This month will mark the one year anniversary of the signing of Prince Fielder’s nine year, $214 million contract. At the time the deal was largely regarded as a gross overpay by the national media. Not so much in terms of dollars per year (in the short term), but in the total length of the contract. Here was Dave Cameron from FanGraphs:
No matter how much you might like Prince Fielder’s bat, there’s no getting around the reality that he’s going to be extremely overpaid during the second half of this contract, and this deal could turn into an albatross very quickly.
Prince’s first year in Detroit saw him hit .313/.412/.528. His power was down slightly (which was expected in his move to Comerica Park), but he made up for that fact by boosting his average above .300 for the first time in his career. The net effect was that he was just as valuable with the bat as he’d been in Milwaukee (a .398 wOBA versus his career .393 wOBA). So fears that the more spacious park in Detroit would sap his offensive value weren’t realized, but he certainly wasn’t more valuable and that’s where the potential future problem comes in.
Fielder provided the Tigers with 4.9 wins above replacement in 2012 – best of any first baseman in baseball. A five win player (let’s call him that) is worth a tremendous amount of money in baseball. The general rule of thumb (based on the last few years of free agent acquisitions) is that one extra win is worth about $5 million to the team (common numbers are anywhere from $4.5 to $6 million). So Prince’s 2012 season was worth $25 million. That’s good news because the average annual value of his huge contract is $23.8 million. So, the Tigers got exactly what they paid for in year one.
The problem is that Fielder will be 29 in 2013. That’s not really a problem because 29 is still a prime age for a baseball player, but what is a problem is that it’s only year two of the contract. Perhaps he’ll provide similar value for the next three or even four years, but the decline is going to begin at some point. It’s tough to picture a 33-year old Prince Fielder still producing five wins. It’s possible, but unlikely. The Tigers could very well pay $24 million in the last half of this deal for a guy that’s only producing three wins or so. That would be a problem, but it might not be as big of a problem as it appears.
Salary inflation is likely headed to major league baseball in a big way. Huge amounts of money are pouring in as teams sign new regional television deals and – beginning in 2014 – each team will be receiving around $25 million from MLB’s new national TV deals with ESPN, Fox, and TBS. That money is going to be spread out among more players; it’s going to mean more money is going to go to each player. That (roughly) $25 million that each team will get – if it goes straight to players’ salaries – would represent a 20% increase in salary across Major League Baseball. That is to say, 20% inflation could be achieved within the next year or two.
If that happens, then Fielder’s deal won’t look so bad. If salaries were to inflate by 20%, then Fielder’s $24 million per year would look like $20 million per year (today’s dollars). That’s still a huge amount of money – roughly four wins worth – but it’s not the same amount of so much money. It’s slightly less.
It could come to pass – if this type of inflation does hit in the next year or two – that Prince’s $214 million hit to the payroll ends up looking like $186 million (today’s dollars) by the time it’s all said and done. That is still a heckuva lot of money – just under $21 million in average annual value – but it’s not the same heckuva lot. Again, it’s slightly less.
Is inflation enough to turn Fielder’s monster deal into a bargain or even a fair deal? Probably not, but it means the end of the contract may not have quite the franchise crippling potential (hyperbole) that it appeared to have when it was signed. Fielder probably still won’t “earn his deal” on the field – in a total value sense – but what he means to a Tigers team that looks to be on the cusp for the next few years could very well be worth the overpay.