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Does this league really need the salary cap

Discussion in 'NBA Dish' started by sbyang, Jul 31, 2009.

  1. sbyang

    sbyang Member

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    My queston is: does the league really need the salary cap? What if they kept everything else the same and just did away with the cap? There would still be a luxury tax line, the home town could still offer the most years and salary to their bird free agents. The only difference a team like Miami could offer Lamar Odom more than an MLE contract.

    I see all these teams making moves and selling their fans on the idea of having cap space to sign these big upcoming free agents, like Memphis dumping Gasol so they'd have that precious cap space to trade for Zach Randolph, like the New York Knicks selling their fans on the idea of 2010 for the last 2 years while they field a terrible team. It just feels like a device owners use to trick their fans.

    The Lamar Odom situation is particularly ridiculous, this guy couldn't get his market value because the teams that liked him did not have cap space. The Lakers had him by the short hairs once Portland didn't show any interest.

    I know most will reply that no salary cap benefits teams like the Mavs and the Knicks, well there should be a simple situation to that as well: increase the luxury tax by how much a team goes over the tax. A crude example would be a team plays dollar for dollar tax for the first 10 million, then 3 dollars tax for every dollar they are over after that. A big enough punishment will stop everyone from overspending.

    What do you think the overall effect of removing the salary cap and toughening luxury tax punishment woud be?
     
  2. nevetslc

    nevetslc Member

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    :( sounds like whining. :(
     
  3. Christopher

    Christopher Member

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    As someone that follows a lot of different sporting competitions in a lot of different countries with a lot of different salary cap systems I have no doubt that removing the NBA cap would be nothing short of a disaster.
     
  4. DrNuegebauer

    DrNuegebauer Member

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    ??

    There's no reason why Odom couldn't have signed a 1 year deal with ANY club at $5.6 million (MLE) - that way he could've gone wherever he wanted and then hit paydirt next season (if said team was under the cap).

    Conversely, if he really wanted more, then he just had to find a way to get the cash through a S&T - if a club REALLY wanted him then they'd make it happen.

    Most likely scenario is that nobody REALLY wanted him as much as his agent thought they did - hence nobody was queuing up to pay big dollars at the start of free agency - Charlie Villanueva was preferred... Odom could take his market value of the MLE (for a season and then test the open market in the year of cap space, 2010) - or he takes a deal with his club.

    Why penalize the team that has developed a player? Of course that club should have the 'bird rights' and be allowed to pay what they please. It stops people jumping ship SOLELY for the sake of the money in a lot of cases.

    Keep the cap - it's a soft cap anyway - it does the required job of setting salary levels and keeping salaries of the "non-great" players at an acceptable level!
     
  5. Rocket86

    Rocket86 Member

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    Trying to balance the competition and putting a premium on those that want to gamble are basically the reason for the salary cap. If a team wants to stack up on stars, They could but they have to be sanctioned with a tax. This way teams do not tilt the balance to just a few teams however if the owners of said teams want to pay then its their decision. A gamble that could work ( Lakers, Celtics) or be a bust ( Knicks )
     
  6. sbyang

    sbyang Member

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    In my proposed scenario, the home team still has the ability to offer more to their own FA than any other team, more years, bigger raises. So guys wouldn't be jumping ship if their teams really wanted them.

    I disagree with you on the specific case of Odom. Why should he settle for the uncertainty of a one year deal? That would be incredibly stupid and risky for him and the people he supports. If he really wanted to get it done he could get a sign and trade? That's not right because the Lakers told anyone who'd listen that they didn't want to do any sign and trade for Odom.

    Imagine if you were very very good at your job and your contract was up. You currently make 100k. You're so good that there are lots of companies that want you, they want to pay you big money, they tell they'd pay you 200k, only the government doesn't allow them to pay you 200k. The other companies can only offer you 50k a year because that's the only thing allowed. The only remotely fair off you have is your original company, who offer you 80k, knowing you can't find more than 50k elsewhere. How is this scenario fair for any employee?
     
  7. foodworld

    foodworld Member

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    Anything that would make the NBA like the MLB would be a disaster. I don't like the prospect of some owners buying championships by overpaying for talent as everyone else gets hosed.
     
  8. JuanValdez

    JuanValdez Contributing Member

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    I don't know if I want to be rid of the salary cap, but I do think there is an imbalance between the salary cap for the team and the pay-scale for the players. The way it is set up, almost all teams are eternally over the cap. To operate under the cap and have the freedoms associated with it, you have to have basicially no good players. Operating over the cap is the rule, and teams will only dip under the cap for a couple of weeks to avail themselves of the contract freedom to put them back over it.
     
  9. kevC

    kevC Contributing Member

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    If anything there should be a harder cap...
     
  10. RedRedemption

    RedRedemption Contributing Member

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    IMO, everyone gets paid way too much as it is.
     
  11. Cannonball

    Cannonball Contributing Member

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    Things like max contracts are based on a % of the cap. Do away with the cap and there are no max contracts (limits) which also allows any team to outbid any other team. Bird rights would be useless.

    To do what you're suggesting, you'd have to add new rules that put a "cap" on individual player salaries.
     
  12. Rocket86

    Rocket86 Member

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    True and it makes watching the games very painful to watch. Everything is one sided and the league will be centered around a few teams only while the rest are just fixtures.
     
  13. emjohn

    emjohn Contributing Member

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    Sort of - the cap itself is based on a formula incorporating revenue, and the max contracts stem off of it. You could continue to determine max contracts, min contracts, MLE and LLE, the minimum payroll threshold, and the tax threshold without enforcing the soft cap itelf.

    At first I was going to blow off the OP until I saw the end proposal - fade out the soft cap itself and let a strengthened lux tax take its place. It's not a horrible idea. But here's what would keep me from agreeing:
    The best thing the cap does right now is prevent an environment where 30 owners feel compelled to get into a bidding war over each free agent. Fans put pressure on their teams to go after FAs, and in the 90s things started to get out of control - leading to stupidity incidents like Washington vs Miami both throwing $100M at Juwan.

    The cap limits the number of teams that can offer contracts above the MLE. That's huge. That's needed - because we've seen that the owners simply can not control themselves, and the economics of the league can't support a high frequency of near max deals. As it is, too many teams are drowning in red.

    What I'd counter-suggest:

    1. Make the LLE annual and the MLE biannual.
    The majority of buyers-regret contracts are from the MLE. There aren't 30 FAs a year that deserve them. If a team were to use its MLE on one player each year, every year it would have an enormous payroll problem in short order. I say flip the frequency of the two exceptions - make teams hesitate a little more before throwing the MLE around like candy.

    2. Ratchet up and tweak the Lux Tax
    Next year the cap is $58M, payroll minimum is $43M and the tax threshold is $69M. How I'd tweak things:
    a. Tax Amnesty for teams that are over the tax line, but by less than 5% ($72.5M). Those owners will not receive the tax redistribution money (ballpark $3M) but won't be taxed on their overage. Helps chill out the hysteria over crossing the line by even a dime.
    b. A $2 per $1 second tax line, at 140% of the cap ($81M). Few teams cross this, and they'll really have to think twice about going Yankees on the league in the future. The bonus effect of this is boosting the redistribution money for teams like Milwaukee that literally can't keep up with NY or LA revenue.


    Evan
     
  14. pgabriel

    pgabriel Educated Negro

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    no

    signed Juwan Howard

    I don't know much about the cap, but I do know that owners have to police themselves or the Juwan Howards of the world make $100MM which is good for no one but Juwan Howard.
     
  15. sbyang

    sbyang Member

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    Owners can control themselves, even before this recent economic crisis hit. Deals like the J. Howard deal went away because of the luxury tax and the new salary structure, not because of the salary cap.

    There are 3 teams in the league that would potentially go crazy if the salary cap went away and offer max deals to everyone: New York, Dallas, and Portland. You might take Dallas out of it because as you saw with Steve Nash, even Cuban has his limits and somehow decided that Nash wasn't worth an extra 2 mil per year. If the league implemented a harsher luxury tax penalty, I don't think ANY team could afford to go crazy. The only effect of removing the salary cap would then be a true free market where free agents like Odom and restricted FA like Josh Childress and Ramon Sessions could get what they're worth.

    There are a couple of additional things the league could do before removing the cap:

    1) decrease max years on a contract, tell the players union that in exchange for the cap getting removed the max years on a deal will be cut down.

    2) set the salary floor higher, or implement a penalty for those teams that do not meet the salary floor. For example, if the Clippers come in under the salary floor, they do not get to share luxury tax.

    3) As someone mentioned before max salary for certain guys is X% of the cap, just make it Y% of the luxury tax instead.
     
  16. Dubious

    Dubious Contributing Member

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    Basketball and baseball are very different. Baseball teams can be competitive at vastly lower salary totals by focusing on developing young talent in the minor leagues.

    - The Florida Marlins and Tampa Bay Rays-
     
  17. Alvin Choo

    Alvin Choo Member

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    agreed with the op. Whats the use of the salary cap when everyone is focusing only on the luxury tax.

    Make the tax hurt the teams to make sure they follow. Dollar for dollar at <10% of luxury tax. 2 for 1 at 10%<x<20% and so on.
     

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