Friday, September 30th, 2011 at 9:10 am  |  42 responses

NBA Owners Looking to Implement ‘Carmelo Anthony Rule’?

One of the big changes NBA team owners want in the new CBA, is the severe limiting of player movement, a so-called “Carmelo Rule”. ESPN has the details: “Possibilities presented by the league as alternatives to a hard cap include: •The institution of a sliding ‘Supertax’ that would charge teams $2 in luxury tax for every dollar over $70 million in payroll, $3 for every dollar over $75 million in payroll and $4 for every dollar for teams with payrolls above $80 million. •A provision to allow each team to release one player via the so-called ‘amnesty’ clause and gain both salary-cap and luxury-tax relief when that player’s cap number is removed from the books. • Shortening guaranteed contracts to a maximum of three or four seasons. • Limiting Larry Bird rights — which enable teams to exceed the salary cap to re-sign their own free agents — to one player per team per season. • Reducing the annual mid-level exception, which was valued at $5.8 million last season, to roughly $3 million annually and limiting mid-level contracts to a maximum of two or three seasons in length as opposed to the current maximum of five seasons. •A new ‘Carmelo Rule’ that would prevent teams — as the New York Knicks did in February with Anthony — from using a Bird exception to sign or extend a player acquired by trade unless they are acquired before July 1 of the final season of the player’s contract. •The abolition of sign-and-trades and the bi-annual exception worth $2 million. • Significant reductions in maximum salaries and annual raises and a 5 percent rollbacks on current contracts. There are also still some teams, sources say, who are pushing for some sort of franchise-tag system similar to what the NFL employs as well as a restriction that allows big spending teams to exceed the annual luxury-tax threshold only twice every five seasons. Yet it remains to be seen how many of these concepts, many of which have been met with union resistance, actually become elements of a deal. Agreeing on those finer points is secondary to striking an agreement on the percentage of the revenue split, which literally shapes what the rest of the next labor pact will look like. The players are still seeking 52 to 54 percent of basketball-related income and the owners remain intent on getting the figure in the high 40s. Players earned 57 percent of basketball-related income last season.”

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  • @Deknowz

    I no longer care how this ends, I hope both sides choke on every dollar.

  • #6marjons

    someone with a better brain than i wanna break that down for me?

  • http://thahiphopcorner.com Kevin

    Yeah im lost on this

  • Morgan

    Basically the owners want to add or remove several “loopholes” from the old system that allowed players to move wherever they wanted whilst hurting the team or holding it to ransom (aka the carmelo saga). If they don’t get a hard cap they want to penalise anyone who wants to go over the salary cap and to add a few restrictions on who you can/can’t resign..all of them seem kind of reasonable (at first glance) imo

  • Sherlock

    Here’s what i don’t get… The owners and GM’s are the ones responsible for signing off on over-spending on previous max & mid-level contracts given to un-derserving players under the previous cba. Instead of trying to rob from Peter (the players) to pay Paul, why can’t they just MANAGE their spending better? Personally the “super-tax” and “Carmelo Rule” are points of negotiation that I can see the union agreeing to. Everything else is pretty much bs…

  • Ryan

    I hope that the season is lost, hell I hope two or three seasons are lost because I want to see the owners destroy themselves. When I read articles like Malcolm Gladwell’s recent piece about the Nets on Grantland it is so obvious how dishonest David Stern and the ownership are and I hope like hell that the players beat them, not with a better deal but sitting out this season and working like hell to set up their own league. It’s time for the NBA to die so that it can be reborn as something better.

  • http://cnbc.com JTaylor21

    So…the players are willing to reduce their percentage of BRI by as much as 5% yet the owners aren’t happy and want to reduce it by a whopping 8-10%. That’s is pure greed on the owners part and the players would be foolish to agree to a deal that cuts down their income by as much as 10% and it’s not like they are getting a share of merchandising, ticket sales and TV contracts.
    Most of the owners are billionaires yet they want more money?

  • http://redoftoothandclaw.ca/ niQ

    Yes, JTaylor21. That is precisely it.

  • misso

    Sounds good to me, cause that way we can get rid of Gilbert Arenas horrible contract & get to keep Dwight Howard

  • http://www.grantland.com/story/_/id/7021031/the-nets-nba-economics Allenp

    Morgan that’s a fairly biased representation of the facts.
    I would say the new rules are designed to punish teams who exceed the salary cap using a sliding scale, they are designed to make it more difficult for big market teams to poach stars and then sign them to big deals, they are designed to limit the impact of poor signings and they want to take back money owners have already promised players to get them to sign with their teams.
    Those are the basic parameters.

  • http://www.grantland.com/story/_/id/7021031/the-nets-nba-economics Allenp

    Here is the funny thing.
    Just like in the NFL, the NBA owners are seeking to shift all power back to them when it comes to negotiating, all while duping fans into believing their actions align with capitalism.
    In capitalism, supply and demand are key. In this case, while the owners have the supply of businesses willing to pay people millions of dollars to play a game, the players also have the supply of high level talent needed to convince fans to come watch people play these games.
    The owners are arguing that they should be allowed to behave as pure capitalists based on their supply, but arguing that players should relinquish their rights as capitalist when it comes to their supply.
    Well, first by restricting player movement. In a capitalist society, the key elements is the idea the demand increases as you increase the different markets available for your supply. If the owners reduce where the most talented players can play, they reduce how much they have to pay them. It goes back to the old “reserve clause” which prohibited players from leaving the team that drafted them unless that team traded them or cut them. The reserve clause made it so players either quit basketball or took whatever contracts they were offered. With free agency, players can negotiate with several teams to create a better market for their talents and a better price. The new rules want to restrict that.
    Second, the restrictions on contract length, amount and the penalties for exceeding the salary cap.
    While these items have been talked about as “owner protection” it’s not a protection from players, but a protection from other owners! In a capitalist society, those with more resources create a monopoly on supply, unless it is prevented by outside influences. That’s why this country has anti-trust laws. In this case, the owners want to prevent big market teams from creating a monopoly on talent. They also want to protect other owners from having to deal with the full consequences of their choices. To do this, they install false limits on how much players can earn, and how long they can sign contracts for. Why? Because they know that if left to their own devices, owners will sign players to big contracts with a lot of years in order to gain a competitive advantage. And, since collusion is outlawed under anti-trust laws, they cannot get together and set an informal, illegal price cap, so it must be codified to protect them from rogue agents in their own numbers. But, they don’t want to argue this point, and instead blame the players.
    I could go on, but this already very long.

  • SWIFTboy

    No, definitely go on.

  • jd1960

    These ideas would further restrict player movement. It’s almost impossible for weak teams to get stronger & eventually contend unless they get really lucky.

    The NBA wants to continue to control what franchises are going to play for the championship each year.

    If they really want a league that is capable of having any team rise to the top, the following MUST happen:

    1. Contraction – at least 2 teams and as many as 6 teams must fold. There are just too many teams that will never compete, regardless of the rules. With so many teams moving in the past several years, the league & its fans need to wake up.

    2. Hard Salary Cap – I don’t know what the number would be but a hard cap would slow down the ridiculous over spending for players & would allow the next and most important thing…

    3. Trades – with the hard cap, the NBA would not have to protect poorly run teams from themselves. Teams that really wanted to make runs at championships would no longer have to trade half their team & be involved with up to 6 other teams in order to get one player. That player can’t help you though because you had to move other pieces. That puts you right back at square one.

  • http://www.grantland.com/story/_/id/7021031/the-nets-nba-economics Allenp

    Well, at their core, the NBA owners want to restrict opportunities for competition among themselves, while increasing opportunity for competition among players.
    This is what the NFL has mastered with its hard salary cap, non guaranteed contracts and franchise tags. The vast majority of NFL players have very little job security, and often must become career vagabonds deciding between big paydays and the chance to win championships every year. It’s why there is so much turnover on Super Bowl teams. NFL owners, and certain media shills, claim that the NFL’s salary system promotes parity and competition, but in reality what it promotes is a complete lack of job security in a sport with the highest incidence and risk of career threatening injury outside of the pugilistic arts.
    NFL owners can’t compete too much amongst themselves because a hard salary cap limits how much they can spend total on their teams. That artificially creates a spreading around of talent, since successful teams with more money cannot hoard talent because no matter how much profit they have, they only have so much cap space. That is why you see NFL contracts with with large signing bonuses, but puny initial annual payments in order to circumvent certain rules of the salary cap.
    The franchise tag also prevents competition among owners because it guarantees that the very best players on every team will not be allowed to hit the open market where, obviously, other teams would bid against their parent squads and drive up the price for their services. The best talent in EVERY other private field commands benefits and payments based its talent and the ability to pit potential employers against each other. The NFL eliminates that for the most marketable and expensive players with the franchise tag.
    That’s why the NBA wants that, and the hard cap, and eventually non-guaranteed contracts. You get the force those players who make teams the most money to stay put, you force all of the lower tier players to be in a state of constant flux and competition, and you guarantee a healthy profit because your expenses for “talent” are always stable. It’s pseudo-capitalism with all the benefits and very few of the risks. It’s how the rich stay rich, basically.

  • http://redoftoothandclaw.ca/ niQ

    Thanks for that, Allenp. Man, with all that you’ve wrote, you couldn’t just opened a new thread/topic on SLAM! lol

  • bike

    Allenp’s dissertation articulates the bizzaro world of the NBA. You have these teams in fierce competition with each other on the court or the field during the season vying for playoff spots and the chip. Yet, collectively, the individual owners want to ensure every team turns a profit and stays competitive. It’s crazy contradictive. I can’t think of any real business world parallel.

  • http://www.grantland.com/story/_/id/7021031/the-nets-nba-economics Allenp

    I actually thought about making it an actual post, but man, I’m as tired of writing about the lockout as people are of reading about it. But, I think people do need to see the ultimate goals behind many of these moves.
    The NFL is basically the best possible outcome for professional sports owners. MLB is the worst, even though it still gives owners lots of power.
    None of it is “capitalism” in its purest form, so it would be great if people would stop making arguments based on this faulty premise. But, of course, that won’t happen.

  • http://www.grantland.com/story/_/id/7021031/the-nets-nba-economics Allenp

    The business world has/had plenty of comparisons.
    Newspapers, radio, television, car manufacturers, oil companies.

    They all are competitors, but also work together to make greater profits and create more profit security. Professional sports leagues are further away from pure capitalism than American society, but not even America is a pure capitalist society. We wouldn’t have anti-trust rules if we were.
    The truth is, a good society incorporates precepts of several different economic models, and the trick is balancing the different ideas to find one that provides security and a good quality of life for as many citizens as possible without stifling creativity and artificially rewarding the undeserving.

  • http://twitter.com/BeezKneezy LA Huey

    I’m okay with adding the Melo rule. To me, sign-and-trades and trade-and-re-ups violated the spirit of the Bird rule. I feel like a player needs at least a few seasons with his team before he earns Bird rights.
    Frankly, I wish people would stop pretending these billionaire owners are so dumb and helpless (Maloofs excluded) that the players are taking advantage of them. Both players, their agents, and the NBA front offices that covet them are taking advantage of these loopholes. Yeah, it sucked for Denver to lose Melo, but the Knicks pulled out every stop to get him.

  • http://espn.go.com/blog/truehoop Allenp

    If you click my name you will find a story on True Hoop that has people with fancy degrees telling you what I just told you about why owners like hard caps, and how the link between hard caps and competitive balance is tenuous.

  • bike

    Allenp’s True Hoop piece is pretty good. David Forrest’s analogy of equal spending and an arms race sheds some light on why owners do what they do.

  • CubicleWorker

    Allenp, the whole problem isn’t the players that are playing well. Players who have a demandable “supply” will get compensated with no problems. The problems are in guys like GA, Eddu Curry etc. Put in the provision to drop one guy per year and decrease the rev split to 50/50 I think 95% of the deal would be done.

  • http://espn.go.com/blog/truehoop Allenp

    You’re wrong.
    The owners want a 46 percent split
    And they want a way to insure that they can keep stars, and depress salaries for middle and lower tier players.
    Just like the NFL. Any deal that does not make serious moves towards that model is not going to fly with owners.
    And they know that eventually the mid-level people will have to cave.

  • robb

    @AllenP Every time you post stuff like that you help me understand a part of basketball I don’t have much knowledge about so thank you, for real.

  • slam-man

    It doesn’t matter Allenp, there’s no way you can create absolute competitive balance. It’s just amazing how ignorant the average person is on this stuff. Then again the owners are pushing this stuff.

  • http://slamonline.com nbk

    Competitive balance yearly? Ofcourse not. Competitive balance over time (given smart management), yes. The NFL is very competitive, across the league. Just look at how many different teams have won a superbowl in the last 20 years….(The answers 13). Then look at the NBA…..(the Answers 6)

  • http://slamonline.com nbk

    Its amazing how ignorant the average person who thinks other people are ignorant are about this stuff.

  • totalbs1

    So the owners want high 40′s, the players 52-54. So why don’t they agree on 50/50? Wouldn’t that make the most sense?

  • http://espn.go.com/blog/truehoop Allenp

    I think the NBA’s game schedule, violence and playoff format make it more competitive. Not to mention the way the game is set up.
    The talent pool is just a lot larger. The means by which teams are sold to consumers is different.
    The NFL has stars, but is not driven as much by those stars, which means an individual teams basketball and financial success are not so closely aligned with a single star. Well, outside of quarterback, to a degree.
    Anyway, I think the parity in the NFL is overblown. Seems like the same teams stay good for long stretches, and the same teams stay bad for long stretches.

  • slam-man

    Competitive balance over time already exists nbk, and since your such a smart guy explain just how you expand that balance in clear words sir. As for owners, THEY SAID THEY WANT COMPETITIVE BALANCE YEARLY. Oh and the NFL is totallly different system.

  • CubicleWorker

    It’s called leverage, if the owners want 50% and start negotiations at 50 then they meet at 53%, start at 46% and meet at 50%. Just wait…

  • http://Slamonline.com nbk

    The NBA owners want what seems like a combination of what the NHL owners got, while treating salaries closer to how the NFL shakes out. Comptetitive balance over time does not exist, that is absurd. Tell me how many small market teams have ever won an NBA title. I’ll give you a hint, you can count them with your fingers and still have some spair to type a response. Do teams get lucky? Ofcourse, look at San Antonio, they luckily got the first pick, with franchise changing players twice, in ten years. Hardly ever in the NBA can a team in a small market compete without getting a top 5 player. And the only way that currently happens is through the draft. Competitive balance throughout the league every year is just a stupid thing to even suggest as a possibility. The owners want the chance to improve fast not sit in the cellar year in and year out.

  • asgf

    On one hand u got have athentic middle level players which are going to screwed but then u got guys like JR smith and Rashard…

  • slam-man

    The Minneapolis Lakers were the NBA’s first dynasty and the San Antonio Spurs were the NBA’s 4th great dynasty. In the meantime the Houston Rockets won 2 in the 90′s and the Dallas Mavericks just got one. Plus if your talking about the mere ability to compete there are many small market teams with great talent that compete and have a real chance to win every decade and every year. The WC is a small market heaven, its the EC where most of the big markets are. And interestly enough the EC was weaker than the WC this past decade. But somehow the Lakers, one of the few big market teams out west, dominate the WC. In the meantime I think the Suns, Kings, Blazers and Rockets all had real chances to grab a championship this past decade, but injuries ruined it for all of them. Maybe the economics can fix that, but I don’t want the situation to be worse if the actual goal isn’t achieved. I don’t know if there is a way to perfectly enforce an actual multi-championship league. The NBA can’t shake out like the NFL. The NFL’s path has nothing to do with rule changes. Just compete and be happy.

  • http://Slamonline.com nbk

    Dallas is not a small market. Neither is Houston.

  • http://facebook.com/tronjohnson ChiefKeewatin

    So Glad AllenP hit up this thread. The NHL needs to deal out some contraction too.

  • steven

    nba fan love it to death. Till all his stuff you think they can sit down and come to agreement.Its a win win players and owners got it made 4 the most part.If they dont start the season on time hope the fan base is low.

  • http://slamonline.com Neitel#2

    right about now, the owners and players are greedy as greed can go. an average person working in a decent job…take me for an example, i am in the US Army…i only make about 35 thousands a year, not enough if you ask me…an nba player can make 35,000 in a few gamnes! ask kobe. So, when there is so many millions of dollars involved, and it’s a billion dollar empire, you know greed is going to sneak in somewhere and halt things up….no training camp, no pre-season, no regular games…this lockout will last for a very long time, because the players will not accept a cheap deal, and the owners, want to save money, by hitting the players salary and maybe im assuming, not their own. I think with the current economy (thanks obomba) the nba wants to save money, but cancelling games is not an answer…i gues the owners can be like parents, “im taking the ball, and you ain’t playing”, so in reality, to me, i sort of careless….because as much as i love NBA basketball, there are plenty of things to look forward than just NBA, but many other people dont see it this way…they just want NBA, and it wont happene this season. AT ALL.

    This is very sad. R.I.P NBA 1998-2011

  • royallblue11

    maybe we should just end this and boycott everything NBA, still buy the players shoes, t-shirts, go to pro am games, but not purchase any NBA merchandise. that will surely wake them up.

  • gakbrenti

    these players nowadays are too damn greedy!
    is there still passion for basketball??

  • http://www.smykicks.com Jay Smykicks

    Todays society is all about more more more, Value size, bigger house, not living with in your means… so with the NBA owners have a reason to want more and the players have a Limit. Owners need to save themselves from…themselves. Offering crazy contacts, smaller markets losing money. both sides are going to have to take some cuts(doubt that’s gonna happen)

  • jason williams

    Well the way I see it the players are the greedy ones. They make millions of dollars for running up and down a basketball court. How about this, why don’t the players take their talents to south beach and get a different job and see how much money they make then. They should be happy with the millions they already get, now the owners want to cut into the players millions…oh my. So the players will 9 million instead of 8 million..you gets no sympathy from me.