By Jan Hubbard
Although records for this sort of enterprise are not kept, it seems safe to suggest the two sides in the NBA labor negotiations have received unprecedented help in trying to resolve the impasse.
The pack of news people who have had the tedious duty of documenting the skirmish in New York over billions of dollars have listened carefully to both sides, recorded the concerns of each and offered logical solutions.
Judge Judy and Dr. Phil combined couldn’t have done better.
Perhaps that sort of precise reporting on dividing revenue has occurred on a small scale in the past, but not to this extent. Once ownership set the amount of its losses at $300 million, and when both sides shared percentages of what they wanted out of negotiations, diligent reporters went to their iPhones, pressed the calculator app and did the numbers. It wasn’t that difficult. Presumably they all passed math in grade school.
As the percentages each side said were required for a deal got closer and closer, writers covering negotiations have been more and more dumbfounded that a middle point could not be found. By not playing basketball games in the preseason and now cancelling the first two weeks of the regular season, each side has sacrificed more than it would lose with the other side’s deal. So why not compromise?
And therein lies the problem – the assumption that logic applies; the belief that it is common sense to believe both sides will exercise common sense.
That has been incorrect, which leads to an obvious conclusion. This financial contest is not about dividing revenues fairly.
It’s about winning.
It’s about owners – who, by the way, include Michael Jordan – pulling a Michael Jordan and imposing their will on their opponents.
It has been noted that wealthy owners can survive a labor stoppage longer than the majority of players. But that’s only part of it. Wealthy owners are nothing less than cutthroat in getting their way, and ownership has claimed the players got the better of the last two collective bargaining deals. So owners are interested in compromise only on their terms.
Consider the “concessions” made so far by David Stern and the owners. Originally, they wanted a hard cap (which they knew they could not get) and a rollback in salaries (which they knew would not happen).
So, magnanimously, Stern agreed to drop both. What a great negotiating tactic – drop something you never had and had no chance of getting. And then portray yourself as flexible and dealing in good faith.
It is wonderful to believe that a middle ground exists, but it’s kind of like sharing a dessert with an older brother, who says he has an inalienable right to “the bigger half.”
To become the CEOs and billionaires that they are, these mega-wealthy men have had to make cold-blooded decisions. Take the league office, for example. In mid-October 2008, the league announced that it was investing in the construction of 12 arenas in China.
The next day, Stern announced at an NBA event in London that 80 league employees had been laid off.
The timing was brutal. How must those 80 people and their families have felt about an investment overseas while losing their jobs? And ultimately, will it really matter if there is no Yao Ming to enrapture the Chinese public?
But, hey, life goes on. As we have been told, it’s just business.
The owners aren’t the only dubious performers in this dispute. The players have developed an acute sense of entitlement, and while there is no doubt they have contributed greatly to the popularity of the NBA, the league has also provided them with the best playing and traveling conditions in the world. Players also benefit from a tremendous publicity machine and ultra-aggressive marketing. And that’s expensive.
So when we hear the concessions the players have already made amount to more than a billion dollars in “givebacks,” the reaction is laughter. By definition, you can’t give back something you don’t have, and the players do not have a contract.
It is correct to say they have been offered considerably less than what was in the last contract, yet even if they don’t believe league officials when they say 22 teams are losing money, there is no doubt that a bunch are. That’s why no one wants to buy the Hornets. So to continue to have 30 teams playing in the best arenas in the world – and 450 full-time jobs – concessions have to be made.
But all of that is not to say that either side is worth supporting. The players, however, should be aware of this: NHL commissioner Gary Bettman played an integral role in league financial matters during a 12-year career at the NBA. And he shut down his league for a year in 2004-05.
You can be sure that Stern, Bettman’s old boss, knows all the background information on that NHL work stoppage, and it is a certainty that Stern and Bettman have conversed at length.
Since losing a season because of the labor dispute, the NHL has steadily grown. In 2005-06, it had a $39.4 million salary cap per team. This season, the cap is $64.3 million.
Hockey’s revenues pale to the NBA’s, but the point is that league has been healthier since it was shut down. The NHL contended that some teams lost less money by not playing than playing. And the owners of the big market teams likely had other businesses that made significant revenues.
Put it this way: Anyone on the Forbes list of wealthiest people in the world did not lose a place on that list because of one season of missed hockey. And the same will be true in basketball.
The players, on the other hand, lost a year of salary and ended up with the same system they would have had without missing a year.
So the bottom line for NBA players is to understand is that the owners are capable of shutting down the league. And these negotiations have a bottom line, which for the owners is to power their way to victory.
Ultimately, it’s just business.
Jan Hubbard has written about basketball since 1976 and worked in the NBA league office for eight years in between media stints. His columns will appear every Tuesday on SheridanHoops.com. Follow him on Twitter at @whyhub.