The Miguel Cabrera Contract is Not the Worst Contract In Baseball History

After news broke late yesterday that the Tigers and Miguel Cabrera were close to an extension my first reaction was that they were doing this to prove that they weren’t being cheap with Max Scherzer.  Then it was wonder for how far after Cabrera’s 35th birthday they will have to sign him (I was hoping it was only 2 years).

Finally the reports came out and I realized the Tigers went WAY overboard with this contract for seemingly no reason at this point but my thought was this: Oh well, he has 3 to 5 MVP caliber season left, then a hopeful slow decline as a DH and David Ortiz is still hitting at 38.

Then I saw what the baseball pundits were saying and it was almost in unison “This is the worst contract ever, let’s all mock the Detroit Tigers because they are all so stupid.”

Any time something happens and in the moment over 90% of baseball writers agree, then usually the opposite will occur.  So, I started to read, Keith Law, Buster Onley, Peter Gammons, the list goes on and they all think this will destroy the Tigers.  One thing none of these guys has (despite writing about the financials of the Tigers and baseball) is an economics degree.  What they may need is a basic understanding of Time(and Space, its confusing) and a basic understanding of the United States economy.

Every time a player signs a 10 year contract writers use the current state of the player, age them 10 years and assume the economics of baseball will be 100% the same a decade later.  What they should do is look at what has happened over just the past 3 years and the amount of TV money that has POURED into baseball, the price that was recently paid for the Los Angeles Dodgers ( $2 BILLIONS) and the contracts they have been handing out.

Kieth Law wrote that the Tigers will be paying Justin Verlander and Miguel Cabrera $56 million for a few straight years, however most of  those years come AFTER the Tigers current TV contract expires, which means that of the almost $100 million they have this season in TV revenues (national contracts and Fox Sports Detroit), they should be closer to $150 , just from TV, not including the revenues from 3 million plus fans entering the ballpark every year and spending on parking, concessions and jerseys & t-shirt sales.

During that time frame, the Tigers (and many other baseball teams) will be pushing the exclusive $200 million payroll.  That leaves about $150 million for the rest of the team, of which, 10 to 12 players on a 25 man roster will be earning less than $3 million per season, meaning there will be plenty of money remaining to fill out a playoff caliber roster.

Miguel Cabrera will not be an MVP player when he is 40 and won’t be worth what he is being paid in that season, however, the Tigers are paying Miguel Cabrera for what he means to the fans, what he has done in the past as much as what they are paying him for in the future.

I understand the knee jerk reaction is “That’s a lot of money for a 30 year old” however, Miguel Cabrera needs to retire a Tiger and go to the Hall of Fame as one of the greatest hitters in the history of the game, as a Tiger and if this is what they felt they needed to do to make it happen, then I’m fine with it.

Some player was going to break the $30 million season sooner rather than later, most assumed that would be Mike Trout, but I guess the Tigers wanted to make sure Cabrera stayed ahead of Trout once again.

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