Breaking Down the Big Ugly Lockout

Nate, I know you enjoy a good intelligent debate; so this posting is for you!!!

Apples-to-Oranges
Comparison has been made between the recent NFL and NBA lockouts. I was more pro-owners on the NFL lockout; but I am more pro-union with the NBA. Reading my recommended goals at the bottom, I’d say I actually came in somewhat in the middle (give here, give there).

I believe NBA franchises are losing money and system reform is necessary. Where I differ, is my belief that much of the lost money, in the NBA, is a result of bad management rather than out of control player salaries and the economy; though these also play factors. Small market status didn’t get in the way of Sacramento being a contender a few years ago.

The Union
I wonder if the players union erred in taking a status-quo position. This has put them on the defensive on almost all fronts. Since negotiations are give & take by nature, they don't really have a platform to negotiate from; other than trying to not lose too much.

The Owners
Rather than "Hawk & Dove" or "Clueless and Have a Clue" in this posting I will group the owners by the following; Deliberately Cheap & Neglectful Owners (DCNO) and, Actually Gives A Rat's Azz (AGARA), and, the others.

AGARA owners I regard as those who are dedicated to trying to win. During the collective bargaining agreement (CBA) negotiations I enjoyed Mark Cuban's refreshingly honest approach where he said he would prefer the salary cap to be lower because that means he would spend less money. But if the cap is higher he said he's ok too; regardless of the cap he would squeeze every last nickel's worth of spending to deliver a title contender.

DCNO owners are those who are ugly deliberately cheap owners, those who truly do not care about team success and those who wouldn't mind the CBA to go nuclear; many of those owners also happen to own NHL franchises and believes the charred cinder that had become the NHL a few years back is the right move to go with the NBA. Poster children for this group include Donald Sterling, Robert Sarver and Enos Kroenke.

And now, The Issues

Contract Length
Maximum contract length of 4 years for players re-signed by their own teams (currently 6 years) and 3 years for players joining new teams (currently 5 years).

Perspective - I have no problem with this. Part of the mess the league is in is due to really bad and really long contracts to players not worthy (Eddy Curry, Kenyon Martin) plus even big dollar contracts to star players whose skills deteriorate much earlier than their contracts (Tracy McGrady).

If I Was the Union - I'd accept this; if I got what I wanted in other areas to make up for it.

Limiting Bird Rights (and the Melo Rule)
The owners are trying to introduce changes to the Bird Rights to further limit player movement.

Perspective - A tool for owners to suppress movement of players that have earned those rights by time served in the League. The owners want to label this the Melo Rule. Manipulation and intimidation by the franchises was what turned the trade into such a drama; not the player’s desires. Adding the Melo Rule, all that does is turn players into Deron Williams; force a team to trade you a year earlier. Trying to remove the sign-and-trade is only another method to try to restrict player movement which I would not be in favor of.

If I Was the Union - Tough Call; but I would hold for status quo and believe the issue falls by the wayside as progress is made on other issue.

Mid Level Exception 
$5.8 million to $3 million with a maximum contract length of two years.

Perspective – I agree with the contract length; but not the amount. For the non-stars, the MLE really is the bread & butter of free agent movement and probably should be going forward.

If I Was the Union - Agree to 2 years; but set the maximum contract amount to $4 million. Players who finish their 2 year MLE should then qualify for Bird Rights.

Amnesty
On the last amnesty, the amnestied money did not count on the tax, but still was part of the cap.

Perspective - In support of this; it's a win/win; players get paid and owners wanting it will get relief. Players can sign with another team or just disappear in the mist if they either are not able or not willing to play any longer.

If I Was the Union - Accept the amnesty if the amnestied money no longer counts against either the cap or tax.

Cap Reform 
I appear to be in the minority on this matter; but I’ve felt for a long time reform is needed if the league ever cares to introduce fiscal sanity in the NBA system. Neither steamrolling cost cuts or maintaining status-quo deals with the goal to provide a means for sincere owners to operate effectively without runaway spending and circumventing the rules. With the DCNO owners, sadly you can’t make them run a franchise in a sincere manner.

Two primary areas I see for reform are contract buyouts and injury exceptions. Both are facts of life that often times handcuff a franchise either by exploding spending over the cap and tax; or paralysis of action for fear of cost overruns.

Owners have insurance on players. If a player has a major injury the team gets insurance money back to cover the player loss. An Injury Trade Exception can also be available. Some owners choose to not use the trade exception but also pocket the insurance money; straight profit for the owner and the team & fans lose twice. Contract buyouts also occur, but the money does not fall off of the cap & tax even though the player is immediately able to sign elsewhere. Again, teams and fans lose twice (lose the player / cannot replace the player).

Perspective – I would address Injury Exceptions and Contract Buyouts. Injury Exceptions would be two-fold. 1) Players acquired via Trade Exceptions should not count against the cap, or at least not against the luxury tax. With agreed upon shorter contracts, this becomes less of a risk. 2) If a team chooses to not use an Injury Trade Exception they should not be allowed to cash in on the Injury Insurance money; though I would give on this point.

I would push for Contract Buyouts not counting against the cap; or at least not counting against a tax.

If I Was the Union – Change so insurance exceptions and buyouts no longer count against the cap; or at least against the tax.

Luxury Tax
Proposed - A luxury tax of $2 for every $1, then $3 for every $1 for hitting the tax line three times in a five-season span, and then $4 for every $1 for teams that stray beyond the tax line five straight seasons.

Perspective - Owners want this but also fight revenue sharing. This smells more like the DCNO owners wanting to pawn this off on the players because they can't win their argument with the AGARA owners.

If I Was the Union - Fight to keep status-quo. If other matters get resolved smartly, then this issue loses some relevance.

Free Agency

Interestingly, changes to free agency has not been brought up.

If I Was the Union – I would keep same framework in place; especially in light of other changes.

Contract Opt Outs

This is one subject I am in agreement with the owners ... somewhat. Throughout league history there have been horrible contract signings ... long term high dollar contracts.

Perspective - Except for cases of legitimate long term or career ending injury, players who benefit from these horrible contracts should not be exempt from change. If anything, the Eddy Curry’s of the league is where the biggest reform should take place.

If I Was the Union – Implement both team and player contract opt outs every two years of a contract.

Salary Cap
It had fallen under the radar a bit by the BRI; but this seems to always be an agenda headliner by the DCNO owners; a smaller cap, a harder cap, a cap with a straight bill rather than curved, a cap with a propeller on the top that spins in circles with the wind.

Perspective - Revenue is up but the cap must go down. Shortening the cap or hardening it makes little sense unless the owners are willing to address their failings through reform; such as handling of bad paper. Shorter contract length helps but owners in the real world still need to take responsibility for their mistakes.

If I Was the Union – Agree to keep the cap number similar to what it is today. Much of the runaway costs would be addressed with shorter contracts, shorter/smaller MLE. Give & take is needed. Not in favor of a hard cap unless the cap is higher and other reforms to remove bad money off of the cap are implemented.

BRI
This has been talked to death; 57, 47, 53, 43, 51, 49, 50, 50, no no nooo. That the players should have a smaller slice of the pie I think is fair; that the players should totally flop down to 43% I disagree with. The players are the product. If the owners want to spend less, they should expect a lesser quality product and in turn charge the fans less for a lower quality product. Of course that's not the case; though some owners may fantasize of paying the LeBron’s only  $2M a year, raise ticket prices and the cost of parking, nachos & beer (if they could get away with it of course) pocket all the money and never let any player move on their own.

Perspective - I believe resolution of this would be a byproduct of dealing with the other matters, rather than vice versa.

If I Was the Union - I think 53% is reasonable. If the owners want a true 50/50 then in turn it should be for the whole pie, including the slice the owners skim off the top before splitting with the players.

Contract Roll Backs

Look forward, not backward.

Perspective – Write this off as the price of doing business. If you don’t like the paper, amnesty or buy the player out. In turn you get shorter contracts, smaller MLE & opt outs to avoid bad paper in the future.

If I Was the Union – No opt outs.

Franchise Tag
Though not mentioned recently, I do suspect this is still on the owners wish list. Depending on whether and how bad they beat the union, don't be surprised if the owners try to push this through.

Perspective - A Franchise Tag is a bad thing. It is a bad thing in the NFL and will be just as bad of a thing in the NBA. This tag would give the DCNO another tool to generate more revenue by forcing to keep a player on the roster while refusing to invest in improving the team around him. This would have been Melo last year and Blake Griffin in a few years.

If I Was the Union - I would refuse this and fight it strong. It would be a bad tool to impact the players and have a trickledown effect to the rest of the roster.

Union Decertification
Major trap here; thankfully the agents finally understood just what the risk is and stopped trying to sell this to the players.

Perspective - This isn't a magic Ace card in the union's sleeve. The DCNO owners would love the union to de-certify; then they could take the argument to court and claim since the union was de-certified by the players all agreements as part of the union are now null and void ... including player salaries. And, it is distinctly possible the owners would win this argument in court and the NBA truly does go full nuclear.

If I Was the Union - Stay away from this unless the rank in file truly is prepared to lose everything in trying to win their argument.

Goals for Agreement:

Contract Length – Agree to 4yr/3yr
Bird Rights and the Melo Rule – Agree to no change
MLE – Agree to $4m/2yr annual MLE with player Bird rights after the 2years
Amnesty – Agree to 1x amnesty contingent on amnestied money does not count against the cap or tax
Cap Reform – Agree to positive reforms in areas such as Injury Exception, Contract Buyout and such

Luxury Tax – Agree to current luxury tax in place today
Free Agency – Agree to current free agency framework

Contract Opt Outs – Agree to player and franchise opt-outs every two years

Salary Cap – Agree to plan similar to what is in place today
BRI – 52/48, 51/49, possibly even 50/50 dependent on successful agreement on the other goals
Contract Roll Backs - No

Franchise Tag – No

Union Decertification - No