Pay Players as a % of the Cap

i feel like literally no one seems to understand what oakdogg is saying. i've thought about this in the past and completely agree with him. he's not trying to take money away from the players. just trying to make changes in the cap apply to all players more equally, instead of just the current year's free agent class. it would benefit teams directly in helping pay players more appropriately, and it would benefit the large majority of players (whatever percent of them aren't a free agent in any given year).



his point is that contracts have maximum raises. for whatever reason, those raises aren't tied to what the cap does. there are two possibilities:

a) the cap doesn't go up much. then players under contract keep getting raises and taking up more of your cap, which the teams don't like. also, current free agents can't get what they are worth, which they don't like.

b) the cap goes way up. then players under contract don't benefit from that, which they don't like. also, teams are forced to pay the current crop of free agent's money that is far beyond what they are worth because, at the very least, they have to reach the floor. teams don't like this and it throws the financials of team building all out of whack.


tying maximum raises to whatever the cap does allows for all players to participate in changes in the cap and makes salaries more commensurate with value. the players should like that for the huge percent of them that are under contract. the teams should like that because it makes team building more predictable. and fans should like that so that we don't all have to watch evan turner get $18M/yr when we could easily just spread the cap increase to player's much more equally instead of just the guy who happens to be a free agent. it's one of those ideas that is clearly better than the current set-up, but which probably makes too much sense for anyone to actually implement it.

 

Tell that to NFL players.

 

given the choice, why would the nba not want the to try to pay everyone as close as possible to their real value. i certainly don't see any value in purposely avoiding paying people as close as possible to their real value.



*** i would define real value as what each player would get if everybody in the league was a free agent at the same time.

 

Again, neither the players nor the owners are interested in this. Just because people disagree with you doesn't mean no one understands what you're saying. Not a single person in this thread suggested that this would take money away from the players.

 

I would propose a more realistic approach that would achieve what the OP proposed without the complication in trading contracts.

Each player's salary is set for the first year of his contract. The amount of raise he gets in subsequent remaining years is according to the percentage of the cap space relative to the first year's cap space.

For example, if Player A signs a 3-year deal for 10M per year. He gets 10M the first year. If the cap space increases by 10% the second year, he gets 11M the second year. If in the third year, the cap space jumps to 180% relative to the first year, he gets 18M the 3rd year.

This way, the contract is still a dollar amount rather than a percentage. Does this make sense?

 

This is exactly what the OP suggested. Your example is simply a contract at X% of the salary cap.

 

malakas said that. knickstorm and SeekingAlpha certainly seemed to imply that. if durvasa got it (which i assume he did), then he basically just dismissed the idea of even considering a way the CBA could work differently since everyone makes millions. and roslolian was one of the first responders and seemed to go away from what oakdogg was saying. maybe "almost literally everyone" was a slight overstatement, but a majority didn't seem to really respond to what oakdogg said from the perspective he was coming from.


as for your assertion that the owner and players don't care. i don't disagree. they don't seem to, otherwise it would be in the CBA. i just don't get why they don't.

from a team perspective, the owners have to pay 49-51% to the players no matter who gets it. given that, i don't see what incentive the owners have to misallocate resources by not anchoring max raises to the cap.

from the players' perspective, i might understand if the cap had a history of dropping, but it doesn't. the players as a whole will get 49-51% of the money no matter what, it would be more distributed more proprtionally to talent (in as much as that is possble) like in the nfl, but without the pesky unguaranteed money like in the nfl.

this just seems like one of those things where management/labor decide to be entrenched for certain reasons that are more theoretical or emotional than practical.

 

No different to Millennials and their situation in real life. It's just the way the die rolls.

 

I think this discussion is silly. It focuses too much on a single year outlier in cap increase. As others have said, tying salary to a % of cap is merely saying we need adjustable raises. However, the existing raises match the cap increases anyhow.

The owners and Union didn't just pick 7.5% raises and the lessor 4.5%...those raises were picked based on historical increases in the Cap.

Over the past 20yrs, the cap has increased on average 5.722% each yr. That is less than the Bird exception raises of 7.5%, and more than the lessor 4.5% raise.

Note the bolded numbers below. 2015-16 is above the new Salary Cap. So, a 7.5% raise per year performed better (in one year sooner) than the Salary Cap INCLUDING this big jump. It beat it by $11m.
<pre>Year Actual Cap 7.5% Raises 4.5% Raises
1995-96 $23,000,000.00 $23,000,000.00 $23,000,000.00
1996-97 $24,363,000.00 $24,725,000.00 $24,035,000.00
1997-98 $26,900,000.00 $26,579,375.00 $25,116,575.00
1998-99 $30,000,000.00 $28,572,828.13 $26,246,820.88
1999-00 $34,000,000.00 $30,715,790.23 $27,427,927.81
2000-01 $35,500,000.00 $33,019,474.50 $28,662,184.57
2001-02 $42,500,000.00 $35,495,935.09 $29,951,982.87
2002-03 $40,271,000.00 $38,158,130.22 $31,299,822.10
2003-04 $43,840,000.00 $41,019,989.99 $32,708,314.10
2004-05 $43,870,000.00 $44,096,489.24 $34,180,188.23
2005-06 $49,500,000.00 $47,403,725.93 $35,718,296.70
2006-07 $53,135,000.00 $50,959,005.37 $37,325,620.05
2007-08 $55,630,000.00 $54,780,930.78 $39,005,272.95
2008-09 $58,680,000.00 $58,889,500.59 $40,760,510.24
2009-10 $57,700,000.00 $63,306,213.13 $42,594,733.20
2010-11 $58,044,000.00 $68,054,179.11 $44,511,496.19
2011-12 $58,044,000.00 $73,158,242.55 $46,514,513.52
2012-13 $58,044,000.00 $78,645,110.74 $48,607,666.63
2013-14 $58,679,000.00 $84,543,494.04 $50,795,011.63
2014-15 $63,065,000.00 $90,884,256.10 $53,080,787.15
2015-16 $70,000,000.00 $97,700,575.31 $55,469,422.57
2016-17 $94,000,000.00 $105,028,118.45 $57,965,546.59</pre>
Based on this, I agree with Major, neither the owners nor the players would want to tie raises to % of Cap. The players wouldn't want it, because the 7.5% Bird increase performs much better. And the owners wouldn't want it, because some would prefer to lock in raises to under-perform the Cap, to make more profit.

 

Just chiming in to say that there is no luck involved in those who are not able to take advantage of this year's cap space(yet). Players/agents have known this was coming for quite a while and have planned accordingly. Maybe that meant missing out on the 2016 FA spending bonanza to get more money/years in last year's FA market or trying to time your contract raises for your last big contract in your late 20s, but players knew these rules far enough in advance to be able to call their own shots at the expense of a little stability.

 

Malakas said the opposite - suggesting that it would be bad for the *owners*. I'm not sure what you're seeing in the other two posts that suggests that it's bad for players. One is simply about why we care as fans.

Simple - everyone wants cost and income certainty. Players want to know how much money they are making. They don't want the risk that comes with a variable cap. Egos want to be able to say they signed a $100 million contract rather than a 23.2% of the cap contract. Teams want to benefit if they are able to raise incomes faster than projected. And given that the cap is a soft cap, there are all sorts of quirks to having salaries tied to a cap number.

And, of course, they renegotiate the cap and all the CBA terms every 5-7 years or so. Having contracts tied to a cap when the calculation of revenues or cap amounts or whatever might drastically get altered midway through contracts is a logistical nightmare for everyone. What happens if you eliminate the cap in the next CBA? All these contracts get messed up.

 

not that you're wrong, but i just don't see the incentive to not match the cap exactly (maybe the cap change + 1.5% for current teams, cap change -1.5% for new teams to preserve the 3% advantage). sure this is an extreme example, but why allow the extreme example to exist? or even a small example? i'll make the excel spreadsheet for them if that's the problem .

then do cap + 1.5% so the advantage for resigning stays. but in general it doesn't matter because the players are locked at 49-51% of the cap no matter what the cap does. they can't outperform the cap as a whole. same for the owners. underpaying people on existing contracts necessitates overpaying the current free agents because they always have to pay 49-51% of the money to the players. it just seems like if i the players and owners should want the money distributed as equitably as possible, especially for the players as long as they keep getting guaranteed contracts. but i guess they don't and no one has invited me to any CBA meetings.

 

sorry, i did read malakas backwards but he's still bringing up owners v players, and the other two both seem to indicate that the current situation is better for the players. which means all 3 brought up owners v players. maybe i'm just interpreting it differently than you. but the OP isn't about owners v players. the current system locks that part of the equation up at 49-51% so i see no point in addressing it. this is really about players v players.

i agree, but i still feel that's just an emotional and not practical consideration. i guess my perspective is just different from what i would want as part of the union. they have cap projections. you'll be reasonably certain of your future earnings given that contracts are guaranteed.

no doubt, but we still have cap projections to get close if people want their headline. how many people even noticed or cared that anthony davis's headline last year of making 145M on his contract went to 128M because he didn't make the all-nba team? he got his headline, and then the numbers settled where they settled.

maybe i'm missing something, but the teams are always going to give the players a certain percentage of the cap, no matter how quickly income goes up. i guess you can argue the benefit to the teams is more cap room, but everyone gets that cap room and that would certainly seem to be more of a curse than a blessing if this offseason is any indication.

maybe i just don't see it. the cap is soft in that you can go over the cap. that wouldn't change at all. all of the rules to cap room and signing contracts (which only affects cap room based on the first year of the contract) would remain the same. you just don't have fixed raises. if there was a 70M cap, your team was at 80M, and 50M was committed for next season and 30M of that expired, then that would mean your salaries next year would be 50M * (1 + cap change) and your cap room would be 20M * (1+ cap change). it wouldn't be any more uncertain than what we have now where we wait to see what teams actually have when they announce the new cap.

sea change events are always tough. i wouldn't go away from what i thought was the best system (in my opinion of course) just in case there was a huge change. max contracts were a huge change. they just grandfathered all of the old contracts in. unless the league is just going to stop calculating revenue, there would probably be a fairly easy grandfather clause to be had to calculate raises on existing contracts.

 

Objectively there arent too many reason not have it tied. It seems like historically it wasnt because nobody saw a reason to and maybe the cap smoothing model the owners proposed actually screwed the players in other ways so they rejected it.

 

The real issue is that there is not really a lot of genuine talent in basketball but a lot of money coming in from the cable cartels. As long as people keep paying for their sports you'll see these salaries in the league.

 

francis 4 prez and oakdogg,

My chart of 20yr growth of the salary cap shows that player salaries with fixed raises performs at the rate of the salary cap. So they are essentially tied together, because owners and the union set the max raises to match the historical growth of the BRI -- which is roughly 5.5%.

The reason I say this is a silly discussion is because there is not really anything to fix. We are suggesting an aberration event of huge TV-money requires a new rule. I'm saying, no it doesn't, because such reactionary rules often cause more problems than they fix.

Employers and employees in all industries rely on known, fixed salaries. The OP suggestion is to make salaries adjustable based on yearly revenues. People and business don't operate that way. And my chart of 20yr growth of Salary Caps proves such a change is not really needed. This is not a Fantasy League -- and this idea seems to be coming from Fantasy League rules.

Examples: Why would anyone want risk of less salary if revenues that are out of their control stagnate or drop...when status quo gives them a known payscale and known raises to budget their freaking lives. Likewise for owners, why can't they use Front-Loaded salary structures to compete for FAs, and descending salaries (or flat ones) to retain future flexibility for a specific year with a crop of FAs they like -- vs salaries that move in some unpredictable % of cap. Your idea needlessly robs thrifty GMs of tools to control spending and plan cap flexibility. You can't do Front-loaded Salaries, descending salaries and flat salaries when raises are essentially forced-upon all contracts.

I'm sure I can think of more issues with switching to auto-adjustable/unpredictable salaries vs fixed, known salaries/raises. So, please don't just pick apart my examples as if they are the only ones. You must prove a bigger problems than what you have done so far.

bottomline: Making Reactionary Rules based on aberration events is silly. The burden of proving a really bad outcome is on you, before you should be allowed to "fix" anything. I don't think you and oakdogg have described a big enough problem.

 

You haven't really described why the change is necessary. I haven't seen one reason to make a change. Further, you haven't explained why the Player's Union would even vote for it vs having the ability to negotiate fixed salaries/raises which historically out-perform the BRI and are protected from revenue fluctuations. It also makes creating Front-Loaded contracts needlessly complicated when tied to a % reduction of unknown BRIs versus a GM handing a player a guaranteed fixed salary reduction that they can see upon signing.

 

Have you never worked before? This stuff happens all the time, you have a bumbling idiot who becomes a boss and makes more than the star employee. Also they signed a contract for multiple years, it's expected Harden will make less than Wes because his contract is only 15M per year, whereas a guy like Wes Matthews' contract ended and he was able to sign a new deal. Once Harden's current deal expires, he can then sign for 30M which would trump his old contract amount. And what is the compelling reason for this to even happen? If you're going to make a change you better have a ridiculously large reason for this, we all saw it where Silver refused to change the "hack an X" ruling because too few players were taking advantage of it. So, what's the compelling reason for this change then?

As for this thread, this is really pointless discussion because both the NBA players and owners don't want their salaries to be %s, we know this because the % proposal wasn't even included in the list of demands the BPA made to the owners during the last negotiations. So if all parties concerned don't want it why are you people wasting time talking about it? Are you going to go out of the blue and impose a change in the league that all relevant parties don't want?

This is like posters tryign to argue removing the salary limits on superstars, this will never happen because the NBPA as an entity will never propose it, guys like Harden/LBJ/KD etc make too little of the population so any attempts to distort the pie sharing will be voted down by the NBA middle and lower class players.

 

Isn't the whole point of this discussion is about those outlier years where some random lucky players happen to cash in to the big jump in the cap?

I guess it might not mean much in the grand scheme of things. But it just doesn't feel right in the gut level that some scrubs make way more money than the real stars.