The Hinkie Letters — Part II: “Demagogues and Lemmings”

Editor’s Note: Tuesday, we published Part I in this series of letters between Tom Pestak, myself, and reader/commenter, Mac on the state of team building in the NBA. The discussion veered off into some pretty unexpected territory: philosophy, generational tendencies, religion… The piece garnered some of the most thoughtful and interesting comments of any article at CtB in some time, and for that, I thank you all. So much has happened since we started these letters. First, the fateful day that Tom wrote us all and said, “Are we sure Mac isn’t Andrew Sharp in disguise?” Sharp’s piece in Grantland (a piece I’ve avoided reading), mirrored so much of what we were talking talking about that Tom and Mac wondered if he was reading our original comments section. The article actually pushed back the publication of this series. Additionally, the Sixers bought out Javale McGee for 100 cents on the dollar, and Sixers bloggers who more are blindly loyal than Saddam Hussein’s Information Minister praised the move. (I stole that Joke from Mac). Hoop76’s, Eric Goldwein wrote a piece that filled Mac with so much rage that he had to watch some old Lewis Black bits on youtube to remind himself “how unattractive it looks to be a goofy guy shaking with anger about some triviality.” Additionally, the first part of this series garnered so many great comments that I’ve even re-written some of my final passages to reference them. The effect may make my final response read more like an epilogue than an organic response, but you guys are too good to ignore.

From the desk of Mac:

Nate, I agree with you, if there is actually a process and it is a good one and it gets good results, nothing wrong with that. But too often these days calling something “a process” is a lot like declaring “it is what it is” . . . it is just a placeholder for having something useful to say.

I don’t like cognitive dissonance. As you note, Sam Hinkie was hired from an organization that got good without ever going bad, and the first thing he says as GM of the Sixers is declare “you can’t possibly get very good without being absolutely terrible for a while.” For god’s sake, that is not even anecdotally true as for yourself, Sam. Also, NBA teams have two goals, to make money and be good on the court. When Hinkie or media members say “the only point in having an NBA team is to win championships”, that sounds great but it’s simply not true. Ask the Papa John guy if the only point in having a pizza joint is to make the most delicious pizza. Ask Dan Gilbert if the only the point in having a mortgage company to lend to the richest people with the best credit. The making of a lot of money and having the highest quality do not have to coincide, in fact they often are at odds with each other. When smart people say things that they know aren’t true and double down in the lie by insisting their view is unassailably correct and nobody calls them on it, what can I say . . . it annoys me.

Speaking of Morey, you are absolutely right to remind us that the guy really knows how to mine talent (he doesn’t always know what he has, like when he had Lowry and Dragic and jettisoned them to sign Jeremy Lin, but anyway) wherever it exists, as Nate points out. The elephant in the room that Sixers fans and Hinkie boosters don’t like to talk about is . . . is Hinkie actually a good judge of talent? Wouldn’t a genius with his supposed priorities (long, athletic coachable types with raw games) drafted the Greek Freak over MCW? People always talk about how MCW was a good pick in a weak draft, but the famed non-genius Flip Saunders traded down and got Shabazz Muhammad at #14 and Gorgui Dieng at #23. Utah drafted Rudy Gobert at #27, so there were guys to take if you knew they were there. Embiid at #3 and Saric at #12 . . . total chalk picks, the autodraft setting would have picked those guys at those spots. What if he had drafted Jusuf Nurkic at #12? The Lakers are supposed to be sooo stupid, but they drafted Jordan Clarkson at #46, and he looks like a better prospect than pretty much anybody the Sixers have on their roster other than Embiid and Noel. I am sure people will say “hey, lots of people whiff on lots of picks”. Yes, but shouldn’t a self-proclaimed genius who works twice as hard as everyone else not make the same mistakes as everyone else?

http://www.businessinsider.com/sam-hinkie-explains-sixers-tanking-plan-2015-2

Then again, maybe not. Sam Hinkie conducted a 40-minute press conference after trading MCW (so secretive!) to basically take a victory lap in front of the press. One thing I thought was really interesting he said was this:

“We will not bat a thousand on every single draft pick. We also have them by the bushelful, in part, because of that. We don’t have any hubris that we will get them all right. We’re not certain that we have an enormous edge over anybody else. In some cases, we might not have an edge at all.”

If I were a Sixers fan I’d be like “what the hell?” Your pointy-headed plan is to draft superstars using high draft picks and the one motherhonking thing in the world you don’t have hubris about is your ability to draft well? That would seem like a problem to me. If Hinkie is basically just David Kahn with greater mastery over his long con, the Sixers fans are utterly screwed. Ask Kevin Love the utility of having a bushelful of high lottery picks if you’re drafting Wesley Johnson, Jonny Flynn and Derrick Williams and a European kid who isn’t coming over for two years with them. Or hey, Dion Waiters, Tristan Thompson and Anthony Bennett, although that worked out thanks to the process by which LeBron decided to come back to Cleveland, which a series of complicated steps such as (1) him deciding to do so and (2) texting the SI guy so they could work on the announcement letter.

—

Tom, you bring up Sam Hinkie, who I consider to be the natural and twisted evolution of the current “process over results” school of thought pervasive in the NBA. And the cynical cashing in by smart people by arbitraging their supposed expertise for producing results that benefits lots of people against their actual expertise for benefiting themselves financially, which everyone seems to agree is just good business these days.

What irritates me about Sam Hinkie is that not just that he has a process, or says building a good team is a process, or that his process is the best process and anyone who doesn’t agree is ignorant and shortsighted, or that he commissions 40,000 word manifestos on ESPN: The Magazine that lays out his purported process in minute detail while claiming to be a paranoid, secretive reclusive on par with Chuck McGill. OK, all that stuff irritates me but more fundamentally, my guff with Hinkie is that I think he is a cynical, self-serving huckster who thinks we’re all too dumb, gullible or in too deep to notice or care. Okay, that sounds harsh but bear with me, I am going somewhere with this.

What Sam Hinkie is selling to Sixers fans and certain media types allying with him under the guise of “analytics” is a lot like what the Koch Brothers are selling Tea Partiers and FOX News (or Hollywood limousine liberals to coastal progressives and MSNBC if you prefer, this point is not intended to be political) – the illusion of control, and a pretend peek inside the Wizard’s curtain. Whether paradise is Heaven or President Bush 3.0 or hoisting the Larry O’Brien trophy, it is always comforting to believe that someone who we agree with in is charge and has everything under control, even (especially?) when you have no reason to believe that is actually the case. However, unlike the Koch Brothers, whose smokescreen of populism is intended to mask they have all the power and control, Sam Hinkie’s smokescreen of elitism is intended to mask that he has very little of either. In truth, he can probably do his job as shrewdly or incompetently as he wants, it is the players who dictate who wins in the NBA. This sounds obvious, and I realize even Hinkie readily admits this. What he refuses to admit, however, is that there is no known process for obtaining superstars if you are not the Los Angeles Lakers. And their process, which is to throw money and starlets and VIP rooms at hot nightclubs and appearances on The Tonight Show at players, appears to have rapidly diminishing sway in a world in which you don’t have to be anywhere to be everywhere and private jets to Miami or Vegas are always only a limo ride away. Actually, I read that back and the Lakers probably will get another superstar soon.

What players do trumps all process, and why they do it tends to be for highly personal, even capricious reasons that cannot be reliably manipulated. The Cavs went from perennial title contenders to a nightly tragicomedy on par with anything penned by Tom Stoppard back to (hopefully) perennial title contenders over the past half-decade, solely because of where LeBron decided to take and retake his talents. People love to talk about how smart Daryl Morey was to “discover” James Harden – bull and crap. Whether you like the guy or not, James Harden discovered himself, dammit. Harden believed he was a superstar on par with Westbrook and Durant, not merely a fine supporting piece like Serge Ibaka, and his refusal to compromise his own vision of what his career should look like forced Sam Presti’s hand. Yes, Morey did a great job of assembling assets and creating a landing spot for James Harden, but he didn’t choose Harden, Harden chose the Rockets. Dwight Howard didn’t choose the Rockets because he was impressed by Morey’s ability to accumulate assets, he chose the Rockets because it had a 23-year superstar he liked personally and an amiable big-man friendly coach. In that sense and in that sense only, Charles Barkley was right in his crazy rant against analytics. The Rockets are a good team because of moves Daryl Morey made. But they will only be a consistently great team if superstar players buy what he is selling (and if this past offseason is any indication, it appears there is at least some growing sense of caveat emptor among the superstar classes with his “let’s all dispense with pretending we value irrational concepts like family or loyalty or feelings” approach to labor relations).

Even the triumph of “process over results”, the San Antonio Spurs, only has existed in its form because the players who control that team’s destiny, Tim Duncan, Tony Parker and Manu Ginobili, chose to play on a small market team for below market value for the last 15 years. Tim Duncan has made one hundred million dollars less than Kobe Bryant over his career. One hundred million dollars. For that matter, the Spurs’ Big Three combined have made about the same salary or less than Bryant during the past three seasons, which is coincidentally when their late dynastic renaissance occurred (yay process!) Was trading George Hill for Kawhi Leonard a shrewd move by R.C. Buford? Of course it was. But they could only afford to keep him under the current CBA because Duncan, Parker and Manu took money out of their own pockets to pay him. Yes, the Spurs are a great organization and they know how to evaluate players who fit their system. But they are multi-time champions because specific human beings made tough decisions that were not driven by economic self-interest, and there is no process for finding guys like that. And so it goes.

LeBron went to the Heat because he liked and trusted Dwyane Wade, Chris Bosh and respected Pat Riley. He came back to Cleveland because they completely lucked into three #1 lottery picks in four years and he has sentimental and personal business reasons for winning a title in Cleveland. No process, just results. LeBron taketh, and LeBron giveth away. That to me is the problem with people who over-emphasize process and yes, even analytics in a vacuum – NBA superstars are like the gods of Greek mythology. It doesn’t matter if they are right or wrong, reasonable or unreasonable, all you can hope is that they don’t take a liking to your kingdom and daughters and throw your sorry a** into the Sun. More information of course helps, but sometimes it’s just extra reading material while you are hurtling through space as a consequence of divine pique.

So whither our clever Mr. Hinkie and his insistence that he has a process for winning, and winning big, that takes luck and emotion largely out of the equation? He doesn’t and I have no doubt he knows it. The fundamental problem with the smartest plan to get filthy rich by winning the lottery is that it is a plan to get filthy rich by winning the lottery, even if slickly presented in bullet points on PowerPoint slides. But he also knows that there are fans who thirst for even the illusion of control (not just Sixers fans either, but NBA fans who generally dislike the idea that players can make or break their teams) and that the media will play along with him up to a point because win or lose, it’s good copy. And that’s fine I guess. I don’t care whether Philly is ever any good, and you want to run a legal pyramid scheme, cool you know? But don’t pretend to be Berkshire Hathaway when you’re Avon. I don’t ask a lot from smart rich people, only that they not insult my intelligence about how they intend to take my money. Or maybe that is the one thing you can’t ask for these days.

From Tom:

Mac, the Sixers weren’t exactly going places before Hinkie took over. Sam Hinkie didn’t kill the Sixers, Andrew Bynum did. After that franchise-slaying move, they grinded out 34 wins in the East. They owed 33 million dollars (That’s $33,000,000.00) to Bynum and Elton Brand. I don’t fault Hinkie for wanting to work with a clean slate, especially since the headliners of the previous slate were Evan Turner, Spencer Hawes (AMERICAN PATRIOT), and Swaggy P. I think he’s had a few whiffs so far, didn’t really get anything back for Evan Turner, but Jrue Holliday for Nerlens Noel AND a 1st round pick? That’s pretty good. And some of his second round selections or trades made with a second round pick have been excellent. Tony Wroten cost a 2nd round pick. Jerami Grant was a 2nd round pick. These guys have looked promising, and the 76ers are actually exceeding expectations this season. The Embiid injury further delayed the timetable for Hinkie. With Wiggins and Parker off the board, the decision to take Joel Embiid was not a bad one, as he clearly had the highest upside of the remaining candidates.

Also, the 76ers plan can not be constrained to “drafting superstars.” First of all, the draft is the ultimate crapshoot. You have the chance to sign a franchise-changing player for $5 million dollars a year, obtain his Bird rights, and lock him up for the foreseeable future. See: Durant, Kevin. You also have the chance to draft a “can’t miss” generational talent like Greg Oden, and watch his body decompose right before your eyes. It’s a stark contrast from signing a 7-year veteran or trading for a young guy entering his 3rd season. There is so much more certainty in those acquisitions. So faulting Hinkie for not optimizing every pick is holding him to an unattainable standard. Also, if Hinkie is the new poster-child for the “analytics movement” then it’s high time we set the record straight on what a GM is responsible for and what role “analytics” plays in an organization. First of all, a GM’s most important task is to master the collective bargaining agreement. This is a task better suited for a lawyer than a mathematician. Guys like Daryl Morey put themselves in a position to pull the trigger or bargain from a position of strength by maintaining flexibility and exploiting the CBA to their benefit. If the Cavs use Brendan Haywood’s contract next season to land a rotation player that will be a perfect example of exemplary General Management. Right now Hinkie is acting as the league’s bank, and he’s taking a small fee for every transaction. He’s not going to draft 47 players in the next two years, but he is going to have a seat at the table of almost every deal if he chooses. If “analytics” is permeating his organization it means he’s trying to measure as many things as he can about his organization and use data to drive decision making. This is far more encompassing than having player evaluation systems, which is where the discussion usually starts and ends. So, insinuating that the entire Hinkie plan is 1.) evaluate draft stock, 2.) win the lottery, 3.) draft superstars is selling him short.

Anyway, I agree with both of you that process != results and that an organization lets itself off the hook if the only standard it holds itself to is “the process” which is a self-fulfilling prophecy. At the same time, the NBA is so rife with examples of teams that made cap-killing moves to placate an impatient owner and were stuck without the ability to improve. There may not be a model for team-building, but there is certainly a model for team-killing. Mac, you think 76ers fans are saying “what the hell?”, how about Knicks fans? I’ll bet you they wish they had the roster, assets, and flexibility going forward that the 76ers have. There’s a limit to how long the 76ers can stay in this 2nd round draft hoarding cycle before I will lose my patience and start decrying their lack of respect for the game and all that. But I also believe that timing isn’t everything, it’s the ONLY thing. Hinkie is clearing going to time his ascent, most likely around Joel Embiid’s development. So if they aren’t filling out the roster and emptying the holster by Embiid’s third full season, then yeah, he will be a free-rider and his “process” a failed experiment.

Oh look, that’s Nate Smith stationary:

Gentlemen,

I was on board with giving Hinkie the benefit of the doubt until the trade deadline. But then the most inexplicable trade I’ve ever seen in my life happened. Hinkie traded K.J. McDaniel to his old buddy, Daryl Morey for Isaiah Canaan and a second round pick. Yes, K.J. will be a restricted free agent this off-season because he only signed a one-year deal with the Sixers after the draft, but if your whole goal is develop potential, improve, have a process, and slowly build a young core, and then you hit on a kid whose block rate for a wing is the best since Josh Smith (who was a wing when he came into the league), and then you trade him because you don’t want to pay him a little extra (when you literally have 10’s of millions in unused cap space — below the salary floor!), then I no longer can concede that your goal is to ascend. When you’re trading a potential second-round gem for a player too short to ever make a significant NBA impact and yet another second-rounder, you’re not even trying. It’s just all about the money. They’ve convinced Tom, their fans, maybe even Hinkie himself that they’re “timing their ascent.” There’s three options here, either I’m a moron or Hinkie’s a liar or a dupe.

The Sixers are planning for a future that is so far out it isn’t anything more than wishful thinking. I guess that’s what venture capitalists do, but Josh Harris isn’t a venture capitalist. He’s in private equity. From Forbes:

In private equity, you start with the numbers, and then you try to fit everything into the numbers.  In venture capital, you start with people, and then you try to figure out what numbers you can make.

In other words, private equity is usually about taking an existing company with existing products and existing cash flows, then restructuring that company to optimize its financial performance.

That’s what Mac and I are trying to get across here. The Sixers are only about making money. Any plan or process to win is just window dressing. They’re the private equity guys in a room full of venture capitalists, and the thought of them turning the NBA into a piranha pit scares the crap out of me. And Hinkie’s “process” has one giant gravity well sized flaw in it (and I’m not talking about Joel Embiid’s waistline). All those draft picks after 2016 may be worthless. The NBA landscape will change so radically between now and the fall of 2017 that any plan in place now is essentially wampum for their fans. We’re victims of failing to to see this future ourselves. In the summer of 2016, NBA salaries will jump 42% to $90 million. Remember when we thought $15 million a year was way too much for Tristan Thompson, last fall? In 2016, that’s going to seem like a bargain. The Cavs probably should have given him the max. But 2016 doesn’t affect the Sixers that much. In fact, the bank of Philadelphia will be in even more demand as the NBA’s place to dump bad contracts, when teams try to clear room to lure “superstars.”

But 2017? That’s going to make 2016 look tame. The players will opt out of the collective bargaining agreement in 2017. I fully expect Josh Harris to cash out and sell the 76ers before this happens. What will happen after that is anyone’s guess, but the players got screwed in the last deal. Ballmer’s $2 Billion dollar purchase of the Clippers was proof of that. (Incidentally, could the Donald Sterling situation have worked out any better for the NBA and Doc Rivers? Sterling started a bidding war over who got to ride in on a white horse and save the Clippers from the scourge of racist old fools. Doc Rivers got to “hold the team together” for a year, and became the de facto head of the Clippers organization. He has so much power, that he conned Ballmer into trading for his son. The Clips are up in the standings lately, so I can’t trash Doc’s coaching, and I know Mac hates him. But man that guy always falls into primo situations. Oh and the Sterlings got $2 Billion out of the deal, so they’re not exactly hurting over it either.)

Michele Roberts, NBPA executive director, center. The rest of the guys you can figure out.

As you talked about, Mac, the NBA is all about the stars now. The stars and the agencies they control and who control them will take it to the owners. The Union heads, Chris Paul and LeBron, as well as LMR and the other big agencies already screwed over their rank and file players by not taking the smoothing deal (which would spread the new TV revenue much more evenly around the NBAPA). The players want the contracts in 2017 as high as they can be because if contracts are high when they opt out, they’ll go even higher after. And count me in the group that doesn’t think there will be a strike or a lockout. I said this in 2011, and it’s even more true today. The NBA owners need the players to have a union a lot more than the players need to have a union. The whole BRI income split benefits the owners immensely more than the players, and is only possible because of collective bargaining. The players just ought to decertify and not be a union anymore.

Larry Coon explained it best in 2011.

Decertification owes its power to the uneasy truce between labor laws and antitrust laws. The antitrust laws prevent employers from banding together to restrain competition. For example, if all the banks in a city agreed that they would not pay their tellers more than $30,000 per year, it would almost certainly be an illegal case of “price fixing.” Likewise, if the banks laid off all their tellers and refused to rehire them unless they agreed to take a pay cut to $30,000, it would almost certainly be an illegal “group boycott.” These types of agreements — which restrain competition — are addressed by the antitrust laws.

However, collective bargaining encourages the very type of behavior that the antitrust laws make illegal. To resolve this inherent conflict, there is something called the “non-statutory labor exemption,” which shields collective bargaining agreements from attack under antitrust law. This protection extends even after the agreement expires — so long as a bargaining relationship continues to exist.

Here’s the key to the whole process [there’s that word again!] : This bargaining relationship continues to exist as long as the union is in place. If the players dissolve the union, the bargaining relationship dissolves with it. Without the bargaining relationship, the league is no longer shielded from antitrust laws.

Much of the economic structure of the NBA — such as the salary cap, maximum salaries, rookie-scale salaries and the luxury tax — could be challenged under the antitrust laws as a form of price fixing if there was no union.

I’m still unclear on what happens to existing contracts in the case of a decertification, and if they’re nullified, that’s the biggest case for NOT decertifying. But that aside, if the NBAPA stops being a union and just becomes a trade association, then eventually (after years of legal battles), the salary cap, the draft, restricted free agency rights, the rookie salary scale, one-and-done… all those things go away. Michele Roberts is not Billy Hunter. She will go to the mattresses. Decertification will be in her bag, and either this BRI stuff will all go away, get severely reversed, or the union will decertify. Heck, I’ve advocated for the players making their own league as an even bigger “nuclear option.” Personally, I think they should be the ones making the money, not the owners, but as, Tom knows, I’m always on the side of the proles (as much as you can call barely educated millionaires, “proles.”)

I wanted to castigate the Sixers for not planning for this, but I looked. They have no draft picks other than their own coming to them in 2017 and only second rounders coming to them in 2018 and beyond. So maybe they are planning for this. Which if they are, I want to scream at their fans, “They know none of this matters past 2016-2017! They’re not ‘building a team!’ They’re printing money!” Things falls apart (the centre cannot hold)… Maybe not in the near future, but it still doesn’t mean all the other teams won’t get fed up and change the rules. Look proposals that Joey B put on the end of our last letters series: 76 game schedule, 22 playoff teams, eight lottery teams, and every lottery team with an equal 12.5% shot to make the top pick. It would certainly change the math for the Sixers.

And maybe that’s what annoys me about where this whole Sixers deal is headed more than anything. I touched on it earlier when talking about Hinkie. We’ve reached a point in society where almost everyone who’s anyone is a con man or a mark. Mac, you touched on it when you talked about what the “Koch Brothers are selling Tea Partiers and FOX News… the illusion of control, and a pretend peek inside the Wizard’s curtain.” Either you’re conning someone to get them to buy your rebuilding plan, your maxi pads, your artisanal pastry, your political viewpoint, or your political viewpoint, or you’re the one being conned into buying those. That includes ourselves… and how we look at others. I mean take our president. No one is simultaneously praised and loathed more than him. In fact, the Fox News crowd can’t even figure out if he’s an idiot or a criminal mastermind. (OK, I’m just trolling Tom now. Forget I said that. The last place this blog needs to go is into politics.) We seem to have only three possibilities when processing information; everyone’s either a genius, an idiot, or a grifter.

And we’ve come full circle. “Process” seems to have become for many, a way to lie to others and to lie to one’s self. But that’s just human nature. We’re born believers. We seek out information that confirms our worldview and protects our ego. We’re narcissistic flawed little demagogues and lemmings. The poet, Wallace Stevens, summed up this phenomenon beautifully. “The final belief is to believe in a fiction, which you know to be a fiction, there being nothing else. The exquisite truth is to know that it is a fiction and that you believe in it willingly.” Or as George Costanza said, “It’s not a lie if you believe it.

There’s only one escape from that mendacious “process.” Just do the best you can. Areté. That’s why I enjoy watching the Cavs this year (except when LeBron loafs). And that’s why I respect the Rockets and Spurs. It’s why everyone enjoys the NCAA tournament, and why my cousins all tell me that college basketball is better than the NBA. They’re trying. But in the spirit of sober self analysis, I must examine the other viewpoint. I might be wrong. I believe in experimentation, and my personal style is to figure out which way the wind is blowing and go the other way. So, as bad as I think the Sixers ideas and behavior may be, I at least have to wait and see how it turns out, cause none of us can predict the future. That’s up to the Gods. In the meantime, Go Cavs.

-Nate