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Locked Out of Reality

November 16, 2011
by

NBA players are lazy. You’ve heard that before, right?

Bad time for a nap, bud.

That’s an issue for another post, but in the middle of an increasingly nasty lockout that threatens to wipe out an entire season, we might as well be frank about the situation.

Right now, the NBA owners are the lazy ones. Let me explain.

First of all, because lockout talk is fun like dentistry, let’s summarize as fast as possible. Lockout micro-recap!

  • The prior collective bargaining agreement allotted 57% of basketball-related income (BRI) to the players, divvied up amongst their variably huge contracts.
  • The rest of the money went to the franchise owners, many of whom incurred financial losses in the past few seasons.
  • All owners, losing or not, realize they have a chance to extract much, much more money from their teams.
  • They’ve chosen to do so by placing a stranglehold on labor negotiations, beginning by offering the players 47% of BRI, but eventually raising to 50%.
  • The players, realizing that a financially strong league is a pretty good thing to have around when you’re an unbelievably skilled athlete, offered to give up part of their share to help offset the losses, coming down to 53% of BRI.

What did the owners say?

More, please.

And here we are.

I’m sitting on my couch right now, with a bad early-season hockey game on the TV. That’s fine – I’m actually not too disappointed about that. What’s shocking is that on the same channel that should be handling local broadcasting for most Philadelphia 76ers games, I just saw a commercial for a TV show called Inside Israeli Basketball.

Seriously, this exists.

I got over it – honestly, there’s nothing wrong with a little international basketball (and does Ahmad Rashad host that show?). But maybe you could say I was feeling a bit entitled to the sports I usually watch, from which the NBA is conspicuously missing.

Entitlements have been all the rage in the United States lately. The past few years haven’t been kind economically, and we’ve seen a lot of bailouts, for better or for worse, as banks, insurance companies, and auto manufacturers have all in turn been granted a piece of taxpayer pie in order to stay alive. Plans are alive to allow mortgage holders to write down loan principal, because they weren’t expecting home values to plummet immediately after signing the mortgage papers. Moreover, whether substantively right or wrong, the Occupy [Your Locale Here] movement espouses the idea that in at least some cases, student loans should be forgiven because of scant job opportunities for young college graduates.

The NBA’s ownership group, with many notable 1%-ers among them (Occupy Ball Street?), are in the same boat right now. They’re looking for a way to dodge responsibility for their own non-performing investments, and to minimize their future business risk, they’re doing it in a way that’s objectively shortsighted and simple-minded, and like I said earlier, they’re just being lazy.

99 problems, but bein' rich ain't one.

The idea that ownership of anything (least of all a basketball team) should amount to entitlement to profit is a flailing tantrum in the face of economic reality. It’s understandable that the owners aren’t happy about losing money last year, but that’s a problem that should be solved with better management, not just by demanding a bigger cut.

Financial messes are unavoidable. If we don’t know that by now, we’ll never learn anything, and it seems like there are two ways to respond to such crises, even such unexpected ones:

  1. You can swear up and down because you’ve been inconvenienced or even wronged by others, and demand that part of their stuff now be made your stuff.
  2. You can get creative, develop a wild, unorthodox master plan to building something new, to make it work*, and build wealth far beyond the value of what you can take from someone else.

In the case of the NBA, it’s a matter of choosing between transferring money from workers to ownership versus reshaping its business model and devising a marketing approach to attract revenue the old-fashioned way: from devoted and loyal customers.

One option is easy, and the other is hard. One is a sure but limited gain, and the other is riskier but potentially a windfall for owners and players alike.

Think about it.

NBA owners, with a few exceptions, can be a haughty bunch. Most have made a lot of money through shrewd business decisions, and they’re proud of that. No matter their individual background, they’ve been successful, and some of them may be losing a lot of money for the first time right now, no doubt a scary situation, so maybe this is more about getting back out of the red than actually maximizing anything at this point.

Maybe that’s actually the long-run idea. Maybe the owners just want to crush the players while they can (and right now they can, without question), and then use their extra cash to begin building a bigger and better league later. But I don’t think they’re that smart. I think basic greed is in play, and jealousy of the NFL’s nonstop cash machine hasn’t helped.

What did people do before image search?

In fairness, I should mention that I’m not particularly sympathetic to the players, especially not when I could retire and live comfortably after a single season at an average NBA salary. Active players have no excuse to be dependent on the future for their livelihood, and they should absolutely offer up some of their portion of the revenue, the highest average pay in professional sports.

But they’ve already made that offer.

So now it’s the owners’ turn to make a good faith effort to be more leadership than ownership, to be inventive and creative and all the things that made them successful in business prior to basketball. Instead of simply carting away a larger stack of the money pile, they should try to build a bigger pile.

After all, it’s worth stating that taking money is not the same thing as making money.

—————

*HoopTherapy knows about making it work. We started an NBA blog just five weeks before the league entered a lockout! Did we curse our bad fortune and ask for a bailout? Nope. Did we jump ship and switch to another sport? Nope. Do we at times take painfully long breaks between posts? Well, yes, and that’s not going to change. We have jobs! We have to make money for our owners!

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2 Comments leave one →
  1. Junaid permalink
    November 21, 2011 2:52 pm

    Well said.

Trackbacks

  1. Mailbag, December 2011: Gettin’ Cynical « HoopTherapy

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