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View Full Version : Why Max Contracts are Bad for the NBA (Promote "Super Teams")



sixer04fan
02-28-2014, 01:11 PM
Been reading a little bit about this lately and I've come to the realization that max contracts really do more harm than good for the NBA. I actually think they are the main problem for some of the league's biggest competitive issues right now. By restricting how much superstars can earn in salary, it forces certain players to be underpaid compared to their true value. This allows for teams to pay multiple superstars and still have room for other players. At the very least - players might be more willing to go off on their own if they could be paid more according to their true market value, or whatever owners are willing to pay them.

The majority of fans always complain about superstars teaming up to play together, "Big 3's," and lack of parity in the league. Even NBA execs come out from time to time to voice their concerns about these issues. These concerns have obviously picked up tremendously since Lebron and Bosh joined up with Wade in Miami. No matter which side of the fence you are regarding this subject, there's no denying that these issues have come to light much more since then.

I think the main problem behind all of this is the implementation of maximum contracts. Contracts that restrict how much money any individual player can make in a year. Generally speaking, players with 6 or fewer years experience can make up to ~$13-14 million per year. Players with 7-9 years experience can make up to ~$16-17 million per year. And players with 10+ years experience can make up to ~$18-19 million per year. There are several exceptions which allow players to earn slightly more than that, based on performance/accomplishments and annual raises. But regardless of the exact numbers, the point is, players have a ceiling for how much salary they can earn, no matter how great or how valuable they actually are to a franchise.

These restrictions are put in place mainly to prevent owners from making crippling financial mistakes. If you are more of a pro-owner than pro-player kind of guy who believes that NBA players make more than enough money as is, and that players have too much power, than you can see the positives in this. It theoretically allows teams to sign superstars while maintaining some financial flexibility. In reality though, all this does is promote the idea that multiple superstars can sign to a team together. It declines league parity as only a certain few teams get all of the superstars, and in turn, forces the less attractive teams to overpay worse players just to keep up.

Hypothetical example - If a team had been allowed to offer Lebron James a $30-35 million per year contract, or Chris Bosh a $20-25 million per year contract... I know that they took pay cuts to sign with Miami to win, but let's say hypothetically that those two players valued their earnings slightly more and were offered contracts that they just couldn't refuse, regardless of the destination. Miami would not have been able to sign both of them while keeping Wade as well, unless they were willing to go so deep into the luxury tax, that the cost of these players to the franchise increased exponentially. That's up to the discretion of the ownership, but shouldn't necessarily be helped because Lebron can only make up to a certain amount of money anyways. If Lebron were willing to take such a drastic pay cut to play with Miami anyways, that's great. But shouldn't the market decide that, rather than the ceiling of how much money he can earn?

Let's just say that Milwaukee was willing to offer Lebron $30+ million per year. They wouldn't necessarily be able to build a great team around him, but that's what they are willing to do, and that's what it takes for Lebron to sign with such a less attractive team. All hypothetical. Maybe that team turns out to be a contender, and other instances like that happen around the league, creating more good teams, less awful teams, less super teams, more league parity, and better and more fair overall competition.

The example doesn't have to be Lebron obviously, for you sticklers. I was just using him as an example because IMO the max contract actually makes him the most underpaid in terms of his value compared to what other players make. It could be any superstar who is underpaid as a result of maximum contract restraints.

Maybe you like super teams and think they are great for the league. Maybe you like how the league is now from a competitive standpoint. That's perfectly fine too. But disabling max contracts wouldn't prevent that, as long as players are willing to take pay cuts and still make what they are earning now. I think a good solution would be to take away max contracts while maintaining the salary cap and seeing what happens.

sixer04fan
02-28-2014, 01:13 PM
Sorry for the length, wanted it to be more concise. I wish I could have worded that all a little better and made more sense of it.

Agree? Disagree? Let me know your thoughts!

desertlakeshow
02-28-2014, 01:23 PM
I agree, and also get rid of the salary cap along with it.


Its America, bring out the rake and the cash.

sixer04fan
02-28-2014, 01:36 PM
I agree, and also get rid of the salary cap along with it.


Its America, bring out the rake and the cash.

Well, I'm in favor of getting rid of the max contract but keeping the salary cap. Otherwise that defeats the purpose of getting rid of the max contract in terms of assembling super teams and declining league parity. Then superstars will all still be able to team up, they'll just be making more money. Doesn't solve any issues in terms of competitive balance.

John Walls Era
02-28-2014, 01:37 PM
You listed a few pros, which I agree with. But there are also the cons. Some teams and their crappy GMs will kill the franchise with terrible contracts. If you think its bad now, think about how bad GMs will pay a lot for crap players (Hedo might get 20M from the Raps in 2009).

Goose17
02-28-2014, 01:40 PM
Miami is a bad example, as the three stars took LESS money to form the super team, which imho is admirable. Interesting post though.

Taking away max deals would result in SO many bad contracts, I don't think it would even be financially viable. I mean small market teams already over pay for players, guys are getting max deals who are either unproven or past their prime just because that team is desperate for talent, they can't attract FAs like other destinations.

So many people would get bad contracts, unloading them would be damn near impossible. Stupid GMs would condemn the future of a franchise with bad contracts, I would hate to think what Andris Biedrins and Richard Jefferson would have gotten if max contracts didn't exist and players could demand anything, the Warriors would still be financially crippled to this day due to the stupidity of one front office that is no longer in control.

mightybosstone
02-28-2014, 01:45 PM
Max contracts are necessary. If you didn't have max contracts, the NBA would have to take a serious look at getting rid of the salary cap altogether, and I am NOT in support of that. MLB is insanely frustrating, because the teams with the money are often the teams buying up all the best players and having the most stacked rosters. Considering how much a single superstar can mean for an NBA team, imagine an NBA where New York and LA ALWAYS have the best players on their teams and could afford $30-40 million a year contracts for the Lebrons and Durants of the league. That would do more to harm parity in the NBA than max contracts would.

Also, I think you're missing a major point, which is that max contracts don't prevent great players from playing together. Look at Lebron. The man could have had a max deal almost anywhere he went, but he took a discount to play with great players. You're telling me he would rather take $30 million to play in Milwaukee than $18-20 million to play for the Heat? I'm calling BS, and he wouldn't be the only superstar to go that route. The man is a global icon and easily makes more money in endorsements than he likely makes in his NBA salary. Plus, building up a legacy means he can make endorsement dollars years after he's retired. You still see Jordan, Magic and Bird in commercials decades after they left the sport.

So really, whether you do or don't have max contracts or do or don't have a salary cap, you're not going to prevent the occasional super teams. Players care about winning and their legacies, and if they want to join other superstars, they're going to do it regardless if they have to take a dramatic pay cut in the process.

mightybosstone
02-28-2014, 01:50 PM
Well, I'm in favor of getting rid of the max contract but keeping the salary cap. Otherwise that defeats the purpose of getting rid of the max contract in terms of assembling super teams and declining league parity. Then superstars will all still be able to team up, they'll just be making more money. Doesn't solve any issues in terms of competitive balance.

Okay.... But if that's true, you're still limiting what teams can offer players. If you're talking about a $58 million salary cap, Milwaukee can offer Lebron $30-40 million, but he's not going there, because the team around him will be even worse than what the guy had in Cleveland.

You make it sound like getting rid of max contracts would put small market teams on a level playing field, but that's simply not the case. Great players don't just want to make money. They want to win rings, play with other great players and get big endorsement dollars. They simply aren't going to be able to do that in Milwaukee or Minnesota. If small market teams want to succeed, they have to do what OKC and San Antonio have done: draft well, make smart front office decisions and put a good coaching staff in place. That's the key. Not changing the entire salary structure the NBA has in place.

mightybosstone
02-28-2014, 01:55 PM
Miami is a bad example, as the three stars took LESS money to form the super team, which imho is admirable. Interesting post though.

Taking away max deals would result in SO many bad contracts, I don't think it would even be financially viable. I mean small market teams already over pay for players, guys are getting max deals who are either unproven or past their prime just because that team is desperate for talent, they can't attract FAs like other destinations.

So many people would get bad contracts, unloading them would be damn near impossible. Stupid GMs would condemn the future of a franchise with bad contracts, I would hate to think what Andris Biedrins and Richard Jefferson would have gotten if max contracts didn't exist and players could demand anything, the Warriors would still be financially crippled to this day due to the stupidity of one front office that is no longer in control.

This is another great point. Eliminating max contracts wouldn't help parity in basketball, it would just allow for small market teams to continue making horrible front office decisions. It might help them win a few games in the short-term, but signing a second-tier superstar to $30 million a year would cripple them long-term and put them in even worse shape than they already are.

The last CBA was put in place to do everything the league could to prevent horrible contracts (though they still happen). But if they were to eliminate max deals, it would completely negate all the work they did in that CBA, and you'd see some of the worst, cap-crippling contacts in the history of professional sports.

Goose17
02-28-2014, 01:58 PM
[QUOTE=mightybosstone;28055632
So really, whether you do or don't have max contracts or do or don't have a salary cap, you're not going to prevent the occasional super teams. Players care about winning and their legacies, and if they want to join other superstars, they're going to do it regardless if they have to take a dramatic pay cut in the process.[/QUOTE]

I agree with this^

abe_froman
02-28-2014, 02:19 PM
also how is this gonna stop superteams? teams like mil will never be able to afford to pay say lebron 30+ mil a year,the only teams that could are the big market teams that you guys complain about(seeing how the nets spend,i think prokhorov wouldnt flinch in handing out a bunch of 30 mil a year contracts to put one together).and those that are truly worth that much wouldnt take it if it meant that couldnt afford anyone else....and seriously fans ***** about players only being about money,so when they arent only about that they complain! ...cant win with you people.

if a player wants to team up with someone,or a gm wants to pair up guys they will find way to make that happen.parity is impossible because of this,because you cant take away free will and also because the design of the game itself

Chronz
02-28-2014, 02:32 PM
Who knows man, hard cap, soft cap, endless contracts, it could all work or backfire.

D-Leethal
02-28-2014, 02:36 PM
Interesting theory that I think has some merit. Max contracts allow for multiple stars to fit under the salary cap, it also allows for guys to "take less" without taking a massive financial hit. If your max is at 18M, than taking 15M isn't the worst thing, but nobody is taking 15M when the free market dictates they could get 40M.

I do think if there was no cap, no max contracts, there would be super teams - but it would be like baseball where the super teams reside in 3 markets and the small market teams would be forced to get crafty with how they try to put together a contender. Knicks, Nets and Lakers would have no problem giving three 30-40M contracts out to form a superteam.

Without max contracts, there would be way too much correlation between the depth of the owners pockets and the quality of the team on the court. You shouldn't be able to buy out all your mistakes - you should have to make prudent decisions to succeed and suffer when you don't.

desertlakeshow
02-28-2014, 04:05 PM
If you really want parity in the league, if that is truly the end goal.

Take the names off the backs of the jerseys, each uniform comes with a facemask.

Take the best players every year statistically, and place them on the worst team. Constantly flattening the leagues teams. Also whoever won the Championship last year cannot win it again until all the other teams have done so.

You parity lovers will be in hog heaven, and what a league it would be. Flat earth society's wet dream.

Goose17
02-28-2014, 04:11 PM
If you really want parity in the league, if that is truly the end goal.

Take the names off the backs of the jerseys, each uniform comes with a facemask.

Take the best players every year statistically, and place them on the worst team. Constantly flattening the leagues teams. Also whoever won the Championship last year cannot win it again until all the other teams have done so.

You parity lovers will be in hog heaven, and what a league it would be. Flat earth society's wet dream.

http://www.youtube.com/watch?v=FONN-0uoTHI

Kaner
02-28-2014, 04:31 PM
Miami is a bad example, as the three stars took LESS money to form the super team, which imho is admirable. Interesting post though.

Taking away max deals would result in SO many bad contracts, I don't think it would even be financially viable. I mean small market teams already over pay for players, guys are getting max deals who are either unproven or past their prime just because that team is desperate for talent, they can't attract FAs like other destinations.

So many people would get bad contracts, unloading them would be damn near impossible. Stupid GMs would condemn the future of a franchise with bad contracts, I would hate to think what Andris Biedrins and Richard Jefferson would have gotten if max contracts didn't exist and players could demand anything, the Warriors would still be financially crippled to this day due to the stupidity of one front office that is no longer in control.

But would Lebron, Bosh, and Wade have taken less money if the difference was 100m (or whatever ridiculous amount lebron would pull) instead of 30? It would have been alot harder to convince a player to walk away from that kind of money no matter how wealthy you are. At the time Lebron had a choice between the same max contract that elton brand gets or better chance at rings, if the choice was between the biggest contract in nba history (or even sports) or better chance at rings then its a much tougher sell on Miami's part.

I think it's an interesting idea but probably wouldn't know how effective it is unless it was implemented

torocan
02-28-2014, 07:29 PM
I'm not sure completely eliminating max contracts would be the best idea, especially if you eliminated the salary cap entirely as it would basically turn the league into pay for play, ie whoever has the most money.

I've thought about this on and off and I think a better solution would be a hybrid cap/max using the "Franchise Player" designation.

For example...

Salary cap is $50M.
Max contract remains as is by definition.
ONE player may be designated a "Franchise Player". They are not subject to the salary cap or a "max" contract, in other words you can pay them up to 2x the current maximum contract without salary cap implication. However, the maximum contract length will be 4 years.
This would NOT impact bird rights so it would not overly punish teams that draft and develop players well.

So using that structure, 14 players have to fit under the cap of let's say $50M (Use the current cap but subtract the equivalent of an average max contract), but they're subject to "max" contracts of the current structure ($14-24M depending on the player, etc).

ONE player (Like Lebron, Kobe, Melo, etc) can be designated a "Franchise Player" and paid up to 2x their normal "max" contract. So Lebron would be eligible for $50M. Kobe for $60M. Melo for $50M. Etc, etc.

Essentially what this would do is it would make it *extremely* costly for a player who could get a "franchise" contract ($14-20M on a normal max) to join a "superstar" vs going to a team without a "franchise" player who could pay them $28-40M+.

This doesn't stop 2nd tier stars from joining a "superstar", but it does put a very heavy deterrent for a "superstar" to join a 2nd "superstar". Also, because the "franchise" designation is so high and there's 30 teams who *can* use it, this puts teams without a superstar at a significant advantage in terms of winning over a new or free "superstar" player.

As for why I'm using 2x the current max contract, this is mainly to protect owners from completely burying themselves. And I'm using 4 years as a maximum "franchise" contract to not only reduce the impact of stupid owners completely screwing themselves, but also to create more turnover of the "superstars" and encourage more consistent performance (more rapid turnaround for superstars to play for "contract years").

Anyway, just some thoughts....

xnick5757
02-28-2014, 07:53 PM
This is another great point. Eliminating max contracts wouldn't help parity in basketball, it would just allow for small market teams to continue making horrible front office decisions. It might help them win a few games in the short-term, but signing a second-tier superstar to $30 million a year would cripple them long-term and put them in even worse shape than they already are.

The last CBA was put in place to do everything the league could to prevent horrible contracts (though they still happen). But if they were to eliminate max deals, it would completely negate all the work they did in that CBA, and you'd see some of the worst, cap-crippling contacts in the history of professional sports.

teams make terrible decisions all the time anyways

ChiSox219
03-01-2014, 01:05 AM
Cut out all the weak US markets, expand into Asia and Europe, eliminate the cap, and no max salaries. Guys like KD and Lebron would be getting $100 million annually as league revenue and fan interest soars.

desertlakeshow
03-01-2014, 01:29 AM
Cut out all the weak US markets, expand into Asia and Europe, eliminate the cap, and no max salaries. Guys like KD and Lebron would be getting $100 million annually as league revenue and fan interest soars.

I like the way you think, no flat earth society thinking in anything that you wrote.

alexander_37
03-01-2014, 02:49 AM
Think about how much Joe Johnson would have got :puke: some teams need to be saved from themselves.

WadeKobe
03-01-2014, 04:42 PM
Think about how much Joe Johnson would have got :puke: some teams need to be saved from themselves.
He would have gotten less. Everyone talking about how guys would get worse contracts are wrong.

In a league where 2010 LeBron can make $40m a year and Wade $30m, and Bosh $20-25m, means they don't "take less" because "less" is far more substantial. The league ends up with a superstar on every team, instead of teamed up, and the "$40m + crappy players can't win" would be incorrect, because every team would be like that.

Then, with restricted cap space left, guys like Joe Johnson couldn't ask for as much money. The market would dictate that he settle for less.

In the current market, most of the talent is condensed to a few teams with multiple stars making less than market value on the same team. This makes second tier players worth more money on the market, because they are more valuable.

If there are 20 franchise players in the league and 30 teams, but those 20 players are playing for 10 teams, how muh more valuable are the second group of guys to the other 20 teams?

Eliminati max contracts in the NBA would actually drastically limit the Joe Johnson signings, because in a league where the top talent is spread out, second tier talent is worth less money on the open market because you have less buyers.

JPS
03-01-2014, 04:49 PM
Just eliminate guaranted contracts. Then there is no need for max contracts. Max contract protect owners from being stupid. No guaranteed contracts would get rid of players getting paid and then turning into dogs. It would give the same protection to owners, but also and more importantly put forth a better product for the fans

Nothing will eliminate super teams though. Jordan took less money to get better teammates for years before the max contract.