NBA Players Union Proving Trickle-Down Economics Can Work

Turns out labor groups of only millionaires can create interesting market dynamics.
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When the Diamondbacks signed Zack Greinke to a six-year, $206.5 million contract last winter, Arizona not only added an elite pitcher, the organization announced its presence with authority on the baseball landscape.

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Optics matter, and when you give out a contract north of $200 million, the message being broadcast is that you are serious about your intention to contend. That the Diamondbacks then went out and lost 93 games, with Greinke posting a 4.37 ERA, is only meaningful insofar as far as it led to a front office purge. You never know if your roster construction will work out, but when you make a splash with a giant contract for a superstar, you know that you will sell jerseys and create buzz.

The biggest contract in the NBA right now belongs to Mike Conley of the Memphis Grizzlies, and it’s more than a little bit telling that “of the Memphis Grizzlies” feels like a necessary set of words to attach to Conley’s name. The contract is worth $152.6 million over five years, just shy of the total value of baseball player Jacoby Ellsbury’s seven-year deal – a contract that made Ellsbury the player with the fifth-largest contract on the 2016 Yankees.

Conley isn’t going to hold the NBA contract record for long. Thanks to the provisions of the new collective bargaining agreement, Steph Curry (“of the Golden State Warriors” not necessary) will be able to sign a five-year, $207 million contract. The splash being made here isn’t by the Warriors, who hardly need more attention, but by the league itself.

The NBA is well positioned for the 21st century. The game of basketball is popular around the world, which means revenue streams that its North American competitors can only dream of are open. There’s no existential crisis of the sport being a danger to those who play it, like football. There’s no demographic crisis, like baseball. There’s no expense barrier for kids to play the game, like hockey.

When Curry becomes the NBA’s first $200 million man, and the first player in any North American sport to crack the $40 million average annual salary mark, the message will be loud and clear throughout the sports world. With the NBA’s business continuing to grow, the salary cap tied to revenue, and the top individual salaries at 35% of the cap for players like Curry under the new “designated veteran” tag, it’s going to remain the case that the top NBA players are the top-earning athletes we have. For a league with more appeal in star power than many of its competitors, this is not insignificant.

So, what’s the catch? Why was Curry’s teammate, Draymond Green, tweeting “Stand for something… or fall for anything” as part of his reaction to news of the new CBA? It’s because while the biggest stars are going to get paid bigger money than ever, there’s not a lot happening at the other end of the pay scale. Green, a bench player his first two years as a pro before he became a star, understands what life is like at that end of the spectrum.

Let’s be real, though, because Green was, too. He mentioned the plight of someone like teammate James Michael McAdoo, not getting a real boost from this CBA, but Green also said, “At the minimum, we’re making – what? -- $600,000 to play basketball. I’m not going to sit here and act like I’m pissed off that anyone is making that because that’s less than 2 percent of America is making that.”

McAdoo, who plays in less than half of the Warriors’ games, and gets about two minutes of garbahj time when he does play, is making $980,431 this season. According to ESPN’s database of NBA salaries, that makes McAdoo one of 60 players in the entire NBA who is making less than a million bucks.

It’s a case where trickle-down economics can actually work. The NBA pays its best players more money, and they get more headlines, more attention, more energy for their game year-round. That means more money coming in, and since everything from the stars’ salaries to the scrubs’ salaries is tied to good ol’ basketball-related income, before long everyone is a millionaire.

Except the writers. We need a better union.

WHAT A BUNCH OF GARBAGE: Speaking of people who could use a better union; Anyone in baseball who isn’t a player or top-level executive!

On Thursday, John Coppolella, the general manager of the Cobb County Unfortunate Nicknames, did a Twitter Q&A, in which he gave some honest, if less than inspiring advice.

Look for internships. Don't worry about the money. Work hard & don't have expectations beyond being part of a team. Assume nothing. https://t.co/7bUe1QhRZU

— Atlanta Braves (@Braves) December 15, 2016

“Don’t worry about the money” is putting it lightly. Coppolella himself has been honest about what he went through as a low-level employee with the Yankees. On Jonah Keri’s podcast earlier this year, he admitted to doing some eating out of trash cans.

This shouldn’t be a badge of honor. It should be something that you work to change for those who follow. Also, when it comes to Major League Baseball’s ongoing problems with diversity, paying entry-level employees less than a living wage – 79 cents an hour! – only serves to ensure that the talent pool is composed of people with enough of a support system to be able to afford to work one of these jobs.

Smart folks in baseball always talk about exploiting market inefficiencies. There seems to be a clear one in getting good work out of low-level employees who don’t have to worry about making rent or if they’ll have to eat literal garbage to survive.

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