The perfect illustration for how the new collective-bargaining agreement is changing the landscape of the NBA is located in the league’s official transaction log.
At the trade deadline two years ago, teams traded away a total of 11 first-round picks. By last season, the first under the newly negotiated CBA, only four first-round picks were dealt. And during this year’s recently completed trading season, only one first-round pick was traded.
The common denominator in all three seasons is the Cavaliers, who managed to obtain a first-round pick in each of the past three seasons. No other team has been so fortunate.
But the dramatic drop from 11 first-round picks traded two years ago to just one this year illustrates the impact of the escalating luxury taxes that will take effect next year. Players making less are suddenly worth more. Much more.
“Teams right now are scared of money,” one league executive said recently.
The days of general managers playing fast and loose with first-round picks are over. Guys like Gerald Wallace, who was dealt at the trade deadline in consecutive years, don’t hold the same value that they did just 12 months ago.
The Charlotte Bobcats acquired two of those 11 first-round picks during the trading season two years ago, swindling two out of the Portland Trail Blazers for Wallace, a good-but-not-great wing who has made one All-Star Game in 12 years. Then the Blazers recouped a first-round pick, No. 6 overall, when they dealt Wallace to the New Jersey Nets in a panic move at the trade deadline last season.
The Blazers plucked the likely Rookie of the Year with that selection in Damian Lillard. Wallace, meanwhile, is still owed $30 million over the next three seasons. That’s the type of contract that now would typically get him traded along with a first-round pick to any team willing to absorb that type of salary. Wallace’s saving grace is that he plays for the Brooklyn Nets and billionaire owner Mikhail Prokhorov, who scoffs at the looming tax damages coming his way.
Precious few owners around the NBA can behave that way. Beginning next season, the new luxury tax will punish teams more harshly for going over the cap and it annihilates habitual offenders. The new tax rules are what prompted Dallas Mavericks owner Mark Cuban to go on Dallas radio recently and suggest the Los Angeles Lakers might need to release Kobe Bryant before next season using the league’s amnesty clause.
Of course, Cuban was just baiting the Lakers and their fans because that’s what he enjoys doing, and no one actually believes the Lakers would release Bryant. But he will earn $30 million next season, when the Lakers could be paying more than $90 million just in luxury taxes if Dwight Howard signs a max contract this summer.
Add in the $100 million in actual payroll and the Buss family, who just lost their patriarch when Jerry died last week, could be writing checks next season that total $200 million. Of course, the Lakers are believed to be pulling in about $150 million a season just on their television contract with Time Warner Cable, but no other team has that type of television deal, meaning most of the league’s owners — including Cuban — can’t afford that type of payroll and luxury tax.
That’s why Cuban began dismantling the Mavericks shortly after winning the championship two years ago. He once was one of the league’s carefree spenders, but Cuban has grown much thriftier in recent years. It’s part of the reason he traded with the Cavs to move down seven spots last summer, giving Tyler Zeller to Cleveland with the 17th pick in exchange for the 24th, 33rd and 34th picks. In Cuban’s eyes, the more rookie scale contracts, the better.
The fact the Cavs are now completing their third year of this rebuild, coupled with all of the draft picks they are owed in the coming years, places them at a distinct advantage. They already have six cornerstone pieces in place on rookie scale deals and will add two more in June’s draft.
In the Cavs’ dream scenario, the Lakers will slip into the playoffs as the eighth seed in the West, allowing the Cavs to swap the Lakers’ first-round pick with the Miami Heat’s pick, which the Cavs own as their first piece of compensation from the LeBron James sign and trade.
The Cavs only get the swap rights with the Lakers if they make the playoffs, and at this point, that could mean the difference in about 15 draft slots between where the Lakers and Heat are selecting.
The Cavs also have two second-round picks again, their own and the one belonging to the Orlando Magic. Given the rate at which the Magic are losing games these days, it’s realistic to believe that selection should be within the top three of the second round and could easily be the top pick of the second round (No. 31 overall).
The Cavs would like to duplicate the Zeller trade if they can find a team in the lower half of the lottery willing to drop down a few slots in exchange for two high second-round picks. A jump from No. 16 to No. 12 or even No. 11 is plausible if the right team (Phoenix Suns?) is in front of them and looking for more picks, meaning the Cavs could be in position to add two more lottery picks to a roster quickly growing in young talent.
This was part of the Cavs’ plan all along. They started hunting and gathering draft picks two years ago because they believed a.) the best chance at building a consistent winner in frigid Cleveland was through the draft and b.) looming changes to the CBA and a stiffer salary cap would make draft picks more valuable. They were right.
It’s why those polled around the league were shaking their head in amazement the Cavs were able to land what should be a future lottery pick from the Memphis Grizzlies last month for swallowing about $6 million in guaranteed salary. No other team in the league was capable of landing a No. 1 pick during this trade season.
The Cavs ideally would like to add one more future pick to their bounty, but that might not be possible. It’s time to start winning, beginning next season. History indicates if rebuilding teams don’t start winning by the fourth year, odds are it won’t happen at all.
But as the league enters into this strange new land of punitive tax fines that can quickly soar into the tens of millions, perhaps no team is better positioned with the salary cap than the Cavs.
While other teams walk a tricky line of trying to fling money overboard while holding onto first-round picks, the Cavs have positioned themselves to make a legitimate run at the playoffs next season — and they’re doing it with their core players entrenched on rookie contracts.
In this upside down salary cap world where less is more, the Cavs have more of less than anyone. It’s the new way of life in the NBA. It has to be.
Jason Lloyd can be reached at firstname.lastname@example.org. Read the Cavs blog at http://www.ohio.com/cavs. Follow him on Twitter http://www.twitter.com/JasonLloydABJ. Follow ABJ sports on Facebook at http://www.facebook.com/sports.abj.