Do Pro Baseball Salaries Finally Prove US Currency Is Worthless?
Written by Kyle Mayers
June 29, 2018 |
Washington Nationals' Bryce Harper is scheduled to enter free agency at the end of this season, and some forecast his next contract will command $400 million over 10 years.
Pro baseball has a rich history of awarding ridiculously large contracts to players with a unique capacity to either throw or hit a baseball. Over the course of his baseball career, Alex Rodriguez earned an incredible $378 million for his on field play. As crazy as that number is, the Washington NationalsBryce Harper is set to break that record with an anticipated contract offer after this season in the neighborhood of $400 million paid out over 10 years. Yup, $40 million per year for the next 10 years. Not a bad payday.
To many fans, these players are worth the money. In the case of Bryce Harper, his ability to consistently hit the ball has him in a unique statistical category not seen in nearly 80 years. Harper has a shot at finishing the season with a batting average over .400, and the last time a player accomplished that milestone was Ted Williams in 1941, when he finished the season with a batting average of .406 playing for the Boston Red Sox.
In addition to consistency, Harper also has the ability to go yard. He hit 42 home runs during the 2015 season. In the early going of 2018, he has already hit 16, good for a home run in every 3 games. If he can keep up that pace for all 162 games this season, he will finish the year with 54 dingers - a monster year by any standard.
Fans pour into baseball stadiums every year. With an annual attendance of 72,670,423, Major League Baseball is easily America's most watched live sport. Each of those fans cough up some hard earned cash to pay for their ticket, and as a result there's a whole lotta money sloshing around in baseball ripe for the plucking by players who have elite skills. At some point though, don't we have to look at the numbers and declare them officially out of control?
An individual earning $40 million in a year makes 831 times that of the average American worker. With an average weekly pay of $925.98, American workers are funneling an enormous amount of money to an elite few in the world of professional baseball. Because there are 162 games in a Major League Baseball season, ticket prices per game are lower than those for other professional sports in America. As a result, fans probably don't even realize they are creating this monster of extreme wealth - at least not until the contract numbers are presented in headlines and web articles.
The first $200 million pro baseball contract was awarded to Alex Rodriguez in 2001 when he was signed by the Texas Rangers to a 10 year, $252 million contract. It took until 2015 before a baseball contract eclipsed $300 million when Giancarlo Stanton signed with the Miami Marlins for $325 million over 13 years. Should Harper command $400 million after the 2018 season, not only will it mark the first time a $400 million contract has been awarded, but it will also signal that contract amounts are accelerating, and that is not a good sign.
Baseball's top end contracts remained under $300 million from 2001 until 2015. These types of contracts grew at an average pace of 1.30% per year over 15 years. Once Stanton's contract crossed over $300 million in 2015, the rate of growth began to accelerate. In order for a top end baseball contract to cross over $400 million in 2019, the average rate of annual growth of these types of contracts must be 7.30% per year over 5 years. If the current growth of 7.30% remains consistent for the foreseeable future, baseball's first half-billion dollar man will officially be signed in 2023 and the first billion dollar man in 2032.
However, if the phenomenon of contract growth acceleration continues, it means that top end contracts will grow by 40.99% per year starting in 2021. At that level, it is fairly safe to say that the state of currency in the United States is in hyper-inflation. Every year a new record breaking contract would be handed out, and the numbers would simply be astounding. By 2022, the first half billion dollar man would be signed to a contract worth $649.72 million. By 2029, the first billion dollar man would be signed to a contract worth $1.06 billion.
Summary
The idea of an individual contracted to play baseball for which the payment due will total $1 billion seems outrageous. But with a weakening currency, it appears that sometime between 2029 and 2032 that very contract will be awarded. By then, top end baseball players may earn even more than the 831 times an average American worker's salary they do today.
Do you think top end pro baseball contracts indicate that US currency is worthless? Do you believe that highly skilled players are worth 831 times the salary of the average American worker?