Winning is costly in NBA

Winning a championship is supposed to solve problems. In the National Basketball Association (NBA), it can also create them. The players who get a team to the top are the same ones who make it increasingly expensive to stay there, and the rules designed to keep the league competitive can make continuity a luxury. Under the circumstances, the Knicks are learning that winning the title may have been the easy part. After having waited 53 years to become champions again, they are, naturally, now thinking about defending their crown. Unfortunately, they have to figure out how much of their championship roster they can afford to keep. The second apron has turned lineup construction into a financial exercise in which every contract carries consequences beyond the player receiving it. Success comes with a bill, and the current collective bargaining agreement has made it considerably harder to pay.

Karl-Anthony Towns is at the center of the dilemma. Entering the final guaranteed season of his contract, the 2015 first overall pick is eligible for an extension that would secure his future with the Knicks, but negotiations have yet to produce an agreement. Needless to say, he has every reason to seek a deal that reflects his value. A three-time All-NBA selection, he provides an offensive dimension that few centers can replicate, particularly with his ability to stretch the floor. Meanwhile, his employers have to weigh his next contract against their other commitments, starting with Jalen Brunson and the supporting cast needed to remain contenders. Neither side is wrong. Players have relatively short careers in which to secure their financial futures, while teams have to consider not just what a star is worth but what paying him means for everyone else. The difficult part is that both calculations can be perfectly reasonable and still lead to an uncomfortable impasse.

This is where the second apron becomes more than a line on a spreadsheet. Its restrictions on trades and roster-building tools can limit a team’s ability to improve, even when adjustments are necessary. The objective is understandable: prevent wealthy franchises from spending their way to an advantage and give the rest of the league a better chance to compete. That said, there is a marked difference between discouraging reckless spending and making it difficult for a team to retain the players responsible for its success. And, in this regard, the Knicks are hardly alone. Contenders across the league must decide when loyalty becomes financially impractical and when paying a premium for a proven player is preferable to gambling on a cheaper replacement. Every team wants continuity, until, that is, continuity becomes prohibitive. The conversation then shifts to flexibility, depth, and the virtues of making difficult decisions. The trouble is that replacing a salary is considerably easier than replacing a vital cog’s production, experience, and fit within a system. Lose one piece and a team may adjust. Lose several, and the identity that made it successful disappears.

Of course, financial constraints do not automatically condemn a team to decline. Good organizations develop young players, find value in less expensive veterans, and extract more from the talent they already have. The Knicks can still manage their payroll and remain competitive, and an unsettled extension does not necessarily mean an inevitable breakup. All the same, the league needs to consider what its rules are ultimately encouraging. Competitive balance is critical, but no more so than rewarding teams that draft well, make smart trades, and build a slate worth keeping. If a franchise assembles a title squad through years of calculated decisions, it’s decidedly counterproductive to make preserving that achievement progressively more difficult. At the same time, there’s a limit to how much sacrifice teams can reasonably demand from their stars. Players are expected to commit to winning, but they are also entitled to seek contracts their performance warrants. Loyalty is a laudable concept until the bill arrives, and then everyone suddenly remembers that basketball is a business. The challenge is finding a system that discourages financial excess without turning sustained success into an exercise in constantly replacing the people who made it possible.

The modern-day Knicks have already done what generations of Gotham stalwarts could not. Now comes the less glamorous work of determining whether they can keep the group together long enough to do it again. And their situation illustrates the NBA’s central contradiction: Teams must spend to acquire elite talent, but opening their wallets too much can restrict their ability to build around it. There is no simple solution. Owners cannot be allowed to buy championships without consequence, and salary rules cannot guarantee that every successful team remains intact indefinitely. Still, there should be room for organizations to reward their players without dismantling the very rosters that made those rewards possible. Championships are difficult enough to win; defending one requires talent, health, timing, and no small measure of good fortune. It should not be made unnecessarily complicated by a financial system that risks treating success as a liability. The blue and orange have earned the right to enjoy their title. They now have to find out how much it will cost to keep it within reach. In the NBA, winning is expensive. Staying a winner is even more so.

 

Anthony L. Cuaycong has been writing Courtside since BusinessWorld introduced a Sports section in 1994. He is a consultant on strategic planning, operations and human resources management, corporate communications, and business development.

Winning is costly in NBA
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