The NBA draft system is broken.
Every season, 14 teams fail to make the playoffs. Roughly half of those teams start the next season with the intention of making the playoffs but then abandon ship once that goal seems unlikely.
Meanwhile, the other half of those 14 teams often will enter the season with full knowledge they have no chance to compete for a playoff berth, nor do they have a desire to. What could cause professional sports franchises, comprised of some of the most competitive people in the world, to stop competing midseason (or worse, never even start competing)? An incentive system that rewards ineptitude.
The draft gives teams an opportunity to acquire high-upside talent in a virtually unilateral fashion: You draft a guy and he pretty much has to play for you, minus a few exceptions sprinkled throughout history. As a result, teams that don't have a realistic shot at making the playoffs are given incentive to be as bad as possible in order to get to the front of the line for the talent handouts.
Instead of the draft being a means for down-on-their-luck teams to pull themselves out of their misfortune, it's turned into something that convinces teams to throw away entire seasons in exchange for priority boarding on "Air Superstar." And it's hardly a new phenomenon.
Thus, I've come up with a proposal on a plan I call the "Rookie Exception System."
But first, a little history and context about the draft lottery.
A brief history of the lottery
The draft lottery came into existence in 1985 because of the events leading up to the 1984 draft. With a stacked incoming class, featuring Hakeem Olajuwon, Michael Jordan?and Charles Barkley, there was an extra incentive for franchises to make sure they had a chance to acquire this talent. In the old system, the two worst teams from either division would flip a coin to decide who would receive the No. 1 and No. 2 picks, and the rest of the draft order was determined by record, with the worst teams picking highest.
That year, the Rockets (who already had drafted Ralph Sampson the year before with the No. 1 overall pick) lost 14 of their last 17 games to put themselves in a position to participate in the coin flip, which they won, and ended up drafting Olajuwon.
The following year, the league instituted a simple lottery, in which the seven non-playoff teams all had an equal chance of drawing the No. 1 overall pick. Five years later, the NBA introduced the weighted lottery to give more of an edge to teams with worse records. Then three years after that, the weights were adjusted to more heavily favor teams with worse records. Unwittingly, the league had just increased the incentive for teams to be as bad as possible rather than strive for success even in the face of missing out on the playoffs.
The CBA and salary cap
Following the 1994 draft, in which No. 1 overall pick Glenn Robinson signed a 10-year, $68 million contract before ever suiting up for the Milwaukee Bucks, the NBA created the rookie scale, which would ensure that incoming first-round picks had to "earn their dues" before being eligible for bigger paydays. In an effort to protect veterans, the rookie scale instantly made high lottery picks even more valuable. Not only did a draftee have to play for the team that drafted him, but they'd be grossly underpaid.
The original rookie scale contract was three years long, and players could sign extensions after their second year. In 1999, the rookie scale added a fourth year, meaning players couldn't sign extensions until after their third season.
The final CBA stroke was the implementation of the luxury tax in 2005, penalizing teams for spending above the tax threshold, making this "cheap skilled labor" even more valuable. The combination of (A) having draftees beholden to negotiating with only one team, (B) underpaying them for their troubles, (C) keeping them underpaid for a longer period and (D) avoiding financial penalties made first-round picks infinitely more valuable.
When you combine the financial ramifications with the effects of the weighted draft lottery, you can see very strong incentives for noncompetitive teams to amass talent through the draft over any other means. Why is that an issue??
1. Any time a team is actively trying to not win, the NBA is failing to serve its fans. The best-case scenario is that the league ends up driving away fans from being invested in the product. The worst-case is a scene such as the one we saw in the last week of this past regular season, when? New York Knicks fans bemoaned their team's win over the Atlanta Hawks, owners of the best record in the East, because it hurt the Knicks' odds of getting the No. 1 overall pick.
2. It makes it hard to differentiate between teams trying to do this on purpose and mismanaged teams that just aren't good (I like to call this the "I meant to do that" defense). The draft supplies endless lifelines and excuses for bad GMs to keep stringing along the franchise, hoping that one of their decisions finally hits.
Get rid of the draft:?Not just the lottery, not just the weighted system -- just get rid of the draft altogether. We have to shift the incentive system to sound management principles and franchise building that has vision and purpose. That can't happen as long as we offer free whiffs at top-tier talent by virtue of being terrible in the prior season.
Turn draft season into a rookie free-agency period:?Each team will have a rookie salary exception at its disposal. Teams would be free to negotiate with any incoming rookie player during this period, and can choose whether to use their entire exception on one player, or divide it among several players (as long as they each draw at least league minimum salary).
Inevitably, bad teams will decry the advantage good teams have, so we can weight the system and size of the exception by the reverse order of the season-ending standings, with non-playoff teams receiving the highest 14 exceptions. Below is an example of how this year's rookie exception distribution would work, with the current rookie scale salaries for the corresponding draft position listed for the sake of comparison.
Notice how the rookie exceptions are more heavily weighted toward the top of the draft; this is to account for the diminishing talent level the further down the traditional draft we go. In other words, we're still giving the worst teams the best financial device to lure the talent (money available), but they still have to convince players to sign there. For example, a team like the Knicks can offer a player like D'Angelo Russell $800,000 more than the Sixers can, but maybe Russell thinks the Philadelphia 76ers to be a team with clearer direction and vision, not to mention a style of play that he finds more amenable. It would be on the Knicks to convince him that signing with them comes with more perks, and not just more money.
Players have more choice in the matter, and teams should have to work hard to gain their services.
Will there be players who'll rather play for Miami for $2.2 million than in Detroit for $2.5 million? Of course, but the idea is that as a team like Miami signs better talent, it'll improve and eventually get smaller exceptions. In other words, while forgoing $300,000 in exchange for a more scenic location is an easy decision, you'll see very few, if any, prospects make that same switch from, say, the Detroit Pistons to the Los Angeles Clippers, who could only offer about $800,000 versus the Pistons' $2.5 million. Remember: Most draftees have never seen a dime of professional pay. In most cases, the need to secure their financial future will outweigh the need to live by the beach.
Another likely objection will be the idea that this system favors successful teams. That's the idea. Players want to be on winning teams. The system should encourage teams to try to build winners.
But players also want playing time, so the argument that a top-five talent will sacrifice money in order to play for the Golden State Warriors doesn't take into account that he probably won't play much because of the Warriors' stacked roster. Since playing time is the best marketing campaign for a future contract, it wouldn't make sense to sacrifice current dollars just to get into a situation that will dampen your chances at playing time and future dollars.
The beauty of the rookie exception system is that it keeps in place many of the features of the current draft like trading futures, including protections, while not guaranteeing anything. For example, the Hawks and Nets have a pick swap this year; in the rookie exception system, they'd have an exception swap, with Atlanta getting $1.6 million to spend versus Brooklyn's $777,453. The Hawks should be rewarded for pulling one over on the Nets, but that doesn't guarantee they'll be able to convince a player to sign there.
What this system does is quickly separate savvy front offices from bumbling ones. You'll know right away which teams struggle to build attractive enough situations to get players to sign with them, especially if they leave money on the table. Inept general managers will have nowhere to hide when their teams are perennially at the top of the exception list and are unable to make anything happen despite having so much cash at their disposal.