Last offseason, the Los Angeles Dodgers broke the brains of baseball fans with an unprecedented contract. They agreed to a deal with two-way player and Japanese phenom Shohei Ohtani for 10 years, $700 million. But, there’s a twist: $680 million of it is deferred, meaning Ohtani is only on the books for $2 million annually until his contract is up in 2034. From 2034-2043, he’ll make $68 million annually in the comfort of his home. Ohtani wanted it this way so the Dodgers could use assets to bolster the team around him and make the most of this championship window.
And that’s exactly what they’ve done. Since Ohtani’s signing, they’ve added a plethora of star-studded talent, much of which has been added on the heels of winning the 2024 World Series. And all of a sudden, the narrative has shifted from “The Dodgers spend so much money just to lose in the first round” to “The Dodgers are ruining baseball.” That is simply not true.
Many fans are upset with the deferrals. In total, the Dodgers have north of $1 billion in deferred salaries, which sounds ludicrous. But keep in mind that $680 million of that is from Ohtani’s contract alone. This has become a trend for the Dodgers’ recent signings; many of their contracts have deferred money. Here’s a list of current Dodgers with deferrals: Ohtani, Mookie Betts, Freddie Freeman, Blake Snell, Tanner Scott, Teoscar Hernández, Tommy Edman and Will Smith.
Deferrals are not a new thing. The Mets pay Bobby Bonilla north of $1 million every July, and they will until 2035. He hasn’t played since 2001. Ken Griffey Jr. signed a contract with the Reds that deferred money to 2009 through 2024. But there’s a reason they aren’t super common. Owners typically don’t want to commit to contract deferrals, especially of this magnitude, because if they were to try and sell the team, deferred money would be an inherited debt for the new ownership group. Also, within two years of a contract being signed, the team must start putting some of the deferred money into a bank account, and then show it to the league. They can’t simply wait until it needs to be paid; money needs to be set aside to be used later. On the player’s end, deferrals aren’t as appealing because one dollar now will depreciate in value over time, diminishing the present-day value of their contracts.
The Dodgers are in a great spot. They make boatloads of money every year and have a wealthy ownership group, and they’re so loaded with talent that players are willing to take less money or defer it, to play for them. The Ohtani contract was a calculated move; you have to spend money to make money, and Ohtani supposedly netted the team $120 million in sponsorships in his first year in blue. Mark Walter and the Guggenheim group (the Dodgers’ ownership group) are clearly invested, or else they wouldn’t be putting this much money into the squad.
Part of the problem is the ineptitude of other front offices. 15 of 30 teams in Major League Baseball have payrolls worth less than 50% of their total revenue. For the 2025 season, the Competitive Balance Tax is set at $244 million. Any team with a payroll over $244 million has to pay surcharges on money above that number, and 50% of that money is given back to teams under the tax; that can be used for signing other players. This leaves out the part that your billionaire owner can pay out of his own pocket if they wanted to like Steve Cohen of the Mets does, but that hardly ever happens. Also, Scott and Yates were both signed in January, nearly three months after the World Series finished. Other teams could have snagged them before L.A. got to them.
Jack Flaherty, free agent and 2024 world champ, said it well when he went to X and posted: “A certain team is not ruining baseball. A lot of other teams are just doing very little.” Maybe other teams should do more before you point the finger at the Dodgers. Their front office is operating in a way that all fans wish theirs would, and you can’t fault them for that.
Sydney Brammer