Clayton Kershaw, as you may have heard, is awesome. He’s probably going to win the NL Cy Young next month, and as he enters his first year of arbitration eligibility, his salary is likely to skyrocket from ~$500k to something like $8m.
If Kershaw continues producing anything like he did in 2011 – a fair bet considering he’s still only 23 – the dollars it’s going to take to pay him each year are only going to keep getting higher, as Tim Dierkes of MLB Trade Rumors points out in his Dodgers offseason outlook:
We’ve seen top pitchers extended for about $30MM, but Kershaw might need $35MM just for his three arbitration years, and that might be a discount over going year-to-year. I think we’d be entering the $100MM range for a six year deal, which is incredible given that three of those would be arbitration years.
While any sort of big contract for a pitcher always comes with risk, I don’t think there’s anyone who would argue that Kershaw isn’t worth at least that and more, so he’ll get it eventually, and we’ll all be happy when he does. Except, as we see these numbers grow and grow, we start to wonder what might have been if he’d been signed to a long-term deal a year ago. The argument, we’ve always heard, is that there was no rush to sign a player who was still in his pre-arbitration years, and while it’s rare, it’s not unprecedented – the Rays signed Evan Longoria to such a deal after just a week in the bigs. If all of the team options are exercised, Longoria will make approximately $44m over the first nine years of his career, an enormous steal for Tampa Bay.
So how much might the Dodgers have cost themselves by not locking up Kershaw before his breakout year? We looked at just that topic in August of 2010, comparing Kershaw’s situation to other young pitchers with similar service time who had recently signed long-term deals – Jon Lester, Ricky Romero, and Yovani Gallardo. As it turned out, all three signed nearly identical deals, for $30m over five years, coming with one pre-arbitration year left.
$30m over 5 years seems to be the going rate for this caliber of pitcher at this point in his career, and if you want to toss in a bit more because Kershaw is younger, that’d be fine by me too. If nothing is done, he’ll make less than a million dollars in 2011. That’s a steal. But then he’ll be eligible for arbitration, and if he keeps on his current career path the yearly arbitration raises are going to get expensive and unpredictable. What if 2011 is his true breakout year, where he goes 21-6 with 212 K? We’ll be begging for the days when he might have been had for only $6m/year. So while I’m sure the responses here are going to be “sure, but the Dodgers are poor” (and it’s not that you’re wrong, it’s just that I’m trying to pretend we’re fans of a real baseball team for once), this is a deal that would save the Dodgers money in the long run.
Damn, a little low on the Ks, but apparently I nearly nailed the W/L almost exactly about 14 months ago. Anyway, the Dodgers clearly didn’t sign Kershaw, and that’s a big loss, because who wouldn’t be thrilled to know that he was under contract for four more years right now at reasonable prices? Thus far they have been content with going year-to-year with him; that’s about $8m this year, and who knows what it could be for 2013 and ’14, his final two years of arbitration eligibility. As Dierkes notes, if he was signed for all three arbitration years this winter, it could be 3/$35, and since he considers that a discount over year-to-year, it might be about $40m if he keeps going through arbitration. And that doesn’t even buy out any free agent years.
It’s a two-way street, of course. It’s possible that the Dodgers reached out with interest in this type of deal and Kershaw wasn’t receptive, reasoning he’d rather pass up the security that would come with signing young while assuming the risk that would come with obtaining every last dollar – we just don’t know. In addition, there’s always the uncertainty that comes with the McCourt ownership situation, so it’s possible that Ned Colletti’s hands were just tied.
Regardless of the reasons, it’s clear that failing to follow the lead of other progressive organizations and locking up a young star early is going to cost the Dodgers tens of millions of dollars. Considering that Matt Kemp and Andre Ethier are both two years closer to free agency and thus more urgent (if not, in Ethier’s case at least, more prudent) it’s unlikely this gets resolved this winter either. So you can look forward to seeing this article again a year from now, as I ponder Kershaw’s imminent $15m 2013 arbitration salary on the heels of his 24-8, 237 K 2012.