The NBA Lockout: It’s Painful

Posted: October 27, 2011 by Kodi in NBA

Who’s to blame for the NBA Lockout?

What exactly are these people arguing over?

Is there anybody that is getting the short end of the stick?

Or are these millionaires/billionaires just a bunch of drama queens?

We all know that the NFL and the MLB postseason dominate October but it feels like something is missing. There is, most people wouldn’t give a shit and I may be one of them, but October is also the month that NBA teams start their preseason. With the start date around the corner, November 1, we all know that the first two weeks of the NBA has been cancelled but is there hope? This is still Barack Obama’s America and we all know he had a basketball hoop installed at the White House.

The NBA is in a Lockout and although the league isn’t nearly as popular as the NFL the issue doesn’t seem to be as concerning to the general public as the latter’s similar problem this summer. The world was going to end before the fans allowed the NFL to cancel games, even preseason, but why don’t people care as much about the NBA? Is it because fantasy basketball fails in comparison to fantasy football? Is it that the NBA is in a slump with fans?

I can understand that fantasy basketball isn’t nearly as entertaining to some as fantasy football is but most fantasy football managers don’t play fantasy baseball. It doesn’t matter how popular the NBA realm is with fantasy players because it is still one of the most popular sports for gambling in the world. Some people think that the NBA is in a decline of popularity but that is a myth.

The NBA is currently enjoying the same success that it did throughout the 1980’s when it had stars like Magic Johnson, Larry Bird, a young Michael Jordan among others. Now the NBA has Kobe Bryant, LeBron James, Dwayne Wade but also have international stars like Dirk Nowitzki, Manu Ginobili, Peja Stojakovic, Yao Ming and Pau Gasol who have boosted ratings worldwide.

So why the hell are the NBA Owners and Commissioner David Stern and the NBA Players Association butting heads and ultimately rolling the dice on whether or not we will have a 2011-12 season? Money. Obviously the most important thing to all of those who are involved isn’t if they can play or watch basketball but how much money they can garner from the sport they supposedly love.

First we must understand what a lockout means for the NBA and what is or isn’t going on during this process. Basically the NBA has closed its doors with their employees, the players, but have left the avenues open when it comes to coaches, trainers, sales and advertising. Ultimately the players and their representatives can have no contact or communication with any other employee associated with an NBA team or the league. That means no contracts, no free agents, no trades and no use of team facilities and those who discuss the lockout or terms publicly may be fined up to $1 million.

The biggest links in this lockout change is definitely the financial revenue split between the players and owners and the collective bargaining agreement. The old CBA expired at midnight of June 30 and now the NBA, its owners and the players must now renegotiate key aspects of that CBA. The biggest hurdle is the split of basketball related income, BRI, which was 57/43 in favor of the players. What is comical about the situation is that for the first time the NBA must return escrow money to the players to ensure they get closer to 57% of BRI in the 2010 season.

Every year escrow money is withheld from all NBA player’s paychecks during the season. The escrow funds totals 8% of each NBA players contract for the year to ensure that the players do not exceed 57% of total BRI but this year for the first time since the CBA of the 1998-99 lockout the players BRI paid to the players were less than 57%. That means that the $160 million that was withheld from players contracts are to be returned to players. The average NBA salary is $5.7 million and a player with a similar contract would receive a rebate for $456,000 while a player who made $16 million will get back $1.28 million and a player with the league minimum contract of $473,604 would get $37,888.

The NBA and its owners want a more even split in BRI between themselves and the players because 22 of the NBAs 30 teams have combined for a loss of $300 million. The owners feel that this imbalance between teams shows that there is a necessity to change key concepts from the old CBA to agree on a new CBA. The players feel that this disparity shows a need to increase an aggressive sharing of revenues among teams and were disgusted by an offer from the owners that would have ensured the players annual compensation to reach $2 billion in the next 10 years. The players countered that offer with one of their own reducing their share of BRI to 54.3% which would have reduced salaries by $500 million over 5 years.  Over the last few weeks the two sides have negotiated for a near 50-50 split of BRI but there are many other issues being used as bartering tools to come to an agreement.

Another huge hurdle for these two sides has to do with a luxury tax proposal that would punish teams that spend a lot of money and discourage them from paying players exorbitant contracts. The owners would love a hard salary cap like the one imposed in their first CBA proposal but have continually shifted towards a soft or flex salary cap but the players feel this restriction would act similarly to a hard salary cap. The NBA would limit the rights of players by forbidding teams to exceed the salary cap to pay their current players. The owners new proposal would also restrict teams that are over the cap from using mid-level annual contracts to sign a player on a year by year basis.

The owners have however agreed with the players on a starting salary for the mid-level contracts. The NBA and its owners had previously proposed a $3 million salary but the negotiations led to a $1.8 million increase. They did differ on the length of contracts for such players as well as the percentage increase but the players have agreed to drop the length of such a contract from 5 to 4 years although the owners were hoping to barter it down to a 3 year contract.

The owners though that they could get that deal down to 3 years by creating a bonus pool of money for young players to reach incentives based upon their performance. The idea is to allow young stars who are outperforming their rookie contracts to gain access to lucrative extensions for winning Rookie of the Year, making the All-Star team and other accomplishments. In the old CBA rookies were unable to renegotiate until they had completed their 3rd professional season and wouldn’t go into effect until after the 4th year of their contract.

The amnesty clause could be one of the final obstacles that the NBA and its players must negotiate, which determines how long teams will have to pay players the money they owe him. The proposed amnesty clause would give teams the ability to drop one problematic contract at the conclusion of the NBA lockout and allow that team to remove three quarters of that contract to come off of the salary cap. That player would become a free agent and the team who cut him would have to pay 25% of his annual salary but would it be over one season, two, five or even 7? The owners hope that the bought out player would be paid over a longer period of time, while the players and their union clearly would like that debt paid off as soon as possible.

It took less than two weeks from the June 30 official lockout date for some of the NBA’s biggest stars to start contemplating playing overseas publicly. The NBA and its players didn’t meet until August 1 and at the end of the meeting Commissioner David Stern told reporters that “I don’t feel optimistic about the players’ willingness to engage in a serious way”. The two sides have had such a difficult time negotiation that they needed to bring in a mediator but there has still been minimal progress. David Stern announced that another two weeks would be cancelled and there seems to be little hope of having even half of an NBA season.

The NBA had a similar issue in 1998-99 when they were in a lockout and the season was shortened to 50 games, the NBA All-Star game was cancelled and the league’s popularity took a hit. Stern, the owners and its players do not want to let this affect their sports popularity but it may already be too late. The NBA season was supposed to officially start next Tuesday, November 1st but we may not have basketball until Christmas or later, or not at all. There have been lengthy negotiations between the two sides over the past few days and there was a glimmer of hope that a full season could still be salvaged. That is not a likely scenario now and NBA fans may be left hoping for a season similar to ’98-99.

This NBA lockout is ridiculous, millionaires fighting with billionaires about money. In all likelihood the people playing in this league came up from the streets, where their standard of living wasn’t near the extravagant lifestyle they have become accustomed to by playing a child’s game. I don’t care about the players or the owners but rather the fans who spend their hard earned money to support this greed.  More importantly I care those people who depend on the NBA for their mediocre jobs, cleaning up stadiums or serving fans, those are the people that are truly suffering. The NBA its owners and the players need to think a little more about those people whose lives are truly being affected not by the 12th man on an NBA roster that makes over 10 times what a concession worker does. There should be some sort of compensation to those who are losing their jobs and forced to look for other work because these millionaire basketball players and billionaire owners. Get your shit together, split up the money, get your asses on the court and entertain the world, that is what you’re paid to do right? Fucking drama queens, all of ’em.


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