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Sports economists say NBA financially healthy, aren’t buying owners claims

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NBA owners are crying poverty — the system needs to change because right now the NBA is bad business. One new owner, Washington’s Ted Leonsis, talked of a hard cap. Then was promptly fined by David Stern for talking out of school.

Two prominent sports economists interviewed by the Boston Globe
said not to believe everything you hear from the owners or players right now. (Found via TrueHoop.) They are negotiating through the media.

They add that the league is basically healthy, so a lockout would do far more damage than good.

“I think the NBA is reasonably healthy,’’ said [Stanford economics professor and author Roger] Noll. “If you extract the fact that it’s the worst recession in the lifetime of anybody who’s thinking about it, the league is healthy. I do not anticipate there will be a strike or lockout. I do not anticipate the next agreement will differ materially from the present agreement.

“Both sides blow smoke in the run-up to collective bargaining. But you shouldn’t pay any attention to what they say. They are jockeying for position and trying to put pressure on the other side through the media. Nothing they say now about the state of the league or the state of the collective bargaining negotiations has any particular truth value.’’

Noll’s solution is somewhat radical — put a cap on team salaries if you want, but let go of (or dramatically relax) what an individual player can make. Put simply, if LeBron James, Dwyane Wade and Chris Bosh could each command $30 million a year there is no way they could team up, allowing a more balanced spread of talent. In this scenario, the top players would make more but many “middle class” players would take a pay cut as the disparity would grow.

He also says revenue sharing needs to increase if the owners want parity.

“The NBA has relatively small revenue sharing in comparison to football and baseball, and so the financial disparity between the top teams and the bottom teams is not as bad as it is in hockey,’’ Noll said. “But it is a lot worse than it is in baseball and football, and one of the interesting features is that it gives the teams in the biggest cities a great deal of leverage over other members of the league.’’

The Globe also spoke with University of Michigan sports economics professor Rodney Fort, and he wasn’t buying what the owners were selling either.

“The argument somehow that owners are on the brink or anything of the kind is a little difficult to swallow, but that doesn’t mean they won’t posture themselves that way,’’ said Fort, who authored a 544-page textbook, “Sports Economics.’’ “But it doesn’t mean they won’t posture themselves that way to reduce the share of basketball-related income that’s going to players.

“They will argue that always, in any situation. Not because owners are going belly-up but because everybody likes more money than less.’’

Fort adds that whatever the owners’ motives, they benefit more from a lockout. Which means there will be one. Which sounds like what we have heard, where people on the owners’ side of the equation have been more adamant about a lockout when talking (off the record) than players, who just accept that it is coming.

“If there’s a lockout, the owners perceive that they are going to be in better shape when it’s over than they are right now,’’ Fort said. “And that’s going to be true, regardless.

“So if the owners feel like they can profit more from a new agreement by locking the players out for a year, you better believe that’s something they are considering.’’

Even if it kills the momentum the NBA as a whole is building right now.

NBA rookies name Kevin Durant their favorite player

OAKLAND, CA - JULY 07:  Kevin Durant #35 of the Golden State Warriors poses with his new jersey during the press conference where he was introduced as a member of the Golden State Warriors after they signed him as a free agent on July 7, 2016 in Oakland, California.  (Photo by Thearon W. Henderson/Getty Images)
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Kevin Durant faced tremendous backlash for leaving the Thunder for the Warriors.

But not from NBA rookies.

In the league’s annual rookie survey, a plurality of first-year players voted Durant their favorite player:

1. Kevin Durant, Golden State — 29.7%

T-2. Carmelo Anthony, New York — 9.4%

LeBron James, Cleveland — 9.4%

Russell Westbrook, Oklahoma City — 9.4%

T-5. LaMarcus Aldridge, San Antonio — 6.3%

Kobe Bryant (retired) — 6.3%

Paul George, Indiana — 6.3%

Chris Paul, L.A. Clippers — 6.3%

T-9. Kevin Garnett, Minnesota — 4.7%

Others receiving votes: Vince Carter, Memphis; Stephen Curry, Golden State; Marc Gasol, Memphis; Kyrie Irving, Cleveland

This is the third straight year Durant has claimed the top spot, matching LeBron and Kobe for combined wins in the six years this question was asked of rookies:

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This is further evidence: If you resent Kevin Durant for exercising his right to switch employers after nine years with a company that acquired him by producing an awful product, you’re out of touch. Follow the kids’ lead and get with it.

Jason Terry: Luke Walton ‘utterly declined’ my offer to provide Lakers veteran leadership

DALLAS, TX - JANUARY 19:  Guard Jason Terry #31 of the Dallas Mavericks takes a shot against Luke Walton #4 of the Los Angeles Lakers at American Airlines Center on January 19, 2011 in Dallas, Texas.  NOTE TO USER: User expressly acknowledges and agrees that, by downloading and or using this photograph, User is consenting to the terms and conditions of the Getty Images License Agreement.  (Photo by Ronald Martinez/Getty Images)
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Before signing with the Bucks, Jason Terry said he reached out to multiple contenders.

He also spoke with the Lakers.

Terry tried to leverage his relationship with Lakers coach Luke Walton, who also played at Arizona (though their time there didn’t overlap).

Terry on SiriusXM NBA Radio.

I called my good friend Luke. I told him if he needed any help, veteran leadership, in that capacity – Lakers – with an ability to coach at the end of my deal, then that was something I would be looking forward to. He utterly declined, and I respect him for that.

Gotta love a guy who announces to the world his pitch of providing veteran leadership was “utterly declined.”

The Lakers should be just fine with Jose Calderon and Luol Deng.

Report: Nuggets trade Joffrey Lauvergne to Thunder for draft picks

DENVER, CO - JANUARY 19:  Kevin Durant #35 of the Oklahoma City Thunder and Joffrey Lauvergne #77 of the Denver Nuggets battle for rebounding position at Pepsi Center on January 19, 2016 in Denver, Colorado. The Thunder defeated the Nuggets 110-104. NOTE TO USER: User expressly acknowledges and agrees that, by downloading and or using this photograph, User is consenting to the terms and conditions of the Getty Images License Agreement.  (Photo by Doug Pensinger/Getty Images)
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The Nuggets already had too many quality young big men who won’t easily mesh in Nikola Jokic and Jusuf Nurkic.

Joffrey Lauvergne only complicated the issue.

So, Denver is moving him.

Chris Dempsey of The Denver Post:

Oklahoma City already had 15 players – the regular-season roster limit – with guaranteed salaries plus Semaj Christon (who’s likely headed to the D-League). Lauvergne’s salary is only partially guaranteed, but given his ability and cost, the Thunder surely plan to keep him.

The bigger question is how they use him. They’re already loaded with big men: Steven Adams, Enes Kanter, Ersan Ilyasova, Domantas Sabonis, Nick Collison and Mitch McGary – though perhaps McGary, facing a five-game suspension for drugs, gets waived to make room for Lauvergne.

The 6-foot-11 Lauvergne runs the floor well, and he can score in the pick-and-roll and on post-ups. He’s an impressive passer for his size, and he crashes the glass hard. But he’s not much of a rim-protector defensively. At age 24, he should produce well over the next several years – though he’s headed toward restricted free agency next summer.

Depending on the second-round picks, this might have just been a value play by the Thunder. They can figure out the rest later.

Report: Bucks signing Xavier Henry

LOS ANGELES, CA - NOVEMBER 16:  Xavier Henry #7 of the Los Angeles Lakers shoots against the Golden State Warriors at Staples Center on November 16, 2014 in Los Angeles, California.  The Warriors won 136-115.   NOTE TO USER: User expressly acknowledges and agrees that, by downloading and or using this photograph, User is consenting to the terms and conditions of the Getty Images License Agreement.  (Photo by Stephen Dunn/Getty Images)
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The Bucks hope Xavier Henry is just another thing Byron Scott is wrong about.

Shams Charania of Yahoo Sports:

Henry – the No. 12 pick in the 2010 draft – never found his footing in the NBA with the Memphis Grizzlies, New Orleans Hornets or Los Angeles Lakers. He made some strides with the Lakers in 2013-14, but he tore his Achilles early the following season. That compounded the knee injuries that made Scott doubt Henry could meet the expectations placed on him coming out of Kansas.

Milwaukee now has 15 players, the regular-season roster limit. If Henry’s deal is unguaranteed, he’s obviously not a lock to stick. But the Bucks could use another wing. I’m guessing they’ll add more players to compete with Henry for that final spot.