The Los Angeles Dodgers crossed a psychological and financial threshold this week that no other franchise has dared approach. With Edwin Díaz’s contract officially added to the books, the Dodgers’ deferred payment obligations now exceed $1 billion, stretching through 2047. Nine players are owed money long after they stop wearing Dodger blue, led by Shohei Ohtani’s unprecedented $680 million in deferred salary.
That number sounds absurd. It also sounds intentional.
The immediate reaction around baseball has been predictable: outrage from rival fan bases, hand-wringing from media, and whispers that the Dodgers are “breaking” the system. But the more uncomfortable truth for the rest of the league is this: the Dodgers aren’t exploiting a loophole. They’re executing a long-term financial strategy that other teams could use—but won’t.
Are the Dodgers Breaking Baseball?
No. They’re exposing it.
Deferred money has existed for decades. Bobby Bonilla didn’t invent it, and neither did Shohei Ohtani. What the Dodgers have done is scale the concept to its logical extreme by combining three things most franchises lack simultaneously: massive revenue streams, ownership patience, and front-office discipline.
The Dodgers aren’t deferring money because they’re cash-poor. They’re doing it because future dollars are cheaper than present dollars. Inflation, media-rights growth, and franchise valuation all work in their favor. Paying $100 million in 2038 will feel far lighter than paying $100 million in 2026, especially for a club that prints money through local TV deals, international branding, and postseason runs.
In other words, the Dodgers are using time as an asset.
How Can the Dodgers Stay Competitive When the Bill Comes Due?
This is where critics miss the forest for the trees. The Dodgers’ deferred obligations peak at roughly $102 million per year in 2038 and 2039. That sounds crushing—until you contextualize it.
By the late 2030s, MLB revenues will almost certainly dwarf today’s numbers. National TV deals will reset. Streaming money will flow differently. Expansion fees could inject billions into ownership pockets. And the Dodgers’ own valuation, already among the highest in sports, will likely balloon further.
More importantly, deferred money does not count toward competitive balance tax calculations in the years it is paid—it is taxed based on present value at the time of signing. That means the Dodgers already absorbed the luxury-tax hit upfront. The future payments don’t restrict roster-building in those seasons the way traditional contracts would.
From a baseball operations standpoint, the Dodgers have essentially prepaid the pain.
Is This a New Model—and Can Other Teams Copy It?
Yes, it’s a new model. No, most teams can’t copy it.
The Dodgers’ approach works because they trust their player development pipeline to continuously supply cheap, controllable talent. Deferred-heavy rosters only function if you’re not simultaneously paying market rates for replacement-level players. The Dodgers believe they can rotate waves of young contributors underneath an expensive veteran core—and history says they’re right.
Smaller-market teams could attempt something similar, but deferred money only helps if ownership can float the cost long-term. That requires liquidity, not just willingness. For many franchises, deferrals create risk. For the Dodgers, they reduce it.
Will this backfire? Only if the Dodgers stop winning.
Deferred money becomes a problem if revenue dries up, attendance dips, or media leverage fades. But the Dodgers have structured their entire brand around avoiding that scenario. Winning fuels revenue. Revenue supports deferrals. Deferrals allow more winning. It’s a closed loop — and an uncomfortable one for the rest of baseball.
The Dodgers aren’t gaming the system. They’re betting that baseball’s financial future will be bigger than its present. And unless MLB fundamentally changes its economic rules, that bet looks frighteningly safe.
This isn’t the Dodgers breaking baseball. It’s the Dodgers proving who truly understands it.
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