Stern: Player Salaries to Be Cut By 1/3

Millions of people have lost their jobs the past couple of years in all types of industry. Running a business at a loss is just not going to happen, no matter how much it hurts to let go employees. I agree with your sentiment, but the reality to me is that the players are more important to the NBA than the team employees, and if some teams are operating at a big loss with no hope of recovery, then maybe contraction is worth at least considering sometime down the road.

 

He was. He gave a more wooden performance than the chair I am sitting in right now!

 

Well I think in order to reduce salary by around $750 million, both will unfortunately have to happen. Contraction and reduced player salaries, with at least partial non-gauranteed money. The league clearly revolves around the players, but I think the players are about to find out that as long as they're 'earning' these exorbitant contracts, the league can't be profitable and, like you said, it's a business running at a loss. It simply can't continue. No league, no more money for players. They can either accept a massive paycut, or they can have a lock out and lose it all, or play overseas. Knowing how stupid players are with their money, I think they'll flinch first. But there will 100% be a lockout.

 

Yeah, a lockout seems to be a foregone conclusion. The owners lose less money by by not playing the games than do playing. They should be able to holdout for a lot of what they want and be comfortable with it. The players are going to have to cave on this one.

 

It's my personal opinion that they make too much money.

 

You worth is judged by what somebody is wiling to pay you son!

 

Compared to what?

 

And they all want to pay them less.

 

And the only reason they got so high is because it was worth it to the fans to watch.

 

I guess this means we should probably just sit back and try to enjoy the season no matter how well or poorly the team plays, it could be awhile before we get to watch these guys play after April (May? June?).

 

Hey Nik, can I come work for you next fall?

 

They want to, which is hardly unusual. If we went by what employers would prefer to pay in salaries, every worker in the US is overpaid. Fairly bizarre metric.

They choose to pay players these salaries because they've decided it's worth it to them, as owners, in terms of what they make back from paying the salaries. Even if there were no salary cap, LeBron James wouldn't make $100 million per year, because at that cost it wouldn't be worth it to the owner.

 

How is it worth it when I see everywhere that the NBA loses money every year? I really haven't researched anything about it or even talked about it so I want to know.

 

Do the players even have a legitimate reason they shouldn't have their salaries cut? It's business. Businesses have to cut salaries all the time if they aren't performing well. Unless the players have a better option, I don't see how they have any leverage.

 

The NBA claims it's losing money. MLB teams, for example, often claim to run at a loss, but then independent surveys by entities like Forbes often disagree. It's a popular tool in labour disputes to claim losses.

I don't know for sure, either, whether NBA teams are losing money but I know owners are willingly signing these contracts (either directly, or by proxy through their hired executives). Unless you believe that NBA owners are all stupid businessmen, why would they all keep signing deals that are losses for them?

 

That happens in a largely free, open market. The NBA is far from one...there are artificial constraints, like salary caps and maximum contracts. All of these things are aimed at artificially reducing contracts. If the NBA were a free market, where any team could offer a player any contract (i.e. open bidding, like workers in other industries), I think you'd see salaries go up not down.

 

To be honest, if it was a truly free market teams would not have to carry the albatross of Curry or Darius Miles contracts on their caps as well. It's a double-edged sword.

It's not just the teams that are on the "not a free market" side here...

 

Do you know anything about photogrammetry, geology, botany or GIS?

 

There wouldn't be "caps." They'd still have to pay those contracts, though.

How so? The cap implications of Curry/Miles deals don't benefit players.

 

That's a really good point. Perhaps Stern's bizarre 1/3 reduction statement out of the blue is a bargaining point for the players to agree to an NFL-type non-guaranteed contract/hard cap structure.

If Stern wants a model for growth, the NFL is a great place to start. Plus, the length of player careers in the NBA is longer than the NFL, so the players should be more agreeable to that model as well.