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The Changing Paradigm

It's become apparent as people are discussing players like Luol Deng (and whoever else comes up) that we're still a little confused about the opportunities and costs surrounding contracts this year and next year.  Specifically I've heard and read a lot of smart people say things like, "I don't know if we want to take on a max contract player next year..."  as if that would hurt us contractually in some way.  The general concern is understandable, but the timing is off by a year.  People are failing to realize that the unique cap situation next summer changes everything we're used to thinking about when we consider taking on contracts.

There is a difference in contractual goals and procedures this year and next year.  The two are exactly opposite, in fact.

THIS YEAR there is an opportunity cost to taking on contracts.  That opportunity cost is not having cap room to play with next summer.  For instance, if we trade Raef LaFrentz's expiring contract for a player making $13 million, that's $13 million more counting against our cap next essence eliminating most of the available space.  Therefore any player we acquire this year would have to pass a litmus test:  is he more valuable than anyone else we could sign or trade for next year using that cap space?  Therefore taking on a max contract this year would indeed be something to discuss cap-wise.

(Side note:  This is not precisely true of trading Martell Webster, Channing Frye, or Ike Diogu.  We would potentially save cap space next summer by trading them for a player who makes the same amount next year.  This is because of the cap space holds we've talked about so much.  So don't worry about cap space ramifications if we trade these players.)

NEXT YEAR there is NO opportunity cost to taking on contracts, max or otherwise!  There are two reasons:

1.  We will be under the cap next year, but not for long.  As our young core players require re-signing in the years to come that cap space will disappear.

2.  The cap ramifications and restrictions are exactly the same whether you're $1 over the cap or $20 million over the cap.

In other words if we don't sign anyone next summer it's not like that money could be used on other players in years to come, as if signing them next summer was costing us later opportunities.  Re-signing Roy, Alridge, Oden, and whoever else we wish will make that cap space disappear anyway.  The Blazers have to use it or lose it.

Taking Deng as a theoretical example, even a max contract next year would not do a thing to make our cap situation worse in ensuing years.  The Blazers are never going to be under the cap again once their Big Three cycle through.  The only difference signing Deng would make would be Paul Allen spending 10-12 million more bucks a year.  It wouldn't change our eventual cap situation a bit.

In three years the situation would be either:

We are capped out and can only use a mid-level exception and Deng is on our team. 


We are capped out and can only use a mid-level exception and Deng is not on our team.

The only criteria that matters here is if you think Deng fits.  If he does, it doesn't matter what you pay him.  You're not making things better or worse as far as the eventual cap.  If he doesn't, you have to find someone else who does.  Then the same will be true of them, contract-wise.

In essence it's like we'll have a coupon next summer, good for acquiring one or more players through free agency or trade with no real cap ramifications no matter what we pay them.  But that coupon is good for one season only.  After that the opportunity goes away.

If we want that cap space next summer, meaning we don't find the exact player we want this season, the mantra right now is save, save, save.  Preserve that space and don't take on any big contracts this year.  But once the season turns the exact opposite will be true:  spend, spend, spend.  Whether the contracts you take on are big or small won't matter.  You will not have another chance to do this again.

--Dave (