Lakers Sign Kobe Bryant to Insane $48.5 Million Deal

Moneybox
A blog about business and economics.
Nov. 25 2013 12:29 PM

Lakers Sign Kobe Bryant to Insane $48.5 Million Deal

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Payday.

Photo by Kevin Lee/Getty Images

Every few years the National Basketball Association's owners gather collectively around the bargaining table and squeeze the players' union for givebacks and concessions. They drive a hard bargain, and they do it effectively. The owners are all rich guys, and the ferocity with which they screw their workforce makes you believe that being a rich guy involves some level of knowledge of how to get money.

And then as individuals they sign absurd agreements with players in which it seems like they've forgotten absolutely everything there is to know about negotiations. The latest example is the Los Angeles Lakers agreeing to pay Kobe Bryant $23.5 million next year and $25 million the year after that.

Have I mentioned that Kobe is 35? Or that he's currently not playing with a ruptured Achilles?

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Under this deal, Bryant will continue to be the highest paid player in the NBA. But at this point in his career, nobody thinks he's the best player in the NBA. Or the second-best. Or the third-best. Nor does anyone believe his place on the rankings list will rise over the next two years. But most egregiously of all, the thing you see with these deals is that the Lakers weren't bidding against anyone. Who else was going to sign Kobe to a two-year, $48 million contract in his late 30s?

Particularly odd is that precisely because the owners drive such a hard bargain with the players union, these kinds of bad contracts are a huge burden on a team. The Lakers are an economic juggernaut when they put a winning basketball team on the court and could easily afford to sentimentally overspend on an iconic player like Bryant. Except, that is, for the small matter of the salary cap and the luxury tax. Under the rules of the CBA, spending on Bryant crowds out spending on other players, and overpaying your iconic star only guarantees that there won't be money left over to build a team around him.

Matthew Yglesias is the executive editor of Vox and author of The Rent Is Too Damn High.

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