Economist Murphy takes us all to school on players stance

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Kevin Murphy is smarter than you.

And me. And David Stern and Billy Hunter and everyone else in the negotiating room. There’s no objective way to prove that, but do you have a MacArthur Foundation “genius grant?” Are you the guy the people who wrote “Freakanomics” think is the smartest person they know?

That’s Murphy. And he’s the players’ economist. Union head Hunter said that pretty much every projection Murphy made back in 2005 about how the labor deal hammered out then would play out was spot on. He may grasp all the moving parts of this negotiation better than everyone.

And he spoke at length with NBA.com’s Steve Aschburner. You need to read this. All of it.

Know that Murphy has a dog in this fight — the union pays him. But he is too insightful not to read.

And this goes back to the core arguments of the entire lockout — how much money are the owners really losing? And who should pay for it?

I would say the primary disagreement is not over the accounting numbers. It’s what you include and how you interpret the numbers. For example, the accounting picture of the NBA isn’t very different from what it was five years ago or 10 years ago in terms of ratio of revenues to costs and all the rest — it’s changed very little. Which immediately tells you, wait a minute, if the underlying financial picture is similar today to what it was five years ago or 10 years ago, and people are paying $400 million or whatever for franchises, and you’re telling me that these things lose money every year, something’s missing, right? These people aren’t stupid, right? These guys are worth billions of dollars. So why did they pay all this money for franchises that, it looks like, lose money?

Well, the answer is pretty clear. There are a couple of things that are really attractive. One is, historically, you’ve seen franchises appreciate in value and that appreciation has more than outstripped any cash-flow losses that you’ve had. And if you’re in the right tax position, it’s actually pretty good because you’ve got a tax loss annually on your operating and you’ve got a capital gain at the end that you accumulate untaxed until you sell it and then pay at a lower rate. So you get a deferred tax treatment on the gains and an immediate tax treatment on the losses, that’s not a bad deal.

I’ll be honest, the last couple sentences are hard to follow for me. My tax position does no require a lot of thought. But you get the idea that what is in the official books is not the entire picture.

To all of you people saying “name another industry where the workers would get half the revenue” (yes, we read the comments) Murphy has an answer:

In certain sectors, there’s a ton. You go to a law firm, most of its cost is labor. You’ve got to remember, labor is 60-something percent of the economy. In the service sector, it can be much higher than that. And these people really define the product. These are the ones people come to see.

What separates the NBA from a different basketball league? Well, it’s the players. The basketball’s’ the same, the court’s the same, it’s the players who really are the distinguishing feature. That’s not to say that the league doesn’t have value. But the defining characteristic and the scarce resource, if you think about it from an economic point of view, is the talent. It’s not unlike Hollywood, the music business or any of the other ones where the thing that distinguishes one person from another is the talent.

Then there is the competitive balance issue. The idea from the owners that there needs to be more parity, something Murphy says clashes with the NBA’s star-driven league. Like another report yesterday, Murphy says that what you spend really only has about a 5 percent to 10 percent impact on wins on the court.

NBA.com: (The owners) want Milwaukee fans, for example, to not only root for the Bucks but to have most seasons with hope that their team can compete with bigger-revenue markets.

KM: There’s an element of that. But also, be careful what you wish for. When you get a Sacramento-Charlotte NBA Finals, guys will be crying over the TV ratings. We know that even with baseball — it’s an exciting World Series but the ratings aren’t there because it’s the Texas Rangers and St. Louis [Cardinals]. Basketball is even more star-driven. You get to an NBA Finals that doesn’t have one of the premier players in the league in it, it becomes a lot less interesting. And with 30 teams, not everybody is going to have one of the premier players.

All the number crunching is nice. But let’s get to what really matters:

Can the two sides reach a deal soon so we can have basketball?

“I was very pessimistic last week after the Thursday blow-up but I’m beginning to come around and think we’ve got a shot,” Murphy said. “If there’s a deal here, it’s going to be a deal that nobody likes. That’s what deals are. Nobody walks out feeling like they got a complete victory. That’s initially. But then you get back to playing and you realize, geez, I can live with this.”

Three Things to Know: Giannis Antetokounmpo spoils Boston home opener

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Every night in the NBA there is a lot to unpack, especially on this, the real opening night of the NBA with 22 teams in action. Every weekday morning throughout the season we will give you the three things you need to know from the last 24 hours in the NBA. Tonight, that includes a few historic numbers… good and bad.

1) Brad Stevens, Celtics have no answer on how to slow Giannis Antetokounmpo either. As a general rule of thumb, if you’re getting mentioned in the record books with Kareem Abdul-Jabbar, you’re doing something very right. Monday night, the Greek Freak was rolling to the rim and finishing alley-oops over defenders, hitting floaters and leaners in the lane, and generally using his length to get any shot he wanted against the Celtics on his way to a 37-point, 13 rebound night in Boston. The only other Buck to have an opening night of at least 35 and 10? Yup, one Mr. Abdul-Jabbar.

Put a smaller defender on Antetokounmpo and he shoots right over them. Put a bigger defender on him and he goes around them — or just over them too. Brad Stevens tried a lot of things on defense, and while Al Horford had a little first-half success slowing him nobody did all game as he shot 59.1 percent on his way to dropping 37.

Notice all those shots are close to the rim. Antetokounmpo was a ridiculous 10-of-12 at the rim and 12-of-18 in the paint overall, but just 1-of-4 outside the key. It’s easy to say “make him a jump shooter” but good luck finding anyone who can stay in front of him, or that he can’t just finish over. The man was dunking over Aron Baynes, how do you get anyone much bigger in front of him?

Boston was up four points entering the fourth quarter when the second night of a back-to-back seemed to hit them, they scored just 20 points on 8-of-25 shooting in the final frame, 4-of-21 outside the restricted area. Meanwhile, Antetokounmpo went off for 16 in the fourth as he ramped up his aggressiveness and Brad Stevens and the Celtics had no answer. Marcus Smart was fiery and got into it with Matthew Dellavedova, that may have exemplified Boston’s spirit, but Celtics looked physically and emotionally worn down by the end. Hard to blame them.

Rough start to the season for Boston, who lost Gordon Hayward just minutes into the opener (he’s out for the season), they fell to the Celtics Tuesday night and now are off to an 0-2 start. They will bounce back, but just now how the team with all these new players thought things would start.

2) Jeremy Lin injures knee and there is “tremendous” concern it is serious. Midway through the fourth quarter against the Pacers, Jeremy Lin drove the lane and finished a layup at the rim that looked ordinary — except when he landed he went to the ground grabbing his knee and did not get back up.

This isn’t good. Neither were the reports during and after the play.

Brooklyn was counting on Lin to help stabilize the point guard position and the backcourt with D'Angelo Russell (who had 30 on the night in a losing effort). If Lin is done for all or most of the season, it’s a huge setback for a team that, while bad, was expected to be a little better than in previous seasons. Remember, the Cavaliers have Brooklyn’s first-round pick this season unprotected (part of the Kyrie Irving trade from Boston).

• While we’re on the injury front, Boston’s Gordon Hayward underwent surgery on his dislocated ankle and fractured tibia on Wednesday, and according to his agent he is “unlikely” to return this season. Hayward did send a video message to Celtics fans thanking them. Boston will try to move on, but it’s been a difficult and emotional start to the season for the Celtics.

3) Suns’ season opening performance wasn’t just bad, it was the worst ever. The record for worst opening night loss in NBA history belonged to the 1987 Los Angeles Clippers coached by Gene Shue, who were blown out by Denver by 46 points.

No more. That record now belongs to the Phoenix Suns, who fell at home to the Portland Trail Blazers 124-76 — a 48 point loss. The Suns shot 31.5 percent as a team — Devin Booker was 6-of-17 and didn’t hit a three, Eric Bledsoe was sloppy and reckless all night and finished 5-of-18 with five turnovers and three assists, while Dragan Bender and Marquese Chriss combined to go 1-of-10 off the bench. The Phoenix offense was about as in synch as the left shark, and many possessions ended with a terrible shot being jacked up because, well, somebody had to shoot it.

I’d like to say this was a good omen for the Trail Blazers’ defense, but really it’s impossible to judge how good it was against this offense. It was still a win the Blazers will gladly take, Damian Lillard had 24 points while Pat Connaughton came off the bench for 22.

PBT Extra: Bobby Portis punch adds to challenges for Bulls this season

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Nikola Mirotic will be out 4-6 weeks due to his concussion and fractured jaw.

Bobby Portis has been suspended for the first eight games of the season for causing those injuries to Mirotic with a punch at practice.

What does this mean for a Bulls locker room that was already going to have to deal with the weight of losing a lot of games.  I get into all these questions in this latest PBT Extra.

It’s going to be a long season in Chicago.

Gordon Hayward’s agent says return this season unlikely

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Wednesday night in Boston Gordon Hayward underwent surgery to repair his dislocated ankle and fractured tibia suffered just five minutes into the season-opening game, a gruesome injury that put a pall over the rest of the night.

There had been hope from some Celtics fans that Hayward could return this season, likely for the playoffs, but now that the surgery is complete Hayward’s agent told Adrian Wojnarowski of ESPN not to expect him back until next season.

This shouldn’t be a surprise to anyone who saw the injury. Hayward is in the first year of a four-year deal with the Celtics, they were always going to choose a cautious path rather than rush him back. Under Danny Ainge Boston has always taken the long view, even with all their moves this summer — specifically bringing in Hayward and Kyrie Irving — the target was to be the team set up for next as LeBron James and the Cavaliers faded. That plan does not change now.

Earlier in the day, Hayward had sent a video message out to Celtics fans thanking them for their support in the past 24 hours.

Without Hayward, the Celtics now will focus more on smaller lineups, rookie Jayson Tatum will get more run, as will Marcus Smart in his contract year. Jaylen Brown will be thrust into a more significant role. Also, Kyrie Irving will be asked to do more as the team’s second-best playmaker is now out for the season.

The Celtics will take a step back this season without Hayward, who was going to be crucial for them on both ends of the floor. That’s evidenced by their 0-2 start, falling to the Cavaliers and Bucks on the first couple nights of the season. Boston should still be a team well above .500 and in the playoffs, but they will not be quite the same this season.

Trail Blazers beat Suns by 48, biggest season-opening rout in NBA history

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Any controversy over C.J. McCollum‘s suspension for the season-opener should be put to rest. The Trail Blazers fared fine without him.

More than fine.

Portland beat the Suns, 124-76, Wednesday. The 48-point margin is the largest ever in a season opener, even as the Trail Blazers let a 58-point fourth-quarter lead dwindle.

Here are the most lopsided season-openers in NBA history (openers for both teams appearing twice):

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The 48-point defeat is also the Suns’ worst lost in franchise history, topping a 44-point loss to the Seattle SuperSonics in 1988. It could be a long year in Phoenix.