Thanks, I had an epiphany: a hard cap exacerbates revenue inequalities and makes revenue-sharing more important. Consider: Right now, if Sac spends $45m and LAL spends $90m, and the BRI% still falls short of the target, LAL pays a larger share (twice as much since they have twice the salary) of the extra funds to SAC players than SAC does. This last season, it wasn't significant enough to matter as far as revenue sharing goes. Now, if you limit LAL's spending to what Sac can spend ($45m), you still have to hit the BRI% target, so both teams are kicking in again. But, this time LAL isn't paying any more than Sac is, and has over the season contributed well short of the BRI% target of it's own revenue. So even if the nominal hard cap is $45m, Sac might end up spending $60m* to stay near that cap number, if that's what the BRI% supports. If Sac thinks it can't support that, they have to stay a good deal below the cap to avoid getting killed on the make-up payments. In short, for a team to be sustainable in a small market and be an equal competitor financially, they have to generate enough revenue and/or receive enough revenue sharing to pay the league average payroll (which is going to be high thanks to the revenues of the Lakers/Knicks/etc of the league), regardless of whether the cap is high or low, hard or soft. If SAC can't be profitable with a $40m payroll, they certainly won't have the revenue to sustain $60m. So they must have revenue sharing. * In 2010-11, the average payroll was $63m, and the league still had to pay a little extra to get to 57% of BRI. If in a future year, the league made the same revenue but had to only pay out 52%, that would be an average team payroll of $58m.
