Thu Jul 23, 2009 3:30 pm
Thu Jul 23, 2009 3:39 pm
You can still hold franchises accountable for a healthy budget, but you don't necessarily have to attach that to a fixed cap number. Soccer teams and cycling equipes can lose their license if they don't have their things in order for instance.
You say it's protection, but Mark Cuban doesn't need any. He only tightens his belt if he feels like it.
Sure they are well paid. The superstars earn a lot of money off the court too, that's true. But the role players are really robbed. They could make a lot more if the sky was the limit. And I think it would attract more money from 'philantropists'.
Thu Jul 23, 2009 4:08 pm
Andrew wrote:You say it's protection, but Mark Cuban doesn't need any. He only tightens his belt if he feels like it.
Who's to say he doesn't need any? And even if he doesn't, he's just one of 30 owners. As I said it's aiming to protect the financial stability of the entire league, not just one owner who's willing to spend money left and right.
Sure they are well paid. The superstars earn a lot of money off the court too, that's true. But the role players are really robbed. They could make a lot more if the sky was the limit. And I think it would attract more money from 'philantropists'.
They aren't really being "robbed". There's a hierachy, plain and simple. I'm sure there's a lot of CEOs and members of middle management in various big corporations that are making much, much more than their underlings and not working nearly as hard. That's capitalism for you. Giving role players equal paycheques to the stars when they're clearly not equal in terms of skill, that would be socialism in my book.
Thu Jul 23, 2009 4:38 pm
One of the 30 yes, but he's got to assimilate. It's just not freedom to me. Btw making you pay double for every dollar above the luxury cap is definitely not a protective measure but pure punishment that rather endangers financial stability than enhances it.
Of course there's a hierarchy. The top players get top dollar, but the rest got to do with what's left. Not in a natural way, what's left to spend, but what is still allowed to spend. Marquis Daniels is probably robbing himself to represent the Celtics, whereas if there was no cap they could pay him his market value and he could still join them (if he would still be on their radar then).
Thu Jul 23, 2009 4:42 pm
Hedonist wrote:A few socialist aspects of this sytem:
- Players are 'shared'. They are somehow public property and all the teams get their 'fair' share.
This is a tremendous violation imo of the freedom of players. Mainly of their freedom of choice of employer (although of course their employer is The NBA officially) but I find it obscure. The maximum salary may also not be a violation by the law - because players voluntarily agree to play in the league of course, but it definitely reeks of socialism. At the very least I find it very un-American to not let the market decide somebody's pay.
Thu Jul 23, 2009 5:04 pm
Thu Jul 23, 2009 5:08 pm
Thu Jul 23, 2009 5:14 pm
Hedonist wrote:Sure I'm not saying it is pure socialism, but if it didn't exist yet and Obama would propose it then Joe the Plumber would think it's a bad idea. To me it's just ironic that such a system exists in the USA.
I don't think money is enough to attract the best players to Europe. If it would I'm very curious how the NBA will react on that, if certain rules will be changed to fight it. But to me it's like if tomorrow a salary cap would be instituted in Hollywood by the Academy for instance (no Oscar if you don't follow the cap rules) then I still don't see Tom Cruise settling for a role in Bollywood.
Thu Jul 23, 2009 5:21 pm
Thu Jul 23, 2009 6:07 pm
Thu Jul 23, 2009 6:16 pm
Thu Jul 23, 2009 6:22 pm
Thu Jul 23, 2009 6:25 pm
Thu Jul 23, 2009 6:26 pm
benji wrote:Hedonist wrote:Sure I'm not saying it is pure socialism, but if it didn't exist yet and Obama would propose it then Joe the Plumber would think it's a bad idea. To me it's just ironic that such a system exists in the USA.
I don't think money is enough to attract the best players to Europe. If it would I'm very curious how the NBA will react on that, if certain rules will be changed to fight it. But to me it's like if tomorrow a salary cap would be instituted in Hollywood by the Academy for instance (no Oscar if you don't follow the cap rules) then I still don't see Tom Cruise settling for a role in Bollywood.
I know you weren't, but "socialism" and the like is thrown around too much to the point it's just a vapid insult like "fascism" with no relation to actual positioning in our political culture. (Here in the U.S.)
I don't actually think it's that disparate. But now that Kobe has won his title, if that Italian team comes back offering $50 million a year for a couple years? We have to remember that for most of the post-war period, Europe couldn't even attempt to compete with the U.S. Now things are pretty even, there a lot of billionaires in Europe putting money into basketball that weren't there a decade ago, let alone five years ago. The level of talent NBA in 1990 compared to the world will be different from 2010. The best players in the world will still be in the NBA along with most of the second tier, but the third or fourth tiers? You can't say that as easily anymore.
It's not really ironic. The USA stopped being a free market well before the NBA was founded.
Thu Jul 23, 2009 6:33 pm
benji wrote:It will be. As I said, it's not about just the NBA, but the status of the European and America economic climates. The European one was depressed for almost the entire life of the NBA due to the War and the Soviets. It's emerged in the last few years and Europeans have played a larger role in the NBA. Now the United States is on a downward spiral into irrelevancy and Europe and Asia are growing.
The Euroleague, and European leagues have gone from where you go if you can't make it in the US to where you can make more money than the US and be a bigger part of a team. As noted, it's not the stars, it's the third/fourth tier players.
Thu Jul 23, 2009 6:35 pm
Andrew wrote:How does the NBA counteract that then (or indeed, can they)? Do they raise (or abolish) the cap or lower the maximum contracts that veterans are eligible for? Do they bite the bullet and eliminate restricted free agency so that players like Childress can freely negotiate with other teams if their current club won't meet their asking price?
Thu Jul 23, 2009 6:36 pm
For whatever reason I had not checked my email in a number of hours, so I was unaware I had a pretty important email containing an official NBA memo for release this morning.
There is quite a lot of interesting data in there.
But one thing that we REALLY need to factor in when looking at what we are doing this offseason is not only what the lux tax threshold is for 09-10, but what it could be for 10-11.
We've talked about this before. Even back earlier in the season when people were dooming and glooming about the 09-10 threshold being between $65 mil to $68 mil, I said at that time that kind of drop wouldn't yet be possible because of the buffer system the CBA uses, so 10-11 was the more worrisome year.
But the NBA's current projections for the 10-11 lux tax threshold is $65 mil, factoring in a 2.5% drop in BRI from 08-09 to 09-10
There actually was NOT a drop in BRI for 08-09 ($3.608 billion) as compared to 07-08 ($3.519 billion), despite all of the economic conditions, so one or more significant TV contracts must have run out for the NBA to forecast that kind of drop.
Also, the amount of the players salaries held in escrow was for the first time not sufficient to cover the overage of salaries & benefits, which also drags the salary cap and lux tax numbers down for 10-11. Of the 9% of salary held in escrow in the 07-08 season, amounting to $184.9 mil, $163.4 mil was used to cover the overage leaving $21.5 mil that was returned to the players. For 09-10, the escrow amount of $194 mil wasn't even sufficient to cover the $219.8 mil overage, so not only was there a larger than normal overage, but there was actually a $25.8 mil shortfall. That might not seem like a big deal relative to all of the other large numbers at play here, but trust me, it is. The overage amount itself already impacts the next salary cap and lux tax thresholds, and a shortfall amount further compounds that.
The NBA also is taking an overly cautious and borderline insane approach and issuing an additional warning to teams that it would be prudent not to plan to the 10-11 projection of $53.6 mil salary cap and $65 mil lux tax, but rather to plan for a $50.4 mil salary cap and $61.2 mil lux tax, just in case.
That's going too far, IMO. Yes, things could get that bad. But we'd probably be to the point of 20%+ unemployment and lines for soup and bread handouts Great Depression style for the climate to be right for that kind of drop. I mean, what if we end up having a nuclear war with Iran and North Korea, simultaneously? Should teams be preparing for that contingency too? At a certain point contingency planning is not productive.
Personally, I think the NBA ratcheted up the doom and gloom in that memo because they didn't feel like teams were appropriately adjusting their fiscal discipline so far this offseason.
But we should for the time being use that $65 mil figure for the 10-11 lux tax threshold and keep that in mind when looking at any moves made this offseason, in addition to the 09-10 lux tax threshold.
Thu Jul 23, 2009 6:50 pm
Hedonist wrote:2nd tier and 3rd is hard to say. I know first tier Dutch players still dream of the NBA and nothing else. If somebody like Kobe would go it might become a trend. It would certainly cause a shock. And maybe open other players' minds to it. There's a Dutch saying that says "After one sheep has crossed the dam, the rest will follow."