NBA Lockout: Why Current Labor Dispute Will Not Happen in Baseball

Gil ImberAnalyst IIOctober 13, 2011

At the end of the day, it's all about making money.
At the end of the day, it's all about making money.Jamie Squire/Getty Images

When NBA Commissioner David Stern announced the cancellation of the first two weeks of the 2011-12 season, the basketball world was anything but shocked.

After all, who didn't see this coming?

The NBA owners are in midst of a rather thorny disagreement with the players' union over—what else—money.

Some might point to the players' greed. Who really needs a $5 million salary? Most of us seem to get by just fine with significantly less income. That said, most people do not routinely splurge on palatial mansions and helicopters, but that happens with the rich.

Some might point to the owners' leadership blunders. Mismanagement at the corporate level has led to proposed cuts at the lower levels. The owners are attempting to cut player salaries without just cause, and the Kobe Bryants of the league are just standing up for what is rightfully theirs.

As I previously discussed, owner-player disputes are settled comparatively quickly when core disagreements arise from non-monetary policies.

This is a money dispute, therefore, we should settle in for the long haul.

But why won't this same dispute happen in baseball?

The NBA, NFL and other leagues possess a salary cap (technically the NBA is without a salary cap because the old collective bargaining agreement has lapsed, leading to a lockout, but I digress...).

Lawyer up. It's going to be a long fight.
Lawyer up. It's going to be a long fight.Patrick McDermott/Getty Images

MLB, in its wisdom, has seen fit to forgo the salary cap in favor of a more flexible luxury tax.

This and other basketball policies ultimately mean that NBA players have a maximum salary they can earn and teams have a maximum payroll they can work with.

In baseball, however, there is no maximum salary and there is no maximum payroll. If MLB teams go over a certain amount of total payroll, those teams pay a luxury.

As of last season, only the Boston Red Sox, Los Angeles Angels, Detroit Tigers and yes, the New York Yankees, have paid this luxury tax. Over the years, the infamously rich Yanks have contributed over 95 percent of these tax payments.

Executive mismanagement in basketball has contributed to the current lockout precisely, and partly, because of the salary cap issue. In the NBA, if one team crumbles due to mistakes made by an owner or leadership group, the league is set up to fall like dominoes.

If one team suddenly cannot afford to pay its players the money they are accustomed to, those players can choose to go elsewhere. Other teams, which would love to have big names, simply cannot pay the new free agent because that would place them over the salary cap if the amount is too much.

Due to the NBA's "Larry Bird" or "incumbent" exception to the salary cap maximum, which allows teams to exceed their salary cap in order to retain the rights to a player already on the team, most teams would routinely hover at or above the salary cap, subjecting them to steep penalties and fines.

In baseball, executive mismanagement affects only the team unfortunate enough to have been mismanaged. Over time, the Montreal Expos/ Washington Nationals and Texas Rangers have gone through these doldrums. In the present day, the Mets and Dodgers appear to be in a financial or ownership struggle.

In baseball, ownership woes are limited to that one unfortunate team.
In baseball, ownership woes are limited to that one unfortunate team.Kevork Djansezian/Getty Images

Yet through these struggles, the rest of the league hasn't fallen apart. No proposals have been made to cut all players' salaries. If the Mets, due to their financial woes, can no longer afford to pay David Wright's salary, another team with the ability to pay will pick him up.

The Yankees are well known for signing players to generous contracts to lure them away from poorer teams.

Mark Teixeira abandoned Anaheim and shunned the Orioles and Nats when the Yankees offered him a blockbuster eight-year, $180 million contract.

And then there's the "Curse of the Bambino" story.

Ultimately, baseball and basketball are two very different sports, precisely because of their differences in how they conduct business.

Basketball is severely regulated to ensure a more balanced playing field, which is a fine concept. However, that also means the players' union has more bargaining power and owners have less of a buffer zone for financial mismanagement.

If the owners make mistakes, the players and fans are sure to feel them in the form of a lockout or other cost-cutting measures.

Baseball is less regulated, which manifests itself in the Yankees winning significantly more championships than any other team—more than two times that of the second-place Dodgers/Giants.

However, such inequality also ensures that the league as a whole remains financially solvent. For a flailing Mets franchise, you have a flourishing Yankees team on the other side of the city to pick them up.

MLB's structure allows play to continue as Bud Selig tinkers with the league's problem child. If owners make mistakes, only the fans of that suffering team will be affected. Players can simply go elsewhere when the time comes, while the richest teams in the league continue to pay taxes they can afford to pay.

Actor Jay Mohr, who is a Yankees fan, once said, "I never minded [former Yankees owner] George Steinbrenner spending obscene amounts of money to put the best product on the field."

Something tells me neither do other fans of the game.