Viewing a single comment thread. View all comments

VinylJones t1_j4i2f0g wrote

Reply to comment by SteelyBacon12 in UFC releases heavyweight champion Francis Ngannou from contract, strips him of title by HeStoleMyBalloons

NBA isn’t nearly at volume for those models to apply, and I think the current issue (if there is one from the player perspective, aside from the brutal schedule and wildly varying officiating quality they don’t have a ton of complaints) isn’t with the structure of contracts or the overall wealth distribution amongst them (we’re seeing $140 million contracts given to year 2, year 3 players already…and not high draft guys) it’s the distillation of league capital amongst markets.

There will never, ever, be a population that can support an Oklahoma City franchise the same way a population can support a New York franchise…and it’s bad. My team is worth $7.5 Billion - putting them in second behind the Dallas Cowboys in team valuation amongst all North American sports - and a team like the Pelicans are worth about $1.6 Billion; that essentially means the Pelicans are physically incapable of earning as much as the Warriors in a business capacity, which means ownership groups will never have the ability to spend on salary. The salary cap in the NBA is soft, it effectively does not exist when someone like Joe Lacob takes a several hundred million dollar hit in luxury taxes every year with a smile and a trophy in his hands. So right now it’s not the inability of players to get well paying contacts, it’s the lack of earning potential in individual markets and a massive disparity between the ones at the top and the rest of the league in terms of spending potential whilst still turning a profit. The owners have painted themselves into a corner.

2

SteelyBacon12 t1_j4i6ob7 wrote

My thought experiment for “how player friendly is a league’s salary structure?” is basically trying to imagine what would happen if owners were banned from violating otherwise applicable labor laws (an example of such a violation would be dictating to employees who they have to work for through a draft). So I’m not sure I’d agree that the distribution of league capital is really separable from overall compensation, but I’m also not sure if you’re really arguing it’s a separate issue or not.

It seems to me that, as you observe, some owners have a willingness to spend money to win games that goes past the cap. It also seems somewhat obvious to me that, in addition to proving the salary cap is porous, such free spending owners prove that there is large unmet demand from owners for “winning.” Surely if Joe Lacob is willing to pay salary plus luxury tax, he would be willing to pay the same total amount in pure salary. Therefore I assume that (at least current period) NBA comp would rise without a cap.

The long term problem is related to the one you highlight in that, under my thought experiment, the league probably becomes even more top heavy than it is already especially with respect to major metro areas. It also become vulnerable to boom/bust overspend cycles. This may be bad for the league overall long term and bad for future players.

I’m also not 100% sure whether the luxury tax gets spent on salaries or not by teams below the cap. Like it doesn’t seem like it does necessarily but I couldn’t figure it out googling while watching wildcard games. Cheers!

1