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Don’t take my word for it: NPR money people say LeBron underpaid

Jan 28, 2013, 5:05 PM EDT

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Like a lot of news programs, National Public Radio has taken to trying to explain the complexities of the economy to people like me with a new segment — Planet Money — that breaks it all down into layman’s terms.

Their piece on Friday — how LeBron James is underpaid at $17.5 million, but that is good for the league overall.

“He’s getting hosed,” says Kevin Grier, an economist from the University of Oklahoma…

Now all (the rules of the salary cap and maximum salaries) are all laid out in the collective bargaining agreement between the owners and the players. Why would the players want this system? Because most players are not LeBron James.

“The union votes on the contract by majority rule,” Grier says. “The guy in the middle is the crucial voter.”

The salary cap means that some of the money that would otherwise go to James goes to the guy in the middle.

He then goes on to talk about how the salary cap and luxury tax make it possible for Oklahoma City or even a medium market like Miami to have a title contender. Otherwise, the Lakers and Knicks could just go Yankees on the league and guy everyone good up. Even with the cap there are times it feels like they do (because they are willing to pay a tax others are not).

It should be noted LeBron with endorsements, LeBron is making $57.6 million this year, according to Forbes.

This is a lot of stuff we talked about during the lockout — if you really wanted to kill off “super teams” you would remove the max salary but leave the cap and tax in pace. Someone like LeBron would draw $40 million a year — not just because what he does on the court but because what he means for ticket sales, sponsorships in the arena, regional television revenue and more. At that price you couldn’t pair superstars.

Of course, is that what fans really want? Some say yes but ratings say no — we watch the super teams.

But I don’t think you’ll see a dramatic change in the salary structure in the NBA in the near future. As the economy picks up and revenue starts increasing (as it is this year) I think there will be a balance and a desire on both the part of the owners and the players to not go through another lockout. At least I hope they look at hockey and think so.

  1. rajbais - Jan 28, 2013 at 5:23 PM

    A salary cap can do that, but the bottom roster guys take a ton of LeBron’s maximum earning power.

    A Salary-cap is good just so that there is competitive balance between upper and lower market teams, But so many payrolls are improperly constructed To the point where the owners blame the players when the owners are not forced to give the players the contracts that were likely overvalued.

  2. someidiotfromouthereintheprojects - Jan 28, 2013 at 5:23 PM

    that npr story was awesome, i’m glad pbt referenced it, for all the b-ball fans that don’t listen to npr.

  3. phaden27 - Jan 28, 2013 at 5:38 PM

    The guy who took less money to play on a better team is underpaid?
    I’m sure TMobile and the rest of his endorsements are making sure he does pretty well. 😛

  4. rickyspanish - Jan 28, 2013 at 5:54 PM

    Why do you people care about other people’s money so much?

    • skids003 - Jan 29, 2013 at 9:46 AM

      They’re liberals, and they want their fair share.

      • badintent - Jan 31, 2013 at 7:54 PM

        Damn right ! And most have no clue that NPR is a left wing scam , sham and shrill for the radical left of DC. But what puzzles me is why an beancounter in OC would have anytime to do this , given that he is up to his eyes in oil profits in the frackland that is Oklahoma. Next time, get a Wall Street Fobes Mag guy to do this work, eh ?

  5. somekat - Jan 28, 2013 at 5:58 PM

    By their logic, since I work in IT, I should get a large percentage of the entire 1 billion my company brought in last year. After all, without me running their computers, the entire business would of collapsed

    • raidmagic - Jan 28, 2013 at 6:11 PM

      That depends, is anyone lining up to pay anywhere from $10 to $300 for a ticket to come watch what you do? I didn’t think so….

    • deadeyedesign23 - Jan 29, 2013 at 8:49 AM

      Jesus. Lebron left a company and there was a quantifiable fall off in the value of the franchise which was used to determine what he would actually be worth annually on an open market. If you left your job they’d find some other shmuck do it just as well as you do.

    • zeedoubleyou - Jan 29, 2013 at 9:54 AM

      This argument slays me every time I hear/read it.

      If you left your company, would there be no one in the world who could do your job as well as you do? Not a chance.

      Was your presence in the IT department directly responsible for your company’s rise to $1 billion in annual revenue? Nope.

  6. eventhorizon04 - Jan 28, 2013 at 6:24 PM

    Yeah, I mean – the NBA wouldn’t feel the need to spell out the maximum money a player could get if they didn’t think a player could get more than that on the free agency market.

    Or put another way – if cars weren’t capable of driving over 55 miles per hour, the government wouldn’t feel the need to set a 55 miles per hour speed limit.

    In 2014, if the Lakers could spend $40 million per year to bring LeBron in to play with Dwight Howard, they would. They’re paying $30 million per year for Kobe, who by his own admission, is nearing retirement (Kobe recently Tweeted that 5 years from now, he pictures himself doing marketing and managing the Kobe brand).

    The only thing stopping Lakers’ ownership from doing that in 2014 (besides perhaps LeBron deciding he’d rather stay in Miami or go to Cleveland) are the league rules preventing contracts that high. Otherwise, you bet he’d get that much.

    Therefore, LeBron James is underpaid – he’s getting paid less than what some people want to pay him.

    Or put another way, if your boss says he wants to pay you a salary of $1 million per year job, but a company rule says he can only give you a $500,000 per year job, you’re “underpaid” too. Your boss wanted to give you $1 million, but can only give you $500,000, so you’re getting paid below what he values you.

  7. katra2logic - Jan 28, 2013 at 6:31 PM

    Everybody in sports is overpaid. Period.

    • paleihe - Jan 28, 2013 at 7:02 PM

      You’re doing a great job of not understanding the free enterprise system.

    • deadeyedesign23 - Jan 29, 2013 at 8:49 AM

      If overpaid=more money than you make then yes all athletes are overpaid.

  8. mrklutch1011 - Jan 28, 2013 at 7:54 PM

    Should’ve stayed in cleveland…. Last I heard you can make more if you don’t be a poser and go start an NBAAU team to win a championship. Where was this whiny tard punchin numbers when EVERYONE said a championship will expose his brand around the world opening him up to an endless amount of markets and revenue streams…. Hosed my arse

  9. 1972wasalongtimeago - Jan 28, 2013 at 8:08 PM

    VASTLY underpaid

  10. metalhead65 - Jan 28, 2013 at 11:32 PM

    nobody making that kind of money is underpaid. you forget the 100 million or so he gets from endorsements in addition to his b.b salary. so I shed no tears for james or any professional athlete.

    • deadeyedesign23 - Jan 29, 2013 at 8:51 AM

      If you’re worth 1 billion dollars and you make 999,999,999 you’re underpaid. If the reason you say otherwise is because it’s relative to what you make I’m pretty sure there are people living in huts all over the world thinking you and your middle class salary to perform menial tasks are over paid by tens of thousands of dollars.

  11. ocgunslinger - Jan 29, 2013 at 8:51 AM

    Dwight Howard should be paying attention and taking notes. LeBron has considerably changed his image and perception since leaving Cleveland.

    • skids003 - Jan 29, 2013 at 9:48 AM

      Yeah, instead of a complete ass he’s now only a half one.

      • badintent - Jan 31, 2013 at 7:58 PM

        quarter ass and melting fast……………………

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