Dodgers Assume Too Much Risk with Kazmir Signing

The Los Angeles Dodgers have just signed the left handed free agent with a history of arm problems, Scott Kazmir, to a three year deal worth a reported $48 Million.  The deal apparently includes an opt out clause after next season that Kazmir will likely execute if he puts together a healthy, typically effective season.  Kazmir was an interesting test subject this offseason because of his injury history that included getting exactly 5 major league outs in the 2011 and 2012 seasons combined.  He’s come back from that and pitched effectively, compiling a 3.54 ERA in 530+ innings since his return.  He’s lost a tick off of his fastball, but has compensated for that lost velocity by improving in other areas.  He’s a good-not-as-great-as-his-2015-season-almost-32-year-old pitcher. In a world where Mike Leake gets $80M from the Cardinals, guaranteeing this guy $48 Million makes plenty of sense.  But the Dodgers got away with that guarantee by giving Kazmir that opt-out.

There’s two primary scenarios at play here, both of which lean heavily in Kazmir’s favor.

1. Let’s say that Kazmir pitches well in 2016 and teams with Clayton Kershaw, Brett Anderson, Hyun-Jin Ryu, and Alex Wood for a great lefty rotation.  He then opts out and takes advantage of the not-so-great free agent class next offseason for a big payday.  Great for Kazmir, Pretty good for the Dodgers.
2. Kazmir does not pitch well.  He doesn’t even pitch at all because he’s hurt.  He’s still guaranteed $48 Million to rehab injuries and hopefully regain velocity.  Ok for Kazmir, bad for the Dodgers.

Any multi-year deal for starting pitchers are full of risk for the club, especially when signing an over-30 pitcher who already has a history of arm troubles and has lost velocity why Kazmir only got 3 years guaranteed, instead of Barry Zito money.  But clubs typically make these deals with the hope that the pitcher ages gracefully and provides the same performance that they have in recent seasons.

This deal is a big win for Kazmir, but not a total loss for the Dodgers.  They operate under a different set of financial rules than the other 29 teams.  They can afford to make $48 Million mistakes.  Club executives are wise to hedge against $100M mistakes by betting on these injury-prone players to ride out their fountain of youth.

However, just last offseason the Dodgers handed the oft-injured Brandon McCarthy a 4-year, $48 Million deal. McCarthy made 4 starts and promptly tore a ligament in his elbow.  The Dodgers have committed $48 Million to injury very-prone players in each of the last two offseasons. For roughly $30 Million/year until 2018 the Dodgers should be able to hope that one of Kazmir/McCarthy is healthy. This type of doubling down just doesn’t seem to add up right now.

Kazmir doesn’t put the Dodgers over the top.  The Dodgers just gave Kazmir the equivelant of a $48 Million guaranteed qualifying offer. He had to take it.

-Sean Morash