Blog Entry

Weekly Post-Ups

Posted on: January 29, 2010 4:25 pm
In addition to what Mark Cuban recently promised would be the “biggest party weekend in the history of the United States,” All-Star weekend in Dallas will mark another important milestone: The beginning of critical negotiations on a new labor agreement between NBA owners and players.

The two sides have met informally and have been exchanging financial and other data for several months. The massive gathering of league and team officials in Dallas will present the first opportunity to begin exchanging proposals. One thing that can be assured is that both sides should expect some sticker shock.

One executive involved in the process told that the owners seek to take a huge bite out of player salaries, and that one method under consideration would be to drastically reduce the length and amount of max contracts. The official, who spoke on condition of anonymity, said targeting the highest-paid players would serve two purposes: It would unify the vast majority of players who don’t make the current max – which is expected to start at about $15 million annually for players signing new deals next summer – and it would wipe out the owners’ financial losses all by itself.

“They need us more than we need them,” the executive said.

I’m not sure I agree. While there is little question the system needs to be changed, owners have to remember that fans pay to see stars. A certain segment of ownership, according to the executive, is prepared to argue that players like LeBron James, Dwyane Wade, and Chris Bosh enjoy millions of dollars in endorsement income by virtue of playing in the NBA. Take away the NBA and its platform, and you take away the superstars’ ability to make money.

“If they don’t like the new max contracts, LeBron can play football, where he will make less than the new max,” the executive said. “Wade can be a fashion model or whatever. They won’t make squat and no one will remember who they are in a few years.”

If those seem like harsh words, get used to it. The tone of negotiations aimed at avoiding a lockout is only going to get uglier. The owners are unified, the executive said, and determined to crush the union on this one.

There are many ways to solve the NBA’s financial problems, and my guess is that owners will have to look beyond the superstars to get this done. In many cases, it isn’t the superstar signings that get teams in trouble. It’s the ill-advised mid-level deals that wreck the cap because teams reach for seemingly affordable free agents who push gently against the luxury tax line but, over time, cost far more than they’re worth. The Knicks have had among the highest payrolls in the NBA for a decade and they haven’t signed a big-ticket free agent since Allan Houston and Chris Childs. But they’ve had more than their share of Jerome Jameses.

So with that in mind, we get to the rest of the Weekly Post-Ups:

Tracy McGrady is splitting time between Houston and Chicago, where he’s working out with trainer Tim Grover while he hopes for a trade that would extricate him from the Rockets. With a league-high $23 million salary, suitors are seeking the same thing the Rockets would get if they simply keep T-Mac and let his contract fall off the books – cap space for next summer. According to a person familiar with the situation, the Knicks, Sixers, and Wizards are the most persistent names linked to McGrady, with the Bulls becoming a less likely destination with their improved play of late.

• Other names on the “hoping to be traded” list are Indiana’s T.J. Ford and Oklahoma City’s Etan Thomas, who both have fallen out of their respective rotations.

• Though Utah’s heightened level of play would seem to lower the urgency to trade Carlos Boozer to get below the tax line, don’t be surprised if the Pistons re-enter the fray before the Feb. 18 deadline. Joe Dumars had been planning to go after Boozer had the power forward opted out of his contract last summer, and the Pistons are internally mulling what to do with Tayshaun Prince and Richard Hamilton.

• A potential swap sending Brendan Haywood to Portland – discussed here a few weeks ago – indeed has risen to the discussion level. But it will take some time for the Blazers to extract more realistic offers for the $6 million big man, who could help any number of contenders.

• The Sixers have been among the most active teams in the trade grapevine, and who could blame them? With Elton Brand, Samuel Dalembert, and Andre Iguodala, team president Ed Stefanski has $120 million he’d like to divest himself of over the next four seasons. Moving any one of those players would be a start, but Iguodala appears to be the most attractive piece for a team seeking wing scoring for the stretch run.
Category: NBA

Since: Oct 11, 2006
Posted on: January 30, 2010 9:40 am

Hello Overseas Leagues

Much as the owners would like to posture about how important they are, this will mark the first time ever, in any pro US sport, that overseas leagues will be able to offer competitive compensation to our stars. Stern's growing of basketball in Europe and China might become his Frankenstein if they start snagging superstars after the owners institute a cap that an Italian or a Greek team can compete with. Consider this: the Euro is worth about 50% more than the dollar. That in itself is a huge financial advantage when paying an NBA star. You are giving him 10 million euros, but it's 15 million dollars. Europe's economy is by and large much more stable than America's right now, and that looks to continue another 5 years.

And imagine the star power that an Olympic or highly-regarded athlete would bring to a European team. If  they're willing to overpay for Josh Childress and even -chuckle, chuckle - Starbury, what do you think they'd dish out for Dwayne Wade?

I doubt it would be a LeBron James or Dwayne Wade to make the first superstar pond jump. But Amare Staudemire? If the cash is there, why not.

Owners and Stern just better be careful that they don't forget about competing basketball foreign markets when they nail down this agreement.

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