The NBA’s Failed Reform

Last week, something interesting happened in the NBA in regards to the NBA draft lottery. The NBA as a whole has been facing criticism about the persistent ‘tanking problem’ where teams are losing on purpose to try to receive a better draft pick the next year. I talked about this in a blog last year, that teams have an incentive to lose as many games as they can if they are not going to make the playoffs, and that this strategy is actually the most rational strategy that they can take on. The main culprits of this strategy right now, are the 76ers and the Bucks, who both just really were bad last year, and put themselves in position for a high draft pick. It actually worked out that the Cavaliers, who had a much lower chance to win the Lottery than both of those teams, ended up with the first pick, while the Bucks ended up picking 2nd, and the 76ers, 3rd. This situation demonstrated how tanking doesn’t always work out perfectly as it comes with a certain degree of uncertainty. The NBA wanted to increase the uncertainty associated with tanking by evening out the probability to win the lottery between all of the teams that failed to make the playoffs. This would make it less likely for the worst teams to win the lottery than it was before, and more likely for teams who just missed the playoffs to win. There would still be a descending scale, but it would be less drastic than it is now.

Well, to pass this revision, which would have gone into effect immediately, the league needed 23 teams to vote in favor of this reform. It theoretically would have decreased the expected benefit from tanking, and created a more competitive league. This vote was predicted to pass very easily, but a last minute campaign against the reform, gained enough support to reject the reform.

Guess who spearheaded the reform (Hint: it is a team that was previously mentioned in this article). The 76ers, who are in the midst of an incredible losing marathon in pursuit of high draft picks, currently have an extremely young team, that will more than likely end up with the worst record in the league this year. If this reform had passed, their chances of receiving a high draft pick would have gone down, so naturally they did not want this to go through. They were able to wrangle up enough support from the small market teams who have to build through the draft, and other teams who are currently struggling, to reject the reform.

This rejection showed gave us a glimpse at the teams who are in favor of the current system. The teams who joined the 76ers were: San Antonio, Oklahoma City, Utah, New Orleans, Miami, Phoenix, Milwaukee, Washington, Atlanta, Charlotte, Detroit, and Chicago. 

There are some teams that I would not have expected to be on here, Chicago for example. But they are a large market team and are almost certain to be in the playoffs, and will not be in the lottery. The other teams are generally smaller market teams, or teams that are struggling, and expect to be on the lower end of the Lottery in the near future. From this list, it looks like smaller market teams generally want to have the option of tanking for draft picks, as it is often their best mechanism for rebuilding, as it is more difficult to attract free-agents to places like Milwaukee and Utah.

It is likely that the NBA will attempt another similar reform in the future. This time, I would guess that the reform would not go into action immediately. This caused some issues with teams who are currently engaged in trades where they are receiving draft picks in the future from another team. Having the reform go into effect immediately created some ulterior motives for teams that are expecting draft picks via trade in the future. If the NBA tries again, and has the reform set in after all current trades run off, then I think they would have a better chance of passing it, which in the end, would lead to a better overall product.

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