Move over, Bobby Bonilla. Make way for Shohei Ohtani as the major domo of deferred payments. People like to chuckle on July 1st of every year that the NY Mets must send Bonilla a check for $1.1M and have had to do that since 2010 and will continue to do so through 2035. Well, if reports from yesterday are even nearly accurate, deferred compensation just went to an entirely new dimension.
Reports say that the structure of Ohtani’s $700M contract over the next 10 years has lots of deferred money involved.
- For each of the 10 years in the span of the contract, the Dodgers will pay Ohtani only $2M each year.
- Therefore, Ohtani will collect only $20M of the contract amount over that period when he will be a member of the Dodgers.
- Then starting in 2034 – one year before Bobby Bonilla’s deferred payments will be discharged – the Dodgers will begin to pay Ohtani $68M per year for the next ten years.
The Mets’ deal with Bonilla was a result of their desire to buy out multiple years on Bonilla’s existing contract but instead of paying the value to him in 2000, they deferred the payments allowing them to accrue a guaranteed 8% interest and do the payouts from 2010 through 2035. That seemed at the time to be a great deal for the Mets because they were earning lots more than 8% on their investments with Bernie Madoff. Ooops …!
The Dodgers’ motivation for the deferrals is to reduce the team’s exposure to MLB’s luxury tax which resembles a “salary cap” but really is not. The deferred money for Ohtani comes at no interest and simply represents a contingent liability on the Dodgers’ books for the years 2034 – 2043.
As a minor issue, Ohtani’s contract also is reported to include:
- A full-time interpreter
- A hotel suite for all road trips
- A “premium luxury suite” at Dodger Stadium for all home games.
Meanwhile, up the road in San Francisco, the Giants came to an agreement with another Asian player signing Korean outfielder, Jung Hoo Lee to a deal worth $113M over the next 6 years. Seems to me that the SF Chronicle missed an opportunity for the headline:
Hoo Lee Sh*t !
Moving on … I pointed out last week the sad and significant decline in stature for Sports Illustrated when it was discovered that they had printed articles prepared by an Artificial Intelligence algorithm and that some of those sorts of stories ran under fictitious bylines. Sports Illustrated is published by an entity known as The Arena Group which also publishes Parade and TheStreet. Here is how The Arena Group describes itself:
“Our unified technology platform empowers creators and publishers with tools to publish and monetize their content, while also leveraging quality journalism of anchor brands like Sports Illustrated, TheStreet, Parade, Men’s Journal and HubPages to build their businesses.”
Earlier this week, The Arena Group fired its CEO and replaced him with Manoj Bhargava who is a successful businessman as the founder of 5-Hour Energy among other healthy drink brands. Bhargava also has been involved in the chemical industry and in plastics. Nowhere in his CV is there anything related to “quality journalism” that could lead “creators and publishers” to “monetize their content”. Here is a hypothesis:
- Sports Illustrated was created by the folks who published Time magazine. One need not agree with the politics of the folks who owned and ran Time, but it was serious journalism and reporting; that was the rearing/upbringing for Sports Illustrated. Considering the journalistic standard set by those related publications put out by The Arena Group, perhaps SI is now living down to the standards of its neighbors just as it used to live up to the standards of Time.
Allow me to offer up here some recommended reading. To appreciate the magnitude of Sports Illustrated’s decline, I suggest you read:
- The Franchise: A History of Sports Illustrated Magazine by Michael MacCambridge
Naturally, you can find it on Amazon.com…
One last item today … Recall the name Matt Araiza. He was the punter drafted by the Buffalo Bills whose NFL career was cut short when he was accused as being part of a gang rape of a woman while he was in college. The Bills cut him immediately; no other professional football team went anywhere near him. He was vilified for what he was alleged to have done. The operative word there is “alleged”.
Police investigations did not lead to an indictment let alone a conviction. Remember the adage that if a prosecutor really wants to, (s)he can indict a ham sandwich. Well, Araiza was less enticing in terms of an indictment than a ham sandwich.
There was a civil action brought against Araiza by the alleged victim. Earlier this week, that civil lawsuit was dropped; according to reports, there was no settlement; the action was simply dropped. So, where are the apologies from all the folks who commented on Matt Araiza’s despicable behavior? Araiza now joins the Duke Lacrosse Team and Trevor Bauer as someone pictured as a social pariah for whom there were no convictions.
Finally, apropos of nothing, let me close with these words from Lily Tomlin:
“The trouble with the rat race is that even if you win, you’re still a rat.”
But don’t get me wrong, I love sports………