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David Stern had the flu, the owners took his place, and the NBA lockout negotiations fell apart again on Thursday. Now, with the the lockout looking like it’s going to last much longer, let’s try to understand why this is happening.

Oct 21, 2011 – “It’s time to make a deal. If we don’t make it Tuesday, my gut is that we won’t be playing on Christmas Day.” That was David Stern seven days ago, handicapping our lockout future should a federal mediator George Cohen fail to broker a deal between the two sides.

Now, after Tuesday—and Wednesday, and Thursday—brought interminable meetings in a Manhattan hotel and gag orders from all involved, Cohen finally threw up his hands, with his office saying in a statement that “no useful purpose would be served by requesting the parties to continue the mediation process.”

So… Okay! Good to know the mediation was a complete waste of time.

But of course it was. Each time we’ve had some shred of hope that there’s progress being made, that hope’s been doused in gasoline, set on fire, packed into a t-shirt cannon, and rocketed into outer space. All in front of an army of NBA reporters who are slowly going insane.

Each time these talks fall apart, everyone that loves basketball gets a little more hopeless. For God’s sake, the head of the owners’ negotiating committee reportedly told the players, “You haven’t felt enough pain yet.”

Uhhhhh. Is this Goodfellas?

We’re supposed to believe the owners are ready to compromise?

That’s been the number one myth all along—that the owners are willing to partner with the players to find a solution that works for everyone. If you’re looking to understand the NBA lockout negotiations and why the two sides are farther apart than ever, we may as well start there. As for the other issues driving the NBA lockout, let’s break it down.

Myth No. 2: The 50/50 Split Is Fair. It may ultimately be what the players take, but splitting basketball revenue 50/50 amounts to NBA players cutting their earnings by 12 percent to help cover the NBA’s losses. On its own, that’s a pretty significant demand after the league enjoyed the most successful season since Michael Jordan left, but let’s not forget the owners are also demanding to overhaul A) contract length B) salary cap structure and C) guaranteed money.

In other words, if the players sacrifice a significant chunk of what they’ve been getting paid, the owners still want to overhaul the system that pays them. So no, this isn’t about partners working things out with a fair deal; it’s about employers telling employees to fall in line.

It only compounds the problem when Stern, Adam Silver and the NBA owners portray 50/50 as a “fair compromise” for everyone, with the pretty explicit implication being that players are greedy and unreasonable by rejecting it. This hardens everyone’s resentment and resolve when it’s time to negotiate, and if the NBA ends up missing the season, this little “50/50″ charade will be a big reason why.

Myth No. 3: The Players Need To Recognize It’s A Different Economic Climate. You mean like, the players need to realize that the old collective bargaining agreement won’t work anymore? They need to sacrifice some of the 57 percent of basketball revenue they’d been getting? Because they’ve done that already. Players have already offered to sacrifice 4.5 percentage points, or roughly $180 million. No, what needs to happen is that the owners need to realize that the struggling economy isn’t a public relations tool that allows billionaires to browbeat their employees into concessions. Speaking of which …

Myth No. 4: This Is About Billionaires Vs. Millionaires, Plain And Simple. Wrong. This is about millionaires who’ve already offered to sacrifice $180 million vs. billionaires holding out for more.

Myth No. 5: NBA Owners Are Losing Money. Uh-uh. Owners may be losing money in an immediate sense—in other words, not all of them profit off their teams each year—but the idea that the NBA’s immersed in some sort of profound fiscal crisis is beyond the pale.

Historically speaking, even as the league’s added more teams (and theoretically watered down the value of existing teams) the value of NBA franchises has grown exponentially over the course of several decades. In other words, the owners may be losing money in the short term, but as the league grows in the coming years, there’ll be ample opportunity for them to compensate for any losses when they sell the team. In that sense, owning an NBA team is a little bit like owning a very expensive stock. Owners pay a gargantuan premium to enter the market, but the silver lining is that over time, you’re guaranteed to make a profit on that premium if you hold onto the stock long enough. The thing is, NBA owners want that stock to make them money while they wait to sell it for even more money.

In any case, not to make this into a macroeconomics column, but any owner “losses” have to be weighted against the profits they stand to make by maintaining their investment over time. Possibly related: The most expensive franchise sale in NBA history happened last year.

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By Andrew Sharp – sbnation.com

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