Hootie, you are looking only at the annual dollar value of the contract and not considering the immense value derived from the truncated term of the contract. $8M/year for Nomar as part a multi-year deal is a lot, but in a one-year it is not bad at all since you do not have the huge downside risk of the latter years of the contract.
The Dodgers are paying Nomar a premium that shifts the risk of his declinign performance from the team to the individual. This is a very smart move that gives you greater certaintly of your return on investment and preserve greater flexibility moving forward.
People can berate the Dodgers to they are blue in the face but the fact is that they are avoiding death spiral that most teams have gotten themselves into by being on the hook to give huge paydays to declining mediocrities like Mussina, Belle, Thomas, Piazza, Sosa--the list goes on and on and will probably include the names Giles and Damon by 2010.