NBA Owners: Clean Your Own Mess First

NBA Commissioner David Stern

NBA Commissioner David Stern

Like all other basketball fans, I am left here to wonder when we’ll see another game played and praying it isn’t the start of the 2012-13 season as some are suggesting. Even before the lockout every talking head on TV has said the players need to give back. I keep hearing how the players are overpaid and should be grateful for the money they receive. I keep hearing that they need to make concessions and come towards the owners. I keep hearing that they need to accept a salary cap. No one seems to be looking at the other side of the equation. Isn’t anyone going to wonder about the owners? Isn’t anyone going to ask about the GMs? Aren’t they the ones writing these contracts and signing the checks? I seriously doubt they’re handing their players contracts and blank checks just telling them to write in whatever they feel like they’re worth.

In the 1984-85 season (get in the hot tub, we’re going for a ride!), the first season the league re-established a salary cap, that cap was $3.6 million in total salary (average player salary: $330,000). That’s for the entire team. Not one person, but everybody. All twelve guys on the bench couldn’t make more than that. In 2005-06, the last time the CBA came up for renewal, the average player in the NBA was making $5 million. Players were, on average, making $1.4 million more than every full roster in the league just twenty years earlier. The cap in 05-06: $49.5 million. For this past season, the cap was $58 million with an average salary of $5.75 million. If the owners and GMs are writing the contracts and the checks, could it really be the players that have caused a 15-fold increase in average salary in a mere two decades?  Any answer other than “no” makes you an idiot.

Paying for talent is one thing. I get that. Talented players are what put butts in seats. Those filled seats buy concessions, souvenirs, and possibly more tickets. It’s one of the primary ways teams make money. The best players are going to demand the most money. There’s a really limited supply of those players, unfortunately and they should get what they rightfully deserve. You won’t hear me, or them for that matter, complaining about their salaries. On the flip side, you know how on Ebay, sometimes auctions just keep going up and up and no one has a clue as to why; how it looks like one person is bidding against themselves. I really get the impression that is what is happening here. Instead of saving that money to pay one of the stars, a guy making $3 million has his contract expire. Let’s say a GM has $10 million in cap space to play with. One of their bench players made $3 million last season, the last in their contract. This GM could offer another $3M/year deal, even $4M. Instead, afraid to lose this player that plays a role on his team, but not a leading one, this GM offers the full $10M available. The successful franchises in the league are too busy using their money like adults and hanging championship banners. Instead, this GM has now left his team no room to maneuver when their chance for a star or other impact player comes along. It isn’t even a tradeable contract. Who wants a role player at $10 million? Smart, fiscally responsible GMs are focused on the right talent, the right roles players, and most importantly, they’re interested in finding it at the right price (see: Lakers, Spurs, Mavericks, Boston). What do these teams have in common? Regular success on the court and a combined eleven championships since 1999.

These teams have managed their money carefully. They’ve made good deals for themselves for local and regional TV rights. They’ve also worked hard to make the best decisions both competitively and financially ensuring on-the-court success for their franchises. They should not be forced to limit what they can and can’t do because some of their fellow executives can’t manage a checkbook. A hard cap doesn’t save management from players making too much money; it saves them from themselves spending too much money on moronic contracts to players who shouldn’t even be in the league. These are grown, educated men. They didn’t become multi-millionaires and billionaires hitting the lotto. The smart teams should not be forced to subsidize the dumb ones. Subsidization isn’t the way to achieve competitive balance. Smart management is.

There should be an NBA version of an IQ test given to anyone who shows interest in buying a franchise. It could even be multiple choice and include questions like “What’s the most important thing when owning a franchise? A) Spending money competently to be competitive; B) Twisting local government’s arm to build you a new arena;  or C) Using the fact you own a team a as a pickup line.” Also “How much would you pay Darko Milicic for a season? A) About $5 million; B) About $1 million; or C) A couple burgers from the concession stand.” The successful teams know the answers are A and C.

At some point in the future, the league will sit at a table with the players. Before that can even be thought about, the owners need to clean their own house. They need to realize that it wasn’t the players that put them in this position. They did this to themselves. These will, in the end, be the uglier, far more contentious negotiations. These promise to make the debt negotiations in Washington look like a love fest. You will have the
struggling franchises asking for a salary cap and revenue sharing in an attempt to level the playing field. The large markets and successful markets will want the status quo. They have no issue with the current economics. They could sit down with the players and hammer out a new agreement so fast DeMaurice Smith will get dizzy. Everyone else is pushing for the nuclear option—no basketball till the players fold. That’s their public stance, anyway. This is their shot across the bows of the successful franchises. If there’s no season, maybe the successful teams will give in. That’s the dumbest game of financial chicken, the debt crisis notwithstanding, I’ve ever heard.

What I pray for most is that this game results in what the game needs most–contraction. Let me ask you this: Do we really need teams in Sacramento, Charlotte, Minneapolis, and New Orleans? These teams have little talent and even fewer fans between them. They could rent out high school gyms for their home games to save money. These mostly talentless teams play in areas where the population just doesn’t care. Would anyone notice if the Bobcats went away? They didn’t even seem to notice when the Hornets left for New Orleans in 2002. Even the Hornets in their current home stink. They are in a city with stiff economic issues and ownership so bad and eventually so broke the league had to take over the franchise. My solution: If a suitable owner doesn’t wake up and plunk down the cash by the time the lockout ends, whack’em. What reason exists to keep the Timberwolves around other than the extra night off the opposing team’s starters can get? No talent, no fans, and no one really cares. The Kings were all packed for a move down the way to Anaheim. This was the Maloof Brothers final attempt to force a new arena from the city. If the league had approved that move, it should have stipulated the sale of the team to Henry Samueli, owner of the Anaheim Ducks and the Honda Center, the Kings’ potential new home. All I keep hearing is that the lockout is more profitable for these franchises than actually playing their games. Explain to me agian why they even own a franchise. If any or all of these teams go poof in the next few months as this drags on, the league will be better off for it.

The successful teams will always remain successful as long as they stick to the blueprints they’ve developed over the years. Success breeds success. It becomes a a way of life; players, coaches, front office people, trainers, everyone lives and breathes winning. There is a system that works. Some teams have figured it out. These guys have put together successful teams; teams that have competed for and won championships. Some franchises have begun to model themselves after these teams by hiring key assistants away from them or studying how they go about evaluating and signing players. Others continue to act ignorant and childish. They’re like the 16-year-old girl at the mall with daddy’s credit card. As long as the fight remains the successful vs. the foolish, we are no closer to getting a deal done. Blame that on the losers.

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