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Why the David Ortiz Contract Extension Was a Mistake for the Red Sox

By Daniel B. Kline – Mar 26, 2014 at 6:51AM

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While Red Sox fans want to see Big Papi play for the team as long as he wants, his new deal sets a bad precedent that ownership had previously avoided.

David Ortiz has been a great member of the Boston Red Sox. Big Papi has been part of so many memorable moments in leading the Sox to World Series titles in 2004, 2007, and 2013 that it's hard to decide on a favorite. His place in Red Sox history can't be debated nor can his current importance to the team.

That makes it painful to say that the team has made a mistake in signing him to a lucrative contract extension.

What deal did Ortiz sign with the Red Sox

The Ortiz deal includes a $16 million guaranteed deal for 2015 and club options for 2016 and 2017. The 2016 deal vests automatically if Ortiz reaches a certain amount of plate appearances in 2015, ESPN Boston reported.  Ortiz will be 42 at the end of the 2017 season.

These are high numbers but not astronomical in a league where there are other talented designated hitters whose credentials don't compare to Ortiz's making similar money. In 2014 the New York Yankees will be paying Alfonso Soriano $17 million (though he plays some outfield), the Chicago White Sox will pay Adam Dunn $14 million, and the Detroit Tigers will shell out $12.5 million for Victor Martinez. With the average veteran's salary in 2013 being $3,386,212, according to the Major League Baseball Players Association , the Ortiz extension is not so low a figure that the Red Sox should have made the deal for the reasons the team reportedly did.

Why did the Red Sox make the David Ortiz deal?

An unhappy Ortiz tends to be a distraction. With the slugger being a key team leader, if he's a distraction it causes ripples throughout the entire roster. In the past when Ortiz felt like he was underpaid or there weren't enough years left on his contract, he would make just enough noise in the media to strong-arm the team into giving him a raise and/or adding years to his deal. That made sense for a David Ortiz heading in his mid-30s, but with 40 fast approaching the team would be better off taking a year-to-year approach.

Ortiz acted this offseason as if he would consider leaving Boston if the team did not extend his contract.

In January Ortiz went on Boston CBS4's Sports Final and told host Steve Burton he would like to retire as a member of the Red Sox. "But as I always keep on telling people, this is a business. Sometimes you've got to do what's best for you and your family. As long as they keep offering me a job and I keep doing what I'm supposed to do and the relationship keeps on building up, I'm going to be there. Hopefully, I won't have to go and wear another uniform," ESPN reported Ortiz told the TV host. If the Sox didn't offer him a long-term deal, he told Burton it would be "Time to move on."

Basically the team gave Ortiz a guaranteed extra year at big money to shut him up for another season.

Why this deal with David Ortiz can go wrong

There have been a couple of seasons where Ortiz slumped and it appeared his days as a home run-bashing star were over. The slugger always rebounded and he has been a key playoff contributor, but at his age it's more likely that the wheels will fall off and Ortiz won't be able to return to form. Imagine if the charismatic player gets off to a slow start in 2014 and has an off year. The team in now locked in to an expensive 2015 deal with a player it may not want to play everyday. Throw in the drama over plate appearances and the vesting of the 2016 deal and you start to see why this is a lousy contract.

At his age and with his history of injuries the Red Sox should take the pragmatic approach -- which the team under its current owners has done starting with the trade of Nomar Garciaparra that led to the team's first World Series in 86 years in 2004 -- and treat Ortiz as a year-to-year player. If he produces, sign him up for next year. If that production drops offer him a lesser deal. If he walks away over money, let him go and replace him as the team has done with so many other perceived irreplaceable players under this ownership group.  

Since when are these Red Sox owners sentimental?

"With this agreement, we have near certainty that David Ortiz will finish his career in a Red Sox uniform, which is something we have all wanted and that we are all proud of," owner John Henry said in a statement ESPN Boston reported. "It is difficult to describe David's contributions to our city both on the field and off the field, and we are so proud to have this ambassador of our game with us as he continues on this road to Cooperstown." 

The Red Sox under owners Henry, Tom Warner, and Larry Lucchino have not given out lifetime achievement contracts. Even beloved players like Jason Varitek -- only the third Red Sox captain since 1960 -- wasn't offered a deal based on past performance. Instead reported in 2012 "Varitek was offered a minor league contract and an invitation to spring training. But without any guarantees of making the team, he elected to retire. 

The Ortiz deal feels like sentiment over business and when you do that, you end up acting like the New York Yankees and paying a broken down Derek Jeter $12 million (which BusinessWeek called "the Yankees' equivalent of a gold retirement watch."

Ortiz deserves the thanks of Red Sox nation. He deserves a place with the team after he retires and a free drink in any bar in Massachusetts for the rest of his life. Paying him in the future based on past performance is a precedent these owners should not set. Ortiz should be with the Boston Red Sox for life, but only at the price his services are worth in the coming year. As a Sox fan you hope Ortiz can play forever. You also hope to see Larry Bird suiting up for the Celtics, Bobby Orr lacing up his skates for the Bruins, and Tom Brady forever under center for the Patriots.

Those things can't happen and a franchise that has won three World Series based on being unsentimental should not have signed this deal. Click to read why my colleague Jake Mann disagrees.

Daniel Kline is a Red Sox fan. His mother is not going to be happy about this piece. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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