ten year, $700 million dollar contract. At the time, it was the largest contract in baseball history (the record was then broken by Juan Soto, who signed a 15 year, $765 million dollar contract with the Mets on Dec. 11, 2024). But the Dodgers really didn’t have to sign Ohtani. In 2023, they had won 100 games and won the National League West division for the eleventh time in 12 years. The year before, in 2022, they won 111 games, which is tied for the fourth most wins in a Major League Baseball (MLB) season by a team in history, tied with the 1954 Cleveland Indians. They already had talented baseball players locked up for a while, like first baseman Freddie Freeman (six years, $162 million dollars) and utility player Mookie Betts (12 years, $365 million dollars). Despite the Dodgers not really needing Ohtani, he did seem to help the team in 2024, as well as setting several MLB records.
In the first year of his contract with the Dodgers, Ohtani won his third Most Valuable Player (MVP) award in four years, becoming the second player in MLB history to win the MVP in both the American League and National League. The first was Hall of Famer Frank Robinson back in 1966. Ohtani hit 54 home runs, 130 runs batted in, which is the third straight year the National League has seen a 130 RBI season by a hitter. He was on the verge of winning the batting title, which would have given him the first hitter Triple Crown since Miguel Cabrera in 2012. After going 0-4 in his last game, Luis Arraez took home the batting title with a 314 batting average. Ohtani led the Dodgers to a World Series win in 2024, their eighth title in their history, yet the Dodgers keep piling on with the free agents.
The Dodgers signed multiple star free agents in the 2024-2025 offseason, signing names like two-time Cy Young winner Blake Snell to a five year, $182 million dollar contract. Then the best relief pitcher on the free agent market Tanner Scott to a four year, $72 million dollar contract. Then resigning power hitter Teoscar Hernandez to a three year, $66 million dollar deal. And finally giving a contract extension to utility man and 2024 NLCS MVP Tommy Edman, which is for five years, $64.5 million dollars. But what’s interesting and smart about these deals is that they all include deferred money.
Deferring money in baseball is guaranteeing the players all the money that’s included in the contract, but either a majority or a minority of money would be paid later in the future, either when the player is still playing but with another team, or through retirement. So between the four contracts that have deferred money, $134.5 million is deferred. The same is the case for Ohtani’s mega contract. With the deferrals, it really isn’t a “mega contract.” Instead, a total of $680 million of his $700 million dollar contract is deferred, which is over 97% of his total contract. So if you really think about it, Ohtani’s contract is a 10 year, $20 million dollar contract. That is until he retires or leaves the Dodgers after the 2033 season.
The thing that’s smart about deferred money is that the Dodgers will still have enough money to sign new players. If none of the money in Ohtani’s contract is deferred, the Dodgers could be in a huge amount of debt and won’t be able to sign any more players. In fact, they would have to trade their star players, like Betts and Freeman in order to shed payroll so they can pay Ohtani.
But whenever the Dodgers sign a free agent that includes deferred money, baseball fans are always frustrated. Deferrals have been around since 1985, when Darryl Strawberry became the first known baseball player with deferred money in his contract. Bobby Bonilla is another player that has deferred money in his contract. Notice how I said “has” and not “had.” In 1991, Bonilla signed a five year, $29 million contract with the New York Mets, and because of his deferrals, he’s still getting paid by the Mets and will still be getting paid until 2035! Right Fielder Anthony Santander, who was one of the biggest free agents in 2024, signed a five year, $90 million dollar contract and has $62 million deferred, over 68% of his contract, making his contract a five year, $28 million dollar contract. People, especially the Baltimore Orioles fans, are blaming the Orioles, Santander’s former team, for not giving him that contract. Instead, they decided to replace Santander with Tyler O’Neill, giving him a three year, $49.5M contract, paying him $16.5M a year, which is more than the total of Santander’s contract. They could have paid Santander that same amount of money for just an additional two years, but they decided not to. There are teams in MLB with money to spend to make their team better, yet they don’t want to.
The Dodgers are one of the only teams in MLB that spend large amounts of money to make their team better. They want to be like the New York Yankees when they had that huge dynasty in the 1990’s and people decide to get angry at the Dodgers for spending money so that they can be good and they don’t get angry at the teams that don’t want to spend the millions and millions of dollars that they have. All teams have the ability to defer money so they can spend more money on top free agents, but the owners of the teams decide to not pay money, even though most of them are worth several billion dollars.
An example of this is when first baseman Rowdy Tellez signed a one year contract with the Pittsburgh Pirates, guaranteeing $3.2 million dollars. The contract guaranteed him an additional $200,000 if he had 425 plate appearances in the 2024 season. Tellez was just four plate appearances shy of 425 before he was released by the Pirates so they wouldn’t have to pay him the additional $200,000. Mind you that the Pirates owner, Bob Nutting, has an estimated net worth of $1.1 billion dollars. He could have easily paid Tellez the additional $200,000, but he decides to play the role of a poor owner and literally releases Tellez so he wouldn’t have to pay him.
The Pirates were also a team that had a total payroll of $33.2 million dollars in 2024 and were a disappointing team for, like, the 10th year in a row, finishing last in the National League Central division with a record at 76-86. The Pirates highest paid player in 2024 was a 36 year old veteran closing pitcher in Aroldis Chapman, being paid $10.5 million. Chapman had an almost four ERA in 2024, finishing with a 3.79 ERA.
Despite me not liking the Dodgers, I have to admit that what they do is pretty smart. What does pain me is that they probably won’t stop with the free agent additions and just get better and better every year, a dynasty like the Yankees were in the ‘90s. But when they do end up to be a dynasty, which they probably already have, then us Giants fans just have to deal with it and know that one day, it could all be crashing down on them.
