What was really accomplished in the last CBA?

So the owners locked the players out demanding change and after missing about a month of the regular season finally came to an agreement. We've now effectively had a full off-season under the new rules and have seen the same types of insane contracts handed about as before, the Lakers still spending without limits, and more superteams than ever before. So was it all worth it?

The short answer: Yes.

For the owners it was definitely worth it. Sure, some players were overpaid in free agency, but to point to that as a problem with the CBA would be to misunderstand the finances of the league. The individual maximum contract and the rookie scale contract forces max players and rookies to be proportionately massively underpaid.

Yet, those are the salaries we use to compare everyone to. If LeBron makes 17 million, then the guy making 13 million should be nearly as good as LeBron. It doesn't work that way in reality, because LeBron is worth 30-40 million, but can't be paid that much. Since total player salaries are fixed to BRI that extra money LeBron does not earn has to go somewhere.

The same is true of rookie salary scale players which all 1st rounders from the draft in their first four years of service and most second rounders for the first two to three years. While you may be thinking "Doug, not all rookie salary players are good, lots of these guys suck". Sure, but ask yourself how often their options are declined. Almost never, maybe one in 20 guys doesn't have his 3rd/4th year option picked up which shows that even when they aren't great players they're still cheaper than the alternatives relative to their abilities.

That leaves a pile of extra cash to spend on the free agent players, so these guys will always be overpaid. As such, pinning your hopes on free agency is typically a losers plan unless you can get max worth players in free agency whom are underpaid [such as the Head did]. If you end up with guys in the next tier then you've locked yourself into a tough corner because you'll have less salary flexibility and talent than the max player team [similar to what the Bulls did with Carlos Boozer].

That said, it's a tough scenario, because not getting the next tier guy leaves you even further away and also doesn't help any. In short, in this league, if you don't get superstars you're screwed, and the hardening of the cap made that even more true than it was before. It used to be a team like Dallas could outspend other team and add enough depth to make up for the fact that they only had one star. The new CBA actually makes that more difficult.

So with all the super-teams forming in LA, Miami, OKC, and perhaps Brooklyn [though I doubt it ends up that way], the league looks fairly bleak for everyone else. That's true, but it's not all that different than it ever was. How many teams had a realistic shot to beat the Bulls in the Jordan era, the Lakers in the Magic era, the Celtics in the Bird era? There have always been super-teams, and they form through various methods of luck and skill.

Miami isn't some hotbed basketball market that's lured the biggest and brightest stars forever, OKC will likely have similar success to the Bucks as a basketball market once Durant is gone, and who knows what the long term viability of Brooklyn will be, but their lack of flexibility will make it next to impossible to do anything for the next few years.

The Lakers have been a dominant market, but if they keep Ron Artest next season and resign Dwight Howard then they'll be set to pay around 95 million or so in luxury tax alone. The Lakers, absurdly enough, can trivially afford that with a new local TV deal that should pay them an average of 200 million a year and likely kicks off at 150 million or so. That's more money from local TV than many franchises in the league make all together.

Perhaps the league's new revenue sharing plan will help feed some of that money back into the rest of the franchises [if not the massive luxury tax penalty will], but the Lakers will certainly be able to afford to do whatever they want in a way no other franchise outside of the Knicks will. That said, are they really going to look at Ron Artest and say "this guy's worth about 35 million to us", probably not, I'd count on an amnesty there.

Also, while the Lakers added Steve Nash, they did so through a S&T which won't be available to teams over the luxury tax apron next season. Thus, the Lakers went with for it and threw all their chips on the table in the last year they could possibly do so. Will they win a title? Who knows. However, they found a way to increase their relevancy in the picture and become the favorites in many people's minds.

What do all these changes mean for the rest of the league though? My guess is as follows: The luxury tax apron is going to effectively become a hard cap for most franchises. While some will spend through the barrier the actual lack of flexibility in terms of S&Ts, fewer exceptions, and massive penalties will give most teams enough incentive to stay under it. Give things another two years, and I'd guess that on average three teams will exceed that number per year, and the days of being 20-30 million into the tax are over for everyone.

Good teams will be built in desirable locations or the draft. This really isn't any different than it's always been. If a player doesn't choose you in free agency or force a trade to your city then you'll have to draft him to get him. For small market teams, they'll need to acquire all their initial talent that way. A team like Cleveland was appealing while LeBron was there, but it's not a hot bed free agent destination right now.

The only team that has had lasting appeal in the NBA appears to be the Lakers. We've seen a few people act like New York is desirable, but really, what free agents have ever gone there. Ever? Carmelo forced his way there in a trade, but that's really about it. The history doesn't back up the general view of them. Miami's desirable right now, but only because Wade was there first, and they had the money to get the big three. No one gave a crap about the Heat three-four years ago.

The Lakers are the NBA's Yankess though. It's the premier place to play. It's where everyone wants to go. If there's ever a choice for similar money between the Lakers and somewhere else, L.A. wins an absurd amount of the time. The Lakers brand, market size, history, commitment to winning at all costs, additional income opportunities, weather, and city combine to make it the best of all worlds. No matter what a player is looking for, there's a good chance L.A. has it better than anywhere else.

The rest of the league will just have to suck it up on that one, but everyone else? In the long run, they playing field has been leveled considerably in terms of ability to make money and ability to compete. It doesn't mean any given year there is parity in the league, but the opportunity to pursue players for each franchise became better with this CBA as well as the distribution of wealth.


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  • I'm starting to think competitive balance would be pretty terrible for the NBA. I mean say OKC wins the championship, nice story sure, but how many people does it make happy compared to if the Lakers win?

    The Lakers have 10 times the fans that OKC do, so any fair system should give them 10 times the chance to win. The flaw at the moment is when you have teams with a lot of fans that are owned by idiots like Dolan or profiteers like JR ... that's a much more pressing problem for the NBA to solve than making sure the teams nobody cares about like the Timberwolves are competitive.

  • In reply to Shakes:

    How can you even attempt to argue competitive balance would be bad, for anything?

    So the Lakers have more fans than OKC, great. But EVERY other fan base would be rooting for OKC over LAL, and that number dwarfs LAL's fan base.

    Sure, a 'fair' system would give LAL 10 times the chance to win, but a 'fair' system would not have revenue sharing either, a draft system, or any other methods of 'competitive balance'.

    So if LAL and maybe 5 other teams can only be competitive, the league shrinks from 30 teams to what, 5-10 teams? Now try persuading the the Owners and Players of those 5-10 teams how going from making tens-hundreds of millions of dollars to this 'fair system' of making single digit millions is good for them.

  • In reply to YouBlewwIt:

    Sure, you might temporarily favour OKC against the Lakers if you're watching a game, but it doesn't have nearly the same care factor as if you were actually a fan of the team. You can't really compare being kind of happy to see the Lakers lose to being thrilled to see your own team win.

    Plenty of sports survive just fine with an uneven balance. The NBA wont shrink and die without balance. Look at soccer: most popular sport in the world, and the major leagues in Europe all have 2-4 teams that top the table year after year. The top teams spend to win, the bottom teams are relegated to lesser leagues rather than being rewarded with draft picks, and yet the sport continues to rake in the bucks.

    You look at the big fan bases in the NBA, the Lakers, Bulls, Knicks, Celtics ... they're the teams that should be up the top of the league year after year. It maximises happiness of NBA fans, and subsequently maximises revenue for the NBA by keeping more people interested. Competitive balance can't be achieved in basketball. There's too small a supply of people who are both tall and talented, so a sport with only 5 people on the court is always going to be skewed by a few teams monopolising those guys who can dominate a game. You may as well accept it and make sure the balance is skewed towards the best markets.

  • I still like the football financial model best especially now that they fixed their rookie salary issue. Hard cap with no player caps. Also having the option of garuanteed money verse the fully garuanteed NBA contracts is much better. Financially the NFL has a superior and more simplistic model IMO.

  • In reply to Chad:

    'Superior and more simplistic' ... for the Owners, not the players.

    The Players would never agree to going from having Guaranteed Contracts to not having Guaranteed Contracts.

    There's a reason why everybody views the NFL Players' Union as the weakest of the 3 major team sports.

    But I agree with the Hard Cap+No Max Contracts model the NFL uses. At least with this model, the NBA Players could agree to it because the Superstars would benefit.

  • In reply to Chad:

    The NFL model is great for the fans and owners. Not so hot for the players, but it makes sense given the realities of the NFL.

  • There's only 1 thing the Owners cared about during the lockout...get more money for them.

    They could give a rat's tail about 'competitive balance'. As long as they made money, they would be fine.

    The Lockout was basically about the Owners getting the Players' share of the pie from 58% to whatever it is now...50-51%.

    In 6 years when I think both sides can opt-out, guess what, Owners don't care about Competitive Balance, but more about making money for themselves. Expect the PR fight to be 'Owners want the competitive balance'...but a NEW CBA ratifying giving the Owners more percentages of the pie.

    If Owners really cared about Competitive Balance, they would adopt the NFL model of NO Max Contracts + Hard Cap. Any other variation wouldn't work as well.

    If there were no Max contracts and a Hard Cap, you won't be seeing Lebron, Wade, and Bosh team up for $15mil per year when they could fetch $30-40mil per year on their own teams.

  • In reply to YouBlewwIt:

    I agree it's largely about money, but it's about who gets the money too. When the Lakers sign a deal that pays them 200 million a year for local TV rights and your small market franchise makes a total of 100 million in revenue a year, then being at 58% vs 51% isn't the whole issue.

    There's a large sub issue of the small market teams getting additional support, and competitive balance is part of that too.

  • This "NFL Parity" stuff is mostly a myth, you know.

    THREE teams (Patriots, Giants, Steelers) have combined to win 7 of the last 11 Super Bowls.

    Since the '85 Bears won, EIGHT teams have combined to win 21 of the 26 Super Bowls.

    It doesn't really matter what system you put in place, for the most part it boils down to which organization drafts better and spends their free agent money most efficiently.

    A big part of the NBA's problem is that it's the only sport where owners trade guys in the last year of their contract instead of letting them become free agents. And they never get traded to teams that would have had the cap space to sign them as free agents.

    Of course, this could be because fan bases scream and cry "trade him, don't let him leave for nothing in return..." Even over a minor free-agent like Asik who wasn't even a starter, fans cry that river al day long.

    If the Nuggets would have called Melo's bluff, you honestly think he would have signed in NY for the MLE? Of course he wouldn't.

    You really think Howard would have signed with Brooklyn or the Lakers for the MLE? Of course not.

  • One more thing, the NFL's non-guaranteed contract system works both ways.

    Every year a dozen or more players hold out for a new contract. They simply don't report to camp because they have out-performed the deal they signed 2 years ago.

    I'm assuming you Bears fans are familiar with Matt Forte's contract situation?

    Sure you can francise tag a guy, but then when they hold out, they almost always get the new contract they want.

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