Where did all the long-term deals in Major League Baseball go?
Ten years is a long time, enough for an industry to flip upside-down.
Ten years ago, in the offseason of 2008-09, the Red Sox extended the future of a dazzling present, extending Dustin Pedroia (six years, $40.5 million), Kevin Youkilis (four years, $41.25 million), and Jon Lester (five years, $30 million) in the span of a few months.
All were coming off spectacular seasons, with Pedroia having won the 2008 MVP, Youkilis finishing third, and Lester having just produced a breakout season that suggested a front-of-the-rotation anchor for years to come.
Back then, the “first fortune” concept mattered. Players across the game seemed eager to sign long-term deals almost as quickly as they got to the big leagues — even if it meant sacrificing perhaps tens of millions in potential earnings through the arbitration process — with young stars routinely embracing financial security with an expectation to cash in as free agents in their late 20s or early 30s.
The Red Sox would love it if that landscape still existed, if they could still take their best young players and ensure that their tenure in the organization would extend not just for the six-plus seasons before their free-agent eligibility, but for more of their late 20s and even early 30s.
They’d love to see homegrown players such as Mookie Betts and Xander Bogaerts sign the sort of long-term deals that Pedroia and Lester inked. Mindful of the fact that they have several stars who will be eligible for free agency after 2019 and 2020, they’re trying.
“You’d like to keep everybody for the long term,” Red Sox president and CEO Sam Kennedy said this week. “We are discussing long-term possibilities currently with lots of guys and discussing those with ownership, trying to prioritize certain players, certain conversations. It’s difficult.”
The difficulty is amplified by the fact that the outlook that prevailed a decade ago — gain financial security in an early long-term deal, then hit a free-agent jackpot — no longer exists, at least not broadly.
Betts has stated repeatedly his interest in establishing his value anew every year, and he’s far from alone. Bryce Harper and Manny Machado, both 26 years old, likewise went through six-plus years in the big leagues without signing a long-term deal in order to get to free agency as early as possible. The Cubs have made runs at locking up Kris Bryant without success. Carlos Correa has shown no interest in a long-term deal.
In the offseason following the 2014 season, Giancarlo Stanton – who had just claimed NL MVP honors at a time when he had four-plus years of service time – agreed to a 13-year, $325 million long-term deal with the Marlins that bought out two arbitration years and 11 seasons of free agency. One week later, the Mariners locked up Kyle Seager on a seven-year, $100 million deal at a time when the third baseman had three-plus years of big-league service time.
Since then? There have been some long-term deals for position players. Miami locked up Christian Yelich after his first full big league season (and long before his superstar breakout) for seven years and roughly $50 million before the 2015 season. Cleveland locked up Jose Ramirez for five years and $26 million, also before he reached eligibility for arbitration and before he become a top-10 MVP candidate. The Giants got both Brandon Belt and Brandon Crawford locked up for six years during the 2015-16 offseason. Wil Myers and Kevin Kiermaier both got long-term deals done entering the 2017 season.
But at the time that virtually all of those players signed, they qualified as very good players who fell below the level of superstars. Superstars — particularly superstar position players — aren’t signing long-term deals.
Numerous factors contribute to the reluctance. For one, they’re getting a lot of financial security by means other than salaries. A lot received multimillion-dollar signing bonuses when they turned pro (Betts received a relatively modest $750,000, but as players who went at the top of the draft, Harper, Machado, Bryant, and Correa all landed millions before stepping on a minor league field). Endorsements add to those piles. There’s awareness of the swift earnings growth through the arbitration process.
And on the back end of arbitration, there’s an awareness that free-agent riches are affected enormously by age, particularly given the views of aging curves surrounding defensive value and positional possibilities. Jason Heyward landed an eight-year, $184 million guarantee from the Cubs in no small part because his age (26) and strong defense made him immensely appealing for teams making a concerted attempt to capture as many prime years of a player’s career as possible while committing to the fewest possible years of decline.
Under those circumstances, players are recognizing that early-career long-term deals don’t only risk sacrificing tens of millions through the arbitration process, they also risk tens and possibly even hundreds of millions of dollars through free agency.
Of course, that view may receive a significant challenge this offseason. Harper and Machado are test cases for whether the industry will indeed produce expected jackpots for premium talents in their mid 20s. For that reason, Betts acknowledged at the All-Star Game that he’d be “locked in” on what his two colleagues will make. Teams feel the same way, waiting for deals for mid-20s stars to help define the market.
And in the meantime? The industry continues to operate as a ballroom of one-year dances, with players and teams having an ever more difficult time finding common ground for a single season, let alone a multiyear deal.
It’s an issue not just for Betts (who won his arbitration hearing in 2018, resulting in a $10.5 million salary as opposed to the team’s proposed $7.5 million) and the Red Sox but throughout the industry, helping to explain why today represents one of the most significant days of the baseball calendar.