Monday, December 22, 2008

The salary cap, parity, and the death of the NRL

Australian Sport, Rugby League, NRL, Brisbane Broncos, NFL, New England Patriots, Chicago Bulls

My cable TV has been out for almost two weeks now. I called in a Foxtel guy—he said it was a Telstra problem. I called in a Telstra guy—he said it was a Telstra-Foxtel problem. Go figure. With this service, it will soon be an Optus problem.

My bitterness extends from my borderline addiction to TV. I love TV the same way the Footy show loves Andrew Johns. It’s open, it’s a little awkward at times, there’s some tension, some jealousy, most argue it’s over the top, no one thinks it will last, and I always defend it.

So, like with any addiction, withdrawals are a sad sight. I know this because since I got the notorious “No signal is being received” message, I have turned into a verbally understandable Mark Renton—ferociously and desperately digging through the shit filled cupboards in my house searching for a fix. I’m not yet “fishing rectal suppositories from the worst toilet in Edinburgh” desperate, but I did seriously consider watching a High School Musical 2 DVD I found, so the signs are not good. Please Telstra-Foxtel hybrid man, save me!

With this said however, my domestic excavation has produced three forgotten treasures:

1) The Rise and Rise of Australian Rugby: The Grand Slam Documentary VHS
2) The definitive Michael Jordan career detailing DVD (including a flurry of awkward and inexplicable Space Jam-esque commercials he shot during the early ‘90s)
3) And, A DVD box set detailing the New England Patriots three Super bowl championships

Like Tony Montana in the final scene in Scarface, I buried my head into the pile of tapes and disks.

Spanning three decades (the grand slam in 1984; Bulls titles in ’91, ’92, ’93, ’96, ’97, ’98; and Pats Super bowls in ’01, ’03, and ’04), the myriad of video documents the Professional Revolution that has shaped the modern sporting landscape.

(I feel we should embrace the term “Professional Revolution”. The rise of professionalism—the ideological reform of attitudes towards sport as a means of financial gain—is as historically important as the Industrial Revolution, or the Renaissance, or the birth of Communism....Ok…it’s not.
But it still deserves a cool name. It still shook the inherent values of society by capitalizing on the most innocent of human pastimes. It still acts as a microcosm of the effects of globalisation, showing how corporate enterprise heavily influences social conscience. And it still produced some of the most interesting and influential characters—Tyson, Ali, Jordan, Ruth, Tiger—the world will ever see. Sport, and the professionalisation of sport, played as much of a role in revolutionizing, and ultimately creating, the liberal capitalist world we live in today as music did in the 60s.)

Watched in order the evolution, physically and ideologically, of sport is sketched before your eyes.

“The Grand Glam” doco illustrates the school boy traditionalism of the amateur game; the wild-west attitudes, the visible racial divide, the ignorance towards conditioning, the clothing, the mustaches, the passion.

The Jordan doco recounts the clarification of professionalism; copious amounts of money, fame, notoriety, women, the media, immortalization, ego, commercialisation and marketing—Jordan was the archetype 90s athlete.

Finally, the Patriots doco represents the modern refinement of professionalism in sport; the calculated businesslike relationship with the media, the post-modern presentation of the product, the constant regard for image, the over-accreditation of quantitative benchmarks, the reclusive and robot-like nature of the modern athlete, the salary cap, conditioning, scouting, globalisation. It’s not only a evolution in sport, it’s an evolution in human values and attitudes towards life. A social step towards liberalism; a social shift emphasising the proverbial “individual” over the “team”.

---

No more is this cultural evolution present than in the creation of the salary cap. The salary cap is a result of the very essence of professionalism: the opportunity for financial gain. Since Babe Ruth crossed the line from athlete to celebrity and shifted the social conscience from the contest to the individual, marketable character-athletes have dictated the success of sports leagues since. Games and matches are merely billboards for advertisement.

Because of this development, high caliber athletes who exhibit significant commercial influence have become hot commodities. Like those who invested in defense corporations before 9/11, sports teams are witnessing huge returns when investing in marquee-athletes.

On paper this seems like the perfect business model. Sports leagues world-wide thought so—until they broke it down long term.

It became clear—to them at least —the model created wealth short term (star athletes brought in advertising revenue, which was used to solicit more stars, which won championships, which brought in more revenue) at the expense of the league’s credibility long term (the extra revenue afforded to big city and marquee-athlete teams created dynasties, and ultimately killed parity). A lopsided league has limited market appeal.

To curtail this path to disbandment, leagues introduced salary caps, free agency, drafts, and luxury taxes, to ensure teams could only afford a minority of stars, marquee-players were spread around, young stars were placed on suffering teams, and small market teams were compensated by big market teams who exceeded the league-wide salary mean. Parity was ensured.

But parity, complete parity, is a dangerous thing. And this is a lesson the NRL needs to learn.
The NRL—operating a salary cap since 1990—has made parity a priority in recent years. Instituting a $4.1m [2008] cap, the league has set in place a system whereby teams can only afford—realistically—to have three premier players on the roster. Assuming first tier players (say: Lockyer, Hodges, and Folau for the Broncos) make between $450,000 and $600,000 a season, second tier players (say: 10 guys from the rest of the starting 17) between $100,000 and $300,000, and third tier players (practice squad guys, rookies, the burley young guy who was building your house last week) make what ever is left over, there is a small amount of “real” money available within a 25 man squad.

(Its small when you consider the average NRL player is lucky to last 10 years in the game. Assuming the average player averages $125,000 (gross) a season over that span, spends $500,000 on a house, doesn’t strike gold in investments, and has a family, they probably retire with $500, 000—if they’re lucky. That’s the same as a guy averaging $30,000 over a 45 year career in the workforce. It’s a small window.)

Because of this small window of opportunity, the system forces talented players to seek first tier money with other teams. Theoretically these teams are suffering because of a lack of talent. They pay the talent, the talent becomes a marquee guy, the marquee guy makes the suffering team relevant, he improves the second tier talent, and the cycle continues.

Like I said, it’s a great business model. So the issue becomes, does parity really make the sports leagues better? The answer is no. It just doesn’t.

Think of it this way: parity is communism; a world without classes and natural structure. But as we know, communism doesn’t work. People need structure; people need to form their identity by knowing their place in the world at any given time. Social tiers—as liberally capitalist as this is—provide hope—namely, when you work you can succeed.
And with that in mind, removing that natural measuring stick (in sports this would be the top teams), leaves everyone average. No one’s good, no one’s bad. The games come down to breaks; whoever gets lucky on the day wins the game. If the system weights luck—wholly out of your hands—over skill in deciding the result, why would teams work to get better? They wouldn’t, and they don’t. And because they don’t, because they stand still, the league takes a step backward. In an oversaturated market, sports leagues have to keep moving forward.

---

In the long run, a league that rewards luck over skill and effort will kill credibility faster than a league that allows for the creation of powerhouses. Ultimately the NRL should model itself off the NBA. Raise the cap, make it a soft cap, force big market teams (Roosters, Broncos, Rabbitohs, Bulldogs) to pay luxury tax, implement a rookie cap, and legislate exemptions allowing teams to exceed the cap (without luxury tax penalties) to keep veterans who have played for one team for more than 9 years or 200 games.
Petero Civoniceva and Steve Price are examples of players who would have benefited from the last one. When you play for 10 years in one city, you have given back to the NRL, you are a fan favorite, a marketing asset, and you have a life in that city. Those players should never have to end there careers anywhere else. Especially Penrith.

So heads up David Gallop, parity will turn you into Cuba. In other-words: poor.

No comments: