The NRL salary cap is again in the news this week with the entire board of the Parramatta Eels being sacked in an unprecedented move by the state government.
The position we find ourselves in with this saga could have been easily prevented. Don’t have the restrictive salary cap in the first place.
The salary cap in itself lives in a bubble tolerated only in professional sport. Nowhere in any other professional business situation would anyone reading this article accept a cap on their earnings to ensure another company could also perform well, or another employee be paid the same.
A noble and Utopian pursuit of so-called fairness is well-meaning, no doubt, but it doesn’t wash when put to the test of these praising wage restrictions on players. Heads of sports organisations regularly tout the benefits to the fans and the league and point to the lack of dominance of a wealthy set of teams to be of great importance to the survival of sports leagues.
One thing always springs to mind when I hear these arguments. How many of these executives would embrace a cap on their earnings? How many of these people implementing a restriction of wages would accept having to uproot their life to move to another city because a wage restriction didn’t allow them to stay? How many would accept a short career, sometimes only ten years long depending on how brutal the sport is, in which to set themselves up for the rest of their lives happily accept a earnings cap?
The only ones that appear to win from this is a marketing team from the league in which the salary cap is used and the team owners who are able to pay less to top talent while not dropping the prices of seats or merchandise.
Often heard arguments regarding wages follow along the same predictable narrative of “these players are spoilt millionaires,” and “they should be paid less,” or “they should get a real job.”
This speaks often to the naivete and ignorance of those making the statements. Why sneer at these men and women who have performed at the top level? The dedication, the blood, sweat and tears, put in is not something most people are willing to do. So I would argue they should be justifiably rewarded as such.
Athletes alone are responsible for massive TV deals, sponsorship, fan attendance, and back page articles. None of this would exist if the players who have provided many billions of dollars by proxy to governments, television companies and equipment manufacturers. If anyone in any business situation provides to such a large audience no one would deny them their just rewards.
So why are athletes treated with such disdain?
Like rent control or laws that put a ceiling on the price that consumers must pay, sports watchers say salary caps create an artificially low market price for professional athletes compared to the revenue product they provide. In other words, salaries could, in fact, be a lot higher, given the ways individual players contribute to their teams and the intangible benefits they bring to their respective geographic areas. This cannot be ignored.
Let’s look at American sports. In the past 30 years, 19 different teams have won baseball’s World Series. In comparison, only 14 different teams have won the NFL’s Super Bowl, 13 have won the NHL Stanley Cup and only eight have won the NBA championship in that same time frame. Major League Baseball is the only league that does not implement a cap.
As the recent move of NBA superstar Kevin Durant to the Golden State Warriors proves, an unfair advantage of sorts has still occurred despite the salary cap being in place in the NBA.
While I acknowledge that the implementation of a salary cap was designed to increase the competitiveness in sporting leagues, has it done so at the sake of a dynasty? Shouldn’t teams be rewarded for showing their respective league how to make a successful franchise?
The glory of a Leicester City win in this year’s Premier League or the brilliance of a ‘moneyball’ structure with the Oakland A’s to me would have a permanent asterisk against it had they implemented the salary cap instead of allowing the pure competitiveness and shrewd planing to get them to the top of the mountain.
At times life isn’t fair and winning through adversity is much more romantic, dramatic and worthwhile in this author’s eyes. The whole point of a cap has more to do with expansion. Should we look more into creating a competitive league rather than expansion into every part of the globe?
A promotion-relegation system coupled with a transfer market employed in European football is a much more enjoyable prospect, with the ability of a franchise to create players and build a solid financial structure to then become competitive team organically.
We must respect the players’ lives and careers and think of a better system in which to create competition, rather than be happy with a contrived game of pass the parcel.
bear54
Another article challenging the salary cap. The cap exists to save the clubs from themselves. Do you honestly think it's just the duds at Parra who would lose their heads spending millions to buy a competition? Given Canberra, Canterbury, New Zealand, Melbourne as well as Parramatta have been caught cheating the cap there's solid evidence the average league official just can' help themselves and will sell the farm in the hope of a competition victory. The result will be clubs going bankrupt and into administration. So what say the fans of Brisbane and Sydney who could probably afford a chequebook fuelled arms race. The problem is the NRL gets its cash for supplying a 16 team competition to the media buyers of Nine and Fox. Start losing teams because former players with zero business sense run their clubs into the poor house and the NRL gets paid less for us to sit at home and watch the "product". The concept of promotion and relegation is just ludicrous because the NRL really want to broadcast Brisbane V Wentworthville next Friday night?
jamesb
Guest
Sounds like the luxury tax is not a bad idea. Like any sport, the NRL also wants to have big name players. We keep hearing how the salary cap spreads the playing talent across 16 clubs. In some ways its a myth because many players are squeezed out from the NRL. You can probably name two or three decent teams of ex NRL players who are plying their trade elsewhere. If you put all of those players back in the NRL, you would have a very high standard competition. Judging by some of the comments, the NRL should look into the use of the luxury tax. And I agree with the article.
Niall
Guest
Where did i say uncle Nick cheats the cap? I said if he wants to spend more then let him. How would the honest toilers wage go down? Clubs would go broke because they tried to spend money they don't have. That is the clubs' problem.
Cugel
Roar Rookie
Lose or go broke would be the outcome for most clubs.
Baracuda
Guest
The NRL is currently looking to implement a cap on football department spending...
Chui
Guest
The salary cap isn't in the news this week. Parramatta are. There are more things going on here than a salary cap. If you think the rest of the world outside this bubble of the NRL is a true free market, think again. What do you think anti-competitive laws are for? Aren't they to stop monopolies. Wouldn't an executive stand to earn more working at a monopoly? They can't because in most cases monopolies are prevented. By law
matth
Guest
This would be great ... of course I'm a Broncos supporter, so I could look forward to a guaranteed top 4 finish every year. Winning the comp should not be about who has the deepest pockets. It should be, given a level playing field (in theory), who can manage their roster and maximise their effectiveness the best. Who can make the smartest decisions? Who can keep a harmonious team structure where players want to play and might even take a pay cut to do so? The other unknown is how much the wealthy teams benefit from out of cap advantages, such as having more funds to invest in training facilities, health and conditioning, even PR and media management, sponsorship, etc. If you don't think this makes a difference, go and compare how the Broncos operate compared to the Wests Tigers, the difference in resources is significant.
Wizard
Guest
Above you say Uncle Nick cheats the cap but here you go on to list the players the roosters have shed? This illustrates a fundamental problem with the cap... Fans, including yourself, do not understand it and the way it must be managed. It doesn't help when the media throws out arbitrary contract values significantly more expensive than the actual value of the contract and pedals it as fact. The elephant in the room is that getting rid of the salary cap would send clubs broke and would mean mid to lower tier first graders, honest toilets, would earn less. Comparing the NRL to US sports or the premier league is a futile as they have monumental financial resources, they aren't a village sport playe in 2 states of a country of 23mm and pockets of NZ/UK.
Doug Graves
Guest
Oh great another neo-liberal rant about just how terribly unfair it is to have a fair league..... The bottom-line is this, unless someone can come up with something that is demonstrably better, the Salary Cap stays. So far this has not happened. It's up to the proponents of a different system to demonstrate one and they haven't so far. If something better can be designed then I'd be all for implementing it but removing the cap and having a free for all is not an option.
Niall
Guest
Look at the Roosters 2013 premiership team. Losses Tuivasa Sheck (a player they developed) Jennings (goes to salary cap cheaters) Maloney (bad decision on roosters part) SBW (Politis would have given him a blank cheque if allowed) They lost the best young fullback in the game (yeah better than Tedesco, Moylan etc) One of the best left centres in the game and one of the most marketable players in the game. Souths should have been able to build on 2014. But instead they've got a handful of elite players surrounded by incredibly average players in a squad of 25.
peeeko
Guest
How many of these executives would embrace a cap on their earnings? you realize the NRL gives the clubs most of them a large chunk of their money so they can place measures on controlling it. the maximum salary within a cap is what keeps NBA with so few winners. It means the top players get less than they deserve and you can squeeze more into a team. the personality of NBA players also means they want to play for the big city teams. as for Oakland and their moneyball - they never won anything. and for Leicester city - a massive one off 5000/1
Dave
Guest
Actually I like Niall's suggestion. The problem with removing the salary cap altogether is that it can often result in all-too-predictable sporting leagues such as the EPL which (granted, the most recent season aside) ends with the same teams in more or less the same position every year. Means that billionaire businessmen can almost 'buy' the league. Leicester City may have won the title by using shrewd strategies, but the likes of Chelsea and Man City wouldn't be where they are now if there was a salary-cap in place and they weren't able to spend an unlimited amount on players and their wages. A 'luxury tax' which has been mentioned here sounds to me, like a good compromise between the 2 extremes. I would imagine loosening the salary cap would definitely improve the quality of talent playing in the domestic league and in turn - increase revenue from media, merchandise and sponsorship deals.
Baracuda
Guest
The NRL should keep the salary cap for the future but a luxury tax would do the trick. Australian sports have a credited history of implementing salary caps to maintain competitive balance. However, a 'soft cap' would allow certain clubs to flex their muscle and have a squad of players worth more than a determined threshold. The excess funds are than paid to hq and distributed amoung the other clubs. The cap has to be altered, as it essentially punishes success (no team has gone back to back in NRL era) and creates a mentality of "letting everyone have a go'', pathetic in professional sports. Should we put a cap on Queensland?
Jara W
Guest
"A noble and Utopian pursuit of so-called fairness." Great summary. Few people recognise the murky differences between fairness and equality.
Niall
Guest
Its either get rid of it or totally change the way it is operated. If the cap is set at say 8m per year, but uncle Nick or the Parramatta geniuses want to spend more than that then let them. For every dollar they go over the cap they must pay a certain percentage of that into a pot that can be redistributed to other clubs and areas of the game. The Americans call it a luxury tax. Is the salary cap in its current form good or bad for the game? Forcing players like Koroibete and Folau out of the game because they're club couldn't match the offers they received. The same can be said for countless other players. That can't be good. If a club goes out and signs a load of Kangaroo, Kiwi and England internationals and supplements that by signing a Wallaby, an All Black and a Springbok which turns into a super team then how is that bad for the game? The argument would be competitive balance but is dragging the best and most ambitious clubs back towards some of these basket case operations (the system we are currently using but is obviously failing) a better option? I don't think it is.