Union, NBA not softening on hard cap stance
Tuesday September 13, 2011 10:06 PM By Alan Hahn
Dan Gilbert emerged from the board room today at The Palace Hotel in Manhattan wearing a satisfied grin. I wondered if it was the first time he'd been able to smile since a certain "decision" was rendered over a year ago.
You also have to wonder if the Cleveland Cavaliers owner would be as adamant about installing a hard cap system in the next collective bargaining agreement if a certain Akron-born superstar opted to stay home. The Cavs were willing spenders when LeBron James was wearing wine-and-gold. That was about building a championship team around a superstar and Gilbert, to his credit, returned every dollar of revenue he made off LeBron and put it back into the team.
Now, with no star to cater to and a notable loss of revenue as a result of LeBron's departure, Gilbert believes in equality. With a franchise that is losing money with a young, rebuilding roster, he desperately needs equality.
And the NBA, despite a record-breaking season of interest that was mostly spawned by the rise of big-market superteams such as LeBron and the Miami Heat and Carmelo Anthony and the Knicks, believes Gilbert is right.
Out of five hours the league and the union spent in collective bargaining, three of them -- three of the five hours -- were spent apart. The NBA owners caucused for that time to discuss how to address the union's opposition of a hard cap system. In the end, the majority rule was that a hard cap had to be in the deal.
And while it's impossible to believe that the major market owners in New York, Los Angeles, Boston, Chicago, Dallas and Miami are willing to kill part or all of a season to get it, that is not expected to change.
Stern said the league returned to the bargaining table opting to make no response and and put the onus on the union by saying it "didn't make sense for us to respond to their non-negotiable demands."
And after yet another uneventful large-group collective bargaining sessions, NBA deputy commissioner Adam Silver zealously addressed the hard cap issue to the gathering of scribes.
"We've had this discussion," Silver said. "Teams that are able and willing to pay the tax are at huge competitive advantage over teams that are unable or unwilling to pay the tax. And that's not how our system should operate."
Union president Derek Fisher has taken offense to the suggestion that money is the only reason why he has five NBA championship rings with the Los Angeles Lakers, a big-spending team which happens to be, according to Forbes, the NBA's second-most valued franchise. Fisher has routinely argued in these meetings that the Lakers had to earn their titles with hard work, dedication and the confluence of good management, coaching and talent.
"We don't mean to take anything away from [Fisher's] multiple championships, but it's a critical issue," Silver said. "And a GM who is given $100 million to spend as opposed to a GM who is given $50 million to spend is at a huge competitive advantage. And that's something we want to fix in this deal."
Perhaps someone might want to point to both the Scott Layden and Isiah Thomas Eras in New York to prove that money can't buy you happiness. And a soft-cap system can, and has, punish you for bad decisions.
But David Stern instead tried a more political approach to the campaign: he mentioned the fans.
"Not only are the teams at a disadvantage, but the fans of the $50 million team are at a real disadvantage," he said.
[As one fan pointed out to me on Twitter, if that's the case, shouldn't it work in reverse, too? For example, if a major market team is restricted in how much is can spend, shouldn't it be restricted in how much it can charge?]
The players feel they are at an even greater disadvantage, however, in a hard cap system. As NBPA executive director Billy Hunter pointed out, a hard cap system means less security for a majority of the players. It means only lottery picks and superstars will get multi-year deals, while the middle class will bounce from team to team each season on one-year deals.
The NBA has made it clear they want a hard cap and odds are they will eventually -- season or no season -- get it. But for a man representing over 400 players, that isn't something you concede three weeks before training camp is scheduled to open.
Despite the pessimism that permeated the board room where the union -- Hunter, Fisher and seven other players who make up the executive committee -- met the media with hangdog expressions, there actually was an element of accomplishment revealed. The sides seem to be moving in the right direction on the economic side of the negotiations:
1. Hunter said the players were ready to give back even more of their percentage of the Basketball Related Income (BRI) in the next deal. But the players would not move on that if the league insisted on a hard cap system.
2. Stern said the league has discussed a revenue sharing plan that would be triple the amount from the previous CBA, but he would not reveal that system to the union until a system is in place.
Even some of the debate over the hard cap system is a matter of semantics. Hunter said the union isn't fundamentally opposed to a hard cap because, he said, they would accept a hard cap with an astronomical 65 percent share of the BRI. In other words, set the hard cap at a ridiculously high number that only a few teams could afford to hit.
The league, meanwhile, has on the table a system very similar to the NHL's hard cap, which would involve a "mid-range" based on the BRI percentage (in this case it would be $62 million), with a negotiated range that includes not only a "cap", but a "floor" as well. For instance, if the league and union agreed to make it a $16 million range, the cap on a $62 million mid-range would be $70 million, with a $54 million "floor" that teams would have to spend up to.
For reference, at the start of last season, there were seven teams that had a payroll over $70 million, while there were nine teams under $54 million.
In the end, this is likely the system we'll see in the NBA in the next collective bargaining agreement. The NHL has had some glitches -- to circumvent the cap, teams can offer front-loaded 10-year contracts, which creates a collection of unwanted contracts in a few years -- but with seven Canadian teams, they need a system that allows them to compete with their U.S. counterparts.
And it should be noted that in the six years since the NHL killed an entire season to get this hard cap system, four major market teams -- Anaheim, Detroit, Chicago and, most recently, Boston -- have won the Stanley Cup, while only two small market teams, the Carolina Hurricanes and Pittsburgh Penguins (who happened to have the best player on the planet) were the other winners.
The reality of a hard cap will likely be in discussion Thursday in Las Vegas, where the union will hold a meeting to update its membership. It has to be sinking in even now. When a reporter asked the group if they think the NBA will ever come off the hard cap stance, Roger Mason Jr. muttered, "Never."
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