I guess this will be the counterpoint to my don't trade Rip Hamilton trade thread from the other day. My bottom line there is that the Bulls have at least some chance at a title this year and next, and thus they should keep all the players, especially playoff saavy vets they've got, and hope something pans out.
Especially because trading Rip doesn't do much to help change the game in our long-term financial picture. We're still at or above the luxury tax next year, and the following year (if we don't amnesty Boozer). Or (if we do amnesty Boozer), we're significantly less competitive.
Here's the counterpoint to all of that. The Bulls have a chance this year, but it's an exceedingly small chance. They might be better served making bigger moves now to put themselves in a better situation over the long run. As good a position as we might be in now, we'd be in a better position with Omer Asik. This summer, we felt the need to lose a young, extremely talented center because we couldn't afford him.
That sucks, and most importantly, I think under the changing NBA landscape, issues like that are avoidable if we make the right moves.
1. The NBA's new tax structure is much more punitive on heavy spending teams. Even the historically spendy teams (the Lakers, Heat, Celtics, Mavs, Knicks) seem to be mindful of the coming luxury tax increases. This is part of the reason why the 2014 summer seems to be one everyone is gearing up for. Take a look at the salary structure of the Lakers and Heat.
It's not at all a stretch to say the Heat might not be able to afford keeping that team together. What?!? Yes, they're paying $14M in luxury tax this year on top of about $84M in payroll. Next year their payroll will be about the same, but their tax level will be at about $21.25M because the new incrementally increasing tax rates set in. Then, in 2014-2015, the new repeater rate kicks in, and the Heat, who paid the LT last year and who project to pay it this year and next, will be subject to it as well.
Looking at their roster, it's hard to imagine them being below something like $80M for that year barring major moves. Given that the LT might be $75M, that would make their luxury tax bill roughly $12.5M.
So all in all, we're talking $50M in luxury tax over the next few years, with no end in sight. Will the Heat ownership get sick of that? Will they still want to pay Wade and Bosh $20M+ per year?
Maybe. But when you look at the finances of it, there's no getting around that the new NBA is a lot more punitive to teams that overspend than the old NBA. That's going to have an effect.
And really, it's an effect that should, in the long run, work to the advantage of the Bulls, since other teams will be less willing to outspend us.
2. Players are signing for less. The maximum salary for a young player coming off his rookie contract is going to be $13.7M next year. That's what, say, James Harden will make. By comparison, Luol Deng will make $14.2M. And it's not just at the top, if you look at salaries for players coming off rookie deals, they seem to be down across the board. Yes, there are a few stinkers, but generally, you see highly productive young players like Ty Lawson, Danilo Galinari, Harden, Goran Dragic, Ryan Anderson, Jrue Holiday, Taj Gibson and (ahem) Omer Asik making a million or two less than they would under the previous CBA. And they get smaller raises annually too.
3. These two facts will slowly change the NBA landscape. Signing the right players at the right price will become more valuable, and overpaying is becoming more damaging. In the 2014-2015 summer, we can expect to see several big names retiring, changing teams, and/or taking quite a bit less money (Kobe, Gasol, Dirk, Boozer, Deng, Lebron, Wade, Bosh, Pierce, Garnett, Iggy, Danny Granger, Ben Gordon. And some young guys who will be FAs Paul George, Greg Monroe, Ed Davis, John Wall, as well as guys who will be up for extensions like Nik Vucevic, Jimmy Butler and Kawhi Leonard.
That's a lot of guys, and the point to consider is that they are largely going to come at better rates that what they're coming at now. That's also likely true of guys who will be available this summer, like Gerald Henderson, JJ Redick, Tyreke Evans and OJ Mayo.
4. So how are the Bulls positioned over the medium to long term? In the short term, not very well. Part of this was the rest of the league doing us the "favor" of including the new "Derrick Rose Rule", which made Rose eligible for a salary that's 30% of the cap ($16.4M this year) instead of 25% ($13.7M). Obviously Rose is worth it, but those $2-3M amounts add up quickly.
In addition to that handicap, I'd estimate that Carlos Boozer is paid well over the amount he'd make as a FA under the new CBA (I'd guess he might make a salary starting in the $8-10M range) and to a lesser extent, so is Luol Deng (I'd guess he'd also be in the $10M range). If they were paid at something like their market value, it would constitute a savings of about $8M this year and $9M next year. Which would, obviously, be enough to go out and pay for a much better player (especially if you had used some of that money for savings and some to add to the amounts being paid to guys like Kirk and Rip to actually bring in good young players).
That's the downside.
On the upside the Bulls have Jimmy Butler locked in for next to nothing, and will likely get Nikola Mrotic for something on the order of $5M. And they've got Taj Gibson on a very good looking deal if, as we might expect, his minutes get bumped a bit. And there's the Charlotte pick.
But, on the whole, what I see is that the Bulls will be about what they are this year and next. At or over the luxury tax for a kind of sort of contending team that's going to have a hard time replacing key players without losing others. That's where loosing a guy like Asik really sucks.
5. I'd like the Bulls to learn from their mistakes and become more, for lack of a better word, sustainable. Target younger players on better contracts. Be willing to make moves this year to make the following three or four awesome. I don't want to be discussing Kirk Hinrich as SG or amnestying our starting PF. Find guys, fit them in, and don't be too sentimental.
Guys I'd look to trade while their value is reltively high: Deng and Boozer (in Boozer's case, this means he's maybe, possibly, tradeable at all).
What can we get for those guys?
Guys I'd target as good young players on affordable deals, or likely to be on affordable deals: Marcin Gortat, Jared Dudley, Gerald Henderson, Reggie Williams, JJ Redick, Bargs, Amir Johnson, Terrance Ross.
Guys I'd at least consider because of overall talent: Josh Smith, Tyreke Evans
What teams would be interested in Deng? The same sort of teams interested in Rudy Gay, I'd guess (Phoenix, Toronto, Boston, Washington? In Boozer? Maybe the Nets since they don't care about finances, or the Raptors or Bobcats (because they have terrible frontcourts and no one to spend their money on anyway).
6. Well, not the Raptors, since they just acquired Rudy Gay, but what the Grizzlies are doing is similar to the sort of thing I'm suggesting. They traded their overpaid player and while Tayshaun Prince is not quite a good, this puts them on a very sustainable path over the next few years, with a very good core of talent (Gasol and ZBo, Conley I guess) that should help them stay competitive for the next few years, despite being a small market team.
Obviously we're not a small market team, but we often act like it, and by taking a similar approach to salary and occasionally being aggressive keeping a pipeline of upgrades going (a la Mrotic, the Charlotte pick, and robust scouting to get guys like Butler and Gibson), we'll be in better shape over the long haul.
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