Pujols: $35,000,000 a season?

[RedsBaron]

In the 11/29/10 issue of The Wall Street Journal, page A19, former MLB Commissioner Fay Vincent speculated that Albert Pujols will probably negotiate a salary of around $35 million annually in a four or five year agreement. In addition to being interesting in and of itself, I also found his speculation to be noteworthy for the ongoing debate about how much it will take to sign Joey Votto to a long term deal. No, Votto hasn't put together ten straight Pujols type seasons, but he just put one together and at his age he is probable to put together several more, so anyone thinking Votto can be had for $10 million a year is probably optimistic.
Anyway, the amount of Pujols's annual salary was not the thrust of Vincent's article ( I do not believe it is available online). Vincent argued that Pujols should to convert a portion of his compensation from ordinary income to capital gains income, which is taxed at a lower rate. He could do that by getting an ownership interest in the Cardinals as part of his compensation. Highly paid business executives and movie stars get part of their compensation by getting a piece of the action with shares in the corporation they work for or with an ownership interest in their films. Vincent mentions the riches William Holden gained from having a share in "The Bridge on the River Kwai."
Vincent wrote that while someone such as Pujols could be required to sell any ownership interest if he later left the team, but even then the gain could be substantial. He speculated on how rich Mickey Mantle would have been at the end of his life had he been able to acquire even a tiny share in the Yankees in 1961.

[Chip R]

I'm fairly sure players can't own shares in their club.

[Red Leader]

I'm thinking this article was written just to drive the price tag up on Derek Jeter.

[Chip R]

Boy, if the Cards did pay Pujols anywhere near $30M, it would be tough for them to afford him and other expensive players. No knock on Pujols, who is a tremendous player, but am I the only person who thinks his body is going to break down within the next 5 years? He's had several injuries over the past few seasons and injuries usually increase when you get older, not decline.

[GoReds]

Boy, if the Cards did pay Pujols anywhere near $30M, it would be tough for them to afford him and other expensive players. No knock on Pujols, who is a tremendous player, but am I the only person who thinks his body is going to break down within the next 5 years? He's had several injuries over the past few seasons and injuries usually increase when you get older, not decline.

And what effect is a contract like that going to have on the Reds?

30+M is to St. Louis' payroll as X is to Cincinnati's?

I'm guessing X is significantly less than 30+M. I'm sure Votto's agent figures they are about to win the lottery.

[Chip R]

And what effect is a contract like that going to have on the Reds?

30+M is to St. Louis' payroll as X is to Cincinnati's?

I'm guessing X is significantly less than 30+M. I'm sure Votto's agent figures they are about to win the lottery.

It's a good question. StL is not the only team with big decisions to make. I think Pujols is going to stay in StL for somewhere between $25-$30M for 5-6 years. While that's not $35M, that's still a big chunk of change for any team that's not the Yankees.

[Reds4Life]

Nobody except the Yankees will be able to afford to pay that kind of money to one player. And now with the sons in charge, I'm not so sure the Yanks are going to be willing to spend that kind of money either.

Hank & Hal don't seem to have the 'win at any cost' mentality their father had. If the Yankees start pulling back on salary, there could be a moderate to large correction in the market for player salaries.

[RedsBaron]

I'm fairly sure players can't own shares in their club.

Vincent acknowledged that in his article but suggested that this may be a new way for players and their agents to seek to increase their income. Whether it could ever be approved as part of a new collective bargaining agreement would appear to be unlikely to me, as only a very few players are of the stature of a Pujols who could benefit by the possibility.
I just thought the article was interesting.

[Blimpie]

Pujols might get a "Lifetime Achievement" deal with the Cards, but, personally, I would be more troubled by the Troy Tulowitzki deal.

It has been reported to be a seven year deal in which he would average about $19 million per season.

[BrooklynRedz]

Vincent acknowledged that in his article but suggested that this may be a new way for players and their agents to seek to increase their income. Whether it could ever be approved as part of a new collective bargaining agreement would appear to be unlikely to me, as only a very few players are of the stature of a Pujols who could benefit by the possibility.
I just thought the article was interesting.

Thanks for passing along RB. Unfortunately there is absolutely zero chance of the owners ever approving this. And even if they did, I can't imagine how it would work. Would the existing owners take a reduced ownership position?

[RedsBaron]

Pujols might get a "Lifetime Achievement" deal with the Cards, but, personally, I would be more troubled by the Troy Tulowitzki deal.

It has been reported to be a seven year deal in which he would average about $19 million per season.

Wow! Some posters here still think the Reds can sign Votto to a five year deal for a total of between $40 and $50 million, or about $8 to $10 million a season. Won't happen.

[WVRed]

Nobody except the Yankees will be able to afford to pay that kind of money to one player. And now with the sons in charge, I'm not so sure the Yanks are going to be willing to spend that kind of money either.

Hank & Hal don't seem to have the 'win at any cost' mentality their father had. If the Yankees start pulling back on salary, there could be a moderate to large correction in the market for player salaries.

[Hoosier Red]

Wow! Some posters here still think the Reds can sign Votto to a five year deal for a total of between $40 and $50 million, or about $8 to $10 million a season. Won't happen.

I think any long term deal with Votto will be more for cost certainty than for true savings. $20 mill/season may or may not be worth it, but it's easier to build around if you know 5 years ahead of time what the price tag is.

[Yachtzee]

Ownership interests in teams for players while they're still playing would be problematic for more reasons than just dealing with what happens when a player gets dealt. Could you imagine how hard it would be for a manager to deal with a star player who has an ownership interest in the club your trying to run.

[GoReds]

Ownership as part of a player contract could be done, but only in very rare cases and with a bunch of stipulations. Players such as Albert Pujols, who define a ballclub and are likely to serve their entire career with one team would qualify.

Let's say that the Cards figure Albert is worth 30Mper year. How much would an ownership stake be worth? For this example, let's say 100M. So, the Cards sign him to a 10-year deal worth $300M. $200M is straight salary, the rest is part of an ownership option, valued at $100M. That means that St. Louis would realistically pay Pujols "only" $20M per year with the remainder going towards the ownership option.

The ownership option would have the following stipulations:

1- If traded, the ownership option is converted to contract money. Therefore, any team getting Pujols in trade would have to pay him $30M per year. Whatever time St. Louis had Albert would result in a conversion to bonus money. So, if they trade Albert after 5 years, they would have to pay him a bonus of $50M at the time of the trade. Realistically, it makes Albert absolutely untradeable.

2- At the end of the contract life, Albert is offered the option of "purchasing" the ownership option OR receiving the $100M as a bonus. This means that the ownership stake that Albert would have in the team really wouldn't start until the contract is over. He would have absolutely no say in any manner until his ownership stake is realized, after the contract is through.

This isn't the type of contract I would like to see anyone offered, except for the rarest of players such as Pujols. I really can't think of any other player on any current roster that should be considered for such a deal.