Their belief that 'Melo would re-sign in New York this summer caused them to not part ways with him at the trade deadline. Now, instead of getting at least some guaranteed return on their investment, he could walk as a free agent and leave the Knicks empty-handed.
Conventional wisdom dictates that he wouldn't be willing to turn down an extra year and roughly $33 million to flee the Knicks, even though they're growing more embarrassing by the day. Conventional wisdom could very well prove wrong in this case, however, as Anthony could prioritize winning over money—similar to what Dwight Howard did last summer.
If Carmelo does depart as a free agent, the Knicks would be up a creek without a paddle, stuck in an absolute worst-case scenario.
Some fans might believe a total rebuild (sans Anthony) would be the team's optimal path forward, but that ignores one simple reality: New York lacks assets with which to rebuild.
Draft Picks? What Draft Picks?
Over the next four drafts, the Knicks have a grand total of two first-round picks. Thanks to a series of misguided trades (say hello, Marcus Camby and Andrea Bargnani), they aren't slated to have a second-round selection until 2018.
Being that devoid of picks handicaps New York in more ways than one. The current collective bargaining agreement places extra value on players with rookie-scale contracts, as they're locked into those cost-controlled deals for multiple years.
Anthony Davis, who would almost assuredly command a max contract on the free-agent market this summer, will only earn $16 million through the first three years of his career, per Basketball-Reference. Since the New Orleans Pelicans don't have to worry about his extension for another two seasons, they can allocate that extra money elsewhere in the interim.
The Knicks will have no such luxury. Without an influx of cheap, young players from the draft, New York will have to rely upon acquiring cast-offs from other organizations or taking gambles on undrafted rookies.
Draft picks also serve as valuable bartering chips in trade negotiations. At the trade deadline, the Indiana Pacers acquired a former No. 2 overall pick (Evan Turner) for the Golden State Warriors' 2015 second-rounder.
The Knicks' lack of draft picks in the near future severely restricts their ability to land impact players via trades, as the Ted Stepien Rule prevents them from trading their 2015 or 2017 first-rounder. (Teams can't trade first-round draft picks in consecutive years, and they've already traded their 2014 and 2016 firsts.)
Given this harsh reality, how can New York get back on the road to championship contention? It's not going to be a quick fix.
The Path to Rebuilding
No matter what happens with Anthony this summer, the Knicks will have another rough season in store next year. They're set to owe roughly $49.5 million to Tyson Chandler, Amar'e Stoudemire and Andrea Bargnani alone in 2014-15, per ShamSports.com, eliminating any chance of luring a marquee free agent to New York in July.
The 2015 offseason will be a different story, however, as Chandler, Stoudemire and Bargnani will all come off the books. At the moment, New York only has roughly $13.4 million committed to J.R. Smith, Raymond Felton, Pablo Prigioni and Tim Hardaway Jr. for the 2015-16 season, per ShamSports.com.
Even if Anthony signs a max contract with the Knicks this summer, they should still have enough cap space to accommodate a second max-contract free agent in 2015.
In the best-case scenario, 'Melo will re-sign with New York this summer for less than the maximum amount allowed (five years and roughly $129 million), freeing up even more cap flexibility for the Knicks after 2014-15. Signing him to a long-term deal would give the team a strong recruiting tool for other free agents, too.
Barring a repeat of "Linsanity," however, the Knicks still need to acquire additional assets for their rebuild. As Hang Time Blog's Sekou Smith explains:
Throw the shade on Anthony or Knicks coach Mike Woodson or whoever you’d like, but make no mistake, this is a systemic problem with the Knicks that has no quick fix. We’ve heard for years that you cannot afford to "rebuild" in New York, that the rabid fan base will not allow it. That's nonsense. The only way you get out of this mess if you are the Knicks is if you rebuild and start that process now.
Can Anthony help that rebuilding process? Or would the Knicks be better off if he decided to take his talents elsewhere this summer?
If Carmelo does decide to leave, the Knicks should hope he chooses a team without the requisite cap space. That will force his new squad to do a sign-and-trade for him, ensuring that New York gets something in return for its departing superstar.
Anthony likely learned his lesson from his forced sign-and-trade to New York, however. Had he simply come to New York as a free agent, the team wouldn't have had to strip its cupboards bare of tradable assets. Is he really going to repeat that mistake with his next destination?
If the Knicks can't do a sign-and-trade for Anthony and lose him for nothing, they still won't have enough cap space to sign a marquee free agent this summer. The only benefit to that scenario would be the likelihood that they'd earn a top-five draft pick in 2015.
Beyond that, the team would only have the New York market and copious cap space as selling points for free agents in 2015 and beyond. Money and marketing opportunities can certainly entice free agents to join a contender, but the lack of any superstar talent could dissuade players from joining the 'Melo-less Knicks.
There's some benefit to a team blowing things up entirely, as Harvey Araton of The New York Times notes:
Turning 30 in May, Anthony would seem to have a better chance of enhanced self-discovery away from Madison Square Garden, where he has carte blanche and the organization treats him like Jordan. But where would losing Anthony and getting nothing in return leave the Knicks?
Given the complexity of their options, including a cap-clogging contract for Anthony that would carry him to 35, perhaps no worse off than if they started from scratch.
That "cap-clogging contract" might not be so onerous in the coming years, however.
Whereas his $22,407,474 deal in 2013-14 sucks up 38.2 percent of the Knicks' cap space (based on the $58.679 million cap), the first year of his new maximum-salary contract ($23,527,847.70, or 105 percent of his previous deal) would only take up 37.4 percent of the estimated $62.9 million cap in 2014-15 (per ESPN's Larry Coon).
As the league renegotiates its television contracts ahead of the 2016-17 season, those cap figures could expand substantially over the next few seasons.
The likely size of Anthony's next contract is a fair concern, as rebuilding teams rarely seek to dump exorbitant money into one player.
However, given the uniqueness of the Knicks' situation—the lack of draft picks and young quality players beyond Hardaway Jr. and Iman Shumpert—New York finds itself in uncharted waters when it comes to rebuilding.
The Knicks' Future, With or Without 'Melo
You can make the argument that the Knicks never should have traded for Anthony, as ESPN's Matt Meyers (subscription required) and Jared Diamond of The Wall Street Journal both did back in January 2011. The cost proved too prohibitive for the Knicks to build a contender around him, as both suggested might be the case.
You can also make the case that the Knicks should have shipped him out at this past trade deadline, ensuring they'd receive something in return for him. Bleacher Report's Howard Beck did just that back in January, writing, "Having surrendered a small ransom to acquire Anthony in 2011, the Knicks cannot afford to let him walk away."
Therein lies the rub for New York. Signing Anthony to a cap-clogging, five-year max deal might not be ideal, but it's the lesser of two evils.
Watching him walk away for nothing, leaving only scorched earth in his wake, would be even more of a nightmare for the Knicks.