Quit Baseball In 2001, Get Paid Until 2035
October 4, 2016 9:57 AM   Subscribe

Tomorrow night, the Mets face off against the Giants in Major League Baseball's NL Wild Card Game. $1.19 million of the $135 million Mets payroll will be watching from afar. This is not because the player is injured or didn't make the roster. It's because he's 53 years old and hasn't played baseball in 15 years. The Mets will continue to pay Bobby Bonilla $1.19 million each year until 2035, thanks to one of the strangest contracts in sports history. (538Video).

If you're not in a position to watch 538's video, try this ESPN article instead.

And try to keep in mind, as peculiar as a baseball team paying a player into his 70's is, Bobby Bonilla was more than the patron saint of bad contracts.
posted by DirtyOldTown (25 comments total) 10 users marked this as a favorite
 
While I watch the video, a couple defenses of the Bonilla contract:

1) This, somewhat tortured, argument that Bonilla's release freed up money that eventually turned into David Wright

2)An argument on the math

For me, the weirdest part of this is that it's tied up in Fred Wilpon thinking that Bernie Madoff was making him 10% a year. In theory, deferred payments can make a lot of sense, since the increase in baseball salaries outpaces inflation, but man does it look silly.
posted by Bulgaroktonos at 10:12 AM on October 4, 2016 [3 favorites]


A fun bit from the ESPN article:
[Bonilla's agent] said that Bonilla actually has another deferred deal with the Mets that makes another $12.5 million. It was part of his first deal with the team that ran from 1992 to 1996. The $29 million deal made Bonilla the highest-salaried player in baseball at the time. Part of the deal was to defer some money, which resulted in Bonilla getting $500,000 a year from 2004 through 2023. The Mets shipped Bonilla to the Orioles for the last season and a half of that deal, so they split the fare with Baltimore.
posted by DirtyOldTown at 10:12 AM on October 4, 2016 [1 favorite]


I wonder whether this should be the standard for sports contracts. Sign a 22-year-old kid and agree to pay him for an actual career's worth of time.
posted by Etrigan at 10:14 AM on October 4, 2016 [16 favorites]


Also, this is strange, but it ain't a patch on the dumbest contract a sports league ever signed -- Ozzie and Daniel Silva made somewhere around $800 million in return for not having a team anymore. Not selling a team, but folding it.
posted by Etrigan at 10:18 AM on October 4, 2016 [4 favorites]


I think this is a smart move for a lot of highly paid athletes.

Considering how many of them go broke the minute they leave the game (baseball, football, whatever), having a guaranteed payout every year would be much better than getting a giant lump sum.

Especially if you were smart, and established some sort of independent trust, so the athlete in question couldn't just borrow massively against future payouts.

Couple that with a healthcare/medical insurance for life clause, and you'd do better than 90% of the pro athletes out there, even if you weren't one of the top earners up front.
posted by madajb at 10:18 AM on October 4, 2016


I'm not sure there's any better example of how differently money works for billionaires (or at least the economists who work for billionaires) than Bobby Bonilla's contract. Because, yeah, sure, I get that with interest, deferring $5 million makes a lot of sense, but that's not at all how most people think about amounts of money that would fundamentally change their lives. Like, it's extremely stupid that $5 million in 2000 is somewhat equivalent to $30 million from 2011-2035, even if it's true.
posted by Copronymus at 10:19 AM on October 4, 2016 [1 favorite]


Like, it's extremely stupid that $5 million in 2000 is somewhat equivalent to $30 million from 2011-2035, even if it's true.

Whut...? I take it you don't have an IRA then?
posted by danny the boy at 10:24 AM on October 4, 2016 [1 favorite]


I learned about the Bonilla thing a couple years ago while perusing this awesome data viz. For some reason the Bonilla long tail doesn't seem to be there any more, but I have much respect for Bonilla opting to give himself a rich man's pension. Why not? It's crazy money, so just go with No muss no fuss and eat bon-bons for life.
posted by mcstayinskool at 10:24 AM on October 4, 2016


Crazy shades of Steve Young.
posted by ZeusHumms at 10:25 AM on October 4, 2016


Like if you put your money into the vanguard total stock index for the past 10 years you would have had an effective rate of 8.6% per year--so you would have done better than Bonilla.

Compound interest motherfucker do you speak it
posted by danny the boy at 10:29 AM on October 4, 2016 [1 favorite]


I think this is a smart move for a lot of highly paid athletes.
...
Couple that with a healthcare/medical insurance for life clause, and you'd do better than 90% of the pro athletes out there, even if you weren't one of the top earners up front.

MLB players have a pretty good compensation package, thanks mostly to having the strongest union in professional sports. A single day of service in the MLB means health insurance coverage for life, at 43 days of service they earn a pension, their pension benefits increase with their service time until they're fully vested at 10 years.

Unfortunately the same can't be said about their minor league players, many of whom earn less then minimum wage.
posted by papercrane at 10:30 AM on October 4, 2016 [6 favorites]


There was a documentary made on The Spirits of St. Louis, mentioned by Etrigan up the thread here. Would love to know how to watch that without having to buy a 30 for 30 boxed set.
posted by mcstayinskool at 10:32 AM on October 4, 2016 [3 favorites]


Aren't all the 30 for 30s on Netflix? It looks like Free Spirits is.
posted by Bulgaroktonos at 10:41 AM on October 4, 2016 [4 favorites]


Sweet! Now I know! Thanks Bulgaroktonos!
posted by mcstayinskool at 10:50 AM on October 4, 2016


Go Giants!

#EvenYear
posted by chavenet at 11:15 AM on October 4, 2016 [2 favorites]


The NHL has a handful of these contracts as a result of the '12-'13 lockout. The CBA adjusted the salary cap and gave teams the option to buyout up to 2 contracts. For the next decade, Vincent Lecavalier will receive over 2 million a year from the Lightning.
posted by cmfletcher at 12:18 PM on October 4, 2016


As a Pirates fan, I Have Opinions about Bonilla.
posted by Chrysostom at 12:51 PM on October 4, 2016 [1 favorite]


Considering how many of them go broke the minute they leave the game (baseball, football, whatever), having a guaranteed payout every year would be much better than getting a giant lump sum.

Especially if you were smart, and established some sort of independent trust, so the athlete in question couldn't just borrow massively against future payouts.


Hoo boy this sure is condescending. Unless the "athlete in question" is either a minor or mentally unfit to govern his or her own finances, a thousand times no.

Leagues have gotten better at educating players about financial security, but they can and should do more -- but education is the solution, not restricting an adult's access to money he or she has gainfully earned.
posted by incessant at 1:41 PM on October 4, 2016 [2 favorites]


incessant, the bit you left out of the quote, "I think this is a smart move for a lot of highly paid athletes" changes the entire thing. With that part included, the implication is that many athletes would benefit from choosing this, not that it should be imposed upon them. That's how I read it, anyway.
posted by DirtyOldTown at 2:09 PM on October 4, 2016


As a Mets fan (of 35 years' standing), I too Have Opinions about Bonilla. From that last link ("more than the patron saint of bad contracts"): "The Mets may have had the worst team money could buy, but it wasn’t Bonilla’s fault." True, but if you were a Mets fan suffering through the results of the worst management in baseball, and still coming off the high of '86, he sure was easy and fun to blame.

I don't know whether to say "Thanks for the post," given the bad memories it dredged up, but I learned some stuff and got to vent a little!
posted by languagehat at 2:12 PM on October 4, 2016 [1 favorite]


What's crazy to me is that the Mets agreed to pay such a high fixed rate, instead of tying it to a benchmark or inflation. Typically a high fixed rate would compensate the investor for risk, but you wouldn't expect a legacy team like the Mets to be in danger of going bankrupt. That's why the Madoff angle is doubly interesting. On the one hand, Madoff was promising high returns, more than covering the 8% the Mets agreed to. And on the other, knowing what we know now, those holdings put the Mets in a precarious position and made the deal riskier for Bonilla than he may have realized at the time.
posted by mama casserole at 4:04 PM on October 4, 2016


Another CBA quirk from the NHL via General Fanager on Twitter:

$20.635M of #Coyotes $72.137M (28.6%) est cap total is "dead money":
Datsyuk 7.5M
Bolland 5.5M
Pronger 4.94M
Ribeiro 1.44M
Vermette 1.25M

These are players who have left to play in other leagues (Datsyuk to the KHL), are injured, but not officially retired (Bolland, Pronger (Pronger actually has another job in the league's Toronto office!)), or who have had their old contracts bought out at a discount, but the Cap hits remain (Ribeiro, and I think Vermette). The Coyotes are actually paying those players something in the neighborhood of $2M actual monies. Why would they do that? They don't have any actual money, and they need the "Dead Cap" to get to the league's minimum annual salary floor.

Former NHLer Patrick O'Sullivan (previously) tweeted: "That's an elite P[ower] P[lay] unit in 2010."

It would have been, yeah.
posted by notyou at 4:05 PM on October 4, 2016 [2 favorites]


Pronger actually has another job in the league's Toronto office!

Not just that, he's been a member of the Hall of Fame for a year now despite taking up a contract slot and cap room for the Coyotes. I feel like the arc of the NHL somehow bends toward absurdity in all times and places.
posted by Copronymus at 5:11 PM on October 4, 2016 [2 favorites]


Pronger is an exception on the discussion. He was on a long term contract and his career ended abruptly on a serious injury*. He still has vision issues and headaches today. The Flyers kept him on long term injury reserve until the coyotes (owned by the league at the time) in order for them to meet minimum salary cap requirements.

*Fair warning on the video, no blood or gore but the pain is obvious.
posted by cmfletcher at 6:21 PM on October 5, 2016


I don't see how any of that, as tragic as it may be, makes Pronger an exception to the quirkiness of Arizona's dead cap all stars. He's done playing. He hasn't officially retired because he enjoys the check, and the league hasn't pressed the issue because the league enjoys allowing the Coyotes and the Flyers (owned by NHL broadcast partner NBC/Comcast) to skirt the spirit of the Cap and the CBA. So I guess all that does make Pronger's case an exception. It makes it the most sordid of the lot.
posted by notyou at 9:51 PM on October 5, 2016 [1 favorite]


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