Super Agent David Falk Believes it is ‘worst time to have a lockout’, Offers to Mediate CBA Negotiations

July 13, 2011 – 2:15 pm by Michael Bean

If you’re not quite sure about the particulars of the NBA Lockout and what could potentially be done to resolve the labor impasse for the long-term viability of the game, you’ve got two pieces of media that should get you up to speed quite quickly and informatively. The first is this interview with one of the league’s most influential power brokers and agents, David Falk. You should also read Bill Simmons’ recent article that outlines a multi-step solution to the lockout. Simmons’ piece is long and delves deeper into the issues, but the two both touch on what I’m now convinced is the biggest problem facing the league — overpaying the role players on a team that have no business taking home high seven or even eight figure yearly salaries that are guaranteed for the life of the contract. Take a listen to Falk, then read Simmons and you’re well on your way towards having the necessary info to opine on the situation one way or another.

Falk joined 106.7 The Fan in Washington D.C. with Mike Wise and Holden Kushner to talk about if he thinks big-name players will go overseas to play and earn a check during the lockout, how he’d best summarize the primary issues being negotiated during the work stoppage, his opinions on David Stern’s role in the negotiations, if he thinks existing guaranteed contracts will be grandfathered in after explaining why he thinks the players are receiving too much of the financial pie, how he thinks there are viable solutions to the mess and how he’d love to mediate the negotiations, and what he thinks are the most broken aspects of the NBA system.

If he thinks there’s really a strong possibility that certain players will go to Europe to play during the lockout:

“I don’t think so. First of all, I’ve been discussing this with my own clients. I had a client in 1989 who was the National Player of the Year named Danny Ferry. He got drafted No. 2 by the Los Angeles Clippers, and he had personal reasons why he didn’t want to play for the Clippers at that time. His first year, he played for a team in Rome called Messaggero. It was owned by a very wealthy guy named Raul Gardini who was one of the three wealthiest men in Italy. And he made $4 million dollars in 1989. Very few NBA players will make $4 million in 2011 if they go to Europe. And if you ask him since he’s been a general manager, the floors were hard, the medical situation wasn’t very great, the guys smoked and drank after the games, practices were four hours a day and he really hurt his knees. I’m not sure he ever became the player he could have been had he started in the NBA. And so some of these guys going over there and risking $100 million dollar contracts to make a couple of million the next several years, I’m not certain for a lot of players that that’s a very wise choice.”

On what the NBA Lockout is all about in layman’s terms:

“Well let’s first start in the broad context. I think we’re in an environment where you have the perfect storm not to have a lockout. Unemployment in the United States is higher than it’s probably been in decades, and as an Econ major in college, the way they keep Labor statistics, they say you’re not looking for a job on a Thursday afternoon wearing a blue shirt, so we’re not going to count you in the people that are unemployed. You go to Detroit or Cleveland, and I bet you the unemployment is up near 25 or 30 percent. And you go to one of those fans whose out of a job, who can’t go to a game for $20 a ticket and a Coke. And Derek Fisher is making $5.5 million and he thinks he should be making $6.5 million; or the owner of a team who’s worth $3 billion and lost $4 million last year, those guys have zero sympathy for either side. It’s the worst time to have a lockout. We had a great season, great playoffs, games are at an all time high, ratings are high, and their job is to make a deal. When I get hired as an agent, my job is not to hold a guy out. It’s easy not to make a deal — you just ask for something unreasonable, and when they say no, you walk away. Sort of like what’s going on in the budget negotiations right now between the Democrats and the Republicans.”

If he thinks David Stern is making a big mistake with this developing labor impasse by not stepping in more forcefully:

“No, no, I don’t think David’s being a hard-liner at all. I think there’s probably a lot of young owners that think David’s not being hard enough. But the truth is that there are a significant number of teams that are losing money. You can argue over how much they’re losing, you can argue accounting and say maybe you shouldn’t put depreciation of franchises which is a non-cash item in the loss, but they are losing money. But at the end of the day…and I’m a player guy, Mike…but the players in the aggregate are making $2.166 billion dollars. So let’s say you’re a player and I’m an owner, and I say ‘Mike, I’m losing money, I’ve got to change your salary, I’ve got to reduce it, I’m losing too much money.’ And you say ‘I don’t believe you’re losing money.’ I say ‘Really?’ I use my favorite David Falk expression — ‘are you bettin’ or are you talkin’? I’ll bet you $2.166 billion dollars that I’m losing money. If you’re wrong, you’re going to lose all your money, and if you’re right you’re going to get it.'”

Does he not think that existing guaranteed contracts should be grandfathered in?

“Well I think there will be guaranteed contracts. What they’re arguing about mostly is the percentage of the pie. The players are making 57 percent of the pie, the owners want to make it less. And I think there are many ways to solve it. In many ways, having done this for 37 years, and having owned a business that’s bigger than most of the teams, and having been an agent for so many years, I’d love to mediate the dispute because I think there are solutions that are acceptable to both sides. But at the end of the day, this is different than the football situation because the owners are printing money and the owners want a deal in football because they know if they start missing preseason games, for every game they miss, they’re going to be losing money. There are about 14 to 20 teams in the NBA, if they miss games they’re going to make money because the losses are going to stop.”

On what he thinks are the most broken aspects of the current NBA system:

“I think the problem in the system, in my opinion, is basketball in the post-cap era…the cap came into the league in ’82 for 6 teams and for the rest of the league in ’83. And what the cap has done in both basketball and football is it’s made it in order to win…pop quiz, how many teams won a title in the NBA since 1980 in the last 31 years? Eight. Each of those teams have a formula. If you look at the Lakers, San Antonio, Miami almost won it last year — they have three stars that make almost all the money. When the Celtics won in 2008, Ray Allen, Paul Pierce and Kevin Garnett made 75 percent of the money. The fourth highest paid guy, Kendrick Perkins, how much did he earn? $3.6 [million]. Now, when your fourth guy is earning $3.6 and you say ‘Kendrick, I want you to be a role player, play great defense, rebound…’ He doesn’t turn to you and say ‘are you stupid? I’m making $9 million, I’m a star.’ Okay, so the formula for almost every team that’s won since 1980 in the cap era is to have three stars and a bunch of role players. What’s happened by putting a maximum salary on the LeBron’s and the Kobe’s and the Iverson’s over the last ten years, we’ve taken the money that we’ve saved from the stars and we pay guys that are probably worth $3 million, $9 million. That’s the problem in the system. They’re hard to coach, some of them aren’t heavily motivated, and you brought it up earlier, in 1998 when I was in my prime, Patrick Ewing was the president of the union. Stars ran the union. Today, the rank and file is running the union, and there’s a lot more rank and file players — they are passing the rules that disadvantage the stars that the people come to see and buy their merchandise or watch their commercials. And they’re overpaying the middle guys, so you have guys that are really out of shape…I’m not going to name names….there are certain guys that I watch when I come to the games here that I wouldn’t pay a nickel to watch because they’re in worse shape at age 22 than I am at 60.”

Listen here to Part 2 of Falk with Mike Wise & Holden Kushner on 106.7 The Fan in Washington D.C.

Listen here to Part 1 (non-lockout talk) of Falk with Mike Wise and Holden Kushner on 106.7 The Fan in Washington D.C.

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  1. 12 Responses to “Super Agent David Falk Believes it is ‘worst time to have a lockout’, Offers to Mediate CBA Negotiations”

  2. American players are like hassidics or amish people when it comes to leaving their country.
    Canada is nothing more than another US state yet the winning heard from NBA players about Vancouver and Toronto was beyong annoying and in baseball, its not that bad but there was always griping about having to play in Montreal and Toronto.

    Call it provincialism or isolationism or living on an island but americans players and foreign countries dont mix.

    Falk on the other hand is predictable and as full of shit as expected. Yes, use an example from three decades ago as to why youre not for it.

    You havent seen a game until youve been to Greece (the 2004 US team almost crapped their pants in Greece when the fans went wild and that was the ultra calm, docile groups that was there, not the insane club followers.)
    Playing the euroleague cup on top of the league games and playing in France, Spain, Greece, Italy, Russia, Israel, etc.
    You want to visit Milwaukee, Cleveland, Okie City and Charlotte or Milan, Roma, Paris, Barcelona for road games?

    Its funny how basketball is a true international sport (unless you believe the absolute BS teh NBA peddles about how the game didnt exist anywhere until the NBA decided to show the world in 1992) and yet americans are so isolated (voluntary) from the rest of the planet.
    Like soccer, players from all over the planet play in leagues all over the planet. Except american players.
    Like I said, US players are the hassidics of the basketball world.

    By Lorenzo on Jul 13, 2011

  3. @Lorenzo:”Canada is nothing more than another US state…” Are you freaking serious? You need to brush up on Canadian history and understand that in no way, shape, or form do Canadians want to be identifed as Americans even if we like your President. That’s the sake kind of mentality shown by the very players you are taking to task, rightfully so, for believing that playing in Toronto, Vancouver, or Montreal is a trek to Siberia. Some of these “informed” players, my tongue firmly planted in my cheek, wouldn’t know where to find Toronto on a map. Some even play in places colder than Toronto, yet complain about snow in Toronto. Go figure! Anyways, unlike you I do believe some of Falk’s points do have some merit. I am not sympathetic when millionaires and billionaire are fighting over how to divide the spoils. What ticks me off is the mediocre talent that expects to get paid like a superstar, when he may finish a career without ever putting up a NBA double-double. I would rather see the owners donate some of the money to community schools, hospitals, and other groups that are struggling to make ends meet. Those people are my true heroes.

    By KemKev on Jul 15, 2011

  4. @Lorenzo: Your parents should really place restrictions on internet usage, because you really need to go back to school and learn geography, culture, and do anything but try to comment with the grown-ups. Your complete and utter ignorance makes me almost feel bad for dismantling your pathetic little arguments.

    1. Canada is a whole lot more socialist than the US. To say that Canada is “like another US state” is like saying “China is like Japan”.

    2. Many players don’t want to play in Canada because income taxes are so damn high there.

    3. Even Canadian players don’t want to play in Canada. See Steve Nash, for example.

    4. If you love to watch sub-par flopfest of a game, go ahead and watch European basketball. As for the Greek clubs? They can’t even pay their players!

    5. Even if basketball is a “true” international sport, the NBA is still the premiere destination for talents of countries world over. In soccer, players get sold like whores.

    6. The entire United States has more land area than France, Spain, Greece, Italy, and Israel. While it’s nice to travel to Milan, Rome, Paris, and Barcelona, but why would you want to go to countries on the verge of bankruptcy, a country that’s blanketed by snow more than half the year and its road filled with gigantic potholes?

    7. The bottom line is, NBA teams are willing to pay far more money for talent. NBA team owners provide far better amenities. The American basketball market is still far more lucrative. Why do the US players want to stay in the US? Why don’t you ask every foreign player from A(rvydas Sabonis) to Z(ydrunas Ilgauskas)? Because the best basketball players in the world all play in the NBA and no where else.

    By Henry on Jul 15, 2011

  5. Soccer sucks. Who cares what they do?

    By Malcom on Jul 25, 2011

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