In the past few days I’ve witnessed many basketball writers bemoan the lack of common sense exhibited by the owners and players in failing to reach an agreement in the eleventh hour of negotiations of the NBA lockout. In particular, both Chris Sheridan of Sheridan Hoops and Ken Berger of CBS Sports (who coincidentally have both done some incredible reporting on this story) held steadfast to their optimism that reason would prevail, and then exhibited bitter disappointment when the actual outcome was announced.
Respectfully sirs, I submit that reason did prevail. It just was a based on a set of premises that you may not have agreed with initially but now in hindsight have become crystal clear.
Consider the following string of logic:
A) Money is the top, and only priority
The owners, at their core, are business moguls and profit maximizers.
Now I know some would point out that if they were really only concerned with profit they wouldn’t give out mammoth contracts to the likes of Eddy Curry or Rashard Lewis. Yet I say that these decisions are different. They are emotional decisions where the instinct to win kicks in and the people in charge make irrational, sometimes desperate moves because they feel it gives them a shot at improving their team. Really, it’s very human.
By contrast when it comes to collective bargaining the owners are of a clear and sober mind. There is no hidden emotional factor at play. All that matters is the bottom line. All choices will be made rationally to serve that end.
B) The owners hold the best hand… and it’s not even close.
In a nut shell, the players have no leverage. To one degree or another, the league is losing money and that means that the union knows they’ll be having to concede something to begin with when they come to the bargaining table. Not a good position to negotiate from.
More to the point, the owners can also afford to scrap an entire season if need be since for nearly, if not all of them the NBA is not the primary means by which they derive their income.
On the other hand, for the vast majority of players who are in the prime years of their career and whose earning power is directly tied to their NBA salary, you can’t tell me they’re willing to lose an entire season based on principle. It just doesn’t make economic sense.
Because the owners know they can outlast the players in a war of attrition this gives them the ace in the hole. In essence, it’s a trump card that the players simply cannot match.
Next Page: For the Owners, why Compromise?
C) There is no reason to compromise
To me, at least in terms of pure economics, the owners are just following the optimal strategy to maximize their long term profits. Sheridan calls it “being lawyers instead of being humans” but I say it’s playing the game within the confines of the rules provided. Not to say it’s the most magnanimous negotiating strategy, but what economic motive do they have to let up? To be charitable? Please.
One could argue, I suppose, that there are detrimental factors involved in the PR nightmare that the lockout will continue to provoke and the loss of good will that could follow when the league comes back online. That there will be, for lack of a better term, a grudge factor that leads to substantial lost revenue.
Yet the NBA looks over to it’s most closely related cousin in the sports world, the NHL, and sees a sport that had to sacrifice an entire season to get an owner friendly deal. And you know what? The fans came back and that league looks a heck of a lot healthier now than it did eight or nine years ago. Ultimately this will only embolden the owners belief that they can risk the good will of the casual NBA follower because in the long run the association offers a product that can’t be duplicated anywhere in the world. Sad as it is to say, I think they’re right.
D) The players were destined to lose, and lose big
In a way, this was all just kismet.
I honestly believe that the owners knew that this was the path they were going to take all along and what we’re seeing now is their strategy playing out to a tee.
Start off with a ridiculous low ball offer, gradually work up to a more reasonable position, generously “conceding” on certain items like a hard cap that were never part of any collective bargaining agreement to begin with and never agreed to in principal by both parties. This gives the appearance of negotiating while really just masking the true motive of squeezing every dollar possible out of the union.
And while you can argue that it’s disingenuous or cutthroat or in bad faith, you can’t argue with the effectiveness of it as a tactic. In short, from a profit maximizing standpoint, this was exactly how the owners should have played it. And since we’re working on the premise that the owners primary objective is to maximize their profit, why are we surprised at all that we got to this point? Why despair the lack of reason when it appears that the owners are simply making the most rational economic choices possible.
The truth is the players never had a chance here. Without an ounce of leverage to battle back with there is really nothing they could have done to prevent this, other than to sign off on the owners list of system demands on Monday and take whatever offer was on the table, walking home in shame with their proverbial tail between their legs. Not going to happen.
In addition, the one game changing option they could employ, the nuclear bomb of decertifying the union, probably won’t come to pass because there would be too much money lost to role players who by in large make up the majority of union members.
Sure, Sebastian Telfair and Brandon Bass and J.J. Barea may have budgeted for a few months of missed paychecks, but will any of those guys be willing to to sacrifice an entire season of NBA salary to fight to the bitter end, especially if getting a more player friendly collective bargaining agreement would hardly be a sure thing? I doubt it. As many bystanders point out, including Bill Simmons, the money they lose now will never come back into their pockets. Just look at the recent writer’s strike in Hollywood for evidence of that.
It seems to me that the players have only two choices: lose big now or lose big later. It’s a bitter pill to swallow, and I know that ego plays a factor in not wanting to surrender so readily, but at some point they have to realize the outcome isn’t in doubt. In fact it never has been.
“Victorious warriors win first, then go to war, while defeated warriors go to war then seek to win.” – Sun Tzu, The Art of War
The players may not know it yet, but they’ve already lost. Sadder still, so have the fans.