Dan Gilbert Takes on Larger Payroll to Add Talent

Excerpt from Brian Windhorst's column:

Gilbert doesn't speak with the media often, but he did before Sunday's game to explain his thinking about giving the green light to expand his payroll and luxury tax bill to bring aboard the four new players, including Wally Szczerbiak and Ben Wallace, who make a combined $27 million this season.

''I thought it was pretty important to do something,'' Gilbert said. ''We got to the Finals with this team, but the competition got harder and it was going to be a bigger challenge than last year.''
Gilbert said that he's not spending as much as people think. Because the Cavs are just responsible for paying the new players for the final 27 games of the season, he's only actually paying about $1.2 million more in the prorated salaries than he would have before the trade.

However, the Cavs will have to pay luxury tax on the entire additional $4.7 million added to their total payroll and that is a dollar-for-dollar penalty. The Cavs payroll is currently about $80.85 million — third in the NBA. The NBA's ''soft'' salary cap is $57.63 million and the luxury tax threshold is $67.865 million. That puts the current tax bill, the first-ever in franchise history, at a shade under $13 million.

''We are trying to build something here,'' Gilbert said. ''You pay $375 million for a franchise and then break even for a couple years. You can't start getting cheap now. It's a big commitment, but before we even look at money, we look at what is right basketball-wise first. If you do it money first, you may start getting (the front office) gun-shy even thinking of ideas.''

Bulls Problem Defense, Not Offense

This season, the Bulls are winless when they allow 100 or more points in a game. After Houston's win earlier this week over Seattle, 109-107, the Bulls became the only team in the NBA to not win a game when they give up 100 or more points. In all other games, the Bulls record is 17-7.

So, although many point out the struggles for the Bulls to score in the paint and their other offensive deficiency, perhaps it is the defense that is the root of the problem. The Bulls most impressive victories this season have come against Detroit. In games against the Pistons, the Bulls have held them to 93 points, 91 points, and 81 points.

Some key defensive categories and the Bulls current rankings:
Three Point Percentage, .382 (28th)
Free Throws Attempted, 1073 (13th)
Total Rebounds Per Game, 43.1 (21st)
Fast Break Points per game, 13.1 (23rd-tied)

Starting Thabo Sefolosha over Ben Gordon, giving Joakim Noah time over Ben Wallace, and playing Tyrus Thomas less, should help the defensive issues the Bulls have. Sefolosha especially, allows Kirk Hinrich to defend point guards rather than bigger, shooting guards.

Memphis, Chicago & Orlando Up For a 3-Way Trade?

With the Bulls floundering at seven games under .500 and Memphis looking to the future as they sit in last place in the Western Conference's Southwest Division, both teams look like they are ready to make a move. In Orlando, Stan Van Gundy has struggled to find an effective big man. So, here's a three-way trade that would get each team closer to their short-term and long-term goals.

Memphis gets:
PF Pat Garrity ($3,818,750, 1 Year Remaining)
C Adonal Foyle ($1,219,590, 1 Year Remaining)
PF Tyrus Thomas ($3,505,320, 2 Years Remaining)
C Ben Wallace ($15,500,000, 3 Years Remaining)
SG Ben Gordon ($4,881,669, 1 Year Remaining)
Future Orlando First Round Pick

Chicago gets:
SG/SF Mike Miller ($8,376,194, 2 Years Remaining)
C Pau Gasol ($13,735,000, 4 Years Remaining)
PF Andre Brown ($770,610, 1 Year Remaining)

Orlando gets:
PF/C Stromile Swift ($5,800,000, 1 Year Remaining)

In this trade, Memphis gets more young talent (Gordon, Thomas, first round pick), cap flexibility (Foyle, Garrity, and potentially Gordon), and veteran talent (Wallace). Adding Thomas and Gordon to the core in Memphis of Rudy Gay, Mike Conley Juan Carlos Navarro, Kyle Lowry, Darko Milicic, Hakim Warrkick gives general manager Chris Wallace a great start to turning this team around. With this trade, the Grizzlies would have just about forty million dollars for seven player - Milicic, Brian Cardinal, Damon Stoudamire, Gay, Lowry, Ben Wallace, and Tyrus Thomas. Even with the option of bringing back Ben Gordon long-term and eating into their payroll, the Grizzlies would still have a significant amount of cap room to bring in a veteran post player.

The Bulls would be able to re-make this team in a short period of time. Gasol clearly would fill the void the Bulls have had in the post since Eddy Curry was traded to the Knicks. Averaging 19 points per game and almost nine rebounds, Gasol would be the focal point of the Bulls offense. Mike Miller would also be a great addition to the team. Playing Miller (6-8) next to Luol Deng (6-9) on the wing would allow the Bulls to turn a negative (size at the wing) into a positive. Miller is also a veteran scorer that would take some pressure of Deng and Kirk Hinrich. With averages of 16.5 points per game, 6.8 rebounds per game, and 3.9 assists per game, Miller would be a perfect fit in the Bulls offense. Andre Brown is a young, power forward from Chicago, who the Bulls would get a half of a season to take a look at.

For Orlando, this trade would The Magic have had a great deal of success this season playing a smaller front line with Hedo Turkoglu and Rashard Lewis playing the forward spots. Off the bench, the Magic have gotten very little production from their big men - Brian Cook, Pat Garrity, Adonal Foyle, and James Augustine. Adding Stromile Swift to this Magic squad would give the team athleticism, shot blocking, and post defense off the bench. Swift has a player option after the 2007-08, but could become an unrestricted free agent. In this trade, Garrity and Foyle are little used big men who are free agents after this season.

Charlotte and Detroit Swap

Saturday night, the Detroit Pistons trade center Nazr Mohammed to the Charlotte Bobcats for forward Walter Hermann and center Primoz Brezec. My first reaction to this deal was: what is Charlotte thinking? Now that I have had two days to further consider the deal, my thought is: what is Charlotte thinking?

In this trade Detroit relieves themselves from Mohammed, who was a little used, overpaid big man that they clearly overpaid in July 2006 to replace Ben Wallace. Mohammed still has four years left on his deal with $5,632,200 in 2007-08, $6,049,400 in 2008-09, $6,466,600 in 2009-10, and $6,883,800 in 2010-11. Mohammed hasn't scored in double figures since the first half of 2004-05 when he played for the Knicks. Consistency has always been an issue with Mohammed who had a big 2000-01 with the Atlanta Hawks, but then never played at the same level for them again.

Bobcats coach Sam Vincent said, "We see this deal as a major improvement for the team. Not that we were down on Primoz and Walter, but we're trying to improve the Bobcats. We feel we've got a big guy that can come in and score in the post and help us with rebounding."

Unfortuantely, I doubt Mohammed will be the answer for Charlotte.

For Detroit, this trade was a no-brainer. Brezec will become the second big man off the bench for the Pistons playing behind Antonio McDyess, Rasheed Wallace, and Jason Maxiell. Brezec showed the ability to score nightly during the 2004-05 and 2005-06 season. Herrmann also has shown an ability to score from both the small forward and power forward positions. In 2006-07, Herrmann played in 48 games for Charlotte, averaging 19.5 minutes per game, and 9.2 points per game. He can shoot the ball well from the perimeter, and defend well enough to play power forward. Herrmann brings a veteran leadership to a young Piston bench which includes: Arron Afflalo, Rodney Stuckey, Jason Maxiell, Amir Johnson, and Cheick Samb.

Financially, this deal also made a great deal of sense for Detroit. Both Brezec and Hermann are in the final year of their contracts and become unrestricted free agents. Herrmann will make $1,944,000 this season and Brezec will earn $2,750,000. The Pistons will have the entire year to take a look at both players and see if they want to bring them back next season. In the meantime, they will bring further depth to a team who is looking to make a run in the playoffs.

In Mohammed, the Pistons will save more than $19,000,000 over the next three seasons. This factor is even bigger for Detroit than the talent upgrade they received in this trade. As key players like Rasheed Wallace, Chauncey Billups, Lindsey Hunter, and Antonio McDyess get older, this will provide flexibility for Detroit to add key players down the road.

For Charlotte, I simply cannot understand this trade. At the time of the trade, the Bobcasts were 8-13 and had lost 2 of their last 10 games. Although they have some nice players, they are clearly not ready to compete for a playoff position. Furthermore, adding Nazr Mohammed and losing two potential key players is not a move I would have made. If Sam Vincent was unhappy with Brezec and Herrmann, then the Bobcats should have rode it out the rest of the year and then let the players leave in free agency. They would have saved close to $6,000,000 and been in position to add a player such as Antawn Jamison, who could score effectively in the post.

In my eyes, this trade allowed the rich to get richer, while the poor got poorer.

Taking a Look Back to Draft Night

After seeing Zach Randolph score 22 points and pull down 17 rebounds in a Knicks win over the Nuggets on Tuesday night, it certainly got me thinking. Perhaps after this awful start, John Paxson regrets not pulling the trigger to acquire Randolph on draft night this past summer.

At only 26, Randolph could have been the Bulls answer for a post man for the next ten years. Although he clearly has had some off the court issues previously, the Bulls today have a team with no players of questionable character. Maybe in a different situation and environment, Randolph would have been different.

During his last four seasons in Portland, Randolph averaged between 17-24 points per game, 8-11 rebounds per game, and around 2 assists per game. These type of numbers that Randolph has put up in the past is certainly consistency in the post that the Bulls have not had in a very long time. In fact, the Bulls have not gotten more than 20 points per game in a season from the power forward spot since 1985-86 from Orlando Woolridge.

The Knicks acquired Randolph in a package along with Dan Dickau, Fred Jones, and the draft right to Demetris Nichols. In the trade, New York gave Steve Francis, Chaning Frye, and a 2008 secound round draft pick to Portland. Without giving it much thought, I would think the Bulls could have swung together a package more attractive than what New York gave up. With the rights to P.J. Brown, the rights to the ninth pick in the draft, Chris Duhon, and several other trading pieces, you would think the opportunity to acquire Randolph would have been there.

Instead, Paxson and the Bulls wonder how a lineup of Kirk Hinrich, Ben Gordon, Luol Deng, Zach Randolph, and Ben Wallace would have fared.

Kobe-Bulls Update

Reports out of Chicago are saying that a three-team trade is on the table for Kobe Bryant to approve within the next 48 hours. The trade includes the Bulls and Lakers and now also the Sacramento Kings. With Kings point guard Mike Bibby out six to ten weeks with a left thumb ligament injury and a roster of players either past their prime or vastly inexperienced, the Kings most likely are looking to shake up their roster.

The reports only mention Kirk Hinrich, Ben Gordon, Kobe Bryant, and Ron Artest as the primary members. So, I spent some time looking at possible three-way trades and here is the best that I could come up with:

Chicago gets: Kobe Bryant ($19,490,625) and Jordan Farmar ($1,009,560)
Sacramento gets: Ben Gordon ($4,881,669), Joakim Noah ($2,135,400), Viktor Khryapa ($1,928,598)
Los Angeles gets: Kirk Hinrich ($11,250,000), Ron Artest ($7,400,000), Adrian Griffin ($1,593,000), Chicago future first round pick.

With this trade the Bulls would automatically become a contender to win the championship. They would maintain a core of Luol Deng, Ben Wallace, Andres Nocioni, and add in Kobe Bryant. Role players such as Thabo Sefolosha and Joe Smith would also play a critical role. Although the Bulls currently constructed are a nice team that may compete for the Eastern conference title, this team post-Kobe trade would compete for the title. And as I always stress, each year your goal is exactly that -to compete for the championship.

In Sacramento and Los Angeles, this trade allows both teams to rebuild their roster without falling too hard. Sacramento gets another scorer to play next to Kevin Martin, another young big man in Noah, and cap flexiblity next season when Khryapa's contract expires. The Lakers acquire two starters and some flexibility for the future. Hinrich and Artest would team with Andrew Bynum and Lamar Odom to create a nice core for the Lakers to build around.

Thoughts from Bulls-Wizards/October 16

Last night I went to the Bulls game against the Washington Wizards. Below are some thoughts I had after the game:

-I assumed that Thabo Sefolosha and Adrian Griffin would be out with injuries last night, but I was hoping we would get to see Ben Gordon for the first time this season. Gordon sat out once against with a left ankle injury.

-I was suprised Gordon was out again, considering Skiles said he would possibly play in last week's game against Dallas.

-I like how the Bulls made an effort right from the tip to post-up Luol Deng. With Roger Mason and Mike Hall on him, Deng clearly has an advantage. Considering his height and wingspan, Deng should continue to take advantage of that mismatch.

-I loved the big lineup that Skiles went with mid-way through the first quarter, which included: Kirk Hinrich at point guard, Luol Deng at shooting guard, Andres Nocioni at small forward, Tyrus Thomas at power forward, and Ben Wallace at center. That is a unique lineup that can play many different styles of basketball.

-I really like how Skiles is utilizing the preseason effectively: different lineups, Deng in the post, Thomas Gardner playing with the starters, seeing what Aaron Gray can do in the post, playing JamesOn Curry at both guard positions, and giving significant time to Viktor Khryapa.

-Antawn Jamison got tangled up in the corner opposite of the Wizards bench towards the end of the first quarter. Shortly after, Andray Blatche came up lame after finishing at the basket.

-Washington's rookie guard, Nick Young, really played well last night. He seems like he can play three positions if asked and plays aggresively. Of all the Wizards, he impressed me the most.

-I watched Gilbert Arenas throughout the evening frequently. I like the way he carries himself and leads his team. He did not play his best and only played limited minutes. I would really love to watch him live again during a big regular season game.

-Both Caron Butler and DeShawn Stevenson did not play last night for the Wizards.

-By my account, Oleksiy Pecherov may one day be a signifcant player in the NBA. However, last night I could tell that he is still very raw. He struggled from the perimter and turned the ball over a great deal. He works hard out there but still seems like he is not ready to significantly contribute to an NBA team today.

-At this point, I think I have seen enough to determine who my fifteen man roster that I would go into the regular season would be: Hinrich, Duhon, JamesOn Curry at point guard; Gordon, Gardner, Sefolosha at shooting guard; Deng, Nocioni, Griffin, and Khryapa at small forward; Smith, Thomas, and Noah at power forward; Wallace and Gray at center. I would assume that Khryapa and either Curry or Gardner, probably Curry, would be inactive on game nights.

-Both Jared Homan and Andre Barrett have not played poorly during the preseason, but they lack the talent the players ahead of them have.

-I really like the Joe Smith acquisition John Paxson made in the offseason. He is an experienced veteran, who really wants to win now. I do not think he is "over-the-hill" at this point, and can still be effective. If he can play twenty minutes a night and average ten points and six rebounds, then the Bulls will be in great shape.

Follow-up on "Wages of Wins" Review

In response to the New York Times' review of "Wages of Wins", the author, David Berri, posted some thoughts on his website:

Having reviewed some of the reaction to his story, though, I thought it would be useful to summarize what our research indicates about decision-making in the NBA. Here is a point-by-point summary of the story we are telling about the NBA.

Payroll does not explain much of wins in the NBA, MLB, or NFL. Specifically, payroll only explains 12% of the variation in wins in the NBA. In baseball explanatory power is 18% while in the NFL it is below 5%.

We think the low explanatory power of payroll in baseball and football can at least partially be explained by the relative inconsistency of performance in these sports. As we note in our book, across time in baseball and football we see fairly wide variations in player productivity. After all, who expected the Detroit Tigers to be so good this year?

Relative to these sports, though, performance in the NBA is more consistent. So why is payroll still unable to explain much of wins?

We think the answer lies in how players are evaluated in the NBA. For more than two decades economists have looked at the link between player salary and various performance statistics. Scoring totals are the only player statistic that consistently explains player pay. Shooting efficiency, rebounds, steals, and turnovers do not consistently offer much explanatory power. We updated these studies in our book. Our story, though, was essentially the same. Scoring totals are the one statistic that matters most in determining player pay.

How much players are paid is not the only decision economists have examined. Ha Hoang and Dan Rascher published a study in Industrial Relations in 1999. The Hoang and Rascher study looked at the factors that caused a player to be cut from an NBA roster. The only player statistic these researchers found to matter was scoring. All other player statistics did not matter.

We have looked at the coaches voting for the All-Rookie team and the factors that impact where a college player is drafted. What matters most? Again, scoring matters more than factors associated with getting possession of the ball (i.e. rebounds, turnovers, and steals).

Wins in the NBA, though, are not just about scoring. Possession factors have a large impact on the outcomes we observe in the NBA. When you look at all the statistics the NBA tracks you find that with these you can explain 95% of the variation in wins. And when you look at all these statistics you find that you can create a very accurate estimate of the wins each player produces.

From all this what do we conclude? Conventional wisdom in basketball is incorrect. Players who only score are not as valuable as people think. Players who do not score much — like Ben Wallace and Dennis Rodman – have a bigger impact on team wins than people seem to think.

Building of the 2006-07 Bulls

(Post originally written October 11, 2006)

After a 41-win season, the Chicago Bulls return only seven of the players that made up that teams roster. Guard Jannero Pargo (Hornets) and bigs Tyson Chandler (Hornets), Darius Songaila (Wizards), and Othella Harrington (Bobcats) are gone, replaced by Ben Wallace, P.J. Brown, Tyrus Thomas, and Thabo Sefolosha. This appears to make the Bulls just as deep, numbers-wise, but with a better collection of players. With Viktor Khryapa (who is already earning compliments from Bulls head coach Scott Skiles) and Adrian Griffin, both very useful players, replacing Eric Piatkowski and Eddie Basden at the end of the bench, Skiles will certainly have more depth to work with. If you consider the players added and those lost, the “added” definitely consists of much more talent.

Going:

Player Lost, 05-06 Contract, 06-07 Contract
Jannero Pargo 700k, 900k
Tyson Chandler, 4.8, 9.0
Darius Songaila, 1.6, 2.2
Othella Harrington, 3.2, 3.5
Eric Piatkowski, 2.8, 3.0
Eddie Basden, 400k, 600k
TOTALS $13.5 million, $19.2 million

Coming:

Player Added, 06-07 Salary
Thabo Sefolosha, 1.7
Viktor Khryapa, 1.2
Ben Wallace, 16.0
Adrian Griffin, 1.5
P.J. Brown, 8.0
Tyrus Thomas, 3.2
TOTAL $31.6 million

Although the total added players salaries is much higher, General Manager John Paxson was in position to do this because his team was significantly under the salary cap. Paxson put his team in this position because of key trades over the last two seasons (i.e. Eddy Curry, Tyson Chandler, Jalen Rose).