Author Topic: Cuban knows cap space  (Read 4043 times)

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Cuban knows cap space
« on: May 25, 2008, 09:19:06 PM »

Offline Hollywood

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http://www.blogmaverick.com/2008/05/25/understanding-salary-caps-and-why-the-nfl-opted-out/

Here is Mark Cuban on salary caps...

"The bottom line problem for current cap systems is that one teams financial success can have a significantly negative impact on the financial performance of another. Rather than enjoying the success of the new stadiums in the big markets, or the big local TV or advertising deals they sign, small markets are shell shocked by the annual increases in the cap they create. Increases that they can't possibly keep pace with.

When this happens, teams have to "give up" on their players and seasons more often in order to try to rebuild, which in turn hurts not only the fans and the league, but also the players as higher priced players lose slots to lower priced and younger players.

That's not a good situation for anyone. Its a huge problem that needs to be solved."

He later adds...

"Can a league survive without a cap ? Yes, but I think it must be a league where it takes more than 1 or 2 players to lead a team to a championship. Otherwise, the richest teams can just buy those 2 players, with a 3rd as insurance, which means the competitive balance of the league is purely dependent on finances. That is not a good position to be in. Baseball and football are 2 leagues that I can think can survive (as baseball has) quite nicely without a cap. The NBA and NHL would struggle competitively without them."

I don't know much about this stuff, so I thought it was a good summary. Does anyone have any thoughts on what this stuff means for the NFL or the NBA down the road?






Re: Cuban knows cap space
« Reply #1 on: May 25, 2008, 09:28:48 PM »

Offline Rick Robeys Return

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Very interesting, thanks for posting....it seems to me the only possible way to address the problem that Cuban raises is for their to be some sort of profit sharing...and it would need to be built around that portion of the profit streams that have most impact on how they are determining the annual increases in the cap limits

Re: Cuban knows cap space
« Reply #2 on: May 25, 2008, 09:51:00 PM »

Offline miraclejohan

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I think the only way to fix the cap space problem is go back to a time when your top-ten stars of the entire league were making something less than 12 million dollars, let alone 20.  That paradigm gets Scal 3 mil per year and Jamal Crawford 10.  Who'd ever trade for someone like either unless it was for salary purposes.  I think the CBA could be partially to blame, but 99% is just inflation, rationalization, and capitalism. 

good post. tp.
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Re: Cuban knows cap space
« Reply #3 on: May 25, 2008, 09:58:39 PM »

Offline TrueGreen

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The salary cap was put in to keep owners, who didn't know what they were doing,from overpaying players who didn't deserve it. This hasn't worked. One good thing the NBA did was to establish set salaries for draft picks (even though I think the top pick salaries are too high).  As to Mark Cuban his biggest problem is Mark Cuban. He is all knowing and makes basketball decisions because his ego can fill an arena. To their credit, after a rocky start, the Celtic owners figured out how to do it the right way.

Re: Cuban knows cap space
« Reply #4 on: May 25, 2008, 10:26:36 PM »

Offline cordobes

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The salary cap was put in to keep owners, who didn't know what they were doing,from overpaying players who didn't deserve it. This hasn't worked. One good thing the NBA did was to establish set salaries for draft picks (even though I think the top pick salaries are too high).  As to Mark Cuban his biggest problem is Mark Cuban. He is all knowing and makes basketball decisions because his ego can fill an arena. To their credit, after a rocky start, the Celtic owners figured out how to do it the right way.

That's not the only reason. Without a salary cap, Los Angeles, Boston, NY and Chicago would be the only teams contending for championships. And teams owned by billionaires: imagine Paul Allen using his money to sign Paul, Kobe, LeBron, KG and Duncan to play for Portland.

Very interesting reading, indeed. TP for you. The only obvious solutions would be to create a local revenue sharing system, or some kind of profit sharing. But that would incentive badly managed franchises and penalize well managed ones, eventually leading to an overall worse league. Smaller salaries to top draft picks and longer contracts for rookies would help a lot, but you need the agreement of the players to get that...

Re: Cuban knows cap space
« Reply #5 on: May 25, 2008, 10:49:18 PM »

Offline spelz

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I like the idea of a salary cap in the NBA, even though it is not a true cap.  Baseball makes me mad because the big market teams monopolize the playoffs.  I know a small market team makes it every now and then, but their chances are very unlikely.  They need to hit on every free agent signee, unlike big market teams who can afford to miss on one or two because they have so many big market names. Small market teams also have to be creative in order to keep their young talent. 

Re: Cuban knows cap space
« Reply #6 on: May 25, 2008, 11:14:22 PM »

Offline BUTerrier

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You know what the difference is between the NFL salary cap (and I believe the NHL cap as well) and the NBA salary cap? You can't go over the NFL salary cap, but for some limited exceptions (such as IR settlements). In the NBA, you just have to pay a fine if you go over it, but given that the revenue from playoff ticketing and such tends to far exceed the tax levied, why wouldn't any owner ignore the luxury tax ramifications? It's not a cap in the NBA so much as it is a slap on the wrist.

If small-market/big-market paradigms are so important to Mark Cuban, then he should be proposing a hard cap for the NBA rather than a soft cap with a luxury tax penalty. I understand that a majority vote of the owners would never pass it, but why wouldn't that system work? I wouldn't mind it being immediate, but seeing as making it immediate would DEFINITELY never pass, I'd say give teams 4 or 5 years from the time the rule is approved so they can get all the big contracts off their books. Then, starting with the first season the rule goes into effect, no mercy. If the cap is $X million, you can't be one penny over the cap. Sure, you're going to have some small-market owners that can't/won't afford that, but by and large you would level the playing field. You might not be able to corral player salaries of the big-name players, but you could certainly limit the Scalabrines of the world from cashing in (not that I have anything against him as a person, but even the most die-hard fans would admit his current contract far exceeds his value.) I'd even be willing to consider allowing minor excursions above the cap to allow for Bird Rights and MLEs (though I'm not sold on that.) People say it doesn't work? Well, the NFL and NHL seem to be doing pretty well with their hard caps.

All that being said, I find it particularly ironic that Mark Cuban is the one going off on the imbalance in salaries and the salary cap. This is a guy who vowed to pay whatever it took to get Shaq to Dallas, a guy who has spent hundreds of millions by now to upgrade every element of his facilities, buses, planes, etc. so as to encourage free agents to consider Dallas. And, hey, I've got no gripe with that; I think that it's his money to spend, and he can spend however the hell he wants. But it all rings a bit hollow when he's trying to play the "moral high ground" card, given that -- but for his lack of luck with the Lakers and Heat front offices -- he would willingly ignore the luxury tax to pay players. You didn't seem so worried about competitive imbalance when making all those facility improvements; THAT doesn't give you an advantage over, say, the Spurs and Grizzlies?

It's not that he doesn't make a point; I just don't think he should be the one making it.