Time for some new leadership?
by gunballs on Jul 9, 2011 9:13 AM PDT
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In growing more and more dissillusioned with the NBA around the lockout I wanted to put this question out there to see what people think. I don't know the issues of the lockout nor do I really care. I work in social work and have watched people around me loose their jobs, watched needed services get cut, and their is no relief in sight. The unemployment is demoralizing across the country. Yet NBA players, who daily display vulgar forms of wealth, are striking? I know the prevailing attitude is to be supportive of obscene wealth under some kind of banner of freedom or the divine order of capitalism, regardless of the cost to a disappearing middle class, does exists. But I don't get it.
Just tired of it all and feel we need new leadership all the way around in the NBA. Bill Hunter seems to fight for things I don't agree with, including current lockout. Derek Fisher has been one of the bigger floppers and manipulators of officials in the NBA. Granted it's a limited view, but it's what I got, and I wouldn't be surprised if he plays a similar role in negotiations. David Stern has reached the point that he is viewed as the one time hero whom has turned tyrant. The truth is probably somewhere in the middle, but I this point I think the perception has become enough and it's probably time to step aside.
Ii apolagise for this being more about politics than basketball.
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Yay, lets take money away from the workers so their bosses can have guaranteed profits!
Because guaranteed profits is what the owners are fighting for, if you did happen to care about the lock-out issues. Of course, it is easy to take a hard line stance if all you have is ignorance.
I know the wealth displayed by the players is more visual than that of the owners – they are in fact entertainers living celebrity lives, while the owners are business people – but they are also huge creators of wealth. Without the players, the game wouldn’t exist, and neither would the 4 billion revenue it generates – yet the owners feel the players shouldn’t see their market value, and should accept a smaller slice of the pie THEY are playing and dedicating their lives for.
There is no excuse for owners demanding guaranteed profits. There is not a single industry, especially an entertainment industry, that has been set up to guarantee everybody makes money. People need to make good business decisions, they shouldn’t be allowed to both be incompetent and successful. The owners are asking for something that has never existed within the sport, let alone outside of it, and unless you believe they are entitled to reduce player salaries to line their own pockets, I don’t see how you can NOT side with the players.
Plus, if you spent any time figuring out what was going on, you would realize it isn’t the players striking. The owners are LOCKING OUT the players, meaning the owners are refusing to let the players play (even under free market practices). The players aren’t trying to get more money, in fact, in negotiations, they have offered to take a smaller share of revenue than any other major sport, and a significant drop from what they got in the most recent CBA.
Please, learn about what is going on before throwing condemnations at people.
by Sir.Ludo on Jul 9, 2011 9:33 AM PDT reply actions 1 recs
Right
Yes I’m ignorant of the issues. I’m not that invested in who did what. As with anything else that takes more than one party to accomplish, I’m sure the responsibility is shared.
But thats not really my point. I’m speaking more to the belief that culturally people value a sense of entitlement more than they value sacrifice. Your heated defense that players should be after every penny they are entitled to is kind of proving my point about the values at play. It’s an argment of perspectives of which you have yours and have mine. I’m not sure what their is to get upset about though. It’s a post on a fansight of one person’s opinion.
So should the players be happy to be making less than their market value?
Should the owners rightfully deny the players any penny they are entitled to, if their goal is guaranteed profitability?
Let me set up an example for you: I own a lemonade stand. I invite you to work at for me, and we split any money we make 50/50. We make $20, which should be split $10 and $10. However, I come back to you and tell you that because I bought some Nike shoes while I advertise (instead of my flip flops), that you are going to have to take a pay cut. Now, you have earned every penny of that $10 selling lemonade, and I had unsound business practices – buying expensive shoes when it was above my means and unnecessary to do so. But I tell you, since I am the owner, I want to guarantee that I make a profit, even if tomorrow I decide I want to buy a bike and advertise riding around instead of walking. Would you take a pay cut so that I can run my business however I want and still end the day with money?
If anyone is feeling entitled here, it is the owners, feeling entitled to guaranteed profits. The players have already sacrificed, willing to bring BRI down to 54% instead of 57% (while most sports are above 55%). The reason one should learn about issues before making strong opinions is so that you understand why each side is doing what they are doing. Honestly, if you still don’t feel like you should educate yourself before taking hard line stances against one or another party well… I suppose you are free to do what you want, but your opinion is worthless (to me).
by Sir.Ludo on Jul 9, 2011 4:26 PM PDT up reply actions 1 recs
exactly. The author of this post has an opinion which is based on his/her not knowing the situation?
At least for me, I try to find out what I can re: an issue with which I decide to have an opinion…or I say…I don’t really know much about it..I haven’t been following this…etc.
So really…I suggest that it may be a good idea to become informed.
Are most sports really above 55%?
NFL is at about 53%, with most of that unguaranteed
NHL is at about 57%, with teams able to buyout unwanted contracts at a discount
MLB is well below 50% and probably closer to 40%
To me, a key point that you are missing is that aspect of NBA salary guarantees. The players are guaranteed their money, even if they no longer have the skill to play the game. To use your analogy, the employee making $10 would be guaranteed that amount for the length of his contract, even if he sold no lemonade whatsoever. That’s tough to swallow as an owner. At that point, not only are the employees making as much as you are, but they are guaranteed their money when you are not.
The players have had ‘entitlement’ in the form of guaranteed salary for 40 years now. The last CBA was written assuming an 8% yearly increase in revenue. In actuality, revenues have only grown by 2-3% over the last several years. That means a need for change. Even the players agree that they need to give a current portion of the pie to the owners – the dispute is over how much and how that portion is actually transferred.
You’re correct in saying that the NBA is a unique entity in entertainment. That’s the point. The players want to keep their guaranteed flow of money. It should rationally make sense that the owners should want the same. In fact, what they want doesn’t even guarantee them a profit, although it does make it more likely. That sounds good to me – a workable system in which the players are guaranteed something and the owners are essentially guaranteed something. That’s the kind of agreement that, as a fan, I can get behind.
To put it another way, a business that makes millionaires of its employees but runs in the red consistently is headed in one direction, and one direction only. Bankruptcy. As a fan of basketball, that’s the last thing I want to see. I have no problem with the owners wanting a system in which most, if not all, franchises can operate in the black. That’s not the case now.
by Storyteller on Jul 9, 2011 5:01 PM PDT up reply actions 5 recs
well wait a second...
whether the contracts are guaranteed doesn’t impact the total share given to the players in the Collective Bargaining Agreement. The NFL’s minimum salary guarantees that the players will ultimately receive 53% of revenue, right?
The guaranteed contracts relate to how the money is distributed amongst the players, though it is also crucial to the health of the league.
i keep dancing on my own.
by atomiccafe on Jul 9, 2011 7:34 PM PDT up reply actions 1 recs
NFL players were guaranteed for 57% of revenue
after the owners took the first billion
Red means run, son, numbers add up to nothin
However, it also speaks to a point about competitiveness
In the NFL, if a player’s skills have deteriorated and he no longer ‘deserves’ the size of his contract, the team can waive him and only the guaranteed portion (prorated bonus) counts against the cap, but no further money is actually spent by the team. The team can use that money to obtain another player or players to improve their ability to compete.
In the NBA, if a player’s skills have deteriorated and he no longer ‘deserves’ the size of his contract, well, he still gets that full contract unless some unguaranteed provision was written in (the great majority of NBA contracts are fully guaranteed). No additional cap space and no money available to sign other players if he’s waived.
The NBA players want not only to keep the corporate guarantee (the minimum % of BRI due them as a group) but also the individual guarantees. That adds a higher level of security as long as the CBA is in place.
My point is that if the players demand that sort of guarantee, shouldn’t they also welcome the idea of the league staying in the black, too – so that owners also make profit out of the huge pot that is shared?
The argument that “well, if the owners didn’t want them to get that much money, they’d just pay them less” also neglects the previous guarantee of 57% of BRI. If the owners didn’t give them the contracts, not only are teams risking not being competitive, they also just invite being charged that money at the end of the season to raise the player’s total up to that designated percentage of BRI – without getting the benefit of actual production for that extra money.
Oh, I wasn't talking about the last argument
and I agree that the guarantees are a problem. All I’m saying is the issue of % of BRI and guaranteed contracts are separate issues… you could have no guaranteed contracts but the players keep getting 57% of BRI. And I’d disagree with your framing of the issue that the big loser in a case where a player starts to play below his value is the team’s owner. The real losers are the players who deserve more money but can’t get it because it’s already committed to a bad player.
To clarify—ultimately I think the BRI issue is what needs to drive the negotiations here. That’s how the owners can become profitable again, which is clearly their #1 priority. Everything else, including competitive balance and contractual fairness, is subordinate to that for them.
i keep dancing on my own.
As always, perfectly put Storyteller--fix the system period!!
Both sides are complete jackasses but the players have less of my sympathy than the owners do.
interesting analogy, Ludo
But let’s say, for simple numbers here, that the Nike shoes cost $50. That would show a loss of $30 for that day. But then wearing the Nike’s to run around and advertise meant that on the third day $100 of lemonade was sold. Revenue for the three days would have been $140, costs would have been $50 for advertising (shoes). We would split the remaining $90, so $45 each. Compared to not spending money for advertising, our income would have increased by 50%.
So really, spending the money on advertising helps both parties. But now let’s say that the employee was guaranteed a minimum of $10 per day, or 50% of profits for that day, whichever is greater. That would mean the employee would make $10 on each of the first two days and $50 on the third day, so $70 total. The business owner on the other hand would make $10 on the first day, lose $40 on the second day, and make $50 on the third day. So the owner would make $20 while the employee would make $70.
The only businesses that use this second model are new businesses just starting up, where the employer is willing to make less money because they have the asset of ownership and are willing to sacrifice for it to pan out. If things don’t pan out for the owner to make at least what the employer does, the business closes. Except for the NBA. In the NBA, owners are expected to incur all expenses and pay the players this certain guaranteed salary. And if the salaries of all teams don’t equal 57%, then the owners have to pay all the players extra money. So even if they manage their salaries and don’t give out ridiculous contracts, they still pay out that money.
Owners pay 57% of basketball related income OR a guaranteed salary, whichever is greater. That is not a sustainable model for any business.
by Rodney Gustafson on Jul 18, 2011 9:11 AM PDT up reply actions
I sounds like you are the one throwing out condemnations, Lido
Gunballs sounds pretty reasonable to me.
Make ‘sound business decisions’, how about not signing a stupid contract ?
This is not exactly “workers” against Henry Ford, or Cesar Chavez and the farm workers we are talking about here.
Making LESS that they were making !!!!!!! Imagine that…. welcome to the real world.
How is signing a huge contract
stupid for a player? They should sign smaller contracts because it will help out the owner? Sadly for smaller markets to compete they have to pay more. This makes “Smart” business a little objective.
ahh, I was referring to the owners signing a stupid CBA.
I expect players to take good contracts offered to them.
I do think it would still be a good job at somewhat less income, and possibly a better deal for fans.
Yeah, because ticket prices are going to come down if player salaries do.
If you believe that, I got some land to sell ya….
by Sir.Ludo on Jul 9, 2011 4:31 PM PDT up reply actions 1 recs
He is not reasonable. He is mis-(or dis)-informed.
The players are not on strike. The players are not demanding more money. The NBAPA is NOT making any demands of the owners, they are the side making concessions. It is the owners who are making demands and not concessions.
And yes, going from 57% of revenue to 54% is “making less than they were making”.
I understand that 54% is less than 57%,
I’m just totally unimpressed with the ‘sacrifice’.
Whether owners are ‘guraranteed’ a profit or not, I don’t blame them ALL for wanting to make one
I’m really not motivated to fight about it. It’s not my problem nor is the CBA my decision.
If there is no NBA I will move on just fine. All this squabling is just repulsuve to me. You can have it.
A few misperceptions here
The owners are fighting for the opportunity to make profits. Under the current system, except in big markets, that is not happening. No industry survives if it loses money across the board. Average value in an NBA franchise is $356M. Under the current system which would you rather have – an NBA franchise in Minnesota or $356M invested and returning 10% each year? And revenue sharing does not solve the problem because there is still a $370M – $300M loss league wide so perfect revenue sharing causes every team to lose $10M+ each year.
If you watch the Forbes annual NBA Team Valuations you can see that they fluctuate individually each year according to revenue stream. The teams that are winning rise and the losers fall (except NY Knicks but they are a special situation of owning the cable network with over 7M hookups.) So teams that make bad management decisions will still lose money. But not 22 or 23 teams of 30. Maybe 5-8 deserve to lose.
You are incorrect about taking a smaller share of any sport. In fact they are on top of all sports, The NFL is just closing on a CBA which reduces the player share of BRI from 53% (overall) to 48%, reflecting the climate we are living in. The NBA players turned down an offer of $2B per year (nearly what they are getting now) from the owners. Neither is really budging from their positions with the players claiming a partnership with the league. But the players are not partners because they do not share in losses. Instead of a share of BRI (revenues) they would be getting a share of net income before player salaries. That would change things pretty drastically, In order to maintain their current total payments they would have to get 117% of the profit!
You are correct that there is a lockout, Why? It is a tool that owners can use under the labor laws to stop paying employees who do not have a labor contract. Essentially the owners are saying: we are not operating at a loss any longer. That does not make the players or the owners good or bad, right or wrong, It is part of how labor disputes get settled.
Stern seems to make his bosses happy
His bosses being the owners. Does that mean he’s doing a good job? Well, there’s no NBA atm, so I’d have to say NO.
Just because the owners pay him doesn’t mean he can’t smack them around. The biggest money problem is revenue sharing; if that was fixed, the current negotiations would likely go pretty smoothly. That seems to be a big roadblock; the players are willing to cooperate, the owners aren’t. Stern says rev-sharing is next on the agenda, but the players have to cave first. That issue should have been resolved before the CBA ran out, and Stern knows it.
Lockout issues aside, IMHO Stern is a power-mad jackass. He’ll fine you for looking at a ref the wrong way, for wearing clothes he doesn’t approve of, and God forbid you make an unflattering comment about the league. You can’t question the refs, yet very often a ref’s actions are highly, obviously questionable. Never hear about any refs being fined/suspended, do you? Donald Sterling is an embarrassment to humanity, let alone the NBA. If Stern cares so much about the NBAs image, why is Sterling around?
Stern speaks of owners/players needing to be “partners”, yet he has to date refused to make the owners play partners with each other. To me, that’s a HUGE failure. Sometimes, the “best interest of the league” involves telling the owners things they don’t want to hear.
Right now, the league owns the NO team. That would seem an extremely bad investment. It’s an even worse investment when you have Larry “richer than most states” Ellison trying to buy into the league. Teams that are “losing money” are forced to subsidize another money-loser; why isn’t Stern begging Ellison to join in? That’s doing a disservice to his direct employers.
Inclosing, I think Stern sucks. He’s more concerned about style than function. His ego’s bigger than Charles Barkley’s mouth. And if you boil his job description down to the very basic (“Keep the league going”), he’s a huge failure. He’s had years to address rev-sharing before the CBA ended, he knew rev-sharing was going to be a problem, and sat on it. He’s not likable, he’s not believable. He hasn’t made the owners play nice with each other, apparently that pleases enough of his bosses to keep him employed.
So how often do you "smack around" your bosses?
I’m no big fan of David Stern either, but the thing to remember is that he is paid a very substantial salary to be the Commissioner of the NBA, and that salary is paid by the owners. He serves at their pleasure, acts according to their wishes, and can be fired just as any employee can , so of course he pleases enough of them to keep himself employed.. Billionaires don’t get smacked around by anybody. Stern’s salary amounts to pocket lint for such people and if he does anything that they perceive to be against their colledtive best interests, he will be the ex-Commissioner in an instant. Whether you or I or anybody else besides the owners who pay him disagrees with his management style is irrelevant.
"Send lawyers, guns and money; the [nsfbe] has hit the fan." - Warren Zevon
If Stern is supposed to run the league
He needs to (attempt to) make the owners understand they are just as wrong as the players, if not moreso. Failure to do so amounts to a failure to do his job.
If his job is to be the owners’ lickspittle, he’s due for a raise. Shame he won’t get it. You know, since nobody makes any money if there’s no games.
“He serves at their pleasure, acts according to their wishes,”—So Cuban wants to be fined millions? Owners want horrible officiating affecting the outcomes of games/playoff series? Yes, they pay his salary. He also has the autonomy to put them in their places when necessary. If they decide to fire him, do you think that would work in their favor? Answer: NO.
And trust me, you don’t become a billionaire w/o getting smacked around at some point. A smart businessman listens to intelligence, even if it contradicts his personal opinion.
by GoForthAndDie on Jul 10, 2011 2:05 PM PDT up reply actions
Revenue sharing does nothing to solve the losses overall
It just readjusts the pain. First is to get a CBA that provides opportunity for return on investment to the owners. Then revenue sharing allocates a fair portion of the profits from the major markets to the smaller markets to provide balance across the league. We will never have parity because – well David Kahn. Kahn can’t. But the opportunity needs to be there for a team to be profitable and return on the investment the owner has made in the team.
hmmmm
I think you’re far off with your assessments of negotiations, players, etc. The Derek Fisher thing doesnt even make sense.
yes, it sucks that plenty of people lose their jobs, and yet bball players make tons of money, but they also are in something that makes a TON of money, and they just want to get their fair share of profits, etc, while also the owners want EVERY NBA team to make money, rather than lose it.
nonetheless, I’ve never seen apologize spelled ‘apolagise’ and that made me smile :)
Barefoot conducts his seminars on his houseboat in Sausalito. It costs a hundred dollars to find out why we are on this Earth. You also get a sandwich, but I wasn't hungry that day. John Lennon had just been killed and I think I know why we are on this Earth; it's to find out that what you love the most will be taken away from you, probably due to an error in high places rather than by design.
by thankyouforblaze on Jul 9, 2011 3:03 PM PDT reply actions 1 recs
spelling: use it or loose it.
zing.
llbdll
///
((()))
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OMG!
by Oh. Em. Gee. on Jul 9, 2011 6:48 PM PDT via mobile up reply actions
There's a children's mural at the Arbor Lodge New Seasons...
It’s got planets on it, and says something about “eaoter space”.
Doers & Makers > Movers & Shakers
by Adam Randall on Jul 10, 2011 11:31 AM PDT up reply actions
A fair share starts somewhere below the number that brings losses
Is it fair that an owner risks and average of $356M in the team and gets no return but has to add money every year from some other source? Would you want that as an owner? Fair starts with a share of the profits not a share of the revenues. So far the current CBA has provided the players about $1.8B of losses to the owners over the 6 years. Keep that up and the fair share of zero is zero because there will be no league. The players currently are guaranteed a profit and the owners are guaranteed a loss. A fair share requires the players to share in the losses.
players may be rich...
But the guys that pay them are wealth.
Wealth is different from riches.
Rich people can go broke. Wealthy people just get less wealthy.
To me the issue is that large market teams don’t want to share their pie with those in smaller markets.
Since small market owners can’t get more mone frim their partners they want to pay less to their employees. That also benefits big market teams so they can all agree to lockout players.
by Anim8rguy on Jul 10, 2011 6:48 AM PDT via mobile reply actions
see above on revenue sharing
In business it has nothing to do with how wealthy or needy the parties of a contract are. It only has to do with leverage and agreement, Leverage determines the terms and agreement happens once those terms are acceptable to both sides. If there is no return on investment there will be no league because there are many other investment opportunities for the average $356M each owner has invested in his/her team. Opportunities that earn $35M or more each year instead of losing an average of $10M+ each year. What would you do as an owner?
I get where you're coming from.
It must be very frustrating to work with the needy, then have your pastime derailed by a labor negotiation between very rich people. Folks are starving and homeless in our own country while diamond encrusted celebrities and their patrons argue about revenue sharing. I can’t imagine how the recession casualties must feel about this; to see owners choosing not to sell their product, and workers choosing not to work, must be absolutely maddening.
I know that it must be done, and I hope everybody get a fair shake. I want the NBA to be profitable, because I love the sport and want to be able to watch it on TV. I care little about the specifics, just so long as it gets sorted out in a reasonable amount of time, and the city of Portland gets to keep its team for the rest of my life.
Doers & Makers > Movers & Shakers
Yes, your priorities are in the right place to want to help those who need it
There are vastly different schools of thought on how to best provide that help. Democrats have led the way in providing help through government handout programs. Nothing wrong with that, Republicans have led the way in providing help by returning more money to taxpayers in order to stimulate the economy and provide more jobs. During the depression the Democrats had control and provided handouts. During the ramp up after WWII the Republicans had control and stimulated the economy. The cycle repeated under President Johnson and then President Reagan. Both have shown value in getting help to the needy. I am not trying to open a political debate, only noting that the concepts are difficult to reconcile and we seem now to be moving into the Republican phase of the cycle after seeing the effect of the Obama plans.
The NBA is an entertainment enterprise. It competes with Hollywood, the music industry and the other sports leagues to secure entertainment dollars. Ideally in a depression perpetual recession there might be a way to channel entertainment dollars to more constructive purposes. But in hard times entertainment increases to allow people to escape. (I remember seeing the line for the movie theatre in Phnom, Penh during the war which extended around the block while rockets were being fired into the city.) Can we change that? Not historically.
Players don't wanna strike
It’s an owner’s walk-out
The NBA is heavily favored towards the Lakers. What happens now, is when a team goes over the salary cap, they have to pay fines and kickbacks to all the head cheese in the front office of the NBA (Stern and friends). One team has been going way over the cap, the Lakers. What does the NBA do with that extra cash you may ask? Well, you’d have to ask former NBA ref Tim Donaghy to get a better answer.
L.A. has been obliterating the salary cap for over a decade, grabbing talent and making unbalanced trades with the NBA’s approval. The owners must throw in the towel for this league to be competitive, or your 2012-1013 Laker starting lineup will look like this:
Chris Paul – (aquired via free agency)
Kobe Bryant – (probably last season left on those tires)
Rudy Gay – (aquired via Memphis salary dump)
Blake Griffin – (aquired via trade for crusty reality star Lamar Odom)
Dwight Howard – (aquired via trade for A. Bynum and some 2nd round picks and cash)
Now, how competitive does the NBA really want all 30 teams to be again? And do we just send the Lakers to be the Olympic Dream Team?
what the nba does with the tax money
The league collects tax money from all teams that are over the luxury tax threshold. Then that money is distributed evenly to all teams that are UNDER the luxury tax threshold. That’s why the difference between being one dollar over the tax threshold and one dollar under the tax threshold is actually several million dollars, not two dollars. And that’s why you see teams that are near this threshold dump players for nothing mid-season, like Utah did with Ronnie Brewer a couple of years ago. Brewer may have only been making half a million that year (don’t really know his salary), so a mid season dump only saved them a quarter of a million. But clearing his salary off the books could have gained them a tax payday, creating an extra three or four million dollars. It’s hard to say that Brewer would have been worth four million for the last half of that season. For the record, this is part of how Sterling makes a profit with the Clippers. He usually keeps himself below the tax threshold and collects those checks. He doesn’t care as much about fielding a competitive team.
The reason the league wants the Lakers to be good is because of marketability. And let’s be honest, that lopsided trade with the Grizzlies to acquire Pau Gasol? It doesn’t seem quite as lopsided in hindsight. Would the Lakers be worse right now if they had kept Marc Gasol, and Marc had grown into the same player he currently is? They would have probably traded Bynum for a stud PF, or possibly a combination of PF and PG. Heck, they might actually be BETTER than they have been the past two seasons had they not traded for Pau. Granted, they wouldn’t have been as good immediately following that trade, but Memphis wasn’t able to ever build around Pau and go anywhere. Let’s see if they can do better this time around.
by Rodney Gustafson on Jul 18, 2011 9:20 AM PDT up reply actions
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