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CBA Primer: The Nuclear Option

CBA Primer: The Nuclear Option
League owners ask, “Where have you gone Che Guevera?”

(If you missed any of the previous installments in this series, click here.)

Throughout this series, there has been a common theme. When it comes to the Collective Bargaining Agreement discussions, the owners have the advantage. Thanks to the NFL Players Association, though, the court may have just been leveled.

In order for the union to beat the owners in the NFL’s battle, they ceased existence. The fancy term is “decertification,” but what it really means is that the players are no longer a collective unit. As such, they cannot collectively bargain anything. To which most people, if they are anything like me, would initially think, “Doesn’t that mean the owners won?”

If this were thunderdome, that would be the case. Two entities went into the ring of collective bargaining, and only one entity exited. In this case, however, death becomes the union.

As much as league ownership paints the Players Association as a big, bad villain, they desire unionized players. That’s because in a country that detests communism, the major professional sports leagues are allowed to practice that form of economics because the U.S. goverment allows them an anti-trust exemption.

Who is John Galt? Don't ask Roger Goodell.

The anti-trust exemption is what allows the 32 teams in the NFL (30 in the NBA) to act in conjunction with one another. Without it, every ownership group is truly an independent entity that is not allowed to collude with their fellow franchises. That means that there cannot be a salary cap of any kind, there cannot be revenue sharing, and there cannot be limitations placed on player salaries. It becomes a totally free market. Ayn Rand’s dream.

This should be perfect, right? Except it is not. It is great for the best players and the largest markets. Kevin Durant, in a system with no limitations on how much money or how many years could be offered, would get a monster contract. Even with the limitations, he is in line to make over $100 million over the life of his current contract. Had he been given the option to go on the market with the Lakers, Celtics, and Knicks having no cap on how much they could spend, it is not out of the realm of possibility that he could have signed a deal averaging $50 million/year in a contract longer than ten years.

[pullquote]Death becomes the union.[/pullquote]One thing is for sure, Oklahoma City would not have even been a contender in the conversation in signing Durant. Neither would 75% of the other teams, all of whom would have limited resources and no revenue sharing to encourage competition. Meanwhile, the lesser players receive completely unguaranteed contracts with no minimums.

For the league as a whole, it is a disaster. No team not playing in a mega market could compete on the floor. The product is decimated. Mid level players would leave to play in Europe as the middle class of the league would disappear. In the NBA, for sure, many of the small market teams would either fold or operate on shoestring budgets (eliminating many jobs for basketball players).

This may seem like a paranoid, apocalyptic forecast, but it is very much why the NBA commissioner David Stern has referred to the elimination of his biggest adversary as “the nuclear option.” While the league has built a tough facade knowing a lock out would take a harder toll on the players than them, the NBAPA has been crafting their own Little Boy to drop on the owners.

Would Russell Westbrook turn down a Godfather offer from his hometown Lakers?

According to an ESPN report, the NBAPA has the votes to decertify. Without a union, the owners lose their best weapon (the lockout), then if the association does not reform in the near term, the league will play without any salary cap for possibly several years.

That can do irreparable harm. As Thunder fans, imagine if the NBA goes without a cap into the summer of 2012 (and I’m assuming with no CBA that qualifying offers and restricted free agency are revoked) and Russell Westbrook is free to go anywhere and the Knicks/Lakers both hoping to sign a marquee point guard…

Actually, let’s not think about that. Instead, pray that the threat of decertification makes the owners start getting more realistic with their demands.