The NBA model the owners are proposing is the way to allow teams to compete and avoid financial troubles coming soon. We can´t say there´s no need for that system, "they just have to be financially sound", because that does not exist. Nowhere I know. Once there are no rules about spending there will be an arms race, and then you die quickly if you don´t spend or you die slowly if you spend. How things are rolling in Euro soccer is a good example. Give this a read: european soccer eating itself
You have to take into account that in Euro soccer there is a hierarchy in competitions, and teams can lose their spot in the best ones if they are among the 3 worst teams in any given season. Losing that spot has serious consequences in their economies, so there´s big pressure to spend even for small market teams.