Statistical Analysis. Humor. Knicks.

Thursday, April 24, 2014

Class Warfare

I’m sure you’ve seen that sitcom episode where one character says they’re short on funds, so another person lends them money. Inevitably the recipient starts buying things that the lender finds to be extravagant, and that inevitably leads to a conflict. Like on Frasier where he lends Roz money, only to see her going to spas and fancy restaurants. Or on Everybody Loves Raymond where Robert borrows a thousand dollars and wants to take a trip to Las Vegas. Heck even the dark drama “Breaking Bad” wrote this theme into a recent episode. Of course in the end of the sitcom, the axiom “don’t count other people’s money” is proven because it’s difficult to evaluate someone’s economic portfolio from a few purchases.

In my life I’ve found that someone’s financial situation is a private matter. At my day job, no one has revealed exactly how much their paycheck is, nor have I divulged that information to any of my coworkers. I’m not sure how much my closest friends have in savings accounts, retirement funds, or credit card debt. Rarely is money owner-less, seeking someone to claim it. It’s always my money, your money, or their money. With money comes ownership.

Enter the second decade of the twenty first century, where everything is about counting other people’s money. Republicans say there is too much restriction on businesses for them to create jobs. Democrats respond with the rich have too much money and don’t pay their fair share of taxes. The Koch brothers fund the Tea Party and the ‘Baggers get lots of play on mainstream media. Meanwhile AdBusters start Occupy Wall Street, but struggle to get the national news to report about it.

Currently our country is undergoing a fascinating game of rock-paper-scissors, with the upper, middle, and lower class all at each others wallets. Middle class Americans believe the poor are getting off easy (see: Yes, It’s Absurd That 46% Of Americans Don’t Pay Income Tax), while fighting off the rich through their unions. Yet even though the middle and lower class spar with each other, they can both agree that they want to tax the rich more.

If the US were twitter, #classwarfare would be trending. It’s even permeated into our sports. Recently the NFL settled its dispute just in time to start their season, and so far they are reaping the rewards (are the Bills and Lions really a combined 7-1? Does that mean this is back in vogue?) Unfortunately the players and owners of the NBA have intensified their work stoppage by recently canceling a chunk of the preseason and threatening to end the season. The last time these two sides fought over money, they lost a third of the season.

The curious thing about these major sport labor disputes is the skew of the playing field. Usually when unions are fighting companies they are representing the working class. However in the NBA talks, the middle class is made up of millionaires (primarily). So although the public tends to side with the union in labor battles, in this case there isn’t as much sympathy for them. That’s because we, the fans, are essentially the underclass in this turmoil. For the most part we get to feel like America’s poor, we are marginalized without much of a say in the matter. There is a seat at the table for the owners and the players, but neither of them care much what the fans think.

Sure some will say we as fans get to choose where we spend our money. Unfortunately that just isn’t the reality. Tom Ziller talks about how the relationship between the public’s money and the NBA:

The people of Oklahoma City have spent more than $100 million to build the Chesapeake Energy Arena and a practice facility for the Thunder. They deserve to know why Clay Bennett is holding out for more money from Kevin Durant, Russell Westbrook and James Harden. The people of San Antonio have spent hundreds of millions of dollars in taxes to build and renovate the AT&T Center, and have turned out in droves to celebrate the Spurs’ success. They deserve to know why an ownership committee headed up by Spurs owner Peter Holt has made so little progress in negotiations that a shortened season seems inevitable.

In the NBA, fans aren’t just customers. We are investors. We bankroll the whole operation. Of the $2 billion spent on building and renovating NBA arenas since 2000, $1.75 billion of it has been public money. Without a public willing to play Stern’s extortionist games — ask Seattle what happens if you refuse to build a gym on the league’s terms — the NBA would be hosting its biggest games in rinky-dink arenas, or worse, on college campuses. Instead, the public plays along and bites on the threats, Stern’s NBA rakes in $4 billion a year and owners have the luxury of demanding a bigger slice.

Both the owners and the players have been so successful at getting people to throw money at them that they can cease operations to fight each other on how much each side should earn. The stream of cash of the NBA is so secure that a loss of games, even a loss of season, won’t ruin the league. Yup, and to prove it, look at the NHL’s attendance since their lost season. The only losers in this game of tug-o-green are the fans. Our source of entertainment is potentially gone, and even worse we’ll hand over our wallets once they do return. And like a syndicated sitcom, in a few years when the next CBA expires, we’ll go through the whole thing again.

28 comments on “Class Warfare

  1. Frank

    great piece Mike. Would be very interesting to see how the NBA would react if the next time a city agreed to pony up $$ for an arena, a clause was put in authorizing a clawback of the money if there is a work stoppage for any reason – after all, the reason the owners give for public money use is that it creates jobs, improves the economy, etc. — if they are willfully removing the benefit of jobs/economy, then why not take the public money back? The owners shouldn’t be alone in their responsibility to the public also – the players obviously benefit from public money too, and so perhaps there should be a clawback on them as well. It is a little ridiculous that so much public money (that could be spent on schools, teachers, unemployment benefits, health care etc.) is dumped on these teams and now they are fighting like a bunch of little kids over it.

  2. Mike Kurylo Post author

    Frank:
    great piece Mike. Would be very interesting to see how the NBA would react if the next time a city agreed to pony up $$ for an arena, a clause was put in authorizing a clawback of the money if there is a work stoppage for any reason – after all, the reason the owners give for public money use is that it creates jobs, improves the economy, etc. — if they are willfully removing the benefit of jobs/economy, then why not take the public money back?The owners shouldn’t be alone in their responsibility to the public also – the players obviously benefit from public money too, and so perhaps there should be a clawback on them as well.It is a little ridiculous that so much public money (that could be spent on schools, teachers, unemployment benefits, health care etc.) is dumped on these teams and now they are fighting like a bunch of little kids over it.

    Well that just makes too much sense to actually be in a public contract.

  3. Count Zero

    “The people of Oklahoma City have spent more than $100 million to build the Chesapeake Energy Arena and a practice facility for the Thunder.”

    That’s somewhat disingenuous. While the arena would not have been built without the (at that time) prospect of getting the Thunder, it hosts everything from concerts to WWE to NCAA Tournament games. The Thunder’s 41 home games aren’t the sole source of revenue / additional city income. Nor is it fair to call people “investors” in the arena — unless you want to extend this blanket and say we are all investors in the roads, the sewer system, the public parks, etc. Investors get paper that says they own xx% of the property and they expect to receive some portion of the earnings. Taxpayers don’t get any portion of any revenue from any public project.

    “Our current country is undergoing a fascinating game of rock-paper-scissors, with the upper, middle, and lower class all at each others wallets.”

    Our current country? Are we all emigrating somewhere soon? :P

    More to the point — this is a terrible metaphor. I don’t think the upper class is losing to either of the other two classes at any time. No one is getting at their wallet in any meaningful sense. If you think the lower class is actually winning anything from the upper class, I suggest you spend a year or two on food stamps for an “up close and personal” dose of reality.

  4. Mike Kurylo Post author

    Count Zero: More to the point — this is a terrible metaphor. I don’t think the upper class is losing to either of the other two classes at any time. No one is getting at their wallet in any meaningful sense. If you think the lower class is actually winning anything from the upper class, I suggest you spend a year or two on food stamps for an “up close and personal” dose of reality.

    True in the sense that in RPS, everyone has a fair chance of winning. And to be fair, I did talk about the fans being the underclass in this struggle, and ultimately they (we) are the only ones that end up losing.

  5. Z

    1. Nice piece Mike. Is today D-Day for a full season? (ie, The day that makes proves Roger Mason’s twitter truly was hacked?)

    2. Jim’s piece is completely awesome.

  6. Jim Cavan (@JPCavan)

    Thanks guys!

    I’m actually kind of hurt she thought I had “never played organized basketball.” I led my HS conference in technical fouls, damnit!

  7. Jim Cavan (@JPCavan)

    BTW, excellent take, Mike. Although I’m not sure whether the public sides with the players because they’re union members, or because we all know in our heart of hearts that no one pays $150 for a mediocre seat so they can watch James Dolan play terrible music. The players are the entertainment, the show — everything. As such, I can totally understand their looking at taking anything below 50% of BRI as a true “blood issue.”

    Yes, we’re talking about millionaires vs. billionaires. To a certain degree, the millionaires part is our fault: We buy the tickets, the merchandise, and produce the kind of ratings that grease the wheels for enormous television deals. The end result is the kind of money that makes dumb, exorbitant contracts even possible.

    I know the owners love to argue that they’re just as important because they, like, own the buildings and stuff. Now don’t get me wrong, there are some great professional sports owners out there. I just think it would be much more feasible — in an alternate, utopian universe — for the players themselves to disband, form their own league, secure by their own means the kind of capital to build and operate their own arenas, and run the league entirely independent of “ownership” as such, than it would for, say, James Dolan to hit a game-winning tear-drop floater in Game 7 of the Finals….

    I also appreciated Henry Abbott’s admirable — if totally unrealistic — remedy for the existing gap between players and owners:

    http://espn.go.com/blog/truehoop/post/_/id/32206/radical-charity

  8. Mike Kurylo Post author

    Jim, I disagree that public is on the side of the players.

    Lots of people view athletes as lazy & spoiled. They think players just show up to a game, like they show up to a Saturday softball game. (Considering what you went through, I’m guessing that you know this to be exactly the opposite of the truth.) Sure it’s fun to knock down a few jumpers in the summer sun, but imagine having to shoot 500 every day during the offseason. Then work out like a dog, play rec ball, go to a signing or charity event, etc.

    Any time a player has a run-in with the law, or any juicy story it enhances that stereotype. They get paid millions of dollars, and are too lazy (or dumb) to learn the fundamentals of the game.

    Sure if given the opportunity, just about any of us would sacrifice our body to play basketball for money, fans, etc. even given the rigors of the game (the pain of practice/workouts, long shifts away from home, dumb fans, dumb press, surgeries, etc.) But I don’t think it’s as easy as most people think.

    Yes we identify with the players and root for them. And yes most fans can’t name more than a dozen owners. But still there is that stereotype of athletes as spoiled millionaires that don’t know how good they got it. Fans aren’t going to care if Kobe or LeBron are entitled to get an extra million more. They are going to wonder why Eddy Curry, Jared Jeffries, and Jerome James got overpaid. They are going to want teams to be competitive, and have a salary cap on the league, and not have guaranteed contracts.

    To me, that’s why the players are going to lose. Only the players want this soft cap. Only the players want to ensure they will get that 6-year no-refund contract. The fans think the players have enough. They don’t care if the owners make another billion, as long as Jerome James isn’t cashing out on his couch.

  9. flossy

    Mike Kurylo: But I don’t think it’s as easy as most people think.

    Right, it’s definitely not. You know what else is not as easy as many people seem to think? Being, oh, I don’t know, an elementary school teacher? Or an EMT. Or a scientific lab technician, assistant DA etc. etc.

    Personally, I don’t have a ton of sympathy for NBA players in this dispute not because being an elite athlete is easy, but because I recognize that getting paid an average of $6 million to put a ball through a hoop is kind of crazy in light of the job’s utter lack of redeeming social value aside from entertainment value. I understand that we as fans enable this crazy salary structure by pumping money into a league with a set number of player positions available, but really. I get that being an NBA player is often hard. Lots of jobs are really hard. Being hard-working does not change the fact that getting paid, say, “only” an average of $4 mm to play a sport still falls under the category of “people who are insanely fortunate.

  10. Jim Cavan (@JPCavan)

    @10

    I guess it depends on what we mean by “the public.” Certainly there is a rather disconcertingly large cross section of the public who thinks that athletes are spoiled and lazy. We Knick fans know more than a little something about that. You named one of them yourself.

    But that kind of knee-jerk logic cuts both ways. By that I mean, there are just as many — if not more — people who believe that pretty much every owner got to where he is through nothing more than their own hard work and volition. Indeed, we need look no further than our own Guitar Jimmy to see that owners of professional sports franchises can oftentimes be just as spoiled, lazy, and entitled as any 7-foot waste-of-space center. Not naming names!

    So again, it goes back to how we define “public.” In my previous post — as here — I’m referring to the “NBA-viewing public” more so than the general public. The general public, I think, has always had something of a antipathetic attitude towards the NBA and basketball in general. It still trails both baseball and football in popularity. Obviously the “why” is a subject for another time, but I just don’t feel NFL players get nearly the brunt of the general public’s wrath the way NBA players do. A lot of that has to due with the visibility of the athletes themselves; NBA players are much more “visible” and, it can be argued, marketable; whereas NFL players are seen almost as untouchable gladiators from a bygone era.

    Now I’m just rambling. My point: Yes, the general public would be much more evenly split as to who they “support” in this fiasco. The NBA-viewing public, on the other hand, knows who they’re paying to see. Are both sides grossly overpaid? Yes. But, as I mentioned before, part of that is the fault of this same “public.” The public might not care if the owners “make another billion,” but if they can’t see how that directly results in these terrible contracts, then they’re certainly a far cry from being an…

  11. d-mar

    Looks like we’re going to lose some if not all of the regular season based on what the 2 sides are saying after today’s meeting. What I don’t get is that the owners have backed off on their insistence on a hard cap – I thought that was the biggest obstacle? I know they’re still apart on how to divide up the $$, but each side has been giving in a little on that and at least they’ve gotten closer.

    Why does it seem so bleak? What am I missing?

  12. latke

    Mike Kurylo: Sure if given the opportunity, just about any of us would sacrifice our body to play basketball for money, fans, etc. even given the rigors of the game (the pain of practice/workouts, long shifts away from home, dumb fans, dumb press, surgeries, etc.) But I don’t think it’s as easy as most people think.

    The bottom line is that people judge what people are entitled to based on how much they like them. We all know successful people who are hard workers and are intelligent and have “earned every penny they have.” However, if we don’t like those people, if they’re jerks, then we wouldn’t bat an eye if they, for example, lost all their cash in a Ponzi scheme. It works in reverse as well. If your lazy pothead friend who can’t keep a job but is always generous to you and easy to talk to were to win the lottery, you’d be happy for him. No, he hasn’t worked for it, but we want the people we like to have good things happen to them.

    Basketball players — really athletes as a whole — aren’t very charming. This is because they don’t have to be. It’s no easier to make a three-pointer if you sweet-talk the rim beforehand. In most industries that involve being a public figure, charm is the central ingredient to success, but in sports it is not, and so we begrudge our rich athletes. People aren’t thinking rationally. As with most judgments that human beings make, they are just going on sentiment.

  13. Robert Silverman

    Many, MANY thoughts about this.

    But since it’s late, I’ll be brief:

    1. – really good stuff, Mike.

    2. – If the Players’ Association really had any ‘nads, they’d be down on Wall Street w/the protesters. I’ll be there tomorrow if anyone wants to get together.

  14. BigBlueAL

    First game I played on NBA 2K12 was vs my brother and Melo hit a game-winning 3pter at the buzzer in OT to beat the Thunder. Its an omen.

  15. rooster_douglas

    Interesting idea for a post, Mike. I just graduated with a degree in Labor Relations and I had a couple related thoughts.

    Typically, the Right takes an anti-union stance because unions distort labor markets – they exist to organize workers into cartels, raising their wages compared with the labor costs that would exist in a free market. The Left typically supports unionization/organization because they see it as a way to raise the standard of living for low and middle class workers who, in their view, deserve more than the greedy capitalists are willing to give them.

    Collective bargaining in sports, however, operates differently. It is the workers (athletes), not the capitalists, who want pay at market levels and it is the capitalists (owners) who want distorted labor costs. Nearly every aspect of pro sports CBAs is designed to prevent players from getting paid their full market value. Examples include the draft itself, the rookie salary scale, max contract rules(years and pay), salary caps etc.

    Thus, at least theoretically, one would think that the Right would support the players because they are the ones taking a free market stance and that they would also have the support of the left as they battle the oppressive forces of the owners. Instead, liberals hasn’t taken much of a stance in the debate since advocating for the rights of workers who are already millionaires has (rightfully) taken a back seat to the economic calamities facing common workers. The Right, instead of supporting the free market, seems to have taken a mostly hands-off stance in the debate, except to occasionally chime in in support of the owners, likely because the majority of the owners look like the Right and the majority of the players don’t.

    So, even though ideologically the players union enjoys similarities with the entire political spectrum rarely seen in the labor movement, most common folk can’t be moved to care about this battle of millionaires vs billionaires.

  16. rooster_douglas

    That said, I am surprised that the owners have gotten any support whatsoever. The players are willing to cut their percentage of revenues to a level far below that of their contemporaries in other sports yet this isn’t enough for the owners, even during a period of skyrocketing franchise values, though, admittedly, not of skyrocketing profits. I would personally find it difficult to stand behind the billionaire owners when it is the players who comprise the product of the NBA. I have to believe some of the public’s reticence towards supporting the players stems from tacit racism, but who knows.

    Anyways, I think I’m in the majority when I say that in the end all that matters is that this gets resolved sooner rather than later, regardless of which side “wins” (hint: it will be the owners).

    Hopefully this gets sorted out within a week or two.

    /late night rambling over

  17. Mike Kurylo Post author

    http://www.latimes.com/sports/la-sp-plaschke-nba-20111005,0,4527585.column

    “The NBA is not the NFL. Heck, right now, amid the major leagues’ thrilling late-season rush, the NBA is not even baseball. Yet the NBA’s average player salary of about $5.1 million equals the average salary of those two sports combined. The NBA players need to do the math, listen to the yawns, and look in the mirror. The NBA players need to take a pay cut and go back to work in a sport that will be healthier because of it. Under the old agreement, the players were making 57% of basketball-related income. After Tuesday’s negotiating session, the owners were talking about giving the players 50%. What happens if the players take that horrible pay cut? They will still be the highest-paid team athletes in American pro sports. Some of them will still make millions to spend their lives on a bench. The only thing that might radically change is that more owners might have more money to field better teams, increasing parity and popularity while ensuring survival.”

    This is as dumb a quote that I can imagine. Basketball players make more on average, because there is less of them per team. It’s like Plaschke doesn’t understand the concept of division.

  18. Brian Cronin (@brian_cronin)

    I was actually shocked by how close the two sides seem to be.

    No hard cap, no rollbacks of salaries, just a debate between the owners asking for a 51/49 revenue split (with economic incentives that could see it become a 49/51 split) while the players are countering with a 49/51 revenue split (with economic incentives that could see it become a 47/53 split).

    I mean, for crying out loud, the players are coming off a deal where they got 57% and they’re willing to take 51% (with a chance for 53%). How can this not get done?

  19. Robert Silverman

    Interesting take from WoW:

    “In today’s America, every political and economic dispute is resolved in favor of the moneyed few. From the much ballyhooed deficit reduction deal that was composed 100% of cuts to services and government agencies while asking nothing of our wealthiest citizens and corporations, to the anti-union and anti-worker legislation that has passed in states like Wisconsin, Ohio and Michigan, and at a time when income inequality in America is at its highest levels in history,the United States is a country where in business and in politics, the very rich invariably get their way.

    This idea has finally reached the NBA, where the extremely wealthy individuals that populate NBA ownership have decided to use their muscle to change their financial relationship with players, in the image of the general American economy. It seems truer now than ever, as author William Rhoden notes in “Forty Million Dollar Slaves,” that “for all the wealth [that players] generate for the league in their comet-quick careers, [players] share will always be circumscribed — through bullying or forcible lockouts if necessary — by the dictates of the owners rather than by the widely praised American free-market system.”

    http://wagesofwins.net/2011/10/04/cut-cap-and-profit/

  20. flossy

    Robert Silverman: In today’s America, every political and economic dispute is resolved in favor of the moneyed few.

    Earth to WoW: Everyone involved in this dispute is among the moneyed few. By the standards of the Occupy Wall Street folks, not a single NBA player even comes close to qualifying as one of the 99%. That in a nutshell is why I find it hard to muster much sympathy for either side. In a Goliath vs. Goliath battle the only people who lose are us, the fans.

  21. danvt

    I think you make a compelling case that the fans deserve a seat at the table due to public financing.

    I think your take on the Tea Party is an interesting one, as well. It’s the middle class turning on the poor. They want to squash single payer type health care, affirmative action, and, to be fair to them, a lot of programs that benefit the middle class, as well. It’s about the role of government to them. It’s rugged individualism, at it’s best, and, pooping where you eat, at it’s worst. The problem is that the movement is being guided by the Koch brothers and other folks who have very specific agendas as to where money should and shouldn’t go. So, it’s been perverted from something most people could at least get their heads around, into a sustained campaign to siphon money from programs that benefit the poor and middle class, and put that money in rich peoples bank accounts.

    Back to what’s important, the National Basketball Association. I’m as pro union as it comes. Collective bargaining is a fact of life and, life since it’s inception, is better by far, than it was before. It’s the only tool to fight the tyranny that I described above. If fans had a union and could organize to the extent where no one paid a dime for anything NBA related once this thing was over, then, next time, maybe, we’d have something to watch once the Yanks were eliminated. In any negotiation one side or the other may have the moral high ground. In this dispute, it’s hard to pick a team to root for, but, the process has to play out. If you want those rights for miners in West Virginia (and teachers in Wisconson!), you have to give them to pampered athletes as well.

Comments are closed.