Although LeBron James’ decision to play for Miami is, by his own words, first and foremost about building a winning dynasty, economics certainly played a role. Due to the NBA’s salary cap rules, every team with the requisite cap space could offer LeBron the same about of money, with the exception of his current team, the Cleveland Cavaliers, who could offer him considerably more. Once James decided against staying in Cleveland, with every other team only able to offer the exact same annual pay (approximately $96 million), economics undoubtedly mattered significantly.

In Florida LeBron will pay no state or city income taxes. None. However, according to the Business and Media Institute, had he chosen the New York Knicks, he would have paid over $12 million in city and state taxes over the life of the contract! In Cleveland he would have paid $5.69 million!

Differing organizations estimate that LeBron’s annual economic impact to be anywhere from $20 million to $48 million on Cleveland. Over the life of a five year contract, that is $100-$240 million. Is $5.69 million in one person’s taxes really that consequential in that context?

Clearly, taxes were not LeBron’s primary reason for signing with Miami, but undoubtedly had to be a factor. Maybe some day politicians will stop looking for peripheral sources of “revenue” and see the true impact of what they do and they will stop driving true job-creating business from their states and our country. However, this is probably less likely than President Obama becoming a Cubs fan.

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