Solving the Real Problem With the NBA’s Tanking Epidemic

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Amid the buzzer-beaters, heartbreak, and drama in the NCAA tournament, NBA teams are using college basketball’s biggest stage to fine-tune their evaluations of some of the league’s future stars. For someone like Ben McLemore of Kansas or Marcus Smart of Oklahoma State, a brilliant stretch in March will allow them to stake their claim as the no. 1 overall pick in next year’s draft. Regardless of where they are selected, both McLemore and Smart — should they declare — will move on from successful college programs to teams in the professional ranks that aren’t exactly synonymous with winning. During the past two seasons, no team has represented this perennial lottery dweller quite like the Charlotte Bobcats.

After a historically bad season that was partially obscured by a lockout-shortened schedule, the team has continued its futility again this year. In 11 of its past 13 games, Charlotte has been blown out by 14 or more points, an embarrassing stretch that has helped make the team owners of the league’s worst record. Or, in other words, things are going exactly as planned in Charlotte.

Welcome to life in the NBA, where every spring brings not only the excitement of the playoffs, but the unsavory notion of tanking. In a league that rewards losing and incompetence with valuable high draft picks, it pays to be bad. So with organizations like Charlotte, Orlando, and even Portland actively looking to avoid respectability, it’s time to restart the conversation about what tanking does to the competitive nature of the league.

That conversation isn’t exactly revolutionary. The war on tanking was brought to the forefront with an epic e-mail exchange between Malcolm Gladwell and Grantland’s own Bill Simmons back in May 2009. Late in the back-and-forth, Gladwell pointed out the fundamental flaw behind the current system:

I think, for example, that the idea of ranking draft picks in reverse order of finish — as much as it sounds “fair” — does untold damage to the game. You simply cannot have a system that rewards anyone, ever, for losing. Economists worry about this all the time, when they talk about “moral hazard.” Moral hazard is the idea that if you insure someone against risk, you will make risky behavior more likely. So if you always bail out the banks when they take absurd risks and do stupid things, they are going to keep on taking absurd risks and doing stupid things … If you give me a lottery pick for being an atrocious GM, where’s my incentive not to be an atrocious
GM?

Henry Abbott of ESPN picked up the torch from there, starting his campaign to end tanking on his TrueHoop blog last March:

Right now superstar-grade players are going into a lottery populated by the worst teams, in a sport where one great player has more impact than in any other team sport and is locked into below-market salaries throughout their careers (because of rookie scale contracts followed by maximum-salary limits).

Meanwhile, teams that win consistently very seldom get players like that, by trade or any other means. Essentially, the best-run teams are penalized while the worst-run teams are rewarded.

Cleveland’s Kyrie Irving is just the latest example of the point Abbott — and, in a broader sense, Gladwell — is trying to make. The 20-year-old guard, when healthy, is fast approaching the upper echelon of the league’s elite. Yet it’s hard for Irving to stay in the national consciousness given that part of the reason he ended up in Cleveland was that the LeBron James era was marked by poor roster management that contributed heavily to the departure of the league’s preeminent star.

Irving’s current injury woes don’t seem to raise the concern they should because, well, they don’t matter. The young guard sadly doesn’t factor into anything important — like a playoff series. He’s merely the difference between Cleveland winning 22 or 28 games. So even though Irving is set to play tug-of-war with Chris Paul for the title of best point guard on the planet as early as next year, he remains, in the larger scheme, an afterthought.

In fact, Irving’s absence actually helps the Cavs. Without him around, Cleveland becomes even worse than it already is (which is pretty terrible), making it ripe to pile up the losses and acquire more ping-pong balls for the upcoming draft lottery. Let that sink in for a second. The NBA is a league in which a rising, young star’s injury brings a team closer to achieving its desired short-term goal.

Charlotte is the team that has truly perfected this art. By deconstructing its roster after the middling Larry Brown era, it became a prime contender for the no. 1 overall pick. But that also left it with some overlooked consequences.

With consistent losing, bad habits emerge — such as a failure to make the extra pass or put all-out effort into positioning on defense. On a team that is getting demolished every night, those things fail to matter. On competitive teams, however, those things represent the fine line between winning and losing important games. It’s only a matter of time before the young players on their roster, like Kemba Walker and rookie Michael Kidd-Gilchrist, lose the incentive to play winning basketball.

Those are just two players caught up in the collateral damage of teams’ incentive to become truly atrocious. A high-energy rookie like Kidd-Gilchrist would be a cult hero if he were placed on a contender. Instead, he seems destined to waste the first part of his career on a team that’s years away from being important. Not only is the constant losing bad for a player like Kidd-Gilchrist, but as related research about baseball teams cutting spending has shown, it can drive away fans for good.

Perhaps it’s time for the NBA to consider a change — even a radical one — to the way young players enter the league. In another installment from his crusade against tanking last spring, Abbott discusses how sports economist Dave Berri’s book Stumbling on Wins argues that the idea of the draft originated to save owners money (total shocker there), not because it was deemed the best way to allocate new, exciting talent to teams:

Most assume the draft is about parity — that is, about making bad teams good. Berri concludes Bell’s primary goal was saving owners money. And that’s exactly what drafts have done …

Meanwhile, fans and other observers accept this [notion about parity] because it appears to have this wonderful ability to make bad teams good.

There are two systems — mentioned first by Gladwell in the ’09 e-mail exchange — that can keep rookie salaries under control while also eliminating the “moral hazard” that occurs when bad teams are rewarded with top talent. The first is a strict order-of-finish draft. Simply put, the best teams draft first and the worst teams draft last. The second is eliminating the draft and going with a free-agent pool, with slightly weighted salary allotments, that allow teams to simply recruit top talent the same way any other industry does in the business world.

The natural concern is that the best teams would consistently hoard all the talent. But while fans in Cleveland and Charlotte would suffer (at least initially), it’s hard to argue that the NBA as a whole wouldn’t be much better for it. After all, should McLemore, Smart, or Otto Porter of Georgetown — three likely lottery picks — end up on contenders like the Heat, Spurs, or Thunder next year instead of the Bobcats or Cavs, the battles between the league’s heavyweights would become even more exciting.

The first solution would make the stakes of the Finals even higher. Imagine how much more fun it would have been to watch the Mavs upset the Heat in 2011 to not only win the championship, but earn the right to draft Kyrie Irving. Dirk Nowitzki would have played out his remaining years with one of the league’s most dynamic point guards rather than veteran journeyman Mike James.

With the way the new CBA is structured, it would be harder than most assume for a team like Miami or Oklahoma City to stock rosters full of talent. Eventually teams have to pay guys. Stud rookies on cheap contracts quickly become veterans eligible for max extensions, creating the need for deals like the one that sent James Harden to the Houston Rockets at the beginning of this season. This trickle-down effect, aided by the fact that players are human beings with egos who may long to be “the guy,” seems to ensure that teams like Charlotte and Cleveland still get a crack at elite talent if their front offices manage their existing resources correctly.

And that is the whole reason behind necessitating a change. For too long, bad GMs (and bad owners who influence their decision-making), have enjoyed lengthy tenures behind the facade of “rebuilding through the draft.” As Abbott wrote last March, that is normally just a smokescreen hiding a trail of poor decision-making.

But the teams out there that are not winning year after year … in most cases they’re not just “rebuilding through the lottery.” They’re also making one dreadful decision after another. That means with the draft, coaching hires, trades and everything else. I assure you GMs in many NBA markets really don’t want you to examine the record, because it won’t be kind to them. They’re already preparing their stories about how everybody has bad luck.

By taking away a reverse-order-of-finish draft with a lottery, it takes the crutch away from bad front offices. No longer is it about being bad and then lucking out by landing a future All-Star. It becomes about maximizing every asset using the factors teams can control: scouting, cap management, player development, and overall infrastructure.

It’s a Darwinian approach to fixing an issue that takes away from the integrity of the game. Instead of allowing a team’s fan base to be duped by the false hope of a quick turnaround through the draft, it puts an emphasis on the slow process of building up assets to maintain success.

A common misperception we have as fans is to view players as individuals with traits that remain independent of environment. Really, the importance of circumstance for a given player falls along a roughly defined bell curve. The vast majority of young players entering the league are heavily influenced by who (teammates and coaches) and what (city, organizational support) are around them their first few seasons. They are bookended by two smaller groups — the sad sacks whose attitude and game would have them fail anywhere (think Darko Milicic) and the culture-changers (Tim Duncan, Kevin Garnett, Chris Paul) who can alter the path of the franchise that acquires them rather than the other way around.

In Abbott’s “Does Tanking Even Work?” column, he references research done by Devin Dignam that works in tandem with this notion. Dignam looked back at all data from the past 27 years of the draft lottery (his piece was originally published in April 2012) and came up with some staggering results:

After four years — the amount of time on rookie scale contracts — about 31% of the teams with top three picks hadn’t made the playoffs even once. Almost 26% of these teams’ best showing was only the first round. And a further 22% of teams topped out in the second round. Only 17% of teams have managed to do better than the second round, with only two teams managing to win an NBA championship within four years of drafting their top three pick. Who were these two teams? In 1999, San Antonio won a championship in Tim Duncan’s second season. And in 2004, the Detroit Pistons won a championship in Darko Milicic’s rookie season. But Milicic only played in 159 regular season minutes that year. So we are being generous when we say that two teams have managed to win a championship within four years of landing a lottery pick.

The Spurs lucked out in nabbing Tim Duncan in 1997, but they maintained their success by continually mining gems from the bargain bin or latter half of the draft. In watching Kawhi Leonard, Danny Green, and Tiago Splitter team up last week to dismantle the Thunder on Monday night, it’s not a stretch to envision the Spurs continuing to win 50 games a year. They draft the right players for the right coach and have a system in place to make them better.

Leonard is a great example of this. Acquired in a trade for George Hill after being drafted 15th overall by the Pacers in 2011, the young forward was long and athletic but wasn’t overly skilled and possessed a middling shooting stroke. Most projected him to be just a high-energy defensive stopper.

In his first season, Leonard filled that role while also shooting 37.6 percent from beyond the arc — a higher mark than he had at San Diego State despite the closer 3-point line. Against the Thunder two days ago, Leonard scored out of pick-and-rolls and created space to drain jumpers that beat the shot clock. A player projected to be a specialist went to the Spurs and now flashes All-Star potential. This is not a coincidence.

Teams that poorly evaluate or gamble on tainted talent more often than not will fail to sniff the playoffs despite being annual participants in the lottery. Instead of drafting and creating a great atmosphere by asking how they can help players succeed, they seemingly just draft and hope because that’s what the current structure allows them to do. An atmosphere where losing is acceptable — and pretty much required — stunts progress, both of the league and of its players. For the sake of both, it’s time to ask for radical change.

Filed Under: Brett Koremenos, Charlotte Bobcats, Cleveland Cavaliers, NBA, NBA Draft, Orlando Magic, San Antonio Spurs