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Thread: Paul George gets MAX ... is he the next Rudy?

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    Super Moderator Joey's Avatar
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    Default Paul George gets MAX ... is he the next Rudy?

    The Indiana Pacers have signed young star forward Paul George to a five-year maximum contract extension through the 2018-19 season, sources told ESPN.com on Tuesday.

    The Pacers are expected to announce the deal Wednesday.

    Contract terms will not be finalized until the extension kicks in next year, but George is expected to be guaranteed about $80 million. Under terms of the collective bargaining agreement, George can increase the value of the contract to more than $90 million if he makes an All-NBA team or wins an MVP award after this upcoming season.

    Locking up George to a long-term extension was a priority before training camp for the Pacers. He won the 2012-13 Most Improved Player Award (after earning his first All-Star berth), averaging 17.4 points, 7.6 rebounds and 4.1 assists. He was also named to the league's all-defensive team.

    George is the second player from the 2010 draft class to sign a maximum extension, joining the Washington Wizards' John Wall.

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    I don't know about this ... George is good.. but giving a MAX contract to a 23 year old ...
    And this contract is actually worth $7M more than Rudy's was.

    What do you guys think? Is Paul George worth $18M a year?
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    He won't get 18 mil a year unless he makes another All-NBA team next year. And if he does make an All-NBA team, then that kind of answers the question, he would easily be worth the money in that case. He'd be a top 6 forward 2 years in a row. Which would be special considering how stacked the forward positions are right now in the NBA. Bosh has only made an All-NBA team once so far. So, yeah.

    If he doesn't make All-NBA next year, then he's making 80/5, with starting salary at around 14.5 mil, average salary at 16 mil. Which isn't a major risk considering how young he is and how good he was this year. Besides, the cap / tax will keep increasing every year from now on, which will make it easier on the Pacers.

    I think it's a very easy choice for them. Little risk. He might get injured of course, but that goes for every player.

    I'm just a bit surprised that they didn't manage to negotiate it down a little. Not because it's a bad deal, but because the Pacers were in command here. They are the only ones who can offer him 90 mil. Major props to George's agent, if these reports are correct. Still, if the choice was to give that extension or wait till the summer, they made the right choice IMO.

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    Quote BobLoblaw wrote: View Post
    He won't get 18 mil a year unless he makes another All-NBA team next year. And if he does make an All-NBA team, then that kind of answers the question, he would easily be worth the money in that case. He'd be a top 6 forward 2 years in a row. Which would be special considering how stacked the forward positions are right now in the NBA. Bosh has only made an All-NBA team once so far. So, yeah.

    If he doesn't make All-NBA next year, then he's making 80/5, with starting salary at around 14.5 mil, average salary at 16 mil. Which isn't a major risk considering how young he is and how good he was this year. Besides, the cap / tax will keep increasing every year from now on, which will make it easier on the Pacers.

    I think it's a very easy choice for them. Little risk. He might get injured of course, but that goes for every player.

    I'm just a bit surprised that they didn't manage to negotiate it down a little. Not because it's a bad deal, but because the Pacers were in command here. They are the only ones who can offer him 90 mil. Major props to George's agent, if these reports are correct. Still, if the choice was to give that extension or wait till the summer, they made the right choice IMO.
    This is exactly what I was thinking; just surprised they couldn't get him for less.
    Great points everywhere else though.

    However, to the second part of the bold, if they're going to offer him Max, why not just wait and see if he gets anywhere close to that on the open market? Max is still Max, right?

    But I guess the CBA was done the way it was so teams like the Pacers can keep players .. but it was also to protect small market teams from biting off more than they can chew .. I guess George had a slightly better season than Rudy did the year he got Maxed, so hopefully George can live up to it.
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    If they wait, then other teams will offer him a 3+1 (player option) 60 mil deal, so it's a risk. Should they lock him up for 5 years, or should they get a few mil/year discount and let him become a free agent in 3 years? Also, does George take it as disrespect, like Kevin Love did?

    I thought they'd manage to have him waive the Rose portion of the contract (take 80 mil, no All-NBA bonus). Or at least part of it. But if that wasn't possible, then I think they did the right thing to lock him up for 5 years.

    Btw, maybe he did waive part of the Rose bonus? Full Rose contract would be ~95 mil. We'll know these details soon enough, I guess.

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    Doesn't this contract go against trend? I guess the Pacers are confident with their team as is. I was expecting a 12-14 Mill contract. I guess it's not that much more, but this contract doesn't exactly give the Pacers much flexibility to add to a team that needed to improve their bench... They must really like the moves they made over the summer to fix that bench.

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    Quote Brandon wrote: View Post
    Now, all of this is part of the post-19th century idea that non-economists have that markets don't work, freedom doesn't work, and we need legislation to repair freedom's faults. So, to make sure that the teams that don't have the very best players can compete with the teams that do, the NBA has legislated a system heavy on rules and regulations. As a result, the team with the best player has been to 3 straight finals and won the past 2 championships.
    Of course it doesn't work, if they want to maximize profits, which they do.

    Re soccer example, soccer teams lose a bunch of money, btw.

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    The NBA is full of high stakes gamblers. The Pacers will do this because they feel strongly that someone else will make such an offer if they don't. Most guys who get max money turn out to be overpaid when compared to the absolutely best players in the league but owners can't help themselves. No doubt if the league was collectively more responsible with their spending the Pacers would not need to make such a play but I get what they're doing. It's 50/50 odds on if this pans out in my opinion.

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    Quote BobLoblaw wrote: View Post
    If they wait, then other teams will offer him a 3+1 (player option) 60 mil deal, so it's a risk. Should they lock him up for 5 years, or should they get a few mil/year discount and let him become a free agent in 3 years? Also, does George take it as disrespect, like Kevin Love did?

    I thought they'd manage to have him waive the Rose portion of the contract (take 80 mil, no All-NBA bonus). Or at least part of it. But if that wasn't possible, then I think they did the right thing to lock him up for 5 years.

    Btw, maybe he did waive part of the Rose bonus? Full Rose contract would be ~95 mil. We'll know these details soon enough, I guess.
    Thank you for pointing out why team's give max RFAs extensions before they hit FA. Very risky to let the player go to FA and get a 3+1 offer from the Lakers, and you match it. Then you've got a guy that clearly doesn't want to be in Indiana, wants to be in LA, and will likely go there in 3 years after his contract is up.

    Now they have George for 5 years to try and win a title with.

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    I'm a little surprised by this. I think George really emerged as a superstar this past season and playoffs. He started off a little slow but I'd say the last 55 games or so+playoffs he was probably a top 5 player. I think he's worth the max and I think Indiana can still remain contenders. They showed last season they were almost on par with Miami and now with some depth and experience, I'd say it's very reasonable they could win a title. He'll only get better and has superb defense and has shown he can lead an offence with some consistency. I think Indiana made a great choice locking him up.

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    Quote BobLoblaw wrote: View Post
    I'm just a bit surprised that they didn't manage to negotiate it down a little. Not because it's a bad deal, but because the Pacers were in command here. They are the only ones who can offer him 90 mil.
    I understand your angle, however, thats looking at it from a position of not knowing the relationship there. George might be a great team guy, good person, plays by the rules as it pertains to media, public appearances and community service. Indiana management might simply like him, appreciate he wants to be there, and were simply happy to reward him.

    It isn't always an adversarial negotiation. George is worth good money, and if he's a great dude for the organization, the benefit of giving him a bit more might just be that, a reward.

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    Quote Xixak wrote: View Post
    Thank you for pointing out why team's give max RFAs extensions before they hit FA. Very risky to let the player go to FA and get a 3+1 offer from the Lakers, and you match it. Then you've got a guy that clearly doesn't want to be in Indiana, wants to be in LA, and will likely go there in 3 years after his contract is up.

    Now they have George for 5 years to try and win a title with.
    Right, but I'm sure this was exactly the same mindset that Atlanta had when they signed Joe Johnson to Max, and Memphis with Rudy Gay. While I can appreciate and understand the desire to not lose a player for nothing, I believe the risk to be just as great going the other way, where you're stuck with a player, on the hook for everything.
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    I don't think he is the next Rudy Gay based on his current production.

    After just 3 years in the league he has shown to be much more efficient and versatile than Rudy.

    I'm not sure if he is worth MAX money but I'd rather pay him max than Rudy because he brings much more to the table.

    Plus he has just 3 years under his belt and is only 23. With Rudy - eyes or no eyes - I think you know what you are getting. There is a ceiling with George that has not yet been reached.
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    I think it's a gamble that Indiana had to take.. similar to Houston's gamble in trading for Harden and giving him a max contract. With Houston it looks like it paid off (they were able to get Howard because they already had Harden and Harden exceeded expectations in his first year in Houston).

    Memphis had to gamble on Gay to keep him.. a small market team has to do that. It didn't work out for them but they were able to trade him pretty easily. If Indiana wanted to flip George in 3-4 years I'm sure it would be doable.

    The problem with Indiana though is that they have two players on their roster getting the max. Those are two good players but not elite (well George isn't yet).. and that could backfire on Indiana. We'll see what happens.

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    It will be interesting to see how they solve their 2nd wing problem next year. Will they be able to afford Lance Stephenson? Will they have to pair George with a rookie? They could have a formidable team this year if Granger is healthy. But if they miss this chance to win, they might not have another one quite as good for a long time.

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    Apparently he did take a paycut (compared to the full Rose max), but they also gave him a player option. Yuck. I wonder how big is the paycut.

    Mark Montieth ‏@MarkMontieth 4h

    @TimDonahue8p9s @PacersScribe He said he got a max deal, but not the "ultimate" number he could have gotten.


    Mark Montieth ‏@MarkMontieth 4h

    Fifth year of Paul George deal is a player option, so he can leave after four if he wants. "I doubt that will be the case," he said.

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    Quote Craig wrote: View Post
    I understand your angle, however, thats looking at it from a position of not knowing the relationship there. George might be a great team guy, good person, plays by the rules as it pertains to media, public appearances and community service. Indiana management might simply like him, appreciate he wants to be there, and were simply happy to reward him.

    It isn't always an adversarial negotiation. George is worth good money, and if he's a great dude for the organization, the benefit of giving him a bit more might just be that, a reward.
    Unfortunately paying people a "good guy" bonus is a terrible way to run a successful franchise.

    Quote joey_hesketh wrote: View Post
    Right, but I'm sure this was exactly the same mindset that Atlanta had when they signed Joe Johnson to Max, and Memphis with Rudy Gay. While I can appreciate and understand the desire to not lose a player for nothing, I believe the risk to be just as great going the other way, where you're stuck with a player, on the hook for everything.
    I agree there's a huge risk there, and that analysis is one of the things that separates good GM's from bad ones IMO.

    Quote Brandon wrote: View Post
    George isn't nearly as productive as the Lebronniac. Why are they getting the same salary?

    I thought about doing a post about how the CBA is screwing over teams that don't have the very best players. Here's the logic.

    George is a lot less productive than the Lebronniac, so to compete with Miami (or whatever team it is), Indiana has to get George a lot more help than the Lebronniac needs. Say for example, George needs 3 all-stars around him to compete on a level playing field with Lebron's team (3 all-stars Lebron's team can't adequately counter). But the problem is the CBA makes it just as possible for Lebron's team to bring in those 3 all-stars. Lebron's team can bring in as much help, or perhaps more help.

    If there were no restrictions on salary, no cap, no max deals, no luxury tax, then Lebron would be paid a lot more than George (Lebron's Marginal Revenue Product shows us that), so much that his team would be restricted by natural market forces in what it could do to make the team much better. Lebron would also be restricted in his choices by market forces. How many teams could afford him? My guess is, the Lakers, the Knicks, the Nets, and that's all. His salary would be at least 3 times what it's allowed to be in the current system. How many other players could his team afford to bring in? Certainly George's team could afford a lot more help. Maybe Indiana couldn't afford George, but what if teams were allowed to sell players like European soccer leagues do? Under the Current CBA only $3 million in cash can be traded in an entire season by any team. Maybe George would be sold for some astronomical sum to a team that is in direct competition with Lebron's team. And that would be a kind of market-based (as opposed to legislated) wealth redistribution.

    Now, all of this is part of the post-19th century idea that non-economists have that markets don't work, freedom doesn't work, and we need legislation to repair freedom's faults. So, to make sure that the teams that don't have the very best players can compete with the teams that do, the NBA has legislated a system heavy on rules and regulations. As a result, the team with the best player has been to 3 straight finals and won the past 2 championships.

    For more on how most untrained people are to the left of Marx on basic economics, see Bryan Caplan's book "The Myth of the Rational Voter: Why Democracies Choose Bad Policies". In that book, Caplan argues that politicians are just giving people what they want in terms of economics policy. Perhaps North American sports leagues are giving people what they want as well, in trying to legislate competitiveness and parity. It doesn't work, but people think it does, so it has a social benefit, even if it does the opposite of what it was designed to do.
    A few points I'd like to make about you post.

    Bold #1: Agreed, in this model it may be as easy as Lebron to get other all-stars on his team than Paul.

    Bold #2: Removing all luxury tax/salary cap/other restrictions doesn't limit Lebron's choices. In fact, it gives him more choices. He can sign with any team, they don't have to worry about whether they allowed to sign him (due to restrictions) they only worry about whether they are willing to pay him the amount he wants. You assume (and perhaps I'm projecting incorrectly) that the number one concern for Lebron is money in the bank from an NBA salary. I would argue that although it is entirely possible that overall money in the bank is Lebron's overall goal, winning championships might be more important than money received in basketball salary, for two reasons. First, a pay cut in salary that would allow him to win a championship, might could actually net him more money in the long run because of an increase in value of his "brand". Second, even if taking a pay cut in his basketball salary means he is going to make less overall in the course of his career/life. It is also entirely possible (even from an economic "homo econimus"/rational man, perspective that he values winning a championship over the money. In this sense winning a championship comes at a cost of x amount of dollars in salary left on the table, a cost that he is entirely willing to pay. BUT let's say that he goes where the money is, in a completely free market NBA (which does not and cannot exist because you and I can't just start up an NBA team [even if we had unlimited funds]) it is no less likely that Lebron ends up with 3 other superstars than our current model. Pokorhov basically just gave the finger to the salary tax restrictions (something that I personally don't think will be something he does for more than 3-5 years, and something no other owner we'll ever do again). I failed to see where your argument of a completely "free" market in the NBA benefitted small market teams. Unless it somehow involved even more radical changes that happen in soccer, if that's the case you should expand on HOW changing to a free market and adopting soccer policies will result in making small market teams more successful, because I am completely missing something.

    Fourth bold: I think this is a very simplistic sentence. There are a LOT of economists including ADAM SMITH who pointed out ways that markets, left to their own devices would not work. ALSO there are plenty of instances of gov'ts using the rhetoric of "free markets" to reinforce a power hierarchy that runs contrary to an actual free market. For example, "The North"'s double standard of calling for free trade and the removal of subsidies in "The South", but then HEAVILY subsidizing their own local agriculture. I'm not saying that they are right or wrong for doing it, because the conflation of economics and politics is extremely complex, just that people often call for "free markets" when the result is good for them, but against "free markets" when it is bad for them. The idea that actively choosing to not have a free market is a choice that only a non-economist could make is inaccurate.

    To me the way you increase the ability of a small market team's ability to compete (from an economic perspective) is to remove caps on players salaries BUT inserting a HARD CAP. This forces teams to make hard decisions... is it better have 1 lebron and 4 steve novak's or the raptors current starting five? Small market teams would lose the ability to gain the transcendant star in their prime, but would have an advantage in being able to afford more borderline/perennial all-star types.

    From what I've read, the result of this would be a huge gap of haves or have nots. Salary cap on players essentially works out as a subsidy for the Landry Fields of the league. Even if owners were all for a completely free market, or a free market with a hard cap, in reality, the players union would have to be on board and that is tough sledding.

    Regardless of the system, players are always going to have the option to accept less money to increase their chances of getting a ring, and although we see this almost exclusive with aging veterans, there is nothing stopping a super-duper star/generational talent to take less money order for his team to have a better chance to win it all. I believe Lebron and Bosh took pay cuts to get into Miami, and there's nothing a free market can do about that, and very little a regulation market can do about it as well.

    Lasty, using Lebron as an example of how the current model doesn't work, may be accurate, and still misguided. Lebron is a once in a lifetime generational talent, an arguable and legitimate contender for GOAT. In terms of basket-ball players he is the outlier of outliers, and I would argue that the philosophy of utility would suggest that designing a model of compensation surrounding the vast majority of players as opposed to the once very 10-20 year generational talents is the more prudent approach. I'm not saying the model we have is that model, but the idea that Lebron is evidence of why the whole salary compensation structure should be thrown out the window, is not best rational.

    However, I am interested in hearing more expansion on your ideas of how to change NBA salaries to make small market teams more competitive.
    Last edited by ezz_bee; Thu Sep 26th, 2013 at 08:24 AM.
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    Quote Brandon wrote: View Post
    Alright, so let me take a crack at this. [/url]
    Thanks I appreciate it. I did a little bit of digging myself, and there is something to be said about regulations & parity, and a good case can be made that regulations reduce parity. That said, it is difficult to compare parity across leagues due to some of the unique features of each league. But yes, the argument has merit.

    Quote Brandon wrote: View Post
    I'd like to point out that the single greatest factor in any team's longterm success is a good owner/management team. This overrides all other considerations by an order of magnitude at least.
    Agree, agree, one thousand times agree!
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    Quote Matt52 wrote: View Post
    I don't think he is the next Rudy Gay based on his current production.

    After just 3 years in the league he has shown to be much more efficient and versatile than Rudy.

    I'm not sure if he is worth MAX money but I'd rather pay him max than Rudy because he brings much more to the table.

    Plus he has just 3 years under his belt and is only 23. With Rudy - eyes or no eyes - I think you know what you are getting. There is a ceiling with George that has not yet been reached.
    Versatile I'll give you. Better playmaker and also better defensively, can be used to guard 3 or sometimes 4 positions at a very high level.

    But efficiency? This is where some people just lose me with Paul George. Paul George had a TS% of 53 last year and averaged just 17.4 points per game on 14.9 shots.

    Rudy Gay had a TS% of 53% in his 3rd season on 15.4 shots, 55% in his 2nd season on 16.3 shots and 54% in his 4th season on 14.6 shots. I'm really not sure how George is more efficient than Gay was in the same stage of his career. If we're talking about him NOT being the next Rudy, efficiency definitely isn't the argument to use to prove that.

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    Quote BobLoblaw wrote: View Post
    Apparently he did take a paycut (compared to the full Rose max), but they also gave him a player option. Yuck. I wonder how big is the paycut.

    Mark Montieth ‏@MarkMontieth 4h

    @TimDonahue8p9s @PacersScribe He said he got a max deal, but not the "ultimate" number he could have gotten.


    Mark Montieth ‏@MarkMontieth 4h

    Fifth year of Paul George deal is a player option, so he can leave after four if he wants. "I doubt that will be the case," he said.
    I don't think George could have gotten the 'Rose Max'

    To be eligible, the player must be voted to start in two All-Star Games, or be named to an All-NBA Team twice (at any level), or be named MVP.
    unless Allstar + All NBA team count, but I don't think they do.

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    Quote Craiger wrote: View Post
    I don't think George could have gotten the 'Rose Max'



    unless Allstar + All NBA team count, but I don't think they do.
    It's conditional on him making All NBA next season.

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