The Modern NBA is tricky. A franchise such as the Warriors or Nets needs to have enough star power. That is the only way a team can remain in contention. Therefore, franchisees are always focused on securing the long-term commitment of their star player as well as looking for other stars to fit in.
There is a limit on how much an NBA franchise may spend to create its roster. Additionally, crossing a particular limit makes the franchise accountable to pay the “luxury tax”. The Brooklyn Nets spent about 97 million dollars above the luxury tax limit this season. Golden State spent a whopping 170 million dollars above the limit. this adds up to around 268 million dollars Therefore, both teams have spent more than the rest of the NBA which got a combined 448 million from all 30 teams.
The luxury tax is a system designed by the NBA to even the playing field between all tiers of franchises. It involves the organization spending more than expected to keep a star-studded roster. If there was no luxury tax, teams would be free to sign a roster full of stars as long as they can afford it.
The Warriors are worth every penny of the luxury tax
Only bottom-tier teams with young and unpolished talent must look to avoid paying the luxury tax. This is because any major powerhouse or franchise knows that this is a small price to pay. The alternative would be having your stars leave for other teams that choose to pay them better.
The Golden State Warriors clearly had no plans to let this happen. They have drafted the majority of their championship roster and raised them well. It would be foolishness beyond reproach to cut Klay Thompson‘s or Draymond Green‘s salaries and risk letting them leave the team.
The Warriors are well into the luxury tax. However, it has clearly been worth it. By paying everyone big bucks, they have assured themselves a deep roster and a trip to the NBA Finals. They would be the perfect example of why big risks mean big rewards.
The Nets just made some unfortunate business calls
The Brooklyn Nets have had disappointing season after season. They seem to be moving further away from an NBA title as opposed to closing in on one. A huge reason for this is the frequent signings and tradings that they have done over the past few seasons.
It is simply not possible to have Kevin Durant, Kyrie Irving, James Harden, Blake Griffin, and other stars on the roster and not pay the luxury tax. However, the sad facts are that they simply have nothing to show for this financial sacrifice.
A huge factor for this could be James Harden demanding a trade, or Kyrie always being compromised or injured in some form. The Nets clearly didn’t take these variables into consideration when going sky-high over the luxury tax. Therefore, they have much less, almost nothing, to show for it compared to the Warriors.
An avid fan would know that the luxury tax in the NBA, in present times, begins at around 136 million dollars. This means that if a team spends more than this amount per year to keep their roster, they are subject to paying the tax. It is calculated by “every dollar over the cap“. Simply put, the cases where teams exceed the cap by more than 20 million will have to pay 3.75$ for every dollar over the cap. Almost thrice as much!. This is the price that owners pay to build a championship-level team.