Submitted by Randi B, Dec 1, 2006 13:27

John, you have a good article going, but you forgot one thing that makes the owners' argument. And that's the effect of the luxury tax. Any team that pays salary over $61M pays a dollar for dollar salary tax. And that can break a small franchise's back.

Here's the problem with the NBA. Lets say the Sacramento Kings have a payroll of $70M, they're actually paying $80M because they pay an extra $9M in luxury tax. This hurts the Kings financially because they may not have the extra revenue stream to afford extra salary costs. On the other hand, the New York Knicks can have a payroll of $100M (which is really $140M with the luxury tax), but still be in the black because they have an unlimited revenue stream. This gap puts large market teams at a competitive advantage because they have better leveraging in trades and free agent signings. A large payroll doesn't guarantee success, but smaller market teams may have a harder time landing better talent because its larger market competitors have better resources.

Note: Comments are screened, and in some cases edited, before posting. We reserve the right to reject anything we find objectionable.