TGS PRO BASKETBALL UPDATE…ENJOY THE NBA WHILE YOU CAN

It was easy to see what was coming last week when Stern mentioned the “c” word (contraction) on the eve of the 2010-11 NBA season. Of course, negotiations for a new Collective Bargain Agreement figure to make more and more headlines as we proceed through the just-commenced campaign, the final season under the current CBA. Stern’s recent threat was really nothing more than good old gamesmanship, designed to plant a seed within the fragile NBA Players Association that jobs could be lost if they don’t come around to the owner’s way of thinking at the negotiating table. Nothing spooks a Players Union more than the thought of job losses, however thinly veiled the threat might be.

Stern, however, might think he has a joker in his deck with the contraction threat, because he’s continued to bring it up over the last week. He’s included a lot of disclaimers in his commentary, but he’s not exactly backing off his early volleys, either. “The issue of contraction,” Stern said in his preseason conference call, “is one that has to be discussed in the context of collective bargaining with the players. Whether or if there are markets where there may not be buyers for teams that are looking to be sold, that raises the issue of contraction.

“It’s a sensitive subject for me because I’ve spent 27 years in this job working very hard not only to maintain all of our teams, but along the way add a few,” Stern added.

“But I think that’s a subject that will be on the table with the players as we look to see what’s the optimum way to present our game, and are there cities and teams that cannot make it in the current economic environment. I’m not spending a lot of time on it.”

CBSSports.com first reported last Thursday that the league would “continue to be open to contraction,” after Stern said he wanted player costs reduced by $700-800 million. As could be expected, that set off panic in some small-market cities whose teams have struggled on the court and at the gate, especially since Stern was glad to keep bringing up the subject. Asked if contraction should be a chilling word in places such as Memphis, New Orleans, or Sacramento, Stern said: “No, it shouldn’t be. It’s a good word to use, especially in collective bargaining.”

There you go. Posturing 101.

Threats, even baseless ones, are not foreign to Stern, however. Recall the last time the NBA was faced with a serious labor impasse in 1998. For a while it looked as if the entire 1998-99 season would be cancelled until Stern mentioned the term “replacement players” (a nice term for “scabs” and one of the worst threats management can force upon labor unions). Players were soon back at the negotiating table and a deal was quickly reached to salvage the remainder of that season, albeit in an abbreviated 50-game regular-season format.

Stern isn’t the only one spewing the normal negotiating rhetoric, either. NBPA Executive Director Billy Hunter has let it be known that all players have been told to prepare for a long holdout next year and to watch their earnings wisely this season. In other words, we’re ready to wait this thing out if we must. The lines have been drawn in the sand for what could be a bitter labor battle.

The whole contraction dialogue, however, is just a sidebar story. As usual, this labor negotiation is down to money, and the more serious subject of a revised salary cap. Stern claims the teams are bleeding way too much cash and need to shave about $750 million off the total payroll. The players, on the other hand, do not believe the owners are losing money at all, and believe they simply want more of it for themselves. It’s not too dissimilar from all of the labor disputes we have experienced over the past four decades in baseball, football, basketball, or hockey, every time CBA renewal comes up.

In regard to the all-important salary cap, the owners are expected to emphasize a few major issues. They’d like a hard salary cap, and to cut the overall salaries by about one-third. They’d also definitely like to eliminate the “Larry Bird Rule” that allows a team to exceed salary cap limits to re-sign one of its own players as well as “midlevel exemptions” which also circumvent the current cap. In other words, no more “soft caps.” Indeed, it was the “Bird Rule” that was at the root of the 1998-99 lockout, and its retention was seen as a victory of sorts for the players despite making other concessions in the eventual settlement of that dispute.

The more pragmatic owners are going to insist in the next negotiations that the Bird and midlevel exemption loopholes be permanently closed, because they threaten to continue distorting the payroll structure even if ownership can force a reduced percentage of revenue the players can claim as salary. The idea of introducing a “franchise player” much like the NFL will also likely be floated in the negotiations.

But what the owners are asking, the NBPA is not likely to accept, at least at the outset. The players have never had to concede much of anything in previous negotiations, but this time they’re being asked to give up a lot. Never mind that they’re already ridiculously overpaid. Labor negotiations never go smoothly when one side is being asked to concede much more than the other, even when we’re talking about a bunch of millionaires squabbling with one another. This isn’t exactly a renegotiation of a local taxi driver’s union.

Sometimes, however, the situations can deteriorate into work stoppages, and this is what pro hoops fans should be concerned about. It’s always hard to gauge the resolve on either side, and the characters involved in the NBA labor equation are among the most unpredictable in all of pro sports. The consensus seems to be that the ownership group in the NBA contains a few more flakes and lightweights than counterparts in MLB, the NFL, and NHL. People in the know tell us that more than in the other pro leagues, NBA owners can’t even be trusted among themselves. They need rules to protect themselves from one another; hence, the insistence of the most wary owners to get the hard cap in place ASAP. The fact the owners haven’t yet been able to figure out how to share local TV revenues, something the cap-less MLB has even managed to address, is another example of their internal dysfunction. At the same time, the NBA Players Association has more immature misfits, per capita, than all of the other major sports leagues combined. It is hard to predict what might transpire with so many x-factors in the mix.

Stern, however, is a notoriously ruthless character, and is certainly well-versed in recent sports labor history, especially involving the NHL, whose commissioner Gary Bettman used to be Stern’s right-hand man at the NBA. The NHL, if you recall, cancelled its entire 2004-05 season due to labor strife. The ability of the hockey owners to sit tight and eventually force the deal they wanted down the throat of the NHLPA is very fresh in the minds of Stern and the more enlightened NBA owners.

Whether the NBA owners have the fortitude to cancel an entire season (which sources say the NFL owners, looking at their own labor issues next year, could probably afford to do thanks to the majority of TV dollars they’d still receive) remains to be seen. As is whether Hunter’s NBPA has the sort of resolve (stubbornness?) exhibited by the NHLPA and its former Executive Director Bob Goodenow six years ago. In the NHL’s case in 2004, Goodenow and the union were willing to make minor concessions, but were dead against any sort of salary cap linked to league revenues, accurate figures of which, as usual, having been disputed by both sides. The owners, however, held firm in a game of chicken between the two sides that eventually cost the league its entire 2004-05 campaign. Many NHL players flocked to Europe, where 388 of them found jobs that season, mostly with teams in Russia, Sweden, the Czech Republic, Finland, and Germany.

When the sides finally resolved matters in July of 2005, it was seen as a clear win for the owners. Goodenow’s union ended up accepting a proposal that was less than what the owners had offered in the middle of the previous winter’s negotiations. In the end, the owners, who had been reportedly spending up to 76% of their revenues on salaries beforehand, had a new system in place, with a cap adjusted each year to 54% of revenues, and a first year cap of $39 million ($3 million less than the owners had offered the previous February). The players’ share would increase if revenues hit certain benchmarks, and a revenue share was instituted, splitting a pool of money from the top ten grossing teams of the bottom fifteen. The only real concession made by owners was that all contracts would be guaranteed. Although 87% of the players ratified the new CBA, they were hardly satisfied with the leadership and direction provided by Goodenow, who resigned under fire just five days after the new deal was signed.

Rest assured that Stern has reminded his owners that their NHL brethren got almost exactly what they wanted out of the NHLPA in 2005, although they’ll need to band together and risk cancelling the next season if the players don’t blink at the negotiating table. As for Hunter’s constituency, we’d bet our next paycheck that 90% of the current NBPA membership wouldn’t know Bob Goodenow from Adam, and only a few more might realize what transpired with the NHL five years ago and be worried about making the same mistakes. Maybe ignorance will prove bliss for the players.

The bottom line? We don’t have a lot of trust in either side of this NBA debate doing enough to make sure we avoid a repeat of the lost 2004-05 NHL season. The national sporting press might not talk about the upcoming NBA labor controversy in the next few months, but rest assured we’ll be hearing a lot more about all of this once we get past the holidays and into calendar 2011. Cross your fingers, and stay tuned.