The NBA Plays the “Greed is Good” Game - Sports Week


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Written by: Avi Ben-Zvi

The NBA Lockout seems like a distant memory at this point. A little over a month ago, the labor disagreement between players and owners came to an end, culminating in a spectacular Christmas Day NBA season opening. All seems to have been forgotten after tensions were so high, not only between those directly involved with the dispute, but also those “indirectly” effected as well. Everybody seems to have forgotten about the thousands of lower level arena workers that were prematurely laid off in anticipation of a season long lockout. Everybody seems to have forgotten about the small businesses that suffered losses due to the lack of a full NBA season. Even the fans have forgotten about their on-the-court “heroes” that failed them in the negotiating process, and how owners sold their fans down the road to get that extra buck. It’s all about “the benjamins,” right?

It seems a bit outdated to be writing this reflection article at this point. You might be saying, “All is well in NBA land; why write this now?” Well, if you look a bit closer, you’ll see that the “greed is good” complex is still alive throughout the league. A labor agreement deal is in place for the next 10 years, but the culture of the NBA is riddled with dirty greed. For instance, players demanding trades out of small market cities, so that they can play with their buddies under big lights and get those huge endorsement deals (who doesn’t want their own huge billboard in the middle of Time Square?). However, before we delve into this new trend in the NBA, let’s take a look back at the lockout that was and talk some smack.

It was late November and the NBA should’ve been three weeks into its season. Instead, fans were staring down the barrel of an all-out stalemate between players and owners. Things were getting so bad that we were just hoping to have some basketball this season. Every few days, players and owners would get together in midtown Manhattan to try and bring the sides closer together, but the result was always the same. David Stern, the NBA commissioner who technically represents the owners during a labor dispute, would pessimistically walk upon the stage to address the media after hours of negotiation. His face always had this look of impending doom, as if something had gone terribly wrong. Discouraged and frustrated, he would blame the players for their lack of flexibility. Likewise, Derek Fisher, the Players Association representative, would express a similar sentiment after each session.

While things seemed to be in a terrible state amongst the two parties involved, fans were simply trying to understand what the big problem was. This wasn’t like the NFL lockout of a couple months prior, which outlined detailed plans for taking care of players after suffering major health issues due to the physicality of the sport. After hours and hours of continued talks, it all came down to the same point: Basketball Related Income (BRI for short). BRI is a term used to describe most of the revenue generated by NBA teams. BRI includes revenue generated by: all ticket sales, television contracts (with ESPN, TNT, etc.), concessions, parking, and some forms of advertising.

Under the previous labor agreement deal, players received 57% of the BRI, leaving 43% for the owners. Once the agreement expired in the summer of 2011, the owners were seeking revenge. The NBA owners reported a record loss for their franchises, totaling just about $370 million league wide. To rectify this issue, they presented a hard-lined 50% to 50% BRI split, a considerable mark down from the players’ previous 57% majority. Enraged by the 7% decrease suggestion, players asked for a drop no lower than 53%. Once the owners responded with a resounding “no”, things spiraled from there.

In any industry, it’s understandable that there would be issues between ownership and its employees. This sort of discourse, and of course disagreement, is a rather healthy ideal. It’s also not outrageous to think that this could occur in the highly profitable industry that is the NBA. But in a time when the American economy is suffering, joblessness is a continuing problem, and countless corporations are cutting back on workers salaries, shouldn’t the same hold true for the NBA? Why should NBA players get preferential treatment at a time in this country’s history when everybody has to feel its effects? And more importantly, why should I give a shit if players lose their majority hold of Basketball Related Income to their employers? This wasn’t a question of the rich CEO trying to bring down the mighty sword upon his helpless employees. What it really symbolized was a fight of sheer greed between billionaires (the owners) versus multi-millionaires (the players). The “greed is good” concept was doing well thanks to this conflict.

While owners and players disagreed on splitting hundreds of millions of dollars, the hard working American continued to suffer. Not just those who weren’t economically effected from the lockout, but those who outright depend on the NBA each season for their livelihood. Minimum wage arena and concession workers in Dallas, TX were laid off, small businesses (restaurants, bars, etc.) that surrounded NBA arenas and depended on the game crowds were suddenly closing up shop or finding it hard to survive. David Stern and Derek Fisher couldn’t agree to put aside a percent or two for the sake of those who don’t make an exuberant amount of money.

Players attempted to defend their stance by citing their financial losses because they weren’t getting paid to play basketball. They forget one crucial detail, however: It’s easier to survive (a couple months, a year, or more) when you have millions locked up in that shiny bank safe. Meanwhile, the owners didn’t seem to mind that basketball wasn’t happening either. In fact, small market owners were thrilled (both secretly, and in other cases, not so secretly…  **cough** **cough** Michael Jordan and the Charlotte Bobcats). Instead of losing money by paying the players a larger portion of the BRI, they could just close up shop and save operational costs all together. They knew they had the upper hand because they really didn’t have anything to lose, except for money if they didn’t get the deal they thirsted for. It was only a matter of time before the millionaire players would give in to the even wealthier billionaire owners.

And give in is exactly what the players did. The owners had the power and got what they wanted: players were reduced to only 51% of the BRI in the new 10-year labor agreement. They could’ve saved us all a lot of time and just given up in the summer of 2011, when this first happened. They begged for 53%, the owners responded with no more than 50%, and they eventually agreed somewhere in the middle of this only 3% difference. I don’t want to bore you with the brass tax of the economics here, but over time, this differential barely makes a difference for players and owners (read here). Instead, they caused damage to the little guy – that same guy they all claim to be “playing for.”

Now it is all over. Nobody even mentions the CBA (Collective Bargaining Agreement) that was so dirty. LeBron James is back to being the villain, the Knicks continue to disappoint, and L.A. is in the midst of a new turf war. But the sad part is, despite the conclusion of this messy labor negotiation, greed still haunts the NBA everyday.

Since LeBron James, Dwayne Wade, and Chris Bosh formed the dynamic threesome in Miami, stars around the league are abandoning the teams that drafted them for greater glory. This greater glory lays in the creation of “superteams.” With the majority of the NBA’s talent concentrated in larger market cities, the pureness of the league is slowly decaying. Stars’ lack of loyalty to their original team is becoming a theme, and the appeal of playing under “brighter lights” with endless endorsement deals takes over. This leaves those small market fans to wonder why they should even care about their team when the best player doesn’t even want to be there. He doesn’t care about the fan that has stood by him during the good and bad, he sadly only cares about which big city offers him more in the future. Case in point: Cleveland Cavaliers, New Orleans Hornets, and soon to be the Orlando Magic. The NBA has become a sort of sad saga, where the biggest headlines around the league involve star players demanding trades to play somewhere else. Sure, professional sports was never the exemplar of loyalty, but this age of the NBA has gone to an alarming level.

For a purist NBA fan, the state of the league is actually rather upsetting. The NBA lockout may have officially ended, but the “ice age” of the league, which David Stern so hesitantly referred to a couple months back, may still be eminent.