Breakdowns

Defending the Salary Cap: A Response to Big Cat

On Aug. 6 Mike Tannenbaum appeared on Pardon My Take to discuss his experience as an NFL front office executive. Midway into the episode, Big Cat broached the subject of the NFL salary cap. He argued that the “cap isn’t real” — a sentiment shared by many people, ranging from Twitter trolls to ESPN analyst Marcus Spears. Of course, Big Cat and PFT Commenter are well-known trolls themselves, but there is a substantive argument here…

Since teams are able to restructure contracts and prorate bonuses, they can continuously push money into future seasons to manipulate cap numbers. In other words, teams can “kick the can” on individual contracts, creating cap room to sign other players. The Saints are a prime example of a team that continues to stretch the limits and fit players within the cap, despite pundits declaring that they are always in “cap hell.” This strategy of mortgaging the future therefore makes it seem as if the cap is fake.

Cap skeptics persist because there are few examples of the cap actively preventing a team from keeping a player. Likewise, the fact that some capologists are very good at navigating around the CBA (and cap accounting rules) doesn’t help. We may not be able to silence the skeptics, but let’s address the common arguments against the cap and debunk much of what was said on PMT:

Dead Money & Sustainability

How a team manages the cap typically depends on how they view their window of opportunity to win. Just as the Saints tried to maximize their window with Drew Brees, the Buccaneers are doing the same with Tom Brady; their $277,761,518 is the most active cash spending (over the cap). In turn, when a team is in win-now mode, they are going to restructure contracts by converting Paragraph 5-Base Salary into a signing bonus, thereby prorating money. Teams might even add void years to allow them to prorate further into the future.

Playing devil’s advocate, the recovery from significant prorated money might only be one or two seasons with restrictive amounts of dead money; however, according to Joe Banner, “Somewhere you’ve made some roster decision that hurts you… it might be true that you can fix the math, but you’ve denigrated your roster before and that will take more than a year to correct.” And, if you have dead money, you’re either working with less cap in a given year or borrowing from the future.

By far the most common argument made by cap skeptics is that the cap never prevents teams from signing superstars. Yet, this is because teams prioritize superstar talent. In contrast, the middle class in the NFL has been eroded. When teams incur large amounts of miscellaneous charges and excessive cap hits for individual players, they are going to be thin at other positions. For a single contract, a team can always create space. But, to build the best roster in a weak-link sport that is also a war of attrition, you must allocate limited resources well. You’d have to draft impossibly well or have a Hall of Fame QB to overcome poor cap management

The Rams

Speaking of superstars, PFT’s first example of a team that bypasses the two avenues to acquire players—free agency and the draft—was the Rams. And PFT is right; no team has mortgaged their future more than the Rams. They will go seven seasons without drafting in the first round, and they will incur $39,295,099 in dead money this season. As Tannenbaum says, “They are a great science experiment.” If it works out for the Rams, it will be even harder to answer cap skeptics. But, if Tannenbaum is correct that it isn’t going to pay off, the Rams will be the go-to example for why going all-in can be a big mistake. It will be very telling how the next few seasons play out in L.A.

Quarterbacks

The quarterback position is anomalous in terms of both on-field value and market value. As such, no contract can be more detrimental than that of a disappointing QB’s extension. Jared Goff and Carson Wentz are the obvious examples, as they have the two largest dead money hits in NFL history at $22.2 million and $33.8 million, respectively. The Rams and Eagles were fortunate to be able to offload these contracts (although the Rams also gave the Lions two first-rounders to get Matthew Stafford). Moving forward, teams might not have the same luck, which is precisely why Tannenbaum was cautious about giving Josh Allen a massive extension.

On the other hand, the PMT guys were not at all concerned about giving Allen in excess of $200 million. Big Cat even went so far as to say, “The cap doesn’t mean anything; you can cut him after a year if you have to.” Now, the podcast was recorded right before the Bills completed the extension. So, we’ll give Big Cat the benefit of the doubt because there simply is no way the Bills can cut Allen after one season. Per Over the Cap, here is Allen’s contract breakdown:

Response to Big Cat

Focusing on the far right column, the Bills can’t cut Allen until 2024 without it being a net negative in cap savings. Allen will also definitely be on the roster in 2024, otherwise the $41,316,843 in dead money will almost equal what it would cost to keep him on the roster. So, Tannenbaum was right to be worried about Allen’s extension. If he plays closer to the first two seasons of his career than his 2020 season, this contract could be disastrous.

Examples of the Cap Biting Back

Aside from those already mentioned, three other teams come to mind when thinking about cap issues. First, the Atlanta Falcons have had a relatively strong nucleus of players over the last few seasons but have failed to capitalize due to the cap (just ask Mina Kimes). The cap also contributed to them losing Austin Hooper in free agency and trading Julio Jones.

Second, Bill Belichick has publicly admitted that the cap was a significant factor in the Patriots’ disappointing 2020 season. Belichick told Sirius XM NFL Radio that, “From a salary-cap standpoint, we didn’t have much flexibility at all. I think that was obvious on the Cam Newton contract.” He continued to say, “Adjust our cap from the spending that we’ve had in accumulation of prior years. We just haven’t been able to have the kind of depth on our roster that we’ve had in some other years.” Even with Brady taking team-friendly deals year after year, Belichick admits the cap affected their depth in 2020.

Third, similar to Belichick, Eagles VP Howie Roseman “has publicly acknowledged his sentimentality for the Super Bowl roster as a flaw in recent years,” according to The Athletic. This effort to maintain continuity, along with Wentz’s dead cap hit (the largest in history), has added up. One could argue that the Eagles and Patriots are struggling due to poor drafting, but it is undeniable that the cap has also been a factor.

Scroll to the Top