Just when you thought competitive balance in the NBA couldn’t be worse, the two-time defending champion Golden State Warriors swooped in Monday night, stole the thunder from LeBron James’s coronation in Los Angeles and signed DeMarcus Cousins (the best big man still available in free agency) for well below market value. Now, what already felt like the biggest foregone conclusion in sports — yet another Warriors championship — seems even less in doubt, somehow.
Doesn’t the NBA have an incredibly complex set of salary-cap rules to prevent this kind of thing from happening? In theory, yes. But from Kevin Durant’s discount contract to Klay Thompson’s talk1 of leaving millions on the table to remain with Golden State (not to mention the coups the team scored with veterans like David West), the Warriors have a long history of convincing stars to take less money for the sake of the dynasty. Cousins is just the latest example — and maybe the most shocking, since he signed for less than Aron Baynes, Marco Belinelli or Mario Hezonja will reportedly make next season.
The Warriors were able to sign Cousins as a free agent despite being tens of millions of dollars over the cap thanks to one of the NBA’s many salary-cap loopholes: in this case, the mid-level exception, or MLE. The MLE comes in several different varieties depending on how far past the cap a team’s payroll is, but the Warriors used the so-called taxpayer MLE to give Cousins his $5.3 million next season. It’s all legal, at least according to the letter of the salary cap rules. (As for the spirit? Not so much.)
The MLE was introduced in the NBA’s 1999 collective bargaining agreement as a way for capped-out contenders to still be able to add quality role players in support of their stars. Perhaps the best examples of the MLE working as originally intended are Shane Battier, who joined the Miami Heat in 2011 and played a vital role on two title squads, and Shaun Livingston, who signed with the Warriors before the first of their three championship runs over the next four years. Those are the kind of guys who are supposed to be available via the mid-level exception — solid players, not stars.
Cousins, however, is much, much better than your typical MLE pickup. Sure, there are questions about how he’ll fit on Golden State’s roster. But he also made the All-NBA second team as recently as 2016, and has generated 11.2 points of value over replacement player (VORP) — worth roughly 30 wins — over the previous three seasons according to Basketball-Reference.com, a tally that ranks tied for 16th best in basketball during that span.
Using archives of Basketball-Reference’s database of contracts going back to the 2012-13 season, I identified 175 instances of the MLE (or one of its variants, including the taxpayer/“mini” mid-level and the so-called “room exception”) being used to sign a player in recent years, prior to the summer of 2018. In that group, the average MLE signee had generated 1.2 VORP in the three seasons leading up to his contract — meaning Cousins was worth about 27 more wins (!) than the typical MLE-worthy player in the years before signing his new contract. No other MLE pickup in our data set was even remotely close to as valuable going into his new deal as Cousins was:
It’s probably clear by now just what a steal Cousins is at $5.3 million, but here’s one more note: Our CARMELO projection system, which spits out fair dollar values for every player’s production, thinks Cousins should be worth about $46.1 million next season. The NBA’s maximum salary rules preclude him from getting quite so much, of course, but he still figures to be worth far more than the mid-level pittance Golden State is doling out for his services.
From Cousins’s perspective, it does make some sense to cut this particular deal. He’s coming off a major injury last season, and he may not be available to the Warriors until after the 2018-19 season begins. The Pelicans’ unexpected surge without him during the playoffs reinforced old questions about Cousins’ ability to win, and the market for bigs was looking cash-poor anyway this summer, with the repercussions of 2016’s wild spending spree crashing down on teams’ cap and luxury-tax budgets. According to The Undefeated’s Marc J. Spears, Cousins didn’t receive any “significant” contract offers when free agency opened up. So instead, Cousins is gambling that he can fit in with the Warriors’ legendarily unselfish group for a year, produce solid numbers, ease back into health, win a ring — and in the process, ditch his longtime label as a me-first malcontent. If all goes according to plan, he’ll be due for a much bigger payday next summer than he could’ve gotten had he played the normal free-agent game this summer.
But even if things work out well for Cousins, it will have meant dealing another blow to whatever competitive balance is left in the league. For a brief while, things seemed to be taking a turn toward increased excitement: The Rockets spent a season suggesting the Warriors weren’t as unbeatable as they seem — coming within a Chris Paul injury and some historically cold shooting of possibly proving it in the playoffs — and James is just starting to form his own Western Conference challenger in LA. But then, Golden State strengthened their grip on the NBA with another deal that turned the salary cap’s rules against their own underlying purpose. The Warriors proved once again that the most exciting time on the pro basketball calendar is during the summer free-agent frenzy — when no games are played, but the fate of the following season is sealed.