With little movement on labor negotiations, Deron Williams’ signing with a Turkish club team has been the biggest story of the lockout so far. Billy Hunter, the executive director of the NBAPA, even hinted that stars playing overseas might not come back after the lockout.
Instead of encouraging American players to flock overseas, the lockout is likely to have the opposite effect: increasing the incentives for international players to stay home without ever making the leap to the NBA.
In the name of increasing parity, the owners’ CBA proposal institutes a hard salary cap which would lower player salaries across the board. The removal of the Larry Bird and mid-level exceptions, in particular, would have a devastating effect on the salaries of the “middle-class” of players. Combine that with a reverse-order draft where poorly managed teams in small markets can gain complete control over international players for at least four years, and we’re likely to see more foreign players following the path of Fran Vazquez.
Vazquez was selected #11 by the Orlando Magic in 2005. But instead of joining Dwight Howard in the Magic’s front-court rotation, Vazquez spurned the NBA and signed a lucrative deal in Spain. Even though he wouldn’t have been an All-Star, the opportunity cost of a lost lottery pick haunts Orlando to this day. And with the scarcity of talented big men in the league, a skilled and athletic 6’10 230 forward capable of playing in the paint would have easily carved out a 10-year NBA career.
In a free market, the NBA’s vast economic edge over international leagues would have made Vazquez’s decisions a lot easier. A team willing to pay Marcin Gortat $34 million to back up Dwight Howard for 12 minutes a game would have had no problem opening up their checkbook for Vazquez. However, Orlando’s hands were tied. They could only offer him the $2 million salary slot available to a #11 overall pick, a number clubs like FC Barcelona, his current squad, can easily match.
For most NBA players, the second contract is their chance to make the type of money that makes coming to the US an easy decision. But they have to wait four years to get there, and five before they have the freedom to sign with a new team. Even worse, if they don’t fit well with the roster around them, their market value will be artificially suppressed.
Rudy Fernandez, a teammate of Vazquez on the Spanish national team, faced this problem when he came to Portland, where he was stuck behind Brandon Roy on the depth chart. This summer, he was offered a six-year $24 million contract from Real Madrid, much more than what he’d get in the NBA after his inconsistent tenure with the Trail Blazers.
When the Spurs drafted Tiago Splitter in 2007, they faced a similar dilemma. Because he was taken with the #28 pick in the first round, his rookie salary slot was far below what he could make internationally, and he ended up signing a contract worth eight times as much in Spain. San Antonio had to wait three seasons before they could bring him to the NBA, and since they were over the cap and he had never played for them, they could only sign him with part of their mid-level exception.
If salary cap exceptions are removed in labor negotiations, foreign players would have to take drastic pay reductions to play in the NBA. The Spurs are an incredibly well-run organization with lots of experience dealing with international players; imagine the problems a franchise like Sacramento or Charlotte would encounter in a similar scenario.
This year, Nikola Mirotic, a 20-year old 6’10 sharp-shooter, signed a two-year extension that will keep him under contract with Real Madrid until 2015. His exorbitant €2.5 million bailout caused his draft stock to plummet, and he slipped from the lottery to the #23 selection.
After excelling in the Euroleague at a very young age, his dominating performances in the FIBA Under-20 European championships over the last month have highlighted his value. The Chicago Bulls may have gotten one of the draft’s biggest steals, if they can ever bring him to the NBA.
Currently, the plan is to wait at least two to three years until his buyout becomes less onerous. But at that point, the Bulls, one of the most promising young teams in the NBA, will likely be locked into long-term deals with Derrick Rose, Joakim Noah, Carlos Boozer, Luol Deng and Taj Gibson. They certainly won’t have the cap room to offer Mirotic a big contract, and if he continues his upward path, he’ll likely be worth more to an European team than the mid-level exception the Spurs used to sign Splitter, if it even exists after the lockout.
At least Chicago will be able to offer him the chance to play with a great young point guard for one of the most glamorous franchises in basketball. If Minnesota, the franchise that originally drafted him, had kept the pick, they would have faced a repeat of the Ricky Rubio saga: convincing someone who lives in a world-class city to take a pay-cut to play in the freezing cold of Minneapolis for a team going nowhere.
All things being equal, Mirotic will probably want to compete against the world’s best players in the NBA. But if the lockout further restricts player mobility and salaries, then staying home will look a lot more appealing to the next generation of European players.