Opinion: Sports: Sympathy for the young NBA millionaires
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It’s no wonder the NBA season is in jeopardy. It’s not so much that team owners are digging in their heels and demanding that players receive 12% less of the basketball revenue pie than they did under the last contract. It’s that the players union is being asked to save the owners from themselves.
This sort of thing is familiar in sports collective bargaining. Free-spending owners from big markets drive up the cost of top talent, eventually leading the rest of the owners to complain that they can’t afford their payrolls. That triggers a fight between owners and players about salary caps and pay scales, while owners fight amongst themselves over how to share revenues.
NBA owners have a lame revenue-sharing arrangement, and they’ve been working for months on a plan that would move more money into smaller markets. The talks with the players would be further along if a better revenue-sharing deal had been worked out in a previous contract negotiation. Instead, the two sides are trying to solve two problems -- balance-sheet issues and parity issues -- at the same time.
If we can trust the owners’ accounting, it’s clear that the league’s problems can’t be solved simply by more effective revenue sharing. Collectively, the 30 teams are spending more than they’re taking in. It’s also clear that the biggest expense -- more than half of the average team’s costs -- is in player salaries.
So the owners want to cut the players’ share of basketball-related revenue from 57% to 50%, and to make it harder for the likes of Jerry Buss to exceed the salary cap. Assuming total team payrolls of about $1.6 billion last season, based on figures reported by HoopsHype.com, the reduction sought by the owners would cost players about $200 million. The more rigid salary cap, meanwhile, would make it difficult for teams to keep more than one superstar on the roster at full pay ($13.6 million to $19 million last year, depending on how many years the player had been in the league). That would be bad news for Laker fans.
One look at the HoopsHype payroll is enough to explain why owners are so eager to lower the lid on payrolls. The teams with the 10 highest salaries all made the playoffs. Stars are expensive, and the teams with the most stars tend to be the ones playing deep into the extra rounds. But it’s worth noting that some of the most successful teams in the league lately have been those who’ve resisted the temptation to overpay for talent, or who have loaded up on younger players with lower salaries. And of the four teams with the lowest payrolls, three made the playoffs.
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-- Jon Healey
