In July, when the NBA lockout began, there were several unanswered questions. Would players agree to be tested for marijuana? Would the owners consider raising the minimum for veterans? Would both sides agree to a modified rookie salary cap? The answers, it turns out, are yes, yes and yes. When a deal is finally made, marijuana will be added to the league's list of banned substances. Owners will pay more to journeyman veterans, and there could well be two unconditional years added to the rookie cap. Yet the core dispute over how to treat star free agents still threatens to wipe out the season.
The owners are determined to implement a hard salary cap by shooting down the Larry Bird exception, which allows a club to pay any price to re-sign a free agent who has been with the same team for three years or more. The players say they will never accept a hard cap.
It's difficult to weep for the 348 NBA players, whose average pay last season was $2.6 million. Union president Patrick Ewing says players are "fighting for their lives." In fact, they're fighting for their second and third Porsches. These guys are so out of touch they staged their latest pep rally in Las Vegas (page 64).
Billy Hunter, the union's executive director, has kept his membership unified so far, but neither side has yet offered a viable exit strategy, any scenario that might lead to peace and at least a partial 1998-99 season. Here is one for Hunter to consider.
Rather than continuing to treat the Bird exception as holy writ, the players should recognize the exception for what it is: a humongous bargaining chip. The exception tends to advance the interests of only a few players, a superrich elite. Hunter should give it up, and make the owners pay dearly for the concession.
On Oct. 16 management proposed that on free-agent signings for salaries between $2.6 million and $10 million a luxury tax of 50% be assessed on the amount over $2.6 million. Teams signing free agents for more than $10 million would be taxed at rates ranging from 100% to 150% on anything exceeding $10 million. After two years, if the players' share of league revenue got too high, a hard cap would take effect. The players have indicated that they would accept a luxury tax that kicked in at $18 million, a level that now applies only to Ewing and Michael Jordan.
Clearly, there's room for compromise. Here's a solution: a deal featuring a labor-friendly luxury tax on all free-agent signings (a 50% levy on salaries greater than $10 million might work), and no Bird exception. Even if salaries continue to creep higher, there would be no hard cap. Both sides could claim victory—a vital part of any agreement.