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When to hold 'em and when to fold 'em: considering the NBA's "blow it up" conundrum - Pinwheel Empire

When to hold ‘em and when to fold ‘em: considering the NBA’s “blow it up” conundrum

submitted 6 years ago by in NBA

After a few interesting exchanges in the comments, I’ve been doing a little thinking on when, if ever, teams should intentionally get worse in hopes of long term success building through the lottery. Ultimately people on both sides of the debate tend to oversimplify the arguments for the other side, to the point where it’s not really a productive exchange. This post will try to explain a few somewhat overlooked perspectives, and explain why I think teams err too far on the side of remaining a bottom-dwelling playoff team for too long.

The basic blow it up argument (and counterargument)

The basic argument in favor of getting worse is that a team needs a superstar to win a championship. Without a top-5 or top-10 player in the NBA, it’s very difficult given the structure of max contracts and the salary cap (LeBron James delivers many times more wins per cap dollar than does Rudy Gay). So if you don’t have one of these players, basically a team is wasting its time if it is making the first or second round every year.

While this argument has some validity, it’s also flawed, particularly from the standpoint of owners and loyal fans. An owner presumably wants to enjoy his product and make money. While it would be more fun to win a championship, winning is still more fun than losing, ceteris perebis. Also, making the playoffs every year makes money: you sell a lot more tickets and a lot more t-shirts. Although a tanking team can slash salary, the ability to squeeze revenue that way is limited by the salary floor. My guess is that a team that is generally responsible while contending (like the Jazz) is more appealing from a financial standpoint than a salary floor team like the Kings who are terrible.

From the perspective of loyal fans who pay money for season tickets and cable television, the case is even stronger. Like ’92wastheyear says, you probably wouldn’t feel good about sucking for 19 years to win a championship if you buy season tickets to the 19 terrible years. These loyal customers will stop paying for Comcast and for season tickets, and harm the bottom line. That creates intense pressure to stay at least somewhat competitive

Finally, it’s not totally impossible for a team in apparent no-man’s land to claw their way out. The Pistons did so in the mid-2000s by adding Rasheed Wallace to a group of vets. The Rockets nearly did by trading the farm for Pau Gasol and trying to sign Nene in free agency. Although the examples are few and far between, it’s not impossible to win it all by making shrewd acquisitions as a playoff also-ran.

The missing considerations in the “blow it up decision”

So there is rightfully some urge to stay competitive, both for the bottom line and for entertainment’s sake. That said, in the NBA teams hold onto mediocre nuclei too long far more frequently than they blow up a promising ones before their time. The Hawks blowing obscene amounts of money on Joe Johnson is one example, as is the Blazers locking up Zach Randolph and some of his supporting players, as is the Wizards giving Gilbert Arenas stupid money coming off a knee injury and deciding he and Caron Butler should earn marquee player money. So why does this happen?

A misunderstanding of player costs

Oftentimes when a Bird Rights player is up for a contract, the basic statement is “we can pay him whatever.” A similar sentiment is attached to the mid-level exception. Under the old CBA, you could use it every year, so why wouldn’t you? The problem is, the only consideration for many GMs is whether a signing will make it harder for them to acquire someone in the next year or two. GMs generally get fired anyway, and someone else has to clean up the toxic waste dump they create if they do a bad job. Fans exacerbate this problem by by calling owners “cheap” if they don’t spend most every available resource.

In reality, the costs go considerably beyond the limitations on that offseason. Overpaying players or signing them to overly long contracts can kill a team’s cap situation. A team that is under the cap is also in position to make unbalanced trades, or take on bad contracts sometimes at insanely inflated prices. Also, an owner may have buyer’s remorse and decide to crack back on salaries right in the middle of the expected “prime” of the team.

An attachment to a particular “core”

In a league where individual skill is so value, it’s sometimes amazing to me how easy it is to replace one player’s contribution with nearly freely available talent. A great example of this is the Spurs, who were able to trade George Hill for Kawhi Leonard, replace Hill with the T.J. Ford off the scrap heap, and not really miss a beat. Because they weren’t attached to a nice young player, they were able to grab a guy who appears to be a long term solution at small forward while losing a negligible amount on the court.

Now not everyone can plug players in off the scrap heap as seamlessly as the Spurs, but other teams could take a lesson in not getting too attached. Denver’s 42 million dollar contract for Arron Afflalo, the Pistons contracts for Stuckey and Prince, and the Magic’s extension to Richardson all were extensions given to players the teams thought they couldn’t live without, and they were overpaid accordingly. Unfortunately, it’s probable that most of the production provided by those guys could be replaced more cheaply, if not immediately then relatively quickly through the draft or a reasonable trade.

Failure to recognize the inevitability of sucking

The strange thing about this debate is really this is not a dichotomy. No team can go forever in the playoffs. The real key is to try to make sure the highs are high and the lows in the cycle are as painless as possible. The best way to do that is of course make sure the team doesn’t have a bunch of old guys with horrible contracts to get rid of after management decides the last nucleus needs to be put out to pasture.

Again, there is little incentive for GMs to do that, since usually they get fired for making the contracts in the first place, so they won’t be around to clean up the disaster. They know the question is whether they’ll be around for 3-4 years, not 10-12.

What does this mean?

I don’t really buy the idea of a team in the Blazers’, Nuggets’, or Rockets’ position intentionally getting worse just so they can go after someone in the draft. Winning games is fun, makes the owners money, and is just generally better than being terrible. Also, rebuilding through the lottery is no guarantee.

That said, those sorts of teams have to be very careful with tabbing players as “core players” lest they overpay them and make the ultimate rebuild more painful. Although every team should be prudent in handing out contracts, fringe playoff teams are in acute danger of paying a peripheral player like a star. That may not manifest itself as a mistake right away, but over the course of a few years, even medium sized bad contracts can be crippling. An owner has to decide how much it’s worth to him to stay in the playoffs, considering the long term financial costs and also the possibility that cutting losses and declining to re-sign players may result in a shorter turnaround time while saving money.