"Underlying most arguments against the free market is a lack of belief in freedom itself" (Milton Friedman).
If you took even one economics class in college, you know full well what this quote means. Freedom itself is defined by a capitalist or free-market system that relies on supply and demand.
No matter what professional field you are in, your value to the economy is based on factors that exist under the umbrella of a free-market system.
If you are one of a handful of people that can do a specific job, you will be paid handsomely for it. If you are part of a service industry that relies on manual labor, said pay might not meet your expectations.
Golden State Warriors guard Stephen Curry has earned two MVP awards over the past three seasons. He's also won two NBA titles during that span.
Playing in a market that represents one of the largest economic boons of the modern era, the world is pretty much Curry's oyster.
Off the court, the star guard's value is at an all-time high. Here's a guy that offers $14-plus billion in market-cap value for Under Armour, a company he owns stock in.
"If Curry continues his streak, the difference in market-cap value of the company could be approximately $14 billion, with Under Armour being valued at about $14.1 billion under Sole's base case and $28.2 billion in his bull case," Business Insider noted back in April of 2016.
Previously playing under a four-year, $44 million deal with Golden State, Curry just inked the richest contract in the history of the NBA.
Once free agency opened on Saturday morning, the reigning champ signed a five-year, $201 million contract. It's the largest deal in Association history in terms of total value and average annual salary.
Immediately, debates raged about whether Curry was worth this type of money. One article suggested that no one is $200-plus million.
"When some public school teachers are fortunate to make $40,000 a year, no athlete needs to average $40 million (which, at that rate, would fund 1,000 school teachers a year)," The Charlotte Observer's Scott Fowler argued on Saturday. "No CEO needs $40 million a year, either. OK, if a scientist comes up with a flat-out cure for cancer, sure, she deserves it. Otherwise, nobody."
It's a failure of an argument. Supply/demand and the market itself dictates an individual's worth. I'm not here to argue whether teachers and first responders are underpaid. They are. But the argument used here is apples and oranges. Some who speak out about the low pay of public servants in comparison to entertainers are the very same people that are against tax hikes to help fund better pay for teachers and first responders.
Secondly, Curry himself didn't set his market. There are variables well out of his control that led to him receiving the richest contract in NBA history. That includes team-wide success, the San Francisco Bay Area market, Curry's off-court endorsement opportunities and the economic growth of the NBA itself.
In reality, Curry is worth whatever the Warriors decide to pay him. In a vacuum, he's also valued at a much higher clip than $200 million itself.
Just ask rival LeBron James, who has played Curry in the Finals each of the past three seasons.
So tell me again why there's a cap on how much a player should get?? Don't answer that. Steph should be getting 400M this summer 5yrs. #JMTs https://t.co/jMYfI0umWK
— LeBron James (@KingJames) July 1, 2017
That's a tremendous point for James to make.
While we exist in a free market economy, the NBA itself is far from that. The salary cap. Guaranteed contract lengths of rookie deals. These are two things that spit in the face of the larger economic model in the United States.
It's an interesting debate to have. Is Curry worth $40 million per season? Is his on-court value the only thing we should take into account here?
Back in 2010, Joe Lacob and Peter Guber bought Golden State from former owner Chris Cohen for just $450 million. Seven years later, and the team is worth an estimated $2.6 billion.
That's a $2-plus billion return on their investment. It also doesn't even include an expected spike that will come with the opening of a new waterfront arena in San Francisco following the 2018-19 season.
As the face of the Warriors' franchise, Curry is one of the primary reasons this previously struggling organization has hit new heights in terms of on-court success and popularity worldwide.
Curry's MVP performance back in 2015 culminated in the Warriors hoisting the Larry O'Brien trophy for the first time in 40 years. Then in 2016, he was the MVP for a team that put up an NBA record 73-9 mark.
So again, what is Curry's value to this Warriors organization? If it's not seen in the worth of the franchise or its on-court success, what about apparel sales?
Curry boasted the top-selling jersey around the NBA from April through the Warriors' title last month. That's absolutely absurd considering LeBron James' popularity around the world.
Steph Curry secures the top spot on the NBA’s Most Popular Jersey list, based on overall sales on @NBAStore from April through June. pic.twitter.com/jrXFlbHaEP
— NBA (@NBA) June 29, 2017
All said, four of the top-11 selling jerseys in the NBA belong to members of the Warriors. That's a financial windfall for the NBA, the players and Golden State itself.
If we going to sit back and parade Curry's contract as a representation of athletes being overvalued in today's society, we then also have to focus on the billionaire owners of professional sports teams. In what world does it make sense for Lacob to pocket a $2 billion investment while Curry collects pennies on the dollar? That's pretty much the point James himself was making.
If we are going to compare Curry's contract to that of teachers, we then need to ask why taxpayer dollars are not going to help fund better pay for teachers. After all, none of the $201 million Curry received came via us taxpayers. That's money directly out of the pockets of the Warriors' owners, who used this free-market system to create an economic juggernaut in the Bay Area.
See that's the point here. Comparisons between athletes/entertainers and those in the private sector make absolutely no sense. They provide a service to a public that demands it. The popularity of their industries creates appeal, which is then supplied to the masses.
So next time someone comes at you with a "Curry is overpaid argument," maybe refer to the legitimate points made in this article.
