The 2011 NBA Lockout

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Well, true believers, the 2010-2011 season is coming to a close, and as the current collective bargaining agreement between the players union and the league expires, all eyes will be turning onto the upcoming lockout.

We’ve been thinking about it for a while now. The blame game and name-calling has been going on for a long time and tensions are high. In 2009, a NBA executive called NBA commissioner David Stern’s first CBA proposal to the player’s union “a photocopy of Stern’s middle finger.” So, yeah. Negotiations are going to be heated.

Sports writer Charlie Zegers does a great job describing the situation: “At its heart, this dispute is about money…the owners think the players are getting too much of it. The players are pretty happy with their share of the pie, and aren’t about to give any back.”

With the US going through one of the worst recessions in recent history, two-thirds of the teams in the league are crying that they’re losing money and veering into the red.

The owners are arguing that they’re losing money because players are taking too much revenue. Currently, players take 57% of all basketball revenue, but as Zegers puts it, “When [the owners] spend additional money to promote ticket sales, etc., they eat into their own share of the pie but the players don’t take the same hit.” The league would rather have the players take closer to 40% of the revenue.

Jeff Zillgit of USA Today described the problem like this: “The NBA says the system is broken, predicting a loss of about $350 million this season. Among changes the owners want are a hard salary cap, a significant reduction in salaries and a reduction in guaranteed money.”

The hard cap would be like the one the NHL and NFL have with their players. Currently the NBA has a soft salary cap, which means teams can pay a higher salary if they want to re-sign their own player.

The hard cap is intended to reduce salary inflation. As Zegers describes it, “The players’ argument against the hard cap is fairly simple. No one is forcing [the owners[ to sign Drew Gooden to a five-year, $32 million contract, or give Joe Johnson a deal that will pay him over $20 million a year when he’s 35…The owners’ motivation, though, is equally simple… When the Bucks gave Gooden that deal, it set the market for moderately-talented rotation power forwards at $6 million per annum. What happens, then, when Blake Griffin’s rookie contract expires? He’s gotta be worth two-to-three times what Gooden is making, right? One bad deal can cause league-wide inflation…While the ‘hard cap’ concept doesn’t resonate with the fans, even casual observers of the league can see the insanity of Joe Johnson — a good player, but no one’s idea of a superstar — making $119 million over six years.”

But the players aren’t going to accept a CBA like that without a fight, and they haven’t accepted the idea that these negotiations are coming because of a problem with their salary. Zegers writes, “After all, if NBA teams are such money pits, why did the Warriors sell for a record $450 million last summer?”

Instead, players feel the current CBA is a good one, and that the recent season has actually had better ticket and merch sales. So, with the players and the league both digging in for a battle, we are, in all likelihood, heading towards a lockout.
 

But not everyone is so pessimistic. In January, NBPA president Derek Fisher felt that a lockout wasn’t necessary and negotiations could move forward smoothly without the need for drastic measures.

Deputy commissioner Adam Silver has also gone on record saying that a lockout “isn’t inevitable”, and that an agreement could be reached before June 30. According to him, “”It’s not a function of time. It’s a function of movement by the parties. From the league standpoint, we believe we made a compelling case to our players why there needs to be reductions in salaries.”
Well, maybe, just maybe, things will turn out all right.

But if the worst happens and there is a lockout, life will have to go on. According to Zegers, “At this point, a lockout is a virtual certainty — but that just means the league will shut down operations after the NBA Finals, until a new CBA is in place. Depending on how negotiations go, the first casualties will be the 2011 NBA Draft and the summer leagues. The longer discussions drag out, the more cancellations we’ll see.” It might even lead to a lockout like 98-99, which saw a 50 game season.

Zegers also feels that a lockout might be a chance for players to find work overseas: While most players won’t be able to sign on with FIBA due to league rules, free agents like Andrei Kirilenko can play where they like. Ditto for 2011 rookies like Kyrie Irving, who are not going to want to get involved with the NBA during a lockout.

As for the NBA teams we know and love, the players’ worst enemy may be themselves. Historically, some players haven’t been the most scrupulous savers, often living paycheck to paycheck. When their ten million dollar income suddenly vanishes, they’ll be at the mercy of the league.

That’s why players like Toronto’s Reggie Evans have been trying to crack down on their teammates’ spending, to get them ready for something like this. ““Save your money,” he said.”What’s your excuse? Just to get a car and show the neighborhood, ‘Look, I got a car’? Sometimes you’ve got to do the smart thing: Stack that money, save that money, because we know there’s going to be a lockout. You don’t want to be sweating no bullets when them bills are coming.”

That’s sound advice. Because, the bottom line is, for some players and their spending habits, this lockout could be a long and expensive one.

COMMENTS

Latrice at 23 Aug 2011

I was seriosluy at DefCon 5 until I saw this post.

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