Pau Gasol - NBA's Scariest Man .. Again
by shrink on Dec 27, 2009 11:29 AM CST
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PrintPau Gasol three-year extension through 2014, at an average of $19 million a year, should worry all NBA fans. At his press conference, Gasol mentioned several reasons why a player would like coming to Los Angeles, like less cultural differences, its an international city, there's a lot going on, and the weather is nicer, especially after the cold east coast road trip. But he left out the biggest reason -- you can get paid.
Maybe the first question NBA fans should ask would be "How big is $19 million?" It's big, even compared to other giant NBA salaries. Next season, $19 million would be a Top Five salary in the NBA -- and while Gasol is very good, he is not a Top Five player. Also, while those five deals are often the high end of older NBA contracts, Gasol's extension averages that much, and its locked in until 2014.
But if $19 million/year is a lot, remember this -- it will cost the Lakers $38 million with luxury tax penalties! This astronomical sum would quickly bankrupt many franchises who are just trying to keep their head above water in tough economic times. The fact that the Lakers can afford it, and still have money left over, should be of concern to fans that want a competitive NBA, particularly the Chairman of the NBA's Board of Governors, Glen Taylor.
Most fans remember when the Lakers acquired Pau Gasol nearly two years ago, it was one of the most controversial trades in the history of the NBA, pointing to the problem of the "have's" and the "have nots." Small-market Memphis was struggling to avoid major financial losses, and traded their franchise player to the Lakers for an expiring contract and two late future first-round picks. This was essentially a salary/talent dump, and while cutting costs and putting the team back in the lottery for a number of years may have fit ownership, Grizzly fans were very unhappy to lose their best player. Many experts feared that the Gasol trade demonstrated that big market teams would be able to poach the best talent from smaller markets simply because they can afford to pay big contracts. Smaller markets would not be able to compete, and be doomed to mediocrity.
Unfortunately, the situation is worse than ever financially, and I expect to see more shocking trades like this in the next right months. Ken Berger from CBS Sportsline writes that net gate receipts fell 7.4% this year so far, and now eight teams make less than $500,000/game, with the PHI, SAC, CHA joining MIN, MEM, MIL, IND and ATL. While the Timberwolves attendance hasn't dropped as much as other teams, they are still near the bottom despite offering many free and low-priced tickets to boost attendance.
However, things are peachy for the Lakers. The Forbes numbers came out last week, and despite the highest payroll and luxury taxes in the league, the Lakers were #1 in operating income, revenue, and in the value of their franchise, which is now over $600 million. While the Wolves make merely $350,000/home game in revenues (not profits), the Lakers make an astonishing $1.96 million -- over five times as much per game! Local TV revenues (within 70 miles) are not shared, so that's a lucrative revenue stream as well for successful big market teams.
Some experts flinched when the Lakers signed Bynum to a $12.5 mil extension. While people can debate whether he's proven enough to be worth it, the Lakers were already securely over the luxury threshold, and retaining him will cost $25 mil. Few other teams could have afford that much money, and normally that talent would have drifted to the NBA's open market. Now the Lakers sign Gasol to a huge extension, and have headed straight over to Kobe to spend more money on his extension. While most teams can barely afford to build a team around two expensive players, the Lakers can afford four, and still have plenty of money left over. While the luxury threshold squeezes nearly everyone, the biggest team can ignore it, and ruin the parity of the league.
Jerry Buss told the media that this signing sends a message. I think he has. The Lakers are open for business, and will use their cash to add or retain expensive players that other teams can't hope to keep. Hopefully, Glen Taylor and the rest of the league will devise a new Collective Bargaining Agreement next year that restores more parity to the league, or the Lakers could become the NBA's version of the Yankees, throwing money at players and buying championships.
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Yes, but...
The Yankees only won one championship the last 10 years and paid how many 10’s of Millions to the other teams? This is a pretty good deal – and I think this could be even better for the NBA.
The Lakers are paying far more in annual penalties than the Yankees did, and they are committing to players who are either aging (Kobe, Gasol, Artest), injury prone (Bynum) or soft (Odom). So that’s 5 years of exorbitant luxury taxes going to teams that desperately need revenue for what – one championship? Maybe two in that time if the injury stars align.
This is exactly what the NBA needed to support struggling teams.
Just exactly what is the rate of that support?
We won’t know how many teams are sharing that pie, of course, but I wonder what the ballpark figure is for how much we rake in from individual signings like this.
"It has come to the editor’s attention that the Herald-Leader neglected to cover the civil rights movement. We regret the omission."
I Don't Blame the Lakers ..
I thought I should also point out that the Lakers are doing nothing wrong by throwing money at these players.
1. They are completely within the rules of the CBA and its soft cap
2. They are a business making moves that have been financially successful
3. They have made decisions to try to win basketball games.
What’s broken here is the current Collective Bargaining Agreement. While its hard to blame a successful franchise for the Lakers, if the current system continues, league parity will suffer, and the competitiveness of the entire league will suffer.
I believe the NBA is far more likely to suffer without more financial parity than MLB.
First, only five players can be on the court at the same time. If one team can put $80 mil on the court, and the other $25, they have a huge advantage.
Second, the NBA is a superstar-driven league.
Third, basketball is not a “game of inches.” Better teams win, which is why a 600 winning percentage is fantastic in basketball, and 800 is great for the NBA. The Yankees can only buy a ticket to the play-offs, and over 162 games, they aren’t guaranteed to win the 7-game series with a .600 WP%. In the NBA, a star-studded team with an .800 has a better probability of winning 7-game series.
Again, like I said, I don’t blame the Lakers. they are taking the best course of action under the current rules for their team and their business/customers. However, I believe for the NBA as a whole, it demonstrates that there needs to be some major readjustment of the rules, not the Lakers.
Well put..
…this is a league wide issue and the Lakers are doing what they should, given the circumstances.
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Reminds me of what a parent of one of my summer-league t-ball kids said
It basically had something to do with the Yankees not being the evil empire just because they pay the players so much money. If the rules allow you to pay your players obscene amounts of money, and you can afford it if you think it will improve your team (usually helping you earn more money), why wouldn’t you? You’d be stupid not to.
If you are in one of those major markets like LA or NY and you are making a profit after all of these obscene deals you sign, then by all means do it if it’s legal and it helps your team on the court and in your coffer. It’s up to the league and the corresponding associations to change the rules to favor parity. I don’t like it as a fan of their opponents, but I completely understand why they do it. Serve you self-interests as much as the parameters allow.
Well put
The Lakers are doing exactly what they should do, to meet the needs of their fans, advertisers, and team. They are trying to be tjhe best they can, as a team and a business, and they shouldn’t be blamed for this.
On the other hand, Jerry Reinsdorf of the Chicago Bulls steadfastly refuses to spend over the luxury threshold, regardless of the large revenues fans are pooring into his coffers. Are they serving their customers best by not making their best attempt to win? Or are they doing just fine by not overpaying on additional talent when Bulls fans will stilll fill United Center?
This is a problem with the rules, not with the Lakers.
Baseball has the advantage
that a pitcher having a good (bad) game/season can have such an impact that it can offset some salary differences.
Gasol might not be a top 5 player
but I think since he’s been in LA he’s arguably been top 5 in terms of value he’s brought to his team. And I don’t mean value in the “bargain” sense. Just everything he’s brought to the Lakers.
So what happens if the CBA changes and the luxury tax goes way up? Like say instead of having to pay double all salary above the lux, teams have to pay 5 times that salary. Would that apply to contracts signed before the change to the CBA, or would those old contracts be ruled by the current rules?
Was Garnett's cap-busting contract grandfathered?
The league hasn’t done that before, and I can’t recall ever even having heard any admission by Stern or his minions that it was even considered.
"It has come to the editor’s attention that the Herald-Leader neglected to cover the civil rights movement. We regret the omission."
In what sense?
It was grandfathered in that KG’s numbers did not reset, but the Wolves got nothing.
KGs full salary counted against the cap and tax. Fairness could have involved it only counting up to the “max” that other players were eligible to get.
by Blond Ricky on Dec 28, 2009 10:24 PM CST up reply actions
No, it wasn't?
The league didn’t do anything to, for the obvious example, count only the “max deal” portion of that previously-signed contract against Minnesota’s cap.
"It has come to the editor’s attention that the Herald-Leader neglected to cover the civil rights movement. We regret the omission."
why can't a salary cap be a TRUE salary cap?
as in, a team CAN’T spend more than x dollars per year on talent?
am i being naive?
I'm not the greatest NBA historian
But I think the issues with Boston signing Larry Bird may have leaf us to a soft cap, ie. There may be a common law precedent that stops the reintroduction of a hard cap
"I tell one of my media colleagues to watch Hollins, who regards cutters entering his vicinity with the sort of startled amazement newborn infants have when their own appendages enter their vision for the first times."
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by Auswolf on Dec 27, 2009 3:09 PM CST via mobile up reply actions
Well, maybe, but I'm not convinced
First of all, it isn’t clear to me how much correlation there is in the NBA between payroll and winning; there used to be very little, maybe it’s increased as teams have gotten more sensitive about where they are in the success cycle.
Second, while the Lakers are spending a lot of money, and apparently can afford to, it is not yet apparent that large markets are inevitably going to dominate. The best teams in the league, both right now, and over the past decade, do not seem to correspond to the largest markets. (See, San Antonio, Utah on the positive side; Knicks, Bulls, Clippers on the down side).
Your argument that it’s a star driven league cuts both ways, it seems to me. Yes, the Lakers are collecting stars (and winning). But it’s always fragile in the NBA, because of injuries. If Kobe gets hurt, are the Lakers the best team in the league anymore?
As to a fairer CBA…what do you want? The players are already paying escrow to make sure that their salaries don’t exceed 57% of BRI. The “have-nots” (and I use quotes there on purpose) collect significant money from the Lakers in tax payments. Somehow the sports business seems to have lost sight of the idea that you have to invest in your business in order to reap success. Glen Taylor SHOULD be losing money on this club—they’re offering a pretty lousy product. Offer a better product.
It’s true that the winning percentages in basketball are very spread out; perhaps too much so for the ultimate health of the league. I’m not sure that money, either revenue or payroll, is the reason this is true, however.
Ultimately, bad teams are going to struggle financially, which I don’t necessarily see as a bad thing. I do think that the league as a whole would probably be a little better off if teams were more clustered between, say, .350 and .650, I’m not entirely clear on how you engineer that. Teams were winning at a .700+ clip 20 years ago too. It may be that today the bad teams are more willing to be truly awful.
by Eric in Madison on Dec 27, 2009 1:53 PM CST reply actions 1 recs
Good post
First, I think that there is a corelation between payroll and the chance to win. This doesn’t mean that a high payroll guarantees you wins, but a tiny payroll probably guarantees you losses. I believe this has been proven in Major League Baseball, and as the differences in payroll become more extreme in the NBA, I believe you’ll see the same thing. The Spurs are lauded because they are the exception to the rule. Last year, four teams has winning percentages about .700, and the Lakers, Cavs, Celtics, and Magic were all over the lux.
Second, I am very much in favor of successful businesses outcompeting others, and reaping financial rewards. However, in business, unsuccessful competitors go out of business. In professional sports, their customers WANT to see the competition on the court. Economic parity also brings some parity of competition. It may seem fair that if the wolves lose, Glen Taylor loses too much money. However, this hurts the Lakers too. Perhaps the Timberwolves franchise folds, or puts together such a cheap team that few Laker fans are going to pay to see their team “compete” against a team that can’t challenge them at all.
Third, you may be surprised that the amount of revenue a team gets is less correlated with a successful franchise than it is with simply the size of the city. America’s biggest cities, LA, CHI and NYK were all vastly different in their NBA success, but they were all in the Top 5 in revenues. When these teams funnel these revenues back into the teams, particularly at a time when most of the league is retrenching, then you set up an unbalanced system that isn’t based on success.
Ok, accepting for the sake of argument that the problem you describe is really a problem
what’s the solution? It seems to me that there are two possibilities:
1. A hard salary cap. The players will not accept this, nor should they, in my opinion. Why should the owners be saved from their own incompetence? More to the point, a hard cap would essentially be a license to print money for the large market owners, who you say earn enough in revenue to overpay. All of a sudden, they are making windfall profits because their labor costs are being artificially held down.
2. Sharing of local revenue. This sounds good, but ultimately it creates a huge problem which can be seen in baseball (where they do this). It creates a disincentive for many teams to put a winning team on the floor. Why try to compete when the yearly check from LA, NY, CHI comes rolling in and keeps me afloat? If I spend a dollar to try to get better, and thus make 2 dollars in extra revenue, that might be worth it. But if I spend a dollar and have to share my 2 dollars, and I’m a small market, well, that’s a less appealing investment. I’d rather not take the risk if I don’t have to.
by Eric in Madison on Dec 27, 2009 5:51 PM CST up reply actions
This is a source if irritation for several MLB owners
who share money with small market teams and then see the money pocketed as profits rather than used to sign or develop players.
Solutions
Thanks for another great post.
I agree that the players would go to war over a hard cap, and I also agree they should. The NBA Players Association has agreed to accept rookie scale contracts, which have been shown to pay less then market, as a compromise for allowing veteran players to exceed the cap. Personally, I think the general system with the soft cap is a good one. If an owner is willing to pay a player despite the penalty, and the player wants that salary, why should they be prevented? There may be some harm to the parity of the league, but luxury taxes not only limit the amount an owner will go over, but generate funds to pay for parity damage.
The problem though is that the 100% tax payment for every $1 over the threshold, and the loss of the lux share, has now become an insufficient amount of disincentive to a team like the Lakers. They will be putting a team on the floor next year that will cost close to $120 mil (with lux taxes), vs a MIN team that will cost about $60. This ruins competition.
I think we’re going to see more (but not complete) revenue sharing. Each owner is an independent businessman, so I sure this rankles them, but for the good of competition, both economically and on the floor, I see no other alternative. Some local TV revenues are going to have to be shared, to help save some of the small market teams that can’t afford even a low payroll. Moreover, if we maintain the same type of luxury structure, perhaps we will see lux penalties go from 100% to 200% or even $300%. I would also propose that after the NBA gets a cut for operating expenses, the lux share is divided only by teams under the luxury threshold. This will put money in the hands of the owners, and making the threshold a much more expensive line to initially cross.
I actually have an idea though it would never be agreed to
First, let me say, I have real problems with direct limits on salary. I know we already have a cap and max salary limits, and those aren’t going away, but I don’t want to see more labor cost restrictions imposed.
I don’t think simple revenue sharing works, for the reasons outlined above; it creates disincentives to try. We want all teams to try to be successful.
Here’s what I would like to see: each team puts money into a pool that is divided equally among all the teams. The amount each team puts into the pool is not a percentage of revenues, however, but a pre-determined amount based on market size and other factors (per capita income; perhaps an adjustment for new arenas, etc.).
In other words, there would be a formula that would require a certain amount from each team regardless of how much they actually make. This has the happy result that teams have an incentive to make money. If they make more than the formula expects, great—they get to keep that. If they make less, too bad, they still have to pay their share.
This idea occurred to me a few years ago (pre-new ball park), when the Phillies, it was reported, were a net recipient of revenue sharing money in baseball. (They got more than they paid). That struck me as nuts: Philly is a big market. The fact that (at the time) they were incompetent in running a franchise should not have been rewarded.
Now, there still might be a problem with teams stripping salary in order to pay their share into the pool; but here’s my idea: if you fail to increase your local revenues for, say, 3 straight seasons, then you don’t get your payout from the pool.
It might be that this idea is too draconian; I don’t particularly want to send anyone out of business. But I like it as an outline, because I want every team to try to be successful, and to have the chance to be. The problem, of course, is that it’s a zero sum game; if there are winning teams, there are going to be losing teams. That can’t be helped.
by Eric in Madison on Dec 28, 2009 9:14 AM CST up reply actions
And a couple of other things
“…a tiny payroll probably guarantees you losses.” Damn straight. It should. Frankly, payroll SHOULD correlate fairly well with winning; the best players should cost the most, and lead to more wins.
I don’t want to see the Wolves fold, by any means. But I will say that the apologist idea that an owner shouldn’t lose money on his franchise makes little or no sense to me. Invest in your product. That’s how business works, last time I checked.
by Eric in Madison on Dec 27, 2009 5:58 PM CST up reply actions
Many teams don't operate in an environment
where they can be even moderately financially successful and field a moderately competitive team at the same time. No amount of investing money will give them success in both areas.
If the NBA doesn’t want so much of the league to be a joke, they need to make it a realistic possibility to be competitive and successful. I think that is the problem the NBA has now. Teams with more money will always have competitive advantages but you don’t want the league to be stratified. That’s bad business for everyone.
A bunch of teams right now are in dire financial straights and have virtually no chance of beating the Lakers under any circumstances. Is it good for the Lakers home attendance to host a doormat? Is it good for the NBA’s TV broadcasts for them to? Is it good for the doormat?
The trick is to keep teams within the same class despite the advantages the big markets have. The Lakers can still be the favorites in all the games they play but the other team should at least belong on the court with them. That isn’t the case with several matchups you could have right now.
Some small market teams can only run with a tiny payroll
Some of these owners simply don’t have a big enough city to generate revenues for anything but a modest payroll. AS attendance declines and fans pay less for the tickets the team is still able to sell, I think teams like MEM and NOH are beginning to realize that spending like the big boys is simply not something they can afford to do. When the Royals don’t win, we don’t blame the owner for not spending like the Yankees.
Some do, especially if you have an owner who has money and hasn’t been willing to tap into that resource. That was a problem with the early David Glass years in KC
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by frankenhoops on Dec 29, 2009 1:12 PM CST up reply actions
I like the idea that unsuccessful teams pay a price
however, ultimately the large market teams NEED the small market teams. There is a reason the NBA expanded by about eight teams since the eighties. The smaller market teams bring revenue to the league as well as competition. Twelve big market teams making up an entire league would not be worth as much because national TV contracts would be almost impossible to find.
Is it the spread, or is it the persistence of those winning percentages?
It’s true that the winning percentages in basketball are very spread out; perhaps too much so for the ultimate health of the league. I’m not sure that money, either revenue or payroll, is the reason this is true, however.
I’m not sure it’s money either, but the NBA does have a problem with competitive balance.
From the point of view of a fan, it isn’t so much that winning percentages have a big spread to them in any given year. I like having dominant teams, and if we couldn’t at least tolerate losing seasons what the heck would we be doing here on Canis? The problem I see is that losing teams remain doormats for so long, and perennial winners seem to rebound from a bad year or two almost inevitably.
The league needs to look at that, but honestly I’m not sure it isn’t just better management. Phoenix is not a huge market, but they’ve always drafted well, and players were willing to go there even when it was among the worst teams. They turned things around inside of a few seasons. Los Angeles is a huge market, and they’ve got both the Clippers and the Lakers — in the same arena — there.
Baseball had a real problem during the era when small-market teams rightly regarded themselves as nothing more than farm systems for New York. The NBA needs to prevent that from happening to its Minnesotas. Or, uh, stop it happening again.
"It has come to the editor’s attention that the Herald-Leader neglected to cover the civil rights movement. We regret the omission."
But Phoenix gave up being a contender over finances
The Suns had their best chance for a ring in 2006-07, when Bob Sarver was willing to spend over the luxury threshold. However, even with a young successful team, and fans filling the arena and extra play-off games, he still lost millions of dollars. On July 20, 2007, he traded a useful, $8 mil expiring Kurt Thomas to Seattle for “nothing” — the Sonics trade exception. This allowed him to cut $8 mil from his payroll and save an additional $8 mil in luxury taxes. So what did trading the useful Thomas cost him, besides competitiveness? He traded the Suns 2008 and 2010 1st round picks. He hurt their present, and their future, because he couldn’t afford to hang with thebig markets over the lux.
Yeah, it's a little like Utah
I think I just said somewhere here, too, that the Jazz were willing to deal Maynor for contract relief. They’d matched Millsap, didn’t make a resulting Boozer trade…. And as a result they had to shed young talent.
Lower-tier franchises are forced to eat the seed corn. Not good for the long-term health of the league. Maybe Phoenix can rebound from those sorts of decisions by continuing to draft well, but if they slip up there’s no margin for error.
"It has come to the editor’s attention that the Herald-Leader neglected to cover the civil rights movement. We regret the omission."
Solid..
…but I am going to (respectfully) nitpick.
I do not think it is fair to to attribute luxury tax penalties to individual contracts. In this article alone you’ve assigned $19M in tax to Pau and $12.5M to Bynum. Yet, the Lakers will ‘only’ pay about $31M total in tax (dollar-for-dollar over the threshold, right?). And, in fact, the Lakers are under the cap when Pau’s extension kicks in, so they aren’t actually committed to the tax then yet (of course Kobe is not signed so…). So, I don’t think it is fair to imply that certain salaries fit under the tax number, but certain ones are the ones a team pays tax on. I mean when Kobe signs for $27M somebody will post ‘and it costs them $54M!’ And then when Role Player X signs for $3M ‘but it really costs them $6M’ etc. It can’t all be true, though each statement is in fact technically correct the implication they cast is not. Like I said, nitpicky, and I understand that if they could magically cut Bynum this year they would in fact save $25M or if they cut Morrison they’d save $10M, etc. I just take (minor) exception to every single contract being doubled when the total tax bill is ‘only’ about a third of payroll.
Again, solid work, I understand the point completely. And, I certainly don’t mean this to be critical of any single person – more of a general statement about how we all discuss this issue.
Because there are no fours.
Toine
I see it as an incremental decision
When the Lakers decide whether or not to extend Pau Gasol, they aren’t deciding whether to pay him $19 mil or not. They already have guaranteed contracts on other players as sunk costs, and are deciding whether he is worth up to $38 mil.
For other teams, it wouldn’t be a question. There’s no way they could afford that much money. But for the Lakers its a legitimate business decision.
Have to agree with CaliWolf
There are ten other Lakers contributing to the luxury tax. Gasol’s signing doesn’t mean they have to pay $19 mil in tax, they may choose to reduce other contracts to compensate. If they don’t, then the luxury tax costs should be included in the other contracts as well. If the Lakers have a $90 million payroll, plus $30 million in luxury tax, then Gasol’s luxury tax contribution is really only about $6 million. Perhaps the greater issue here isn’t that the Lakers can pay Gasol $25 million including luxury tax, it is that they can afford to do so while also paying Adam Morrison over $6 million when luxury tax is included.
Have to disagree with both of you
CaliWolf’s picked nit is legit if and only if they are deciding on resigning more than just Pau Gasol. As it is, the rest of the roster is already locked up long term, in which case, the Pau extension really is as simple as “If we sign him, he will cost us $38 million next year.”
The counter-argument would be “Well, they can’t just not re-sign him!” But for many teams, that’s exactly what would happen. How do you think we have any hope of signing Rudy Gay or Joe Johnson in free agency? By putting a price on them that their teams are incapable of paying. The Lakers have no such price.
For many teams like Utah
The Jazz, when they decided to match the Millsap offer from Portland this offseason, were immediately faced with needing to make a move on Boozer. When they didn’t do it, Utah eventually sent away a nice young point guard in Eric Maynor for the great privilege of unloading Matt Harpring’s contract.
That’s an eating-the-seed-corn sort of decision for the Jazz. The Lakers simply don’t have to make those.
"It has come to the editor’s attention that the Herald-Leader neglected to cover the civil rights movement. We regret the omission."
Not disagreeing with what you are saying
I was just agreeing with the nit pick. You actually sort of make my point. Did Milsap cost the Jazz his salary + the luxury tax, or was the failure to trade Boozer also part of the cost?
OK, so what happens if next summer the Lakers
are able to trade Walton and Vajucic to teams that are under the cap? Does that mean lower the “Cost” of signing Gasol to $27 million, or does the savings apply to the entire payroll? This is why I say that to be correctly allocated, any change of luxury tax needs to be re-allocated to all contracts, and then those contracts judged as to their benefit to the team.
Eureka!
It’s as simple as trading Luke Walton and Sasha Vujacic for raw cap space! I can’t believe shrink didn’t think of that!
I'm sorry. It's just so ridiculous.
If the premise of your question is that some team might be willing to trade raw cap space for Luke Walton and Sasha Vujacic, I’ll probably laugh first and answer second. But I’m done laughing, so here’s your answer:
Yes, if the Lakers’ extending of Pau is only happening because of a concurrent plan to cut salary other ways, then it represents less of a problem to the league. But how are they going to do it? They’ll probably save a few bucks by re-upping Derek Fisher at a lower salary. One of Josh Powell or DJ Mbenga is likely gone. But the rest of their team is either A) Core guys locked up on huge deals long term or B) Role players on undesirable contracts.
So really, the reason I didn’t answer your question the first time is because there is simply no feasible way for the Lakers to cut salary short of giving away Andrew Bynum. If it did happen, then we’d have to reconsider our take on Pau’s extension, but it won’t.
Cut the guy some slack
No point in mocking anyone for just trying to make a distinction. He in no way said it was plausible or likely for those two players to be moved, it was just an example used to ask a relevant question.
Everyone is correct in that Gasol is doing the major lux damage and that there’s probably little future change in the roster that will happen. It’s unfair that they can afford it, yes, but this extension was signed with the other bloated salaries already on board. It is a bad thing that they have that much power, and nobody is arguing that.
But Rumblebee is correct in making the simple statement that essentially it’s a collection of contracts and not just one player. Yes Pau’s contract is the most recent and most weighty, but Rumblebee’s general idea was something worth pointing out. The roster is a long line of contract decisions; even if you can ignore some of them to add another huge contract, it doesn’t change the fact that it’s a composite problem. I don’t understand why it necessitated such a haughty response.
You're right.
I think I let my surliness from the argument I was having further down in this comments section affect my posting up here. My apologies to Rumblebee.
I understand your point
I just want to make sure you understand mine.
When the Lakers decided to extend Pau Gasol, they knew they would be paying more than $19 mil, and it would be more like $38. They still went ahead with the decision.
This is the same with the Jazz. If I recall, they signed Okur, and expected Boozer to stay. they knew if they wanted to keep Milsap, they’d need to pay his salary + the luxury tax. They still went ahead with the decision.
In an NBA with guaranteed contracts, the sunk costs for payroll is not something teams can easily change. So they make the next contract decision knowing that, not saying, “What if we never signed Luke Walton to that over-priced contract.”
I definitely get your point
and agree with the concept.
I was just also agreeing with the other poster that Gasol alone does not cost an extra $38 million. Just as an example (not saying this will happen but it could, the Lakers have about $25 million in contracts expiring this year or next. If those players (or their replacements) cost half as much in two seasons, then the Lakers luxury tax goes down. So then Gasol’s contract would be less than an extra $38 million after next season. That’s why I think it is more accurate to prorate the luxury tax to ALL contracts on the team.
I agree that it is a ridiculous amount to pay a guy like Gasol
but he adds a ton to their team. In a pure basketball perspective, if they don’t resign Gasol, they probably don’t win it all after he leaves. So basically the difference between first and second is $38M… and that is worth it to them. And plus, the guy has earned at least $15M per and that’s being a little conservative. Offering him a slightly higher salary (even though they do hit the lux with it) is not that far out of the realm of realism… I still wish they couldn’t afford it though, then the world would be a lot more fair. But we all know it’s not. And I definitely agree with the fact that management probably doesn’t look at it as if they are paying Gasol $38M. They are paying Gasol $19M and the league another $19M. 19 of it is guaranteed and the other 19 can be reduced or wiped away completely (ok probably not completely). Gasol isn’t a guy to complain about going over the lux for, that is for guys like Walton and I think their management realizes that. I don’t think I made my opinion very clear… so I’ll try once more and hopefully both of them together make some iota of sense to people besides me. I agree that the lux should be split according to each player’s salary and not just the last guy. I don’t think basketball salaries are accounted for under LIFO, it’s definitely a weighted-average approach.
I really dont have a problem with this because
A) The Lakers are my second favorite team and
B) The Lakers arent singing these players as free agents like the Skakees do.
Kobe- Trade with Charlotte like 12 years ago
Fisher- Originally drafted by the Lakers in 96
Odom- Trade with Miami that sent Shaq to Miami
Bynum- Drafted with their own pick
Artest- FA Signing but they only signed him because they chose not to keep Ariza
Ariza- Trade with Magic in 2007, Ariza was devolped by the Lakers
Farmar- Drafted by Lakers in 2006
Now Gasol is the only one where they actually used their “Power” to get.
This all proves that the Lakers are nothing like the Yankees, they actually go out and make decent trades and get their players through the draft.
"A bad day over here is better than a good day over there"~ Jared "The Mullet" Allen
by Percy Harvin My Fav! on Dec 27, 2009 3:48 PM CST reply actions
but ...
… when these players start to cost $10-25 million, other teams can’t simply keep them. Other teams have limited money and need to make choices whether they can afford to keep the player, or they need to let him go through trade or simly not bringing him back.
As you said, the Lakers acquired many of these players when they were younger, and far cheaper. Well, they aren’t young and cheap now.
And
it’s not as if they’re being shrewd and giving only the good players well deserved raises. They throw money at everybody, a policy which has produced some of the most heinously toxic contracts in the league: Luke Walton, Vladomir Radmanovic, Sasha Vujacic, and in the near future, Ron Artest.
Convenient way to frame your argument
The Lakers may have drafted Fisher, but I believe they used the “power” to sign him to a relatively large contract as a free agent. Also, while Odom was acquired by trading Shaq, didn’t they originally get Shaq using the “power”?
Also, their "power" was part of the reason they were able to get Bryant
At least a few teams passed on Kobe because he wanted to play for the Lakers and was aiming to put up a fight if drafted elsewhere. The only reason the Hornets chose him was because they needed a center and knew they could get Divac.
by pagingstanleyroberts on Dec 27, 2009 6:52 PM CST up reply actions
Ah, the delusion of Laker fans.
With the exception of drafting Magic Johnson, the LA Lakers have had all of their success handed to them by unfair circumstances, earning none of it.
The Franchise itself: stolen from Minnesota
Wilt Chamberlain: fresh off an MVP season, traded in a completely one-sided deal to LA
Kareem Abdul Jabbar: forces his way out of Milwaukee to a big market in one of the most lopsided trades ever
Shaquille O’Neal: forces his way there via free agency
Kobe Bryant: enters the draft as a would-be lottery pick, but ostensibly states that he will only play for the LA Lakers, who hold the 25th pick. He gets his wish.
Pau Gasol: Gift-wrapped by a team with major financial woes in a lopsided trade
Andrew Bynum, Ron Artest, Lamar Odom, Luke Walton, Sasha Vujacic et al: signed to giant long term deals with no concern for future financial consequences.
Forgive me for being blunt, but the only way anyone can be a fan of the Lakers is by being ignorant, deluded, or a fundamentally bad person, and in any case, they’ll get no respect from me.
don't forget..
….that the league changed its free agency rules the year that shaq went to la.
Forever splitting the Cheechakos from the Sourdoughs
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Forgive me for being blunt, but the only way anyone can be a fan of the Lakers is by being ignorant, deluded, or a fundamentally bad person, and in any case, they’ll get no respect from me.
Wow. That is just so wrong. I’m a Blazer fan and I’m supposed to hate the Lakers but to completely judge an entire fanbase because of the successes of their front office is just wrong. Believe it or not, there are some good Laker fans out there.
Blazersedge mods suck
Is it wrong? Here's my thinking:
The Lakers undeniably have major, unfair competitive advantages: more money, willingness to spend, nicer weather, a big city, and good history. Because of these, the team will always be good. Where most teams have cycles of falling into the lottery and rebuilding, every time the Lakers have approached that point (most recently in ’96 and again in ’07), something wildly unfair that would only happen to them would artificially push them back into contention.
Now what kind of person, given a choice of 30 teams, would choose the Lakers? I’d say it’s the same type of person who roots for the Yankees, cheats on tests, supports tax cuts for the rich, doesn’t see the merit in earning success, roots for the house in blackjack… in any case, an evil human being. Laker fandom speaks to a fundamental lack of morality, intelligence, or both. Hence my statement, they’re either:
Ignorant – somehow unaware of these circumstances
Deluded- aware, but have convinced themselves otherwise in order to rationalize their fandom to themselves
Fundamentally bad- aware and don’t care
Not to nitpick
but I can think of at least two groups who have a right to cheer on the Lakers without feeling guilty.
1. Those MN fans who actually watched them play in MN and want to cheer on their old team (fan base is getting smaller by the day)
2. People who were born in LA or actually live in LA. Let’s face it, the clippers are horrible and run by a much worse/diabolical ownership group than the Lakers could ever be.
For that matter, I fully expect anyone who was born in NY to cheer for the Yankees. Good for them. I simply reserve the right to cheer against the Lakers/Yankees since I come from good old fashioned puritan Midwest stock. Seriously, any state that does allow alcohol sales on Sunday reserves the right to be a little ornery when it comes to complaining about sports teams.
by TheEvilProfessor on Dec 28, 2009 2:06 PM CST up reply actions
Your nits are rightly picked.
Group 1 is definitely off the hook.
Group 2 is… mostly off the hook. Definitely more so than those not from LA. But I still maintain that indigenous Laker fanbase is among the most fickle and frontrunning in all of sports.
Like NY fans they just have too many options
MN with four pro teams is the same way. Once they aren’t playing well, there are just too many other sporting options to maintain a rabid fan base. But because they are really large cities, the franchises need to spend like that to be prevented from sucking for too long or risk loosing relevance..
by TheEvilProfessor on Dec 28, 2009 3:56 PM CST up reply actions
So what you're saying is...
…that even though they have the resources and ability to field a highly competitive team, that they shouldn’t because there is a few poorly run franchises and it would only be fair to handicap themselves. Listen to yourself. You sound like the idiots trying to run this country into the ground with socialistic policies. Not everything is equal in life. Deal with it.
Blazersedge mods suck
So...
…the 17 million people of the greater Los Angeles area are supposed to just find another team to root for because the Lakers are too good? Your logic is greatly flawed. The Lakers do have some of the most bandwagon fans but so do all good teams. And just because someone chooses to root for a certain team, does not make them a bad person. How you choose to pick a team to root for does not make your morals good or bad.
Blazersedge mods suck
I addressed that in my response to TEP.
If you’re making a choice to root for a team, i.e. the choice isn’t made for you by the geography of where you live, that choice isn’t made in a vacuum. Like any other choice, it says something about what type of person you are. I stand by that.
If you’re going to continue to respond, see if you can do so without misrepresenting my posts via incredulous, exaggerated reiteration. If you feel so strongly that your point of view is correct, you shouldn’t need that crutch.
Like I stated below, the teams you choose to support might say something about your personality but to go as far as judging character by the teams someone follows is just wrong. If you honestly think that because someone chose to support the Lakers they are a fundamentally bad person, then you may have some issues that I can’t help you with.
Blazersedge mods suck
You seem to have an issue I can help you with:
Reading comprehension. (And condescension, but that’s a separate issue.)
To reiterate, I said above that a non-LA-resident’s Laker fandom could be traced to one of three conclusions:
1) They could be simple-minded to have considered the unfair advantages afforded LA.
2) They could be aware, but in denial.
3) They could unabashedly acknowledge the unfairness, but choose to root for the Lakers anyway. In this third case, it absolutely does say something about that person’s character, moral fiber, personality, whatever you prefer to call it.
The people might have character flaws
I too can’t stand front-runners, but I don’t consider them fundamentally bad. You’re probably right in some instances, but it comes down to people that like to watch teams that win. Yeah, it’s lame, but I don’t infer anything about their full moral character or intelligence. Maybe they’re petty or sore losers, but that doesn’t make all of them bad people.
And sometimes it’s just fun to watch excellence. I in no way root for the Lakers, but I like watching good basketball. At their best the team plays some phenomenal basketball. Some people base their fanship on the fact that they can watch a consistently excellent product. Not something I promote, but it happens.
It still blows me away...
…that you consider what the Lakers do to be unfair. All the teams in the NBA, NFL, NHL, and MLB operate by the same set of rules that are decided by the owners and commisioners of each sport. The rules are to level the playing field for each team to compete fairly. Just because one team, say the Yankee’s, decides to spend more money and resources than another team, the Twins, does not mean that they are cheating. Although I do think they need a hard salary cap in baseball, they are still operating by the same set of rules.
Now if one team, like the 49ers, decides to break the salary cap rules, then that is cheating.
Blazersedge mods suck
but it is totally worth it for the
moral fiber line.
by TheEvilProfessor on Dec 29, 2009 12:06 PM CST up reply actions
quote from the movie
“The Girl Next Door” I want to say it was also recently used with some sarcasm in Harry Potter (one of them at least). But mostly girl next door.
by TheEvilProfessor on Dec 29, 2009 10:34 PM CST up reply actions
This is likely indicative
of why this argument has persisted for as long as it did, because I certainly never said that, at least not the way you’ve interpreted it. Yes, the Lakers operate according the rules. It’s not their fault for doing so. But they absolutely do have unfair advantages in spite of that. And without going all the way into detail again, it’s those unfair advantages that make it impossible for me to respect (the majority of) their fanbase.
Ladies and Gentlemen,
the Senator from Wisconsin has the floor.
Forever splitting the Cheechakos from the Sourdoughs
www.canishoopus.com
As rational as your prior arguments could have been
You lose people – rightly so – when you equate advocacy for a fair economic playing field in a professional sport to socialism.
There’s a massive difference between socialsm and a competitve balance. I actually supported some of your argument with JD until you started throwing
“socialism” around like some Chicken Little politician.
I have the same feeling in arguments and the political arena: Even if I disagree with you, I’ll listen to rational discussion. No matter your political leanings, calling JD or Obama a socialist is misguided to the point of absurdity and it’s a sign that you’re giving up on any rational argument. If you’re to that point, just agree to disagree and walk away without looking foolish.
As someone who grew up...
…during the 80s with the Celtics and Lakers, I strongly disagree with your last sentence. ;) It’s an entertainment version of Hamilton v. Jefferson. Who you pick says a lot about you.
Forever splitting the Cheechakos from the Sourdoughs
www.canishoopus.com
Agreed
It might say something of your personality but I wouldn’t go as far as saying it would determine your character. I just don’t like the fact that John Doe is infering that just because someone roots for a certain team, they are a low character person.
Blazersedge mods suck
it depends on why you root for a team
if you feel you have a connection to the players on the team (know one of them, etc) or are a fan of how they play, that’s cool. But if you simply root for them because they are almost always in the thick of the playoff race and you like rooting for a winning team, then it may in fact say something about not just your personality, but your character as well.
I think this is the basic point JD was going for.
by TheEvilProfessor on Dec 28, 2009 7:08 PM CST up reply actions
I agree with JD to a point, but I understand lrh86's gripes
I just felt it was a little too strong and absolute a stance.
it's the american way
we love to root for the underdogs…because we were one, except we aren’t one anymore and we expect competence and dominance. A shrink would have a field day with the US psyche.
by TheEvilProfessor on Dec 28, 2009 8:36 PM CST up reply actions
I'd definitely...
…go as far to saying it is indicative of your character. If someone likes Duke over UNC or the Lakers over the Celtics, they must have been dropped on their head as a child.
Forever splitting the Cheechakos from the Sourdoughs
www.canishoopus.com
transfer immediately, there's still hope
;)
Forever splitting the Cheechakos from the Sourdoughs
www.canishoopus.com
Interesting!
I’m fascinated by this, and I wonder if there’s a paper in this.
Personally, I’ve always enjoyed rooting for underdogs, which makes the Twins and Timberwolves perrenially great teams to endorse. but I’m curious ..
.. what do you think of all the new, passionate Viking fans?
Well I'm a lifelong Packer fan
So I think whatever information you planned to gleam from my response would be useless due to my incredibly biased perspective. It’s probably best if I didn’t even answer.
More Than Meets the Eye?
I wonder if there is more to this situation than we are thinking. Maybe Kobe not signing the extension has really spooked Buss or Kobe has let Buss know that he intends to leave the Lakers. Or my personal favorite of the Lakers getting sick of Bynum and his inconsistencies and they move him to us for expirings and the Charlotte first round pick to us.
Big market teams need small market teams
A twelve team “Big Market” league playing an 82 game schedule would be a tough sell.
There is an unfortunate correlation between market size and team records in most pro sports other than perhaps the NFL. Major League Baseball loves to point out how the Twins are able to compete, and always laud the couple small market teams that make the playoffs. This is certainly true, but deceptive. They fail to point out that of the ten “small market/revenue” teams, about two make the playoffs each year, while about four of the top ten market/revenue teams make the playoffs each year. In other words, big markets are twice as likely to make the playoffs even though a large payroll doesn’t guarantee a playoff spot. I think the NBA is a little better than MLB, but payroll still matters. A better example may be how the Mavericks are constantly able to use Cuban’s willingness to pay luxury tax to trade expiring bad contracts for good players or sign and trades.
One other thing that never gets brought up in these discussions. Why do “Small Market” teams even exist other than national TV revenue. One other big reason, it is to protect the MONOPOLY! The last thing the NBA, NFL, or MLB want to do is lose half their teams because they cannot compete financially. Eventually these towns would form competing leagues. Maybe the leagues couldn’t compete for the best players, but they certainly could get that second or third tier. Also, once established, the league would be a threat to enter the “Big Markets”. For this reason alone the Big Market teams need to contribute to the Small Market teams, it’s in their own best interest.
Ultimately what I think shrink is saying is...
…the NBA’s luxury tax doesn’t level the playing field the way it’s supposed to, because big market teams like the Lakers make so much profit, they can spend whatever they want on their roster anyway.
Whoa
The luxury tax isn’t supposed to level the playing field; that was never it’s purpose. It was not designed or implemented for that reason. It exists to limit labor costs, pure and simple, and at that, it has succeeded. Perhaps not as much as avaricious owners would like, but it has limited salary growth.
by Eric in Madison on Dec 27, 2009 7:39 PM CST up reply actions
Check David Stern's press releases
As well as his list of “things to do” with the new CBA. The luxury tax was definitely intended, at least in part, to level the playing field by theoretically limiting how much a team could or would spend on a roster. The salary cap was intended to limit labor costs, but even that is halfhearted since it only applies to the roster, not operating costs as a whole, and contains several exceptions.
The league has a system which distributes excess profits among the teams in the league, which is intended to help balance a big market team with a small market team. But as shrink has pointed out, it’s not really working.
I think the new CBA
will add another level to the luxury tax. Instead of remaining at $1 for every dollar over the threshold, there will be a 2nd threshold (say ten million dollars higher) where the tax will become $2 for every extra dollar spent. This will allow well built teams to keep their nucleus together, but teams like the Lakers, Mavs, and Knicks that want to use their advantages will have to spend more money to do so, and thus think twice.
A harder soft cap?
I like it. Not all that different from the baseball version (increasing percentage of tax based on number of “violations”).
Stern certainly favors a hard cap
He wants to eliminate salary exceptions, most notably the MLE, from the next CBA.
I like your idea too, Rumblebee
I think a leveled lux tax would also be easier to implement.
With 14 teams over the lux right now, saying that they had to pay more would, especially now, would be a tough thing to get them to vote “yes” too. However, if the vote was that teams $20 mil over the lux had to pay more, you might see a 29-1 vote, with the Buss family being the only ones saying “nay.”
So how should it be?
The only system that makes sense to me is one based on winning. Imagine this:
All team revenues are shared (including local television) – “The Pot”
All teams receive minimum revenue “sharing”, say, $20M
The remainder of The Pot is doled out based on team wins
Players receive compensation based on contributions – 57% of BRI split by win shares or playing time
Thoughts?
Where on earth did you get those ideas?!?
That’s a highly rational solution and as such has no place in a discussion of sports.
Instead we should continue to focus on individual stars and market inequality until the sport is completely broken and then make minor adjustments that are mostly cosmetic.
I think history is squarely on my side in this one.
Cool idea.
But then how does free agency work? Are players just stuck with whoever drafted them, never gaining control of where they go?
Actually, that doesn’t sound half bad.
Hmmm... Not sure about free agency.
How about there are no contracts. Everyone is a free agent at the end of the year. From a player perspective, you want to play on a team that offers you the best chance to win, AND obtain the highest % of those win shares. For the player, striking a balance between team performance and personal contribution is paramount. A premium is always going to slant towards winning teams. Just ask yourself, what would Marx do? ;-)
That's no good.
Beyond the obvious problems of way too much player movement/lack of continuity, doing it that way would make the big markets king. If franchise is a blank slate every year, the first choices will always be the cities with the best weather/highest populations.
Very interesting
Rewarding success seems like an obvious thing to do, but its not so simple. Let me give you an eye-opening example.
A few years back, I volunteered to work on a committee for my school district that assessed the effectiveness of programs. As you know, the federal government’s “No Child Left Behind” rewards schools for success in funding, or a black stain that may hurt reputation and funding. The schools wanted the students to do well on the standardized tests.
However, the State of Minnesota takes the opposite stance. They believe if the students do poorly, then there is a problem, and that’s where they should send the money!
With two seperate tests, schools beat the bushes and truants to get low-performing students taking the test MIN test, but looked the other way when it was time for the federal test.
As an outsider, it horrifies me, but I can see the point of each side, even when they hold completely opposite views. If we establish a competitive system that gives successful teams more money, wouldn’t they be able to spend that money and become even more successful? Conversely, would a struggling team lose out on the revenue it needs to fix its problems?
I don’t know what the right answer is here. I would enjoy seeing Jerry Reinsdorf to start sharing the revenues he’s getting from big Chicago, and not reinvesting in his team.
There is no way around these opposing philosophies...
…Unless a single mechanism controls the purse strings, it sounds like the system is doomed to failure. A case could be made for either the carrot (monetary reward for high performance) or the stick (low performance receives assistance), but, like you, I see no real difference as long as there is consistency throughout.
In basketball terms, a “No team left behind” program could only improve upon the current state. Economics dictate that scarcity of resources lead to trade-offs. If competitive parity is the end-goal, the tipping point must be brought within an acceptable range.
That analogy has a flaw in it...
Speaking as a MN school teacher, comparing helping students in public schools to whether a pro sports team succeeds within its league rules is a bit misleading. Schools are not for-profit businesses and our ‘product’ is not widgets or wins, but hopefully well-educated, functional young citizens. To those here who may feel that schools need to compete more to get better, I work in a highly-rated, but very rural school district. There are plenty of options for both outstanding students and struggling students in my small town, but the public schools in small towns are the most viable option for the largest group of people. That said, I also agree that the advantages teams like the Lakers have over teams like the Wolves is immense. The winner of the NBA is rarely a fluke team or a team that gets hot at the end of the season, like it can be in MLB or the NFL. I have no good idea on how to address that imbalance, but the league cannot ignore it entirely. Way too many people already feel the league is fixed.
My favorite part about that is that
Stern doesn’t seem to get the fact that the reffing is horrible. I saw better more consistent reffing during the preseason with the replacement refs. Look how much more the wolves got to the line with those refs versus the old ones not giving the wolves the same benefit of the doubt. It’s just frustrating.
by TheEvilProfessor on Dec 28, 2009 3:24 PM CST up reply actions
A few comments of my own
Incentive-based Salary should be king. Incentives could even be paid out of an NBA pot. For example, if you win the MVP, a 1.5M prize comes along with it. Everyone who wins the championship receives a ring and another .25M a piece (make it too much and players will flock to the best teams). You get .75M for ROY. You receive money for acharity for every vote you receive for awards and so on. Then have team incentives like for PGs: If you average over _apg or C and PF over _rpb etc. Teams could also add an additional incentive for winning the MVP or making the allstar game if they chose to (which would probably make more sense than having the league reward them). By adding a few more incentives to each contract, you could cut down on the number of “contract players”, “injury-laden teams”, and bad contracts in general. Basically if you don’t live up to your side of the deal, we don’t owe you anything. Players shouldn’t be paid for their historical value, but for their current contributions and this is a good way to do this. I know it’s already an option, but incentive-contracts should become the norm with a “non-incentive” salary cap at about 10M per player or so.
Have a league-income profit sharing for each team up to a certain amount (so the Lakers, et al don’t get a distinct advantange)
Actually, how about we just combine with Milwaukee and call ourselves the Minnesconsin Timberbucks
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