Is parity in the NBA here to stay? The new CBA could be the key

Tim BontempsESPNJul 24, 2023, 8:00 AM ET10 minutes of reading

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LAST MONTH, THE The Denver Nuggets became the fifth team to win an NBA title in as many seasons.

At first glance, it is not a remarkable fact. But in NBA history, it’s a truly extraordinary one. At only one other time in the league’s existence—from 1975 to 1980—has the NBA crowned a second champion for at least five consecutive seasons.

In other words: This half-decade of parity is a period the NBA can typically only dream of. With the new collective bargaining agreement in place through the rest of the decade, that’s what the NBA hopes will remain the case going forward.

“Parity ends up being beneficial to smaller teams,” former Milwaukee Bucks owner Marc Lasry, who was on the labor committee that helped negotiate the deal, said on ESPN’s “The Hoop Collective” podcast last month. “If you just think about it that way, the problem is if you’re a small-market team, people are going to want to play in New York, LA, Miami, Dallas, any of the big cities. And so going forward, it’s going to be harder to do, from the tax fronts and just the way things are.

“All everybody wants is competition,” Lasry continued, “because the more competition there is, the more teams at the beginning of the season that can say, ‘We have a chance to win a championship,’ the better it is for the league.”

But will that actually be the case? Or have recent years just been an anomaly that is being corrected? Here’s why both outcomes are possible.

The Denver Nuggets are the fifth team to win the NBA title in as many seasons. Is parity here to stay in the NBA?Isaiah J. Downing/USA TODAY Sports

Why parity is here to stay

The NBA is defined by dynasties. There was George Mikan and the Minneapolis Lakers in the 1950s. There was Bill Russell’s Boston Celtics in the 1960s. There were the dynastic duels of Magic Johnson’s Los Angeles Lakers and Larry Bird’s Celtics in the 1980s, followed by Michael Jordan’s Chicago Bulls dominating the 1990s.

And since Jordan won his last NBA title in 1998, four players — Kobe Bryant, Tim Duncan, LeBron James and Stephen Curry — have combined to win 18 of the next 25 titles.

In fact, these nine players have been members of 48 of the 77 championship teams throughout NBA history – a staggering 62% of the total titles won.

And it was with that history in mind that both sides of the CBA negotiations made it clear that the NBA’s goal is to do everything it can to level the playing field. By doing so, the league can try to realize the utopian vision of the late NBA commissioner David Stern: that 30 well-managed teams could all have a fair chance to compete for a championship (and make money).

“That was very much our intention,” NBA commissioner Adam Silver said in early July in Las Vegas, referring to the league hoping the new CBA will maintain the recent level of parity.

“I think with this new deal, it will help to further distribute great players around the league. Now, it doesn’t guarantee championships. Management still matters a lot in this league, [as does] coaching and everything else.”

What is not disputed, however, is that the new rules have brought the league closer than ever to implementing a hard salary cap.

“Each individual thing is manageable,” said one Eastern Conference executive, referring to the new rules, “but the whole thing is crippling.”

“All of it” means this: being able to combine players in trades, removing salary cap exceptions, limiting the ability to sign buyout players, and freezing drafts for teams that go above the second berth. “All of it” was designed to make teams hesitant to go far above the luxury tax, as the Golden State Warriors, LA Clippers and Brooklyn Nets have done in recent seasons.

And while the Phoenix Suns have already blown through the second apron with their trade for Bradley Beal, arguing that there is no point in relaxation past that and proving that there really isn’t a hard cap, there’s little doubt that the rules are already starting to have an impact.

The Warriors, for example, traded Jordan Poole before his four-year contract extension even started, in part because of a budget crunch — the kind of move they’ve never made in the entire Curry era. In fact, under the old system, the Warriors went on a long-term Andrew Wiggins contract to also get a lightly protected future first-round pick.

The Clippers saved more than $100 million by cutting Eric Gordon last month — a still-useful player who went on to sign with conference rival Phoenix. Boston allowed Grant Williams, a rotation player during their deep playoff runs the last two seasons, to leave rather than match his salary offer from the Dallas Mavericks.

While each individual move can be rationalized, collectively they mean one thing: a newfound desire to see every dollar — even for the league’s deepest pockets — and a reexamination of handing out big-money deals that could prove hard to walk away from if they go south.

“You can feel bad [contract] to $11 [million]”, said a scout from the Western Conference. “But not for e.g. $28 [million] or $29 million.”

However, the union has argued that the new rules will not limit expenses or discourage creative shift planning – but instead will actually promote both.

Why? For starters, there will only be a handful of teams flirting with — or surpassing — the second apron in any given season. And with the luxury tax line and the first and second berths rising at the same rate as the cap, one thinks the question of teams bumping up against — or exceeding them — will diminish over time.

For the vast majority of the teams, the new rules have both given them more tools to build their rosters and made it necessary to spend more money earlier. Increased flexibility in the rules for how much money teams must receive in a trade, for example, played a significant role in the Cleveland Cavaliers making a deal for Max Strus this summer. And a new rule in place that makes teams hit the salary floor before the start of the season saw a bunch of teams that could have gone into next season hoarding cap space to take money — meaning, in theory, there’s more money for teams to spend on talent.

Ultimately, though, the new deal is aimed at forcing teams to make tough decisions about which players to pay — the kind of moves the Clippers, Warriors and Celtics made this offseason. And by extension, the overall pool of talent is spread more evenly – producing more teams capable of competing for titles.

“I think people are going to be more cost-conscious about building rosters,” said one Western Conference executive. “You’re just not going to give away max contracts to above-average starters who aren’t max-level players.”

Explanation of the changes to the NBA’s new CBA

Kevin Pelton and Bobby Marks break down the details of the NBA’s new CBA.

Why talent wins

Although the two periods of championship parity in the NBA occurred nearly half a century apart, there is one common thread: They coincided with a black swan event.

In the 1970s, it was the presence — and then collapse — of the ABA that helped create an entire decade in which there was not a single repeat champion and only two teams — the Celtics and the Knicks — to win multiple titles. Over the past few years, it was the COVID-19 pandemic.

The lack of revenue from parts of seasons with limited or no attendance left the salary cap largely flat for three seasons, compressing teams’ books as salaries continued to rise at their normal rates. That, combined with a compressed schedule — jamming three seasons into two calendar years — created an unprecedented level of tedium and randomness.

Both before and after the pandemic, there were a number of significant damages – including to Kevin Durant (Achilles), Kawhi Leonard and Jamal Murray (torn ACLs) and Klay Thompson (who suffered both) — who played significant factors in creating the NBA’s current period of parity.

Another factor: Both Stephen Curry and LeBron James are entering the twilight of their careers. While both are still clearly among the elite players in the sport, the next dominant force to control the league over a multi-year period has yet to emerge.

“I think things are cyclical,” the Eastern Conference executive said. “The reality is LeBron is older, so the guy who’s been driving for the previous 15 years isn’t in the position where he can win championships by himself anymore. Same with Steph.”

And now, as the league digs out of the pandemic and its aftermath, many of the factors that helped usher in the latest revolving door of champions are beginning to reset themselves.

After the salary cap increased by a combined $24 million over a six-season span from 2017-18 to 2022-23, it increased by over $12 million this season alone and will likely increase by about another $13 million next season. If the ceiling continues to rise by approx. 10% per season — significantly above the salary increases in contracts — the cap would eclipse $200 million by the end of the decade. The fact that the luxury tax and the first and second salary cap aprons are tied to the increase in the cap would also allow for increased roster-building flexibility for teams trying to avoid them.

And while there isn’t an obvious team poised to take over the NBA, no one said a decade ago that the Warriors were about to become the dominant team in the sport, or that Curry — and Klay Thompson and Draymond Green, for that matter — would be on their way to the Hall of Fame.

Consider then the reigning champions. Denver’s entire starting five — Nikola Jokic, Murray, Aaron Gordon, Michael Porter and Kentavious Caldwell-Pope — is under contract for next season, with only Caldwell-Pope even hitting free agency at that point. It’s a group that has all the makings of a team that could at least potentially be the next to sit atop the NBA for an extended period of time.

There’s a belief across the NBA, with Denver as a prime example, that teams will still be able to construct championship-caliber rosters around elite talent — especially when they’re on the 25% max contract that comes from their rookie-scale contract, as opposed to the 35% supermax stars earn later in their careers.

This past season, for example, Denver had three players — Jokic, Murray and Porter — all at 25% max, but still had more than enough flexibility to build a deep roster around them. But with Jokic now graduating to a supermax of 35% from this season, the Nuggets will have tougher and tougher calls to make — like refusing to pay Jeff Green, a key piece from last year’s title team, and trying to replace both Green and Bruce Brown with youngsters on rookie-scale contracts.

“I think it’s great that there have been five different teams [to win championships]”, Silver said, “but at the same time, I don’t mind and I don’t think fans mind when you have teams repeating as champions. I think what they focus on is how those teams were formed.

“And I think that when there’s a sense that the team is, it’s through the draft, through trades, that it’s through proper development of players, and that team can then continue to win.”

And while building a roster becomes more difficult as players transition to supermax contracts, the Lakers, Warriors and Heat have all either won the title or reached the Finals with 35% max deals on their books, showing that there is a way—albeit a more difficult one—to win that way.

“It’s going to be very difficult to carry three max players,” a league source said. “You better be sure you like those three guys and be really smart about constructing the rest of your roster.”

However, very difficult is not impossible.

And as the NBA enters its new CBA amid a rare period of parity, it remains to be seen whether it’s here to stay or a brief moment before the league’s typical dynastic reality returns.

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