The Warriors have come up in trade rumors for a number of veteran small forwards like Luol Deng, Rudy Gay, and Andre Iguodala. A lot of people believe that the Warrior front office has made upgrading the SF position a goal this off-season, in addition to adding big-man depth and a back-up point guard. With an immediate upgrade though the draft unlikely, it seems like the only way to upgrade our starting SF is by trading away the 7th pick.
The biggest risk with this move is betting on the success of the team in the 2012-2013 season. In most cases, only playoff teams benefit from trading draft picks for immediate help. Although many expect us to break into the post-season next year, it's far from a guarantee, with our two best players coming off serious ankle injuries and surgeries this season. Trading the 7th pick for any of these players, no matter the order you rank them (from best to worst) could come back to haunt the Warriors, should they not make the playoffs in either of the next couple seasons. All three players are expensive:
Gay - 3 years, $54M ($18M per year)
Iguodala - 2 years, $31M ($15.5 per year)
Deng - 2 years, $28M ($14M per year)
Each would cost us more than any other player on our roster over the next two or three seasons. With next year's salary cap expected to be between $60M and $61M, and the luxury tax beginning around $70M, taking on more salary could present a serious tax penalty, if not next season, then in the future given the league's new luxury tax rules. For those not familiar:
Teams pay $1 for every $1 their salary is above the luxury-tax threshold in 2011-12 and 2012-13. Starting in 2012-13, teams pay an incremental tax that increases with every $5 million above the tax threshold ($1.50, $1.75, $2.50, $3.25, etc.). Teams that are repeat offenders (paying tax at least four out of the past five seasons) have a tax that is higher still -- $1 more at each increment ($2.50, $2.75, $3.50, $4.25, etc.).
I'll tell you which teams don't benefit -- the perennial taxpayers, like the Lakers and Mavericks. When the league was unable to negotiate a hard cap, they settled for the next best thing -- a more punitive luxury tax that will make teams think twice before committing to a higher payroll. For example, the Lakers' tax bill in 2011 (when the tax was dollar-for-dollar) was about $19.9 million. Under the new system, being that far over the tax line would cost them $44.68 million. If they were a repeat offender (paying tax at least four of the previous five years) they would owe $64.58 million!
Trading for the cheapest of the 3 small forwards mentioned, Deng, still represents an increase in team salary next season. Since there's been serious talk of a deal that could net the Warriors Deng on Draft Night, we'll go ahead and use that proposed deal.
In that trade, the Warriors would send Andris Biedrins, Dorell Wright, and the 7th pick to the Bulls for Luol Deng and the 29th pick. The good news with this trade is that it only increases this coming seasons' cap total by a little more than $200k. Chump change to most NBA teams. Were this trade made, the Warriors would have about $57M in promised veteran (not including any signed draft picks or current free agents) contracts for next season. The biggest portion of this would be broken down in this manner:
Luol Deng - $13,326,700
Andrew Bogut - $13,150,000
David Lee - $12,744,000
Richard Jefferson - $10,164,000
Stephen Curry - $3,958,742
You can see a full list of the rest of the current Warrior players here. Take note that the green amount listed for Rush is actually a qualifying offer, or a contract amount the Warriors are required to offer Rush in order to retain his restricted free-agent status. It is not included in the rough $56-57M estimate. Neither is the red team option amount listed for Charles Jenkins. Though, that amount is again a very small difference. Assuming that the front office would still be looking to retain Rush after the acquisition of Deng, as well as use the full amount of the MLE on one or more other free agents, that likely raises the team salary to a minimum of $65M, and more likely a million or two more. Add in the contracts for rookies and veterans to fill out the roster, and it very likely the Warriors actually break the luxury tax in 2012-13.
That's not necessarily a bad thing, but I'm still unsure of the consequences of the Warriors crossing that line for the first time in a while. Is the new ownership prepared to take on that kind of responsibility? Admittedly, even if the tax threshold is crossed this coming season, the penalty would be minimal. It'd grow were the trade for either Iguodala or Gay instead of Deng, but at the most, it would be a couple million dollars. Not a small amount, but not a ridiculous amount to pay for better talent either. The real problem lies in the coming seasons.
All of the players salaries listed above will increase by a full million dollars, with Curry's expected to double or more. No significant salary would come off the books, and the Warriors team salary could balloon to around $80M. That's a 2nd consecutive season in the luxury tax, and a pretty significant tax penalty for just one season. It is just one season, how would the Warriors maintain the same level of success? This year's draft pick would be gone and next year's would still be owed to the Jazz. The 29th and 30th picks aren't likely to net us much in terms of starting-level talent. The Warriors might get one other good player out of either draft. It's hard to predict, of course, but doing better is unlikely. Where would the rest of our talent come from? Curry, Klay, and Lee aren't likely to get the job done. And I don't see Bogut or any of the 3 SFs accepting less money on their next contract. Not after two more years of success while they're still in their or just past their primes.
To maintain the same level of success, the front office would have to shell out just as much money as they had the previous two years. By that point, the Warriors would have become the perennial taxpayer the ESPN article warns about. Is the team really going to be worth that amount?
This is what worries me most. I have hopes for next season. I have hopes that our team is actually as talented as advertised and can remain healthy enough to make the playoffs. I think adding any of Rudy Gay, Andre Iguodala, or Luol Deng helps us get there. From a pure talent perspective, the Warriors win any trade where the 7th pick nets them one of these guys. Over the next two seasons, there's almost no doubt we're a better team with them than any draft pick we could make. But where does that get us? Two first round exits? A trip to the Conference Semi-Finals? Two more playoffs where our guys are watching from the couch because we couldn't stay healthy? I'm just not sure.
If I were sure that we'd see our guys competing in the first round of the playoffs (before upgrading SF), I make any of these trades without a 2nd thought. I think the increase from Wright or Jefferson to Gay, Iguodala, or Deng is enough to push us into the 2nd round. Without that certainty, I strongly consider keeping the pick since there are a few players, even at 7, I believe to have significant upside. Guys that could grow into players as good or better than those SFs. Certainly, if one of Bradley Beal, Michael Kidd-Gilchrist, Thomas Robinson, Harrison Barnes, or Andre Drummond falls to us, I heavily consider simply working with what we have. Like most people, I'm not as sold on the prospects after the top 6, but there are many that intrigue me.
I've said this before, but I do trust our front-office's scouting department. I think Larry Riley has shown an ability to find talent, and Jerry West is one of the greatest basketball minds on the planet. I'd really like to see what we can get in this draft. I won't be upset if we make a trade, but I do worry about the long-term consequences. It wasn't until writing this that I developed a preference either way. It's hard to say no to trades for players that I like, but I think I'd rather risk it with what we've got, and if it fails, at least we have some younger, high-potential players to fall back on. I don't know that the talent on this team to make any sort of impact in the playoffs. For that reason, I'd keep the draft pick and take the best player available, with a focus on long-term potential.
I know there are bound to be differing opinions depending on which player would be traded for, but I wanted to raise the issues that come with all of them. I think their differences, strengths, and weaknesses have been discussed quite a bit around here, so I tried to avoid the question for the most part. It's also important to note that all these trade options may not be legitimate. Even the potential for the Deng trade could fall through. But they are things that will probably be discussed more and more as we approach Thursday's draft. Maybe this can shed some light on the possible setbacks of making one of these moves.