Every free-agent market has its own order of operations. Sometimes the priorities are obvious, as when the whole basketball world waits for LeBron James. This year, however, there are no roadblocks. The best player available (Kawhi Leonard) remains unsigned, and yet all sorts of league business unfurled from the opening bell of free agency on Monday, largely centered on the most veteran stars on the market.
Clearly the Year of Chris Paul continues apace. After leading the Suns all the way to the NBA Finals, Paul re-upped with Phoenix on a four-year, $120 million deal that will take him through his 40th birthday. This is an unprecedented contract. It was also an offer the Suns were uniquely positioned to make due to the fine print of the NBA’s over-38 rule—a provision that all but prevents teams from giving this much money over this long a term to a player of Paul’s age, unless they just so happen to hold his Bird rights. Even without the ability to drive up his price with a competitive offer, Paul managed to apply enough pressure to score the third nine-digit contract of his career, which if paid out in full will bring his total NBA earnings to almost $420 million.
Investing in Paul, who was somehow both a stabilizer and a catalyst for the Suns last season, is inarguably good business. Yet the extent of that investment defies the entire history of NBA spending. Before Monday, the largest contract ever given to a point guard Paul’s age or older was the three-year, $28 million pact the Lakers made with Steve Nash in 2012. Paul set the new benchmark almost $100 million higher. There are many reasons to classify Paul’s deal as an aberration, and one particular reason maybe we shouldn’t: On the very same day, the 35-year-old Kyle Lowry agreed to a three-year, $90 million deal of his own.
Lowry is on his way to Miami in a sign-and-trade, with a new contract that will make him one of the league’s highest-paid players at his position—all at a time in his career when a point guard would otherwise expect to drop into a lower income bracket. The variable working in Lowry’s favor is similar to the one working in Paul’s: a franchise desperate to contend and short on options. Miami’s front office has done some incredible contortions around the salary cap and luxury tax over the years, but all the creative accounting in the world can’t change which players are available. There are only so many stars on the market, and fewer that would fit the Heat lineup, and fewer still that would make sense in Miami’s particular worldview. Lowry was a perfect match—so much so that the Heat already tried (and failed) to acquire him back at the trade deadline.
The urgency for a team like Miami to contend isn’t new, but the way that urgency is quantified seems to be. Any multiyear deal with Lowry is struck with the awareness that he will likely be a different player by the end of it—likely as clever and daring as ever, but less mobile, or more often injured, or diminished in all the ways point guards tend to be in their late 30s. There are countless versions of Lowry along his spectrum of decline that could still be useful to the Heat three seasons from now. Many of them would still be overpaid relative to their impact, and that’s fine; the end of these deals are often a tax, only now they’re paid out in increasingly large sums in measure with the NBA’s inflating contracts in general.
There’s an echo of this same idea at play in Utah, where the Jazz agreed to a three-year, $72.5 million deal to retain Mike Conley, another small guard, who will be 34 years old when the season starts. Generally speaking, veteran players get paid big money until they don’t. The immediacy of these moves, however, feels as though it’s pushing on that boundary, nudging the bell curve. The notion of paying a 6-foot or 6-foot-1 player big money for the later years is a distinctly new phenomenon.
The Heat amplified that commitment—and therefore their risk—by also agreeing to a four-year max extension for Jimmy Butler that will eventually pay him $51.6 million for his age-36 season. Then they tripled down by bringing in 36-year-old champion P.J. Tucker on a two-year deal, just for kicks. Butler wasn’t even a free agent, though he benefited from the same market dynamics that have led to a crush of longer-term contracts overall. In the hurried 2020 offseason, only 12 free agents were able to land deals lasting four years or more. The 2021 free-agent market pumped out 12 new contracts of that length on the first day alone—and that doesn’t even account for the extensions given to Butler, Trae Young, and Shai Gilgeous-Alexander.
It’s impossible to extricate that flush of spending from a league that’s more confident in its revenue streams now than it was a year ago. Signing away $120 million over four years is a different proposition in a league that has proved it can stage a season and, the Delta variant permitting, even fill arenas for the playoffs. Yet what we’re seeing now doesn’t just come in contrast with pandemic lows, but elements of NBA business as usual in the times that preceded it. Paul is set to be the highest-paid 40-year-old in NBA history. The Heat are buying a contending window with their disregard for what happens after it closes. Frankly, more teams should operate this way. There’s a time for prudence, but too many franchises hide behind it—passing up opportunities to improve their rosters only to claim, in defeat, that they did everything they could to win.
This is what doing what it takes really looks like. You can’t do everything you can to win from the safety of an actuarial table, optimizing for cap flexibility. You can do it only by taking the plunge.