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Blog Entry

Hard cap could mean hard times for small markets

Posted on: July 4, 2011 12:05 pm
Edited on: July 5, 2011 9:37 am
 
Posted by Royce Young



NBA owners want a hard cap. It's probably one of the three biggest reasons we're stuck in a lockout right now. Owners want a hard cap, or at least one they're trying to disguise by calling it a "flex cap," and the union has basically said they will never, ever accept a hard cap.

And when the hard cap topic is brought up, people always wonder how a $55 million hard cap would affect a team like the Miami Heat. Between Dwyane Wade, LeBron James and Chris Bosh, those three soak up about $47 million on the Heat payroll. And that's just for 2011-12. In 2013-14, that number will be about $58 million, so even the suggested $62 million "flex cap" the league talked about would leave the Heat only $4 million to fill out their roster.

The super-together, we're-a-real-team Mavericks? Yeah, their total payroll added up to nearly $90 million last season, third highest in the league. That's about $30 million over the current salary cap but because it's a soft cap, it was fine. (Fine in the sense it didn't break any rules, but still, pretty outrageous.)

The feeling though with this hard-cap business is how much it'll affect teams like the Lakers, Heat, Bulls and Knicks. Now their greatest assets -- money and market -- don't mean as much because in a hard-cap system, signing multiple big contract stars just isn't an option. Victory for the small markets, right?

I'm not so sure about that.

I wonder about a team like the Oklahoma City Thunder, one of the smallest-market teams in the league. The feeling is that a hard cap would help smaller markets compete because talent would get distributed a bit more evenly throughout the league. With teams unable to pay a bunch of guys on the roster $15 million or go $30 million over the cap line, either players would have to take a serious pay cut or go somewhere else.

Except in the case of the Thunder, a straight hard cap would destroy them.

Kevin Durant just signed a five-year extension that will pay him around $16 million a year. Russell Westbrook, an All-Star point guard at the age of 22, is eligible for an extension and would probably have it if there weren't a lockout. He's probably a max player or close to it. So that would be another major mark on the cap for the Thunder. Then the other guys -- Serge Ibaka, James Harden, Eric Maynor -- are all eligible for extensions next summer.

If the league has a stiff cap of even $60 million, how can the Thunder dream of re-signing these guys and keeping the core intact?

Answer: They can't.

That has been Thunder GM Sam Presti's plan since Day 1, though. He wanted to draft a bunch of young guys and let them grow together. Let them progress, develop and become a team all together. And when they did, lock them all up long-term and have yourself a contender for the next decade. It has worked. The Thunder just went to the Western Conference finals with one of the youngest teams in the league and should be in the mix for at least the next five.

Unless of course they have to let a couple of their big pieces walk.

Last season the cap was set at $58.04 million and the Thunder were one of only five teams under that number. While a lot of smaller markets prefer not to bust into luxury tax territory, most likely OKC would be there after those key pieces were extended. So while they're under now, that probably wouldn't be the case in the future.

Reality is, a hard cap might have more of an affect on the little guys, which is who the league wants you to think it desperately wants to protect. But basically, with a hard salary cap system, building through the draft and letting a core grow together is no longer the way to go. Put together a roster with five good players that need extensions and you're out of room after three. Maybe you can get four, but how do you add another nine guys to fill out a 13-man roster?

What we might see is the Maverick Plan instituted as the way to win in the NBA. Now again, they totaled nearly $90 million, but I just mean the idea. Grab one star player and fill in the rest with a couple rookie-level contracts and a bunch of aging veterans willing to take $5 million or less. The Mavs had one star and everyone praised them for it. But in a hard-cap world, that might be best philosophy.

Because a team of Durant, Westbrook, Harden and Ibaka probably can't exist just as one of LeBron, Wade and Bosh can't. Doesn't exactly seem right, does it? The idea is a hard cap would help restore some competitive balance and the bigger markets wouldn't be able to just dwarf the small ones by going $30 million over the cap like the Mavericks did. The Thunder would never do that.

At the same time, while the playing field might be leveled in terms of payroll, it could come at the cost of breaking up the band and redefining how a small-market team must build.

Every team that's using the draft to build -- which is the sound and socially blessed way to structure a team -- would have to reconsider. The Cavaliers might've just committed 80 percent of their future cap to Kyrie Irving and Tristan Thompson if those two pan out. Same for the Jazz with Enes Kanter and Alec Burks. The future for those teams might be just enjoying the four years you get with them on their rookie contracts and then choose one to keep. I don't really think that's what the NBA has in mind, but that's going to be what happens. Small markets probably will take the brunt of a hard cap much harder than the big ones. Or at least the good small-market franchises that understand how to build.

Who knows what the NBA landscape will look like when the dust clears in this lockout mess. The players have taken a hard line on a hard cap and supposedly will refuse to back down. The owners though are committed in their efforts to get one. Yeah, it'll reduce salaries. Maybe the system will stay the same but just instead of Harden getting a $10 million-a-year extension, he would get $6 million. That's possible.

But this is the NBA and just because a new salary system is in place doesn't mean the league doesn't have impulsive general managers that are ready to snatch away a player like Harden and give him that $10 million a year simply because they know the Thunder can't go that high. That'll be the world teams operate in. One where the Thunder Way is no longer the blueprint for small-market building success.

Maybe the players have a point, huh?
Comments

Since: Sep 4, 2007
Posted on: July 6, 2011 5:35 pm
 

Hard cap could mean hard times for small markets

You don't see it because you don't understand business.   When there are 30 teams in a professional sports league and a hard cap doesn't exist the players will ALWAYS be overpaid and it's not the owners fault at all. 
And yet I own a successful business!!  Players dont set market value the owners do.  Just like a business owner does not pay more for an employee than he makes in profit, the same applies to the NBA player. If you dont like the salary demands you hire someone that will take the salary you offer.  If you cant compete then you sale your business to someone that can.  Simple business 101.  At least you finally admitted it.  You are a bigot.  Unfortunately for you, even with a hard cap the uneducated, usless human beings will still make more in one season than you can in a life time.  Yet you will still pay for the sport in one way or another.



Since: Jun 25, 2009
Posted on: July 6, 2011 4:58 pm
 

Hard cap could mean hard times for small markets

But how do you take a player with a history of subpar performance and pay him 5-10 million?  I just dont see the business sense in that at all.  

You don't see it because you don't understand business.   When there are 30 teams in a professional sports league and a hard cap doesn't exist the players will ALWAYS be overpaid and it's not the owners fault at all.   It's called competition... there will always be 5 or 6 owners out of 30 that will do anything to win.  Everybody else has to follow or they don't have a chance and may as well as fold their teams and do something else with their money.   How do these big market teams steal players?  By overpaying them... how can small market teams convince somebody to stay?  By overpaying them before a big market team does.... a hard cap prevents those 5 or 6 owners that bully the rest from overpaying.....

By the way, I would much rather have the eduacated and sometimes brilliant owners walking away with my money before these NBA players do.... call it prejudice call it what you want but the NBA players are the most uneducated and useless human beings in all of sports.  They called it "ghetto ball" for a reason.... 



Since: Jun 14, 2009
Posted on: July 6, 2011 1:25 pm
 

Hard cap could mean hard times for small markets

What the idiot who wrote this article fails to mention or realize is that current salaries and contracts would be scaled back quite a bit in the event of a hard cap, much like they did in the NHL.



Since: Sep 4, 2007
Posted on: July 6, 2011 11:05 am
 

Hard cap could mean hard times for small markets

I hate to say, however, I believe most of you are missing the point. I think owners and fans are sick of players getting big dollar contracts as free agents and not performing. 
Then dont give them big dollar contracts.  If the owners were truly sick of this and not merely greedy they would not offer such large contracts for marginal players.  I can see if a player almost wins the MVP and you sign him only to see him lay down the next season.  But how do you take a player with a history of subpar performance and pay him 5-10 million?  I just dont see the business sense in that at all.  The owners and the fans are not in this together as the owners would have you think and some fans believe.  The owners are playing off the fans jealousy.  They want you to think its the players that are greedy and how dare they not be grateful that they get paid to bounce a ball.  While you all get worked up with indignation the owners are laughing all the way to the bank with your money.  Come on.  You have to be smarter than to fall for that.



Since: Jun 25, 2009
Posted on: July 6, 2011 9:52 am
 

Hard cap could mean hard times for small markets

Actually you are wrong. There have been more than 3 different champions in the last 13 years. 

Yeah...I already corrected myself but thanks for the post anyway.  And I said in my next post that whether it's 3 or 6 doesn't make a difference.  Eight of the last 13 championships are by the same 2 teams....  the NBA needs to change... and the NBA will change.  There will be no season next year and there will be a hard cap when they come back.  Then and only then will there be some parity and small market teams will actually have a chance to win anything and fans willing to spend money in small markets. 



Since: Mar 22, 2011
Posted on: July 6, 2011 5:33 am
 

Hard cap could mean hard times for small markets

Actually you are wrong. There have been more than 3 different champions in the last 13 years. 

99, 03, 05, 07 Spurs
00, 01, 02, 09, 10 Lakers
08 Celtics
11 Mavericks
06 Heat
04 Pistons

That makes six, NOT three. 



Since: May 4, 2011
Posted on: July 6, 2011 1:05 am
 

Hard cap could mean hard times for small markets

I really don't agree with all this small market big market talk, if a franchise has good ownership and a GM with a plan and a good eye for talent you can build a contender. Look at what Utah was able to do with Stockton and Malone, Seattle had a good run with Payton and Kemp, Sacramento was a Chris Webber injury away from winning a title when they had clearly the best team in the league that year, and we all know what Cleveland did after drafting Lebron. It can be done but owners have got to be smart about knowing when to unload their stars if they won't resign. Just think of the kind of talent Cleveland could have gotten for Lebron. It's always been my opinion that winning is what attracts talent not a market, the bright lights are cool but any star worth calling a star wants championships. Small market teams need owners committed to winning, a proven GM who can evaluate talent and who's not afraid to pull the trigger on some big trades, and last but not least good coaching someone with the support of his franchise the owner on down. If they can do that small market teams have as much of a shot at the title as anyone.



Since: Jun 25, 2009
Posted on: July 6, 2011 12:26 am
 

Hard cap could mean hard times for small markets

 That mean the Bulls (98), Spurs (99, 03, 05, 07), Lakers (00, 01, 02, 09, 10), Pistons (04), Miami (06), and Boston (08) are all franchises that won championships in the last 13 years. Learn how to count.

Sorry, I mis-read what I was looking at.  So you say 6 teams have won in the last 13 years?  Big deal....  The Lakers and SanAntonio have won something like 8 of those 13.... yeah, that's awesome for everybody else, especially the small market teams.  The bottom line is the NBA needs more parity... if you haven't noticed people have lost interest.  The league is not nearly as popular as it used to be and is losing a ton of money......



Since: Jan 22, 2011
Posted on: July 5, 2011 11:32 pm
 

Hard cap could mean hard times for small markets

I love how sportswriters take one example to try to make their point, ignoring the countless other examples of small market teams who can't compete. The reason they generally can't compete is because not every egomanical superstar is like Kevin Durant and genuinely wants to stay in a small market.   Will 
the players have much of a point when they lose fifty-some jobs due to teams folding without a flex cap????




Since: Jul 5, 2011
Posted on: July 5, 2011 10:35 pm
 

Hard cap could mean hard times for small markets

You are a fool. In the last 13 years, only three franchises have won? Well let's see.... This year was the 2010-2011 season. Subtract 13 years and you are in the 1997-1998 season. That mean the Bulls (98), Spurs (99, 03, 05, 07), Lakers (00, 01, 02, 09, 10), Pistons (04), Miami (06), and Boston (08) are all franchises that won championships in the last 13 years. Learn how to count.


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