What would a Sign-and-Trade for Paul George look like?

Paul George, you may have heard, is about to become a free agent, and any smart Thunder fan should feel more than a little nervous about that. When the team acquired PG13 a year ago, sending out Victor Oladipo and Domantas Sabonis to the Pacers, the Thunder knew the risk. George had only one year left on his contract before he could opt out, and was known to have a strong desire to play for his hometown Los Angeles Lakers. The Thunder bet that they could quickly build a great team with George and Russell Westbrook, spend the year he played in OKC pitching him on the franchise, and sell him on the chance to win a title alongside Russ when it came time to re-sign.

The selling him on the franchise part seems to have gone fine- PG said the Thunder “check all the boxes” as an organization in his exit interview. The “win titles” angle, however, will be a harder sell after the Thunder failed to even make it out of the first round of the playoffs. That doesn’t mean PG is gone for sure, but you’d certainly feel a lot better about the Thunder’s chances if they’d reached the conference finals or at least lost a tight series to Houston. Losing to the Jazz in round one is not the end OKC envisioned when they made the big trade, and it increases the chances that George departs the team (though that is by no means a certainty).

Normally when a free agent leaves, his old team gets nothing in return- the player simply strolls off and signs with a new team. There are certain circumstances however where the departing player agrees to a sign-and-trade; they sign with their old team and then are immediately shipped off to a new team, with something coming back in return. The reason for this isn’t benevolence- it’s that the new team doesn’t have the cap room to incorporate the player, so they need to send some salary back to the old team. For their trouble, the new team will usually throw a pick or a nice young prospect to the old team.

The cap situation around the league means a sign-and-trade for Paul George is possible. While that would be a better outcome for OKC than getting nothing, a word of warning: these will not be sexy trades. George has to agree to a sign-and-trade, which means he dictates the team OKC negotiates with; further, if OKC refuses to deal him, PG leaves anyways and OKC gets nothing back. Their leverage is highly limited in such a scenarios; beggars, after all, can’t be choosers.

PG is rumored to be considering the Lakers, the Sixers and the Rockets in free agency, in addition to the Thunder. The Lakers and Sixers have the cap room to sign him outright, making a sign-and-trade deal unlikely. The Lakers might theoretically be interested in a sign-and-trade where OKC takes Luol Deng’s awful contract and in exchange they throw OKC a young prospect or a pick. But OKC still views itself as a playoff team, and Luol Deng and playoff teams don’t mix at this point in his career. The prospect and pick wouldn’t help much either- the level of players the Lakers would surrender in this arrangement would be someone like Josh Hart, not a blue chip like Brandon Ingram or the surprising Kyle Kuzma, and the pick will likely be a bad one, since the Lakers with PG should be a pretty good team.

If OKC decided to go into full on rebuild mode without PG, I suppose they might make such a trade, but that seems unlikely. If PG heads to Los Angeles OKC is extremely unlikely to get anything in return. Ditto Philadelphia, who doesn’t really have any bad contracts they’d need to get off of. The Rockets, however, are a different story.

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Last year, Houston swung a trade of this type for Chris Paul. That deal was not a traditional sign and trade, but instead a “Opt-in and trade”- CP3 agreed to opt in to the final year of his contract with the Clippers, which he was widely expected to decline, in order to facilitate the trade to Houston. That meant a lower salary, which allowed Houston to send out less salary than they would have in a traditional sign and trade at CP3’s max. The result- Houston acquired Paul without totally gutting their roster. From Paul’s perspective, since Houston technically acquired him on the last year of his old contract, they gained his bird rights- the ability to go over the salary cap to sign him. That means that this summer they can re-sign him to the max contract he could have made last season- the Rockets will “make him whole”, so to speak.

Houston went from losing in the 2nd round in 2017 to being one game away from the finals in 2018 thanks to the addition of one Paul, so General Manager Daryl Morey is naturally very interested in acquiring another superstar Paul. Houston, however is already a very expensive team- they have $80,442,936 on the books in salary next year, and that’s before they re-sign (Chris) Paul and Clint Capela to fat new deals. They will be unable to sign Paul George at his new max contract level of $30.3 Million However, if PG were to opt in to facilitate a trade as Chris Paul did last year, Houston could offer him his full max next year instead, since they’d have his bird rights and could go over the cap to retain him.

The 2017-18 salary cap remains in effect through July 1st- and to facilitate this trade, Paul George would have to agree to pick up his player option by June 29th. This is the only conceivable way I see PG getting to Houston- if he wants his full max, he would have to decline his player option and sign a new full deal. The traditional sign-and-trade could then be done, but if you receive a player in a sign and trade you are locked into the hard cap of $129 Million. Remember Houston is at $80 million without Chris Paul and Clint Capela. Paul would earn $35.4 million in the first year of a new max deal and is on record saying he won’t take a paycut. Capela would earn more than $20 million himself in the first year of a max extension, and Houston would almost assuredly have to pay the max to keep him as well. Long story short: getting PG13 through the traditional sign and trade would prevent Houston from re-signing CP3 and Capela- they’d only be able to get one. Maybe Houston decides that adding George would be worth losing Capela, but that’s a tough proposition- and besides, PG seems like the kind of guy who’d be willing to put off a payday by 1 season if it means his team could keep another all-star caliber player around. So it’s probably the opt-in and trade or nothing.

To make this trade work, the Rockets will need to send back at least 80% of Paul’s salary ($20,703,348) and no more than 125% of it, since both teams are over the salary cap. The Rockets would love to get Ryan Anderson’s contract off the books- he and Paul George will make nearly the same amount next season, so the money works, and Anderson is then due another $21 million in 2019-2020. The reasons Houston would like to move off of Anderson’s contract so badly are the same reasons OKC would be very reluctant to take him on- while he’s an excellent 3 point shooter he’s a horrid defender who Houston felt they couldn’t even play in the series against the Warriors. At this point in his career, Ryno is the kind of player who helps you make the playoffs but is pretty much useless once they begin (rather like Enes Kanter) because teams will target him so repeatedly. He would make it impossible for OKC to have any cap room of their own until 2020, preventing them from luring any top tier free agents. Houston including their 2020 first round pick still wouldn’t make taking on Anderson’s contract worthwhile- the Rockets figure to still be very, very good come 2020, meaning the pick would fall at the end of the first round.

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OKC would much rather base the trade around Eric Gordon. The former sixth man of the year can play on or off the ball, start or come off the bench. He’s an ideal 2 guard next to Russ, able to spot up and nail 3 pointers around Russ’s manic drives to the rim and also run the offense for stretches without Russ. And if OKC decided at any point to blow it up and rebuild the team, Gordon would actually net a decent return, unlike Anderson, who you’d have to give assets up to get off of. Gordon is also cheaper than Anderson- cheap enough that Houston would actually need to throw in other salary to make the deal work. Throwing in Nene would get them there. Naturally, Houston is loathe to give up Gordon- he was a huge part of their success and projects to be going forward. While George is a clear upgrade, they’d love to have their cake and eat it too.

Which deal materializes comes down to who has the most leverage. True, OKC will lose George for nothing if they don’t agree to work out a sign and trade- but two years of Ryan Anderson’s contract is probably worse than nothing. Getting Houston to include a pick helps, but is the 28th pick in the 2020 draft worth a playoff team adding $40 million of salary for a player who can’t stay on the court once the playoffs start? Houston faces a tough situation of their own- acquiring George via sign-and-trade is the only way they can gain his services, and Houston should believe that George could get them over the top, given how close they came last year. If the choice comes down to get PG and lose Gordon or don’t get PG at all, I would bet they swallow hard and take it. Morey will naturally try to strong-arm Thunder GM Sam Presti into the inferior option of taking Anderson and the pick, but Presti will negotiate hard himself. To be a fly on the wall as the men who made the James Harden trade negotiate over another superstar changing teams would be fascinating. Hopefully one of them writes a tell-all memoir someday.

In essence, it comes down to this- if Houston is willing to throw in Eric Gordon, OKC should jump at the chance to get a valuable player back rather than losing one of their superstars for nothing. If the offer is Ryan Anderson or nothing, however, they should go with nothing. As mentioned above, PG will need to accept or decline his player option by June 29, so we’ll know if he plans to be a Rocket before the formal start of free agency on July 1. If PG terminates his player option, then OKC will be down to either keeping him or losing him for nothing. Either way, be ready- the fireworks are going to start flying well before the official start of free agency on July 1.