I went on a long twitter rant about finances, basketball decisions, and the luxury tax with the Bulls yesterday, but so far, nothing they’ve done shows whether they’re ready for significant financial commitment or not. The final two big money off-season decisions (Korver/Omer) will determine whether we’re playing as a big market or a small market team.
It’s an emotional topic for die hard Bulls fans with enough cap knowledge. The Bulls have never paid the luxury tax and while a valid reason can be stated for any individual year under the microscope, it difficult to justify the pattern of behavior that covers the past decade when most teams have paid it at least once.
It’s easy to rationalize that Hinrich upgrades Watson, Butler upgrades Brewer, and Teague upgrades Lucas. We can state Hinrich gives the Bulls better decision making, Brewer’s offense never came around, and Lucas was kind of a scrub while Teague has big upside. I won’t go into the individual merits of that discussion, since with the possible exception of Teague [which could go either way], I disagree. However, it’s easy to say Bulls management can legitimately feel that way.
What they can’t rationalize outside of saying “we’re cheap” is not matching Omer. They announced that locking him up was there number one off-season priority. They clearly like the guy. They clearly want him to stay long term. If he leaves then it’s clearly because they would lose out on profit. His high salary won’t be a hindrance to the team outside of that. If the Bulls were to go all in, his final year actually could ADD flexibility as a massive expiring deal to match salaries in a trade and give bird rights to the team receiving him as a quality player they could keep.
There’s also no way to justify losing Korver with no one to replace him with either. There’s no Korver replacement who is better out there for the Bulls to get. If they let him go, nor does dropping him help their flexibility in other areas. It significantly hurts their flexibility to make a trade later.
If the Bulls lose these two players, it will be 100% about the profits. The unbelievably large profits. The Chicago Bulls have a financial dynasty making the most money in the NBA the over the last 12 years [since Forbes started tracking data] and making the most in almost every season. The Lakers with vastly more revenue have passed them a couple of times and with their new TV Deal will likely stay ahead of them [and everyone else] for the foreseeable future.
The Bulls made more money in the last decade while advancing past the first round of the playoffs only twice, the second round only once, and making the playoffs at all only half the time. The additional playoff revenue is huge money, and the Bulls barely dipped into that pie and still out earned a Laker team in a larger market that won five titles over this stretch.
Stop and think about how sickly dedicated to the bottom line you have to be in order to pull that off? It’s truly an amazing feat, and the business side of the Bulls [in complete seriousness] has serious room to puff out their chests and proclaim themselves as complete bad asses. It’s truly a huge accomplishment to make that work. They’ve maintained the highest profit margin in all of US sports over that period of time [they keep the largest chunk of their revenue as profits of any sports team] and have out earned in net profit all but one NFL team despite working with half the revenue.
Through that lens, I tend to get a bit fidgety because while my financial side is legitimately awed and impressed by what the Bulls have done as a business, my fan side is ready to riot over their lack of commitment to spending. Due to that history, I may have gotten a bit judgmental early. I may have ranted before its time.
The Bulls haven’t failed to match Asik [yet] nor have they released Korver [yet]. Perhaps one of those moves happens, perhaps neither, or perhaps both. They certainly haven’t gone “all-in” this off-season though. The Bulls could have done some combination of moves that look like this:
Korver + Brewer + Watson + Hamilton for Joe Johnson
sign Hinrich for the MMLE
Team could then look to sign whomever the best wings it could find for the vet minimum and hope for the best. The team would be significantly upgraded from the previous year, adding another shot creator, quality shooter, and offensive option in Johnson while keeping the rest of the core together.
The problem with that squad? Craploads of luxury tax over the next four seasons. Joe Johnson’s probably on the worst contract in the NBA, and to take that on you would be assuring massive luxury tax payments until that contract is over. The Bulls would be down to the MMLE and draft choices to improve the team going forward, but the talent would have been significantly upgraded and specific Bulls weaknesses would have been addressed.
The Bulls also would remain profitable in that scenario, so while it sounds bad to take on bad contracts, Chicago has the financial resources to do it.
Another “all in” scenario:
Trade Watson/Korver/Brewer for bad salary plus draft picks. At a minimum, we know we could have gotten Gordon + a lotto protected pick from detroit that would be unprotected in 2014. There were likely plenty of other deals the Bulls could have made in order to get draft picks with bad salary back.
Bad salary guy somewhere on the team
2 extra 1st rounders
That team is also better on the court than the present squad and has two additional first rounders they can use to sweeten trades or make things happen. They’d also pay significant luxury tax in order to do that though less than the Johnson scenario above and for fewer years.
Now in both of these cases while the Bulls would pay significant luxury tax, they wouldn’t run at a loss, or break even, or such a number that would drop their profits out of the top five of the NBA. They just wouldn’t be running at the record setting profit margin levels they’ve had recently. They’d be running at levels of a very good business instead of an elite business.
The Bulls are clearly not going with the “all-in” plan because they’ve let go several of their expirings and can no longer bring back as much salary as they once could. However, they aren’t necessarily going with the cheap plan either. If they keep Korver and match Asik, they’ll have put significant resources into keeping the team on par with last years squad while also maintaining some serious flexibility to make something happen at the trade deadline with Korver/Rip’s expiring deals.
I like to ask, “How many teams in the NBA do you think would refuse to run at break even levels when they have an legitimate opportunity to win a title?” So far, it’s my opinion that the Bulls are the only team on that list, and while the ownership groups aren’t exactly the same, you know darn well the White Sox aren’t. Reinsdorf isn’t cheap, he’s just passionate about baseball and would like the Bulls to win.
This is the guy who once said he’d trade all six of his Bulls championships for one baseball championship. There’s nothing wrong with that. If I owned both teams I’d feel the exact opposite with no apologies. People have different passions in life and one isn’t better than the next. In a week we’ll see the writing on the wall. We’ll know the true financial commitment this team is making to winning. It’s already not the most it could be, but it’s not at comically bad levels. Yet.