NBA Needs A Compromise
Despite all the bluster in the NBA lockout, the opposing sides have begun to show each other where the middle ground is.
The owners want "cost certainty," but they'll likely settle for meaningful cost controls that will produce a similar effect.
The players say "No hard cap," but they'll accept rules that will both restrict the highest salaries and tighten the current "soft" cap.
How long it will take for them to meet in the middle?
That's the big question, and no one knows the answer.
Aa this weekend passed without the owners and players bargaining together, another opportunity to save more of the regular season was being wasted. The NBA already has canceled the first two weeks of the regular season, and another two-week chunk could be lopped off if no agreement is reached next weekend.
Since the sides have no plans to meet anytime soon, the cancellation of more games is a likelihood.
"If the attitude of the owners stays like it is, if they're not inclined to reach some compromise that is satisfactory to both parties, it could well be that (the entire season will be canceled)," union director Billy Hunter said.
Similar doomsday scenarios have been advanced by the owners, but it seems to be a long shot that the sides would allow that to happen. Too much damage would be done to the sport.
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| NBA deputy commissioner Russ Granik (left) and NBA commissioner David Stern don't want to lose any more regular-season games. (AP) |
More likely is a protracted standoff that ends when each side bends.
Whether they were ready to publicly admit it or not last week, the concept of a luxury tax looks to be the mechanism that will help bring an end to the work stoppage that has forced the first labor-related cancellations in NBA history.
Each side has proposed tax rates and thresholds (a $2.6 million starting point by the owners, an $18 million starting point by the players) that the other side can't live with, but that's part of negotiating.
Somshere in the middle, perhaps around $10 or $12 million, is the point that could end up serving as a maximum salary for all but a handful of players.
Along with a tightening of the rule that allows for 20 percent raises each year, it should be enough to keep the owners from ending up with more contracts like the one signed by Kevin Garnett for $126 million over six years.
"All along, their contention has been that they were concerned about the superstars' salaries," Hunter said, "and Kevin Garnett has been the poster child in every discussion. They don't want to see these $100 million contracts occurring."
When Garnett's agent convinced Minnesota owner Glen Taylor to agree to a $14.3 million salary in the first year of the deal, the subsequent 20 percent annual increases allowed it to max out at about $26 million in the final year.
Similar deals would not happen in the future if a) a luxury tax set an effective limit on the salary in the first year of a new contract, and b) there was a decrease in the 20 percent escalation rule.
And guess what?
Although it hasn't been publicized much, the sides have shown each other that an agreement on those two points is within reach.
The union has put a proposal on the table that cuts the annual increases to 10 percent, and the league has asked for 7.5 percent.
If they can compromise on that point and come up with a reasonable starting point for a luxury tax, it would create a situation whereby no owner would be likely to sign a Garnett-type deal.
That's half the battle right there.
"What we attempted to do was address that," Hunter said. "The guys at the top said they were prepared to suffer the imposition of a tax, as long as the guys in the middle become the beneficiaries."
The problem is, the union thinks, that the owners' latest proposal sets such a low tax threshold that about 90 percent of the players would be squeezed into non-taxable contracts.
If the sides eventually move on the tax threshold, which they will do, and the owners increase the minimum player salary based upon years of service, which they have begun tdo, it should benefit the middle class of players that Hunter has promised to take care of.
One major sticking point, even if the sides agree on the tax numbers, is the owners' insistence on putting a limit on the amount of basketball-related income that can be devoted to salary costs.
They've asked that if the tax system doesn't work, they want a hard cap as a fail-safe. The players, however, have vowed never to agree to a hard cap -- even as a fallback.
"Wherever we end up, we have to have an agreement that if it doesn't work, we'll go to something that we know will work," NBA deputy commissioner Russ Granik said. "We're not taking a risk again. That just doesn't seem fair. We can't be asked to again to try something and hope."
When they signed the old collective bargaining agreement six years ago, the owners expected to pay between 48 and 52 percent of revenues toward salaries. They tossed out the deal and imposed the lockout after that number rose to 57 percent.
They have asked that the fallback system have a fixed percentage of 52 percent in 2000-01, 50 percent in 2001-02 and 48 percent in 2002-2003.
"Again, those numbers always negotiable," Granik said.
If the concept of a hard cap also is negotiable, the sides should be able to reach a deal.
With a little give here and a little take there, a basketball season will happen. It's up to the owners and players to decide when they'll do so.
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