It is a dark time for the Players Association. Although the salary cap is greater than expected and player power is at its peak, Stern’s troops (the owners) have driven the Players Association from their seat of power and pursued them across the league.
Evading the dreaded Collective Bargaining Agreement talks, a group of players led by LeBron James has established a new, not so secret, base in Miami.
The evil deputy commissioner Adam Silver, obsessed with cost cutting to make the league profitable, has dispatched owners and league accountants into the far reaches of the NBA…
On Thursday October 21, Commissioner David Stern announced that the league and its owners will push for a 33 percent reduction in player salary. This announcement comes after Stern said that there was no quantifiable progress in the collective bargaining talks throughout the course of the summer. It seems as though players overlooked a decision that really matters.
The drop in salaries that Stern is looking for is in the range of $750 million to $800 million. Profitability is the end goal for the league and cutting the salaries, the NBA spends roughly $2.1 billion annually on player salaries and benefits, is a solution to the projected league-wide losses of $340 million to $350 million this season. At present, the players receive 57 percent of the league’s basketball-related income. A salary decrease along these lines would drop the player’s share to 48 percent. Therefore, the $350 million deficit would become a $350 million profit.
Who can really blame Stern and the owners for wanting to cut player salaries after the gaudy excesses with which the players treated themselves this summer in terms of max contracts and shifting league power? The competitive balance of the league has come under much scrutiny over the past couple of years and there seems to be no resolution of the issue in sight. This summer only proved that there are now even greater rifts between the haves and have-nots.
Not surprisingly, Billy Hunter, the executive director of the players association, does not support the league’s proposal. He feels that limiting the players’ salaries is the wrong way for the league to go about its financial restructuring. Despite his and the players’ objections to the league’s recent proposal the NBPA has not offered up any alternatives or compromises other than calling for expanded revenue sharing between owners.
Contraction has also been mentioned as a possible step for the league to take to regain profitability. That alone expresses how serious the league is about righting its financial books. The players and the union certainly will not want to see this happen. The fewer number of teams there are in the league means that there will be fewer contracts for players to earn. This step, however, would also hurt the NBA’s regional fan bases. Less profitable teams would be targeted during this process which would leave cities such as Sacramento, New Orleans, Toronto, and possibly Indianapolis as possible NBA dust bowls or worse joining the ranks of Seattle, the Alderaan of the NBA. No one wants to see this take place.
Yet, people outside the league continue to question the league’s stance that it is not profitable in its current construction. Season ticket sales, where teams generate much of their profits, are up considerably this season. However, according to the NBA, the efforts to generate these high sales are far too expensive because of built-in costs. An increase in revenue sharing would help the smaller market teams compete with those in larger cities. On paper this seems to be a good solution until you insert two variables into the equation: the New York Knicks and the San Antonio Spurs. New York is the largest market in the country and yet the Knicks have been one of the league’s most uncompetitive teams for the better part of a decade. This is in part because of mismanagement but it goes to show that large market teams are not always better. The Spurs on the other hand are considered a small market team but have won four championships over the past 11 seasons. Clearly revenue sharing is not the only solution.
Essentially, the owners and the league want to spend less money and have performance based fail-safe’s on their investments while the players and the union want to keep things as they are. The Players Association is in trouble. More and more are their actions being seen as impotent and they keep falling back when Stern takes action. They threatened to sue the league over the new technical foul rules but what case do they really have to make on that issue? It was a laughable threat at the most. Time is running out and they must get something done to remain relevant.
The CBA expires on June 30 and both sides hope to come to an agreement before then to avoid a work stoppage. Commissioner Stern, the owners, and the league have played their hand and it is strong, or so they would have the players believe. It is up to the players and their union to decide what to do from here until February’s All Star weekend, which has been deemed by both Hunter and Stern as the unofficial deadline to reach an agreement on the new CBA. Hunter has said that the union is prepared to strike but how much would that really help their cause? If anything it would forfeit all their bargaining power. The ball is literally in the players’ court.