He left it, thereby putting the trade into motion. But was his departure inevitable?
A host of questions were raised in the wake of the trade. Why did he turn down the offer? Was he worth more money? Was he bothered about the way things were handled with his spinal tap last season? Was he ditching the Bulls, regardless of what they offered?
The problem with all of these questions is that they’re nuanced and complex, requiring the actual gathering and consideration of facts before jumping to a conclusion—something many of your more vocal fans (and sadly, analysts) never bother to do.
In today’s world of binary presentations, where some seem to believe that accounting for nuance is just a thing that spineless people who are “afraid to take a stand” do, actual reality becomes the victim.
That is the saddest part, because very often the whole story is not one of two extremes, as was the case with the Luol Deng trade. There are certain realities which necessitated the move, and those need to be understood before we assess Deng’s personal motivations.
The Reality of the Finances
There are realities in regards to the financial situation of the Chicago Bulls, and the luxury tax is not the least of them, particularly under the new Collective Bargaining Agreement (CBA), which features the repeater tax.
In the old CBA, if a team went over the tax level, they just paid a dollar-for-dollar rate for every shekel they were over the tax threshold; now, it’s neither that simple nor that cheap. The more you are over the threshold, the more you pay (the incremental aspect). Also, the longer you stay over, the greater the punitive nature becomes (the repeater aspect).
The Bulls were on track to spend more than $8 million over the tax level before the Deng trade. This year is the year before the repeater tax goes into effect, but the incremental aspect of it still kicks off. Thus, the Bulls would have paid $1.75 per dollar over the tax limit this year, or about $14 million, plus the actual salaries of almost $80 million for all of the players on the roster. The Bulls' total salary costs would have ballooned to $94 million.
Being far over the tax limit for several years can be cumbersome, even to the wealthy teams.
The repeater tax means you pay an extra dollar for every dollar you are over the cap. Teams that have been over the tax for the last three years will pay it next year. Thereafter, any team who exceeds the limit in three out of any four years will have to pay it.
Jimmy Butler’s contract will soon be up. Nikola Mirotic is hopefully coming over. The Bulls have one, perhaps two, rookie(s) who are going to need to be signed. They are hoping to land a major player in free agency. All of that is going to cost money.
Since they were over the tax limit last year, if they were to be again this year, that would have meant that would have had to pay the repeater tax if they were to land in that territory again any time within the next two years. And if they were to start nearing the $85 million neighborhood, they could end up paying $60 million just in taxes.
Sure, you can gripe about Jerry Reinsdorf not being willing to spend, but it’s not your $60 million, and that’s a lot of money, even to someone whose net worth is estimated to be worth $350 million, per CelebrityNetWorth.com. That’s the point of the taxes: make them so punitive that they make even the wealthiest teams think twice.
That’s not to say that the Bulls should never spend into the luxury tax. To be fair to Reinsdorf, he held true to his word that he would be willing to spend into it if he felt the team had a chance to win. In fact, before Derrick Rose’s season-ending injury, he displayed his willingness by using the mid-level exception (on Mike Dunleavy), much to the surprise of some.
But prudent teams need to now shoot for a “window” of years during which they are able to spend above the threshold—most likely during a year in which they have a real shot to contend for a title but can stay away from being penalized with the repeater tax. The idea isn’t to not spend at all, but rather to get the most out of the years that you do spend.
This trade hits the reset button on the clock for the Bulls. It gives them two years outside of the tax penatly, and it allows them use their luxury tax years for a championship window.
Sometimes people scoff at the business side of things, but they are real, and they do need to be considered. Trading Deng made business sense.
Spending money to win a championship is one matter; spending money to not win is a much different one. The first reality that needs to be accepted is that the Bulls had to make a smart financial decision.
And they did.
The Reality of Deng’s Value
There’s a bit of a debate among Bulls fans as to what Deng’s value truly is. The reality of this is that what you think, or I think, or what any “one person” thinks doesn’t set the value for anything.
What sets the value is what the market thinks.
The market is determined by people paying for a thing. Why is cable TV “worth” as much as it is? Because people pay for it. The people who don’t pay don’t set the market; the people who pay set it. If 27 teams aren’t willing to pay Deng, but three teams are, the three teams who bid on him set the market.
This offseason, Smith inked a four-year, $54 million deal with Detroit. Iguodala was offered a four-year, $56 million contract by the Sacramento Kings, but he turned it down to play for a contender, agreeing to a four-year, $48 million deal with the Golden State Warriors.
That gives us a range of four years at anywhere between $48 and $56 million. And no matter where Deng fits on that spectrum, it’s a far sight more than the $30 million presented by the Bulls.
Whether one accepts that Deng is as good as the other two is a bit moot. Some GMs and owners put him on that level, and they are the ones who are making the offers. Deng is likely to get offered as much as Smith and Iguodala on the open market, and Deng's agent, Herb Rudoy, already said that an offer as low as the one the Bulls made is "non-negotiable," per Joe Cowley of The Chicago Sun-Times.
In spite of Rudoy’s assertion, the Bulls’ offer to Deng wasn’t a low-ball; it was simply the most they could afford. Unfortunately, it wasn’t the most that Deng could make.
The reality here is that Deng is worth more than it made sense for the Bulls to offer.
The Reality of the Spinal Tap Controversy
There is some speculation that Deng was going to walk, regardless of what was offered, because of the way the Bulls mishandled his spinal tap last year.
As reported by David Aldridge of NBA.com prior to the season, Rudoy let it be known that Deng was unhappy with the medical care he received:
We (Deng, Rudoy and the Bulls’ front office) had several meetings. One was to discuss the medical care he got, or did not get, after his spinal tap [in May], which was of great concern to him.
In the post-trade press conference, John Paxson acknowledged this, via Nick Friedell of ESPN Chicago:
We did not handle that as well as we could have and should have. I guess we didn't understand the gravity of it in that moment from his perspective. And that's on us. But over the summer we talked to both Lu and (agent) Herb (Rudoy). We apologized. That's something we dropped the ball on and hopefully learn from, but in terms of injuries and things like that over Lu's career, I think we've been really supportive of how he's gone about things.
Absent Rudoy’s post-trade comments are any references to the spinal tap. It would appear that if you look at the full story here, both sides agreed that the Bulls should have handled the situation better, and it was nice that they met and resolved those issues this summer.
We can pessimistically dismiss the notion was resolved with quips like, “What are they supposed to say?”
But what are they supposed to say if it’s true? Sometimes people say things because they actually mean them.
The reality is that the Bulls made mistakes and admitted they made mistakes, but there’s nothing that suggests there was still bitterness that Deng was holding onto.
When he met with Cleveland reporters after the trade, Deng wasn’t lamenting the mishandling of the spinal tap, he was lamenting the mishandling of the contract offer, via Sam Smith of Bulls.com (the emphasis has been implemented by me):
I’ve been with the Bulls for so long I wish I would have stayed there. But things didn’t work out that way. It was a surprise. I’ve been very lucky. Not a lot of guys can say they’ve been with one organization for too long…
It’s a contract thing and my time has come up. That’s the direction the organization chose to go. They have every right to do that. As players, sometimes we forget that we’re employees. That’s who we work for. They have the final say. I wish we would have handled the whole contract situation better. But at the end of the day, either way, I think the decision was going to have to be made. I’m sure it wasn’t an easy decision for them, either. It’s basketball and it’s my job. But the hardest thing is those are friends. It’s really hard when you wake up the next day and know that your friend is gone and he’s going to be competing against you.
There’s nothing that appears bitter in Deng’s comments, and there’s nothing about the spinal tap. Is it possible that he would have left because of it? Sure, but it’s also possible that he would have stayed in spite of it. The nice thing about hypothetical arguments is that as long as they’re hypothetical, you can never be wrong.
According to what’s really been said though, the spinal tap didn’t play into it. Score one for reality.
There’s not always a bad guy in every situation. Just because the Bulls and Deng didn’t reach an agreement, it doesn’t mean that the Bulls forced him out or that he was determined to hightail out of there as soon as he got the chance.
The realities of the situation are complex, but the sum of things is fairly simple: Deng was worth more than what the Bulls could afford to pay. As a result, everything else is moot.
Putting the facts together, I imagine the following scenario is what transpired.
The Bulls received an offer for Deng that put them below the cap, giving them flexibility for the future. It also gave them a potential first-round pick, as well as a few other minor assets. It was, presumably, the best offer they felt they were going to get.
They were also on the clock. Bynum’s contract was about to be guaranteed, so it was literally a now-or-never situation. So they did what they had to do: they summoned Deng and made the best offer they could. Not surprisingly, Deng, knowing he could get better, turned it down.
There are no bad guys, just a bad situation. Deng was neither disloyal nor mistreated.
It was simply the case of the CBA doing what it was designed to do, and while that position might not do much for arguing on talk radio, it is the reality.