It's been quite a summer for professional sports owners and their financial exploits, legal or otherwise. The Los Angeles Dodgers are the latest team caught in a scandal after their own, Mark Walter, sold the Los Angeles Lakers for $12.5 billion — a year after purchasing them. That naturally struck folds as odd timing, and it was.
According to The Athletic, Walter is under investigation for allegedly funneling money from insurance companies, which he owns, to the Dodgers, without properly reporting those deals to the government. While it appears that Walter is desperate to get a little more cash on hand, these controversies really won't impact the Dodgers on the field in the near future, if ever. So here's what could actually undermine L.A.'s attempt at a three-peat and a rare MLB dynasty.
The Dodgers’ spending spree is starting to show diminishing returns
The Dodgers own the second-highest payroll in MLB with tens of millions in deferred dollars owed to the likes of Shohei Ohtani and Kyle Tucker. Their unique contract structures have allowed L.A. to keep piling on the expenses, whether it's targeting the crème de la crème in free agency or trading for Tarik Skubal at the deadline. It's unclear how exactly a 2027 lockout may impact L.A.'s dealings in the future, but for now, this strategy has worked like a charm.
Well, mostly. The Dodgers have seemingly unlimited spending power, but in reality, every owner has his limit — a point at which their money-making brains take over and profit becomes the defining, guiding light. Los Angeles has no trouble turning their expenses on the field into profit both in the stadium and from TV and merch sales, but there comes a point where not all these massive contracts will generate a positive return on investment.
Just look at the Kyle Tucker deal. He signed for four years and $240 million, or $60 million AAV. He has a .694 OPS and 93 wRC+ with 0.3 fWAR, or wins above replacement. The Dodgers very intentionally made it a high-AAV, short-term contract so that Tucker could opt out and seek longer deals elsewhere if he performs. But he's not performing, which means L.A. could end up on the hook for all four years.
Or Edwin Díaz, who inked the largest reliever contract in MLB: three years and $69 million. He has spent much of the season hurt and struggled when available, with an 11.85 ERA and 6.05 FIP in 13.2 innings. Overspending on even a great reliever is questionable to begin with. If Díaz ends up declining to the point where he can't handle high-leverage assignments, but L.A. feels obligated to play him because of the contract, that becomes a huge anchor around their proverbial neck.
If they aren't careful, there will come a time when L.A. has too much money wrapped up in diminishing assets, to the point where it blocks their (extremely stacked) farm system and renders them less able to actually spend on worthwhile stars in free agency. Tucker, for example, is not somebody the Dodgers can simply bench or cut if he never turns it around. Therein lies the risk...
The Dodgers can’t outrun Father Time forever
Shoehei Ohtani is 31. He is signed through 2033. Freddie Freeman is 36, signed through next season. Mookie Betts is 33 and under contract through 2032. Will Smith, 31, is signed through 2033. And so forth. The Dodgers' core, which Los Angeles has diligently signed or extended for the longest possible window, is beginning to age out of its collective prime. We've already seen Betts' production plummet, with his .703 OPS and 92 wRC+, while Smith has spent much of this season nursing an injury. Ohtani remains stellar at the plate, but he hasn't shouldered the expect workload of a starting pitcher due to nagging injuries. He has two elbow surgeries under his belt.
It's fair to wonder when exactly the house of cards tumbles — and how equipped the Dodgers will be to compensate. This is still the best team in baseball on paper, with a deep rotation and a seemingly limitless well of talent coming through their minor league pipelines. However, as some of their superstars become just regular stars, or league-average starters, or god forbid, below average starters, what exactly is the pivot point? That money is still on the books. Even if it's deferred, that money just hits further down the road. It's still a real cost the front office has to weigh.
There are real questions around Ohtani's durability at this point. It's unclear how much longer the Dodgers will be able to justify using him as a pitcher. When that switch inevitably flips, he becomes a $70 million-per-year DH on the wrong side of 30.
Freeman is an aging first baseman, which typically means the fall is near. Betts is still valuable with his defense, but defense diminishes over time. Especially at a position like shortstop. He's a better hitter than the numbers indicate, but far removed from the MVP heights of yesteryear. Smith is a catcher being paid $14 million AAV through his age-38 season. That's less burdensome, of course, but we've already seen Dalton Rushing, a former top catching prospects, relegated to bench duties when Smith is healthy. Even when Rushing was outperforming him straight up.
The Dodgers cannot pay everybody into their late-30s and build sustainably through their farm system. The spots are taken! There's a reason James Tibbs, for example, who has mashed Triple-A pitching all season, is still in Triple-A. Los Angeles will need to reckon with the costly mortality of this core sooner than later. That may not prevent them from winning another title this season, but it will get increasingly difficult in the years to come.
Add us as a preferred source on Google