The Rime of the Ancient Sports Leagues

Money money everywhere and all the leagues did shrink
Money money everywhere and not a drop to drink

Ah, few things take me back quite like the poem based on Samuel Taylor Coleridge’s “Rime of the Ancient Mariner”… anyway, enough nostalgia. At some point, the NFL Players Association and the NFL owners will sign a new Collective Bargaining Agreement. It might be sooner and it might be later (my better half is hoping for later… she tolerates me watching American Football of any kind). Between “The Decision” of LeBron James and “The Manipulation” of Carmelo Anthony, the hard line taken by the NFL owners, and the sounding of Hank Steinbrenner, I think that there is a larger issue that is troubling all of the major professional leagues in North America. In the interest of full disclosure, I did feel the need to say North America instead of the United States because of the 8 teams (out of 122) that reside north of the border.

So what is the larger issue? That millionaires and billionaires can’t agree over who gets the money? I hate to be so blunt about it but if you are under the impression that this problem is a new one to the economic model of this country, you’ve obviously been living under a rock for the past few decades. What is the solution? Nationalize the whole industry? While that might be the answer for some problems, it is not the answer for this one (although it would probably help reduce the deficit significantly).

What I’d like to do is examine each sport and see where they stand with regards to the specific issues which are plaguing them publicly. I don’t delve into the inner workings of professional sporting leagues and it’s entirely possible that the biggest problem facing each league isn’t the one I mention. However, these are the issues that are getting the most play in the press and it’s there that I will focus this post.

Before we get into it, I have to apologize to all of you hockey fans out there. I don’t understand hockey and the only time in my life that I’ve ever watched a hockey game from start to finish was the 2010 gold medal game. Having said that, I don’t know what is plaguing the league other than the fact that it’s getting closer and closer to being replaced as a member of the “Big 4” club by NASCAR. I don’t follow hockey and I still say that would be a sad day.


NBA

Last summer we were bombarded by “The Decision”. Starting last year and going almost all the way up to the trade deadline this year we were treated to “The Manipulation”. The big picture issue is whether or not superstars should team up and form these trios in an attempt to win with three stars and ten role players. Many say that it started with Ray Allen and Kevin Garnett being traded to the Celtics to team up with Paul Pierce and has continued today with the Miami Heat and the New York Knicks (and you could probably throw the Lakers in there… especially if the rumors are true and Dwight Howard ends up there soon). The question is, is this good for the league?

I’ve heard and read about many former players that are condemning these actions, saying that they would rather beat the best than play with the best and I completely understand this mentality. However, how many titles did LeBron James win in Cleveland as the lone superstar? How about Dwayne Wade in Miami? How about Kobe Bryant in LA?

In this day and age, the titles follow the superstars and while that last example may not quite hold water (Kobe) that would depend entirely on your definition of superstar. While I personally would not put Pau Gasol and Lamar Odom into that category, I also don’t think they’re that far off.

Going back further, how many titles did David Robinson win as the dominant inside force he was before Tim Duncan came along? How many did Paul Pierce, Ray Allen, and Kevin Garnett combine for before they teamed up?

As I’m sure you can guess the answer to all those questions is zero. One player can’t take a team all the way in the NBA today and I would argue that the same has been true throughout the history of the NBA. In 1997, a panel consisting of members of the media, former players and coaches, and former and current front office members selected the greatest 50 players from the first fifty years of NBA history. By the logic exhibited by several former players, you would never want to team up with those guys; you would want to beat those guys. Of those 50, only 4 never played with another member of the exclusive club.

George Mikan
Bob Petit
Isaiah Thomas
Patrick Ewing

Another noteworthy factoid from that list; only once has a team has had five players that ended up being named one of the NBA’s 50 greatest players ever playing on the same team. They were:

1973-74 New York Knicks
Willis Reed
Walt Frazier
Dave DeBusschere
Jerry Lucas
Earl Monroe

Considering that Mikan and Petit played in an era where there were so few good players, much less stars, I think we can safely exclude their combined 6 championships from this discussion. Thomas and Ewing combined to play 30 seasons in the NBA and won two titles (both by Thomas). At that time the Lakers and Celtics dynasties of the ‘80’s were winding down and the Bulls weren’t quite ready for the spotlight yet, leaving a perfect void for a very good and tough team led by one great player.

I fully understand that very few of the players on that list manipulated their way from one team to another or staged an hour long primetime special to say nine words but the fact remains that championship teams have always formed around the combination of great players with role players filling in the gaps.

So what is the harm with great young players wanting to team up in an attempt to win a championship? If they don’t care about winning and only want to set records and make money, they can easily go to a team like Cleveland or the Clippers, make $20 million a season and get the lion’s share of the ball. Instead, you have three young superstars in James, Wade, and Bosh who are all willing to take a slightly diminished role in order to play with one another. That, in this day and age of prima donnas, isn’t such a bad trait.

The problem I have is not that they wanted to team up, it’s how they did it; through the media. Carmelo Anthony very publicly wanted out and that drastically reduced Denver’s leverage in the trade negotiations as teams knew they were desperate to get something back for him. On the other hand, LeBron James wrangled a three ring circus and then left the Cavaliers with nothing.

Now you have the formation of an aristocratic class of teams in the NBA, the Heat, Celtics, Knicks, Lakers, and Spurs with the Bulls and Mavericks close behind, while the rest of the league is left high and dry.

Is there a solution? Yes.
Will the owners like it? No.
Why? The almighty dollar.


THE NFL

Whenever it comes to labor renegotiations in professional sports, you have to maintain some semblance of perspective. According to figures researched by Plunkett Research, LTD (a firm that looks into industry trends, statistics, and analysis of top companies) the NFL produced $7.8 billion in total revenue last year. The numbers vary slightly from year to year but the exact numbers aren’t really necessary; ballpark figures will suffice. Under the current collective bargaining agreement (hereafter abbreviated CBA) the owners take $1 billion off the top of that number to distribute amongst themselves. After that, it goes into a pool that is shared by the owners and players. Under the current agreement (if my memory serves me this today) the players cut of that is 60%. If we assume that revenue figure is accurate, that comes out to $4.08 billion that goes to the players, both past and present.

However, the owners are shrewd businessmen and like more zeroes in their bank accounts. They want to take another billion off the top before the revenue sharing kicks in. With these figures, the owners’ share of the pie would go from $3.72 billion to $4.32 billion. If we were to simply spread the remainder of the pie amongst the roughly 1,600 NFL players and we were to ignore things like pension plans, then the average salary in the NFL would drop 14.7% from $2.55 million to $2.18 million.

Again, we have a situation where millionaires are arguing with billionaires over a very large, lucrative pie. I’ll admit that there are certain issues that the owners have (such as a rookie salary wage) that make a lot of sense. However, trimming another 13% of their leagues revenues out for themselves is nothing short of ridiculous. The problem is it’s entirely possible that they’ll get it.


MLB

Is the league’s business model straying towards socialism? Perhaps, a little but I don’t have any problem with that. What I do have a problem with is teams like the Yankees and Red Sox paying vast amounts of money that eventually ends up in the hands of teams that simply deposit it in their bank accounts. The entire point of the revenue sharing agreement was for teams who didn’t play in a market that could justify a $100 million payroll (Pittsburgh, Kansas City, Tampa Bay) to have a $100 million payroll and compete directly with the likes of the Yankees and Red Sox.

First of all, I’m not suggesting that every team should be spending $100 million on its 25 man roster. However, it’s difficult to call the Yankees and Red Sox the problem when the Pirates have spent less money in the last five years (while posting a 321-488 record) than the Yankees did to go 95-67 this past year.

What is the solution? A salary cap? The problem with a cap of any kind is the players don’t want anything to do with it and the player’s union is the strongest of any of the Big 4 sports (in my opinion). What’s another solution?

What are the solutions to these problems?


ARE THERE SOLUTIONS?

All of them center on the almighty dollar. Everyone wants more money and they want to sacrifice less and less to the guys on the other side of the bargaining table. On top of that, none of the parties that are actually doing the bargaining (the player’s rep and the commissioner) want to appear weak by giving too much or else they’ll be out of a job very quickly and you must remember that these are not minimum wage jobs.

All of these problems are easy to solve one of two ways (though really it just ends up as one big problem) as long as you don’t include the players in the decision making process… or the owners for that matter.

In the NBA, eliminate the salary structure that is now in place. How much help will that provide with regards to keeping players in smaller markets? Quite a bit. The difference right now between a max contract in Miami and a max contract in Cleveland is one additional year. The Average Annual Salary (AAS from now on) remains roughly the same. Now imagine that the Cavaliers were able to offer a contract worth an additional $10 million per season… or $20 million. Would that be enough to offset the desire to go to more tourist friendly cities? Absolutely, but here comes the problem… payrolls explode and now, the Cavaliers can’t afford that kind of payroll and neither can the Clippers or the Kings or the Nets. Finally, after much consternation and realizing that all the great players end up in big markets anyway, the NBA eliminates four teams.

In the NFL, the player’s union records some landmark deals in order to secure more of the revenue pie for active players but also much more for retired players and the NFL owners are exposed as the 19th century businessmen that many of them are, putting profits ahead of the well-being of the workers. Salaries continue to escalate to the point that some teams can keep the high priced players and some can’t. In a stunning move by what has been for years the most popular sport in America, Commissioner Roger Goodell announces that he will be contracting four teams.

In Major League Baseball, Hank Steinbrenner wins his argument and in an amazing turn of events, the owners are no longer forced to pay a luxury tax on their high payrolls or share revenues with the less fortunate teams. After a Cinderella run to the ALCS, the Kansas City Royals (who have a nice trim $15 million payroll) lose to the monstrosity that is the Yankees (with their $400 million payroll) and the Yankees go on to win yet another World Series. Admitting that eliminating the luxury tax was a terrible idea, the commissioner of baseball decides to contract four teams in an attempt to level the playing field.

There is one other solution other than contraction and that would be moving the teams to markets that will actually support a professional franchise. However, in this day and age of being able to choose any one of dozens of leisure activities, how many franchises can these major markets support? New York currently has seven teams and they all seem to prosper. Los Angeles has five with a glaring lack of an NFL team and again, they all seem to be well supported. Can other cities support that many teams?

Like I said, the solutions are all tied together but the roots of them all lead back to the same place.

The almighty dollar.