Why the Marlins Finally Opened the Vault to Sign Giancarlo Stanton to Baseball’s Longest, Largest ContractRob Tringali/MLB Photos via Getty Images
If you had the Miami Marlins in the office pool as the franchise most likely to bestow the biggest contract in sports, congratulations: Your office sounds like a laid-back place, and your crazy pick paid off. After days of leaked details and anonymously sourced progress reports, the Marlins have reportedly agreed to extend Giancarlo Stanton, the runner-up in the 2014 NL MVP race, for 13 years and $325 million, convincing the slugger to commit to a club with a roller coaster competitive past by including a complete no-trade clause and an opt-out clause that kicks in after 2019.
The terms of the contract are eye-catching, of course — 13 and 325 are both baseball records, which makes the sum seem exorbitant until you do the division — but it’s the involvement of the sport’s most penurious, transparently profit-seeking team that truly turns heads. Although the Marlins have long denied rumors that they’d trade Stanton before he reached free agency, the club has a long history of dealing young talents before they break the bank: Josh Beckett, Miguel Cabrera, and Dontrelle Willis all left via trade after five seasons in Florida, the length of Stanton’s pre-extension stay. Plus, the Marlins’ repeated assurances that they were serious about re-signing Stanton didn’t carry much weight given the team’s equally established track record of flitting from spending spree to sell-off — a strategy that has made Miami the sport’s most easily despised team even as it has yielded two World Series titles without any Astros-like stretches of sustained futility.
The Marlins are six years removed from spending the same amount on their entire roster that they’ll spend on Stanton next season; less than five years removed from becoming the only team ever officially rebuked for pocketing the proceeds from revenue sharing; a little more than four years removed from seeing their sob stories about their perennial lack of profit debunked by leaked documents (and then reframing the fabrications to sound sort of like truths); and two years removed from a Players Association source essentially saying “We’re watching you” after owner Jeffrey Loria’s latest payroll purge. Nor have relations between the Marlins and Stanton been smooth. Last week’s initial reports about the terms of Stanton’s forever-extension surfaced almost two years to the day from when the homegrown star took a break from tweeting tributes to fans and pictures of whey protein to air his anger about the trade that sent a fifth of the Marlins’ major league roster to Toronto after the team’s aborted attempt to compete in 2012.
Later that week, a bitter, deceived Stanton talked about a “breaking point.” And as recently as this August, with his team technically contending for a playoff spot, Stanton said, “Five months doesn’t change five years.” So what did change five years? Certainly not the sixth month, when the Marlins went 11–16. Having been burned before by the Marlins’ broken promise to surround him with a competitive core, Stanton didn’t leave his future in Loria’s hands. He agreed to stay, but he imposed some conditions.
The last time Loria spent big on free agents, he backloaded their deals and refused to grant them no-trade clauses, an organizational policy that, fortunately for the Marlins, may have cost them Albert Pujols (even though some reports suggested that they topped the Angels’ winning bid). Loria’s refusal to grant no-trade protection sent a clear message that the Marlins still reserved their oft-exercised right to shed players and begin a rebuild should their team have a bad half. Loria was like a thrice-divorced fiancé demanding a prenup — a prudent measure, from his perspective, but not one that inspired confidence in potential partners. After Miami’s last high-profile free agents salted the earth on their way out by calling the Marlins liars, Loria and his stepson, team president David Samson, would have had a hard time attracting top talent under the same terms. They could compete in the medium-tier, Saltalamacchian market without compromising, but to keep Stanton, they had to surrender complete control.
Whatever Stanton accomplishes over the life of this contract, breaking the Marlins’ no-trade blockade will rank among his most impressive achievements. In the past, the Marlins have treated young, productive players like hot potatoes, passing them on before they got pricey. Other teams built around young players; the Marlins repeatedly stripped theirs for parts, consuming themselves like an ouroboros so they could keep slithering along. Stanton made the Marlins act, for once, like they belonged to the same league as the other 29 teams.
While the Marlins broke precedent and surrendered the right to deal Stanton without his consent, they didn’t give him control over the rest of the roster, which left him vulnerable to another potential pitfall of playing for a penny-pinching team. For Stanton, the only thing worse than a Jose Reyes–style sign-and-trade would have been a career-long sentence to stay in Miami while the Marlins floated around the fringes of contention — or worse, cut corners on the rest of the roster to cover his salary. The Marlins could still make life in Miami so miserable that Stanton will want to leave, though if that worst case comes to pass, Stanton’s veto power will give him some ability to dictate his trade destination.1
Even if the team tanks and refuses to trade Stanton, though, the other concession the Marlins made will ensure that he’s not stuck in Miami until his twilight years. If Stanton isn’t satisfied that the Marlins have mended their ways, he can exercise his opt-out and become a free agent after his age-29 season, when he’ll still be enticing enough to land a long-term deal. If he performs as projected, he’ll likely opt out anyway, since salary inflation and the prospect of selling one’s services on the open market makes voiding the post-opt-out portions of multi-year contracts worthwhile for most players not named Vernon Wells. While Stanton has a decent chance of joining Luis Castillo in the ultra-exclusive Marlins 10-year club, the odds that he’ll still be wearing a Marlins uniform in September 2027 aren’t high.
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By then, babies born today will be taking high school tours, so let’s not fast-forward too far. Regardless of what Stanton decides to do in 2019, the Marlins have locked up the prime seasons of one of the best players in baseball, buying 11 new years beyond the two that were already under their control. Stanton led the NL with 37 dingers in 2014 despite playing in one of the hardest places to hit homers. He saw fewer pitches in the strike zone than any other hitter, a sign of pitchers’ respect for his power, and he chased outside the zone at a slightly below-average rate, a combination that led to the league’s highest walk rate and “Three True Outcomes” percentage. He also played above-average defense, per every advanced metric. Stanton’s power produces batted balls that take entire articles to explain — only Matt Holliday’s home runs traveled farther in 2014, on average, and Stanton nearly doubled Holliday’s total — but his defensive value and willingness to walk make him more than a Dave Kingman type who hurts his team when he’s not hitting homers.
If there’s a knock against Stanton, it’s his lack of durability: He has averaged 134 games over the past four seasons, topping out at 150 in 2011. Stanton probably would have surpassed that in 2014 if not for the face-fracturing beaning that cost him the second half of September; before that, he hadn’t missed a day due to injury. In the past, he has suffered muscle and ankle strains, which are easy enough to dismiss. More worrisome, he missed time in 2012 with injuries to both knees, one of which required midseason surgery. Although the knees haven’t caused problems since — and although hitters with similar records at the same age have generally held up well — concerns about Stanton’s size putting strain on his joints, coupled with the aging curve for huge hitters, aren’t totally groundless.
In many cases, extensions granted two years before free agency have been recipes for overpays. From the team’s perspective, the appeal of signing a player to a long-term contract before he reaches free agency is simple: The player has more to lose. A career-ending injury for a player who’s signed to a lucrative contract won’t bankrupt a baseball team, but the same injury for an unsigned player will end his earning potential. That risk imbalance often translates to savings, since the player may be willing to forgo maxing out his expected earnings in order to guarantee that he’ll never have to clip coupons.
That opportunity to profit from a player’s incentives only lasts for so long, though. Once a star player is well into his arbitration years and has already banked enough to buy his first mansion, he has less incentive to pass up future millions in exchange for security. And if a team doesn’t get a discount in exchange for committing to the player’s distant future before seeing his near future, then the club assumes all of the risk with none of the reward.
In the spring of 2013, the Tigers extended Justin Verlander, who wasn’t due to hit free agency until after 2014. Verlander had already signed one extension and made $20 million the previous season, so he had little reason to sell himself at a discount. The righty was coming off a second-place Cy Young finish, and Detroit paid him to continue pitching at more or less the same level. Instead, Verlander had an intermittently effective 2013 and fell well below league average this year. Were he entering free agency now, he wouldn’t command anything close to the five years and $140 million he’s still owed. We could say similar things about other extensions signed two years before free agency: the Tigers and Miguel Cabrera; the Nationals and Ryan Zimmerman; the Indians and Travis Hafner; and the Phillies and Ryan Howard, whom Stanton just tied for the highest average annual salary secured by a player with fewer than five years of service. And those aren’t the only examples.
In Stanton’s case, the Marlins are assuming the slight risk that he’ll suffer some psychological aftereffects of the season-ending hit by pitch, plus the ever-present, if infinitesimal, risk that another traumatic, career-threatening injury will occur. It seems preposterous to suggest that they might have gotten a discount, given that Stanton’s contract broke records, but it’s not as far-fetched as it sounds. For one thing, it seems safe to assume that Stanton imposed an invisible premium — theoretically, the Marlins should get a discount on players because of Florida’s low income tax, but in practice, the team probably has to pay more to convince players to sign on with their unpredictable brand. More importantly, though, there’s the factor that increased Stanton’s earning potential relative to most players who’ve earned ultralong contracts: his age.
Stanton turned 25 earlier this month. If, against the odds, he plays out the contract as it’s currently structured, he’ll be 37 when it ends. Compare that to other mega-contract ending ages: Alex Rodriguez will have turned 42 by the close of his current 10-year contract. The Angels will be paying Albert Pujols through his age-41 season. Robinson Cano and Miguel Cabrera will be 40 in the final guaranteed seasons of their deals, and Joey Votto will have turned 40 before the Reds’ obligation is up. Stanton signed the longest contract ever, and he’ll still be significantly younger when it’s over than the players you probably thought of when you mentally compared Stanton’s contract with others of a certain size.
That youth matters on the back end, when there’s a reasonable chance that Stanton will still be a productive player instead of a broken-down bat without a position. (Unless the NL does away with pitcher hitting, the Marlins won’t have the luxury of having him DH.) But it also has an impact early in the life of the contract. As Sam Miller observed, Baseball Prospectus’s projection system, PECOTA, expects Stanton to produce close to twice the value over the first 10 years of his contract that it projected for Pujols and Cano when they were about to begin their decade-long deals — not because Stanton is so superior now to what they were then, but because he’s so much younger. Even considering the sped-up aging patterns of the post-PED era, it’s reasonable to expect Stanton to maintain something close to his current level of production for several more seasons. Pujols and Cano, by contrast, were projected to decline almost immediately, with the slope of the descent determining whether their deals would be disastrous.
Stanton’s is the ninth baseball contract to total more than $200 million (without adjusting for inflation). Only three of the previous eight were awarded to players who were due to be Stanton’s age or younger at the end of their deals. Clayton Kershaw, the most recent, is a pitcher, which makes him a riskier bet. Prince Fielder, who’ll be 36 at the end of his current contract, offers less defensive value than Stanton (and the two players’ respective spreads in ESPN The Magazine might suggest that one might age more gracefully than the other).
And then there’s A-Rod, who signed his first 10-year deal heading into his age-25 season. If A-Rod had signed for 13 years, his contract, like Stanton’s, would have run through his age-37 season. And it would have worked out well: PED suspension aside, Rodriguez was still worth a roster spot in 2013. Stanton isn’t quite the talent that Rodriguez was, but in inflation-adjusted dollars, A-Rod’s first contract dwarfed Stanton’s, despite its shorter length. A-Rod is an albatross now, but only because the Yankees double-dipped after he opted out. If Stanton opts out and signs another deal that extends deeper into his middle age, that team will probably regret their decision to sign him more than the Marlins will regret this deal.
So why did Stanton arguably accept a discount to stay with a team he had little reason to trust? Stanton’s path to a payday was clear before he agreed to this extension. Arbitration alone would have paid him an estimated $13 million this winter, with another raise expected after 2015. After that, he could have gone to Coors Field and launched 500-foot homers instead of continuing to play in a pitcher’s park. He could have moved to the biggest media market and collected endorsement deals. Or he could simply have surveyed the market and chosen the best combination of payroll and projection. There always would have been a team willing to pay more than the Marlins, and there always would have been a team that could give him a better chance to contend.
So maybe Stanton is genuinely optimistic about the Marlins’ current crop of young talent and the team’s future for at least the next five years. Or maybe that close encounter with a Mike Fiers fastball made him think about how quickly a promising career can be cut short. Stanton is no more likely to suffer a serious injury than he was before the beaning, but having been through the experience once, the risk must seem more real.
In 2012, Grantland colleague Jonah Keri recounted the series of brilliant/nefarious schemes through which Loria parlayed a small stake in the Expos into ownership of the Marlins and a primarily publicly financed stadium. Miami-Dade County helped build that ballpark by incurring a $2.4 billion debt with a payment plan longer than three Stanton extensions. This is the first time Loria has repaid the local community’s investment with a sizable expenditure of his own — or, to put it another way, applied a piece of the public’s donation toward something other than his own enrichment. Stanton’s extension alone represents an exponential increase in the team’s formerly near-nonexistent post-2015 guaranteed contract commitments.
The Marlins’ decision to splurge on Stanton is another nail in the coffin of the free-agent market for position players, and a sign that even the sport’s most anti-competitive club is getting into the spending spirit (even if it’s only with an eye toward renegotiating its below-market local television contract). Stanton alone won’t make the Marlins a perennial contender, though, so to make this rare financial sacrifice count, Loria will have to keep forcing himself to fork over cash. It’s hard to believe that the team has fully reformed, but if there’s any truth to the rumors that Stanton’s deal is just the first Marlins extension of many, the slugger will have more than $325 million reasons to celebrate.
Filed Under: MLB, Miami Marlins, Giancarlo Stanton, MLB Hot Stove, MLB Contracts, Money Matters, Jeffrey Loria, Alex Rodriguez, Miguel Cabrera, Clayton Kershaw, Prince Fielder, Albert Pujols, Contract Extensions, MLB Stats, NL MVP, Baseball, Ben Lindbergh