Sheridan column: On con games and lockout settlements

NEW YORK — “Michael Jordan is a con man.”

Those words were spoken by Jeff Van Gundy, then the coach of the New York Knicks, on a Chicago radio station in January of 1997 when the Bulls and the Knicks were bitter rivals whose epic postseason clashes almost always managed to go Chicago’s way.

Van Gundy meant it in a complimentary way, saying Jordan was brilliantly ruthless for the way he befriended opposing players off the court and then demolished them on the court. But Jordan didn’t take it that way. He told Chicago Tribune columnist Steve Rosenbloom “F*&% him — and you can quote me,” and then went out and dropped 51 on the Knicks whilst pointing fingers and screaming more curses at Van Gundy on the sideline.

Jordan proved a point that night — don’t mess with the best.

But Van Gundy had a point, too.

Jordan would do anything to gain a competitive advantage, and folks were downright scared of him when he was fired up. Few ever incurred the wrath of Jordan quite like Van Gundy did on that cold winter night nearly 15 years ago, and no one ever dared to call him a “con man” again.

Why does this matter today?

Because Jordan has come out of the shadows again after being silent throughout the majority of the NBA’s labor dispute, and he is now being portrayed in the New York Times as the leader of a faction of 10 to 14 hard-line owners who would rather sit out an entire season than give the players a single penny more than a 50-50 split when collective bargaining negotiations resume at 4 p.m. EDT this afternoon at a midtown Manhattan hotel.

This is the same Michael Jordan, mind you, who got up in Washington Wizards owner Abe Pollin’s face at a negotiating session during the 1998-99 lockout and told the octogenarian owner that if he couldn’t make a profit, then he should go and sell his team.

Jordan is on the other side of the table now, and it is beyond a little bit suspicious that he is now suddenly being portrayed as the leader of a ruthless ownership faction that is dictating the negotiating strategy of commissioner David Stern. These owners, we are being asked to believe, would rather shut down their sport at the height of its global growth spurt than meet somewhere in the middle on the split of revenues.

I am calling BS on them. This is a con, and all it is meant to do is put pressure on union negotiators to take the league’s “best and final offer” (actually, those words have yet to come out of Stern’s mouth) when that type of offer is put on the table today (or tomorrow, or Monday) with federal mediator George Cohen overseeing the proceedings.

“Don’t mess with Michael,” the players are being indirectly warned, both through the story in the Times and in Brian Mahoney’s freshest AP dispatch, which says Jordan is such a hardliner that he opposed ownership’s recent move from 47 percent of BRI for the players to 50.

The last time the sides were in a room together, Stern infuriated the players so much by offering a 50-50 split when they had been led to believe he would move northward that they got up and stormed out of the room, a tactic Billy Hunter defended two days ago in the hours before the hysteria over involuntary decertification began.

If the players had stayed in the room two Fridays ago at the Waldorf-Astoria, they may have coaxed the number “51″ out of Stern, and the deal would have been done by now. Instead, we have had eight days of posturing, rhetoric and doomsday scenarios preparing everyone for the NBA’s nuclear winter.

Again, I call BS.

About 95 percent of the contested issues have been resolved, and there is going to have to be some give and take on the remainder in order to get this mess to the finish line so both sides can emerge from the room holding their noses and saying “We have a deal.”

Here are those issues, and where I see the settlement points:

The split of BRI: At this point, it probably can’t be a hard number. It needs to be a sliding number that gives a larger share to the players if revenue growth exceeds expectations. It can be a band ranging from 50 percent to 52 percent, which allows both sides to claim they walked away getting the number they wanted.

Use of the mid-level exception for teams over the luxury tax threshold: Right now, the owners want taxpayers to be excluded from being able to use the $5 million exception. The players are resisting, saying they want free agents to have a full complement of 30 teams with the capability to bid for a player’s services. The compromise is to create a new, distinct mid-level exception for teams over the tax, limiting them to offering a contract with a maximum starting salary of $3-4 million. Call it the mini-midlevel. It’d give both sides a piece of what they are looking for.

The prohibition on taxpaying teams from executing sign-and-trade deals: This is the owners’ best bargaining chip, because it costs them nothing to take it off the table and claim they made another “give.” Because in the end, if a high-spending team wants to use this mechanism to increase its payroll and thereby be penalized under the more restrictive luxury tax rates, those tax funds will end up being redistributed to the league’s poorer teams. It’s a “give” that ends up giving back to the Michael Jordans of the NBA ownership world, and it allows Stern to keep his BRI settlement number closer to 50 than to 52.

So there are your settlement points, folks, and the time to meet in the middle is now.

This con game has gone on long enough. It is, as Ken Berger of CBSSports has called it, an unnerving display of asshattery.

What, you may ask, is asshattery?

From the urban dictionary: “Doing, saying, or participating in anything that makes oneself an asshat (a person who has their head so far up their OWN ass that they are wearing their ass as a hat).

Hat’s off, fellas. Please.

 

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  1. says

    I rarely drop responses, but i did some searching and wound up here NBA lockout
    talks to resume today with Michael Jordan depicted as a hard-liner.
    And I actually do have 2 questions for you if you tend not to mind.
    Is it just me or does it look like some of the remarks appear like
    left by brain dead individuals? :-P And, if you are writing at additional
    online social sites, I’d like to follow everything new you
    have to post. Would you list of the complete urls of your communal pages like your Facebook page, twitter feed, or linkedin profile?

  2. Dan G says

    Agree, clever posturing on the part of Stern to recruit MJ as a leader of a group of hard lined owners who wants more than has been agreed upon.

    I just posted this on a message board and it is nice to see Sheridan agree.

    The NBA is playing in such a way that they will get 80% of what they want and the players union will thank them for agreeing to the compromise.

    Stern when it is done will make it seem like they gave up more than they did and Hunter will be able to mock-up a victory speech.

  3. DB says

    Several people have also reported that the union is nowhere near as comfortable with the luxury tax proposal as portrayed. Specificaaplly they want it less steep and to start at a higher number than the league does. While there certainly is posturing by both sides, I also think they may not be as close to a deal as reported.

  4. Eric says

    Chris,

    Haven’t you been consistently wrong at every turn of this labor negotiation? All I ever read from basketball reporters is how stupid and childish the parties are being. This is a multi-billion dollar business in which 25%-33% of the teams are losing money. I have yet to read or see a detailed article explaining how and why so many teams are not profitable. I don’t really care who wins the labor deal. All I want is a league in which you don’t have to root for your team to lose 60 games a season for the hope you can draft a savior.

    • Mark says

      Eric: control is another issue that hasn’t been fully fleshed out. Owners of the small teams were held hostage by their star players last year (e.g., Lebron, Melo, Deron Williams etc,) . This generated fan interest in New York and Miami but clearly has led to the events we are witnessing now.

      • illyb says

        I think control is a huge issue. David Aldridge had an article that said there were two deals the league would be willing to have. One involves basically taking away all the alleged losses and giving the owners more control over player movement and salaries. The other was a system where the players have more control over their movement but the owners were pretty much guaranteed a hefty operational profit.

  5. Brad says

    This line of thinking is what made you believe the season would start on time, no? I think the issues are serious, and although games are playing to a certain degree, these guys aren’t bluffing.

  6. S. Sebastian says

    Chris,

    With all due respect, if the owners where to make a reasonable profit at 51%, they would not be canceling games. The NBA champions lost money, the Spurs lost money, the Bucks had to borrow money from the league and of course the Bobcats are losing money. Maybe it’s not posturing at all. Maybe the industry needs restructuring like many other industries have and maybe the two sides have not arrived at a sustainable plan yet.

    I think the media and the players union get sucked in by the drama and miss the basic story here. Many owners have more incentive to restructure in the aftermath of a cancelled season than they do to agree with the deal the players are willing to sign.

    The players did very well to take rollbacks and un-garanteed contracts off the table.

    NHL players took a 24% salary hit after their lockout as a result of rollbacks and a reduced revenue share. The NHL lost revenue, but all 30 teams are intact and players salaries are going up.

    Unfortunately, I have not heard one person explain how the players will be better off in the long-run by holding out and allowing the season to be cancelled. De-certification and relying on the courts will not help them. Teams are losing money. The courts are not going to force the teams to pay players an average of $5 million per year when the teams are losing money.

    • MikeP says

      The NBA claimed $340 million in net losses (which the players union obviously disputes). The players giving up 5% (from 57% to 52%) is over $200 million.

      I guess the question is, assuming the numbers are correct, do the owners have a right to shift ALL losses on the backs of the players?

        • says

          The answer is that this has been the history of labor relations for a very long time. Owners may have the right to do so, but laborers have the right to stop what they consider unfair terms and conditions. Who gains and loses continues to rest on a number of factors.

          In this instance, the owners need to exact more revenue sharing from the big market owners.

          • S. Sebastian says

            It’s a net loss. If you share a net loss 30 ways, every team loses money. NFL players get less than 50% of the revenue and every team in the NFL is profitable. Fairness is one thing, but basic math is another. If someone can show me in numbers, how the players will be better off by missing paychecks and get more money going forward to cover their losses, then I would agree. But no one, not players, not union, not agents, not media have done that.

          • MikeP says

            If you read a little more about the NFL agreement, you’d know the reason they went to 48% is that it’s now 48% of all revenue, and before it wasn’t. So their 48% this year is more money than their 52% was before.

            I’m sure if NBA owners proposed 48% of a bigger pie and players were getting more money than they were before (like NFL players), they wouldn’t have a problem with that.

        • MikeP says

          If a company is losing money, you would try to cut expenses across all areas, not just on the backs of employees. Sometimes that means closing operations in areas that consistently aren’t making money. But I suppose that’s not on the table is it?

          • S. Sebastian says

            Mike, NFL players are getting less than 50% and owners are getting some expenses off the top.

            To your point about shutting down unprofitable operations, 22 teams are said to be unprofitable. These two sides have been talking about this for three years. Stern brought up the idea of contracting the league, i.e. shutting down unprofitable operations. The union rejected that idea outright because that means fewer jobs for players. Therefore, if the union doesn’t want to shut down an unprofitable team then that leaves lower salaries as the place to cut costs.

            I believe that was a mistake by the union. They should have said, go ahead and contract. That would have forced the owners to deal with themselves first.

            I don’t if you are aware of this but companies in this country have been downsizing for the last 30 years. Now it’s the NBA’s turn. Fans like myself already cannot afford to pay for games. But my opinion isn’t what counts. The players should do what is best for them and missing an entire season does not add up financially for them.

          • Michael says

            Why isn’t this discussed more?

            In 1998 player BRI equaled 57% and the NBA claimed 15 teams were losing money.

            In 2011, player BRI is still 57% and the NBA now claims 22 teams are losing money.

            With that information in mind, any reasonable person can see that reducing player salaries will not solve the problem of teams losing money. It goes beyond that and imo, mainly revolves around owners buying teams for way too much money, and then shifting these added costs onto the players. It’s why interest and depreciation expenses alone were believed to be about $250 million last year.

            Why doesn’t the media make a bigger deal about this? Why isn’t their more a movement to fix management expenses, instead of just reducing player expenses?

  7. says

    I love this article. I was thinking that MJ’s last minute appearance is more media marketing-magic by the NBA, because MJ let the cat out of the bag earlier when he said the big market owners need to cough up more cash. They do.

    Adjustments to the mid-level exception and punitive luxury taxes are unlikely to accomplish the duel goals of competitive balance and small market profitability. I’m guessing that the small markets will not use the extra money to pay more salary than they must in a soft cap. They will continue to intentionally suck and tank (like the Bobcats the last year or so).

  8. Tyler Reed says

    This article is brilliant but it makes WAY too much sense….if these people were normal, rational, and ego-free this all would have been put into place last July. I hope this does happen today but I fear that irrationality and large egos will prevail……what a huge bunch of ASSHATS!!!

  9. Michael says

    Eh, I don’t think there is as much asshattery going on as this column leads you to believe.

    From an owner’s perspective, there is very little incentive for them to strike a deal going higher than 50/50 on the BRI or to “compromise” on any system issues. Whatever short term pain they will feel, they will more than make up for it over the course of the next few decades if they get a favorable deal. And plus, the value of their teams will skyrocket with the less money they have to pay for player salaries.

    As for the players, I can see the “asshattery” here in the sense they are the one’s hurting themselves the most. But at the same time, it’s utterly ridiculous that they have to concede any more than the $2 billion or so they have already given up.

  10. Neal Power says

    I’ve been waiting for someone to explain why the Jordan story came out Friday…too much of a coincidence that the NBA floats the notion that the best player ever (a feat that gave him a means to become an owner) is standing at 47%. If Jordan, a former player, appears unwilling to agree to the 50/50 deal, then the players will realize that they better take it while they can. Despite all of the drama of this lockout, it’s been quite predictable as far as negotiations go.

    • Brad says

      Paulpressey25, thanks for the link. Can you please post this link to every national NBA writer’s comments section? Excellent, excellent article. The Mo Williams example is perfect in describing how screwed-up the NBA model is. This is why the owners want change, not because of vindictiveness, greed, or ego…three of the erroneous statements made far too often in the national media these days.

      Paulpressey25, aka Chuck, well done. Hopefully, Sheridan himself read your work. You just found another reader for your blog.

    • illyb says

      So basically, teams that have more money and are more desirable use that against teams that have neither. Big surprise on that one. At what point is it just a bad decision by the GM’s handing out excessive Mid Level contracts to unproven or marginal players? Even if the other option is them leaving for another opportunity.

      But I agree this change to the MLE would be a good way to prevent the emerging superstar team structure. Maybe have two different exceptions one for over the tax one for under would be a good solution. The over being very small maybe like ~1.8 mill the under the tax being around ~5 mill. each with no raises.

    • S. Sebastian says

      Excellent article and the MLE limit makes total sense. Even though, it will make it more difficult for my team, the Bulls to get the help they need, it will make for a better league. Does anyone even know what Jerome James looks like?

  11. says

    I’d like to agree with you, but last time we dared think that reason and sensible management defined the ownership stance, we were treated to 2 weeks of cancelled games

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