The CBA Debate Part 2 of 4 10/6/04 - From the
Publishers of the Hockey Alliance
There is no greater issue facing the fans, players, and
owners of the NHL than the expiration of the current collective bargaining
agreement. Both the player's union and the owners are waging a war for public
opinion, considered fairly vital in case of a long term labor shortage. Fans
find themselves, as always, stuck in the middle with no represented voice at
the CBA negotiation table. Fans have to look past the propaganda and rhetoric
spewing from league and union offices in an attempt to understand the issues
being raised. The divide among fans who are lining up either behind the
players, the owners or themselves is fairly strong and has sparked many
interesting debates this summer. The following is a debate between
Hockey Alliance
publishers, representing both sides of the agument. Contributors include:
The debate was triggered by an article written by Lyle
Richardson for FoxSports.com. This conversation is a good example of the
kind of debate NHL fans are having this summer and shows the kind of passion
fans have for the league and the game of hockey. The conversation is picked up
after discussion about the article had begun.
This is Part 1 of
4
Lyle
Richardson : For those who say the players out-smarted the owners, well
then, what does that say about the calibre of the owners? The current CBA
would've kept player salaries under control if it had been used properly by the
owners. The reason the players were able to get away with asking for
increasingly large salaries was because there was always going to be team,
usually in a large market, who was willing to pay it. The owners had it in
their means to keep salaries under control and blew it. Now they're talking
about wanting to scrap everything in favour of "cost certainty", whatever that
is. My question is, how do we know salaries will remain under control under
"cost certainty"? How do we know for sure there won't be teams who'll either
find loopholes they can use to their advantage or will happily pay whatever
penalties to ensure they get the players they want? How do we know for sure
"cost certainty" will in fact work to keep salaries under control?
I agree the European market will likely be limited, but
again, what to make of that report that cited the players savings, war-chest,
investment account and royalties? As I noted before, the players are in better
shape to ride out a prolonged work stoppage than they were ten years ago, and
we shouldn't underestimate their determination and their means for surviving a
lockout. Yes, I agree a five percent rollback is chickenfeed, but that could be
something to be used as a starting point. The NHLPA suggests 5%, the league
should make a counterproposal and then off you go with negotiating down to a
figure both sides can live with. Instead, the league rejected the proposal with
no negotiations in favour of their modified "cost certainty". If the league
would put into clear terms what they mean by "cost certainty", it would be much
easier for me to be sympathetic to their cause. Believe me, if it were the
other way around and it were the players, not the league, dancing around "cost
certainty", I'd be hammering them to the wall every week in my articles. So
far, we've heard Bettman and company say a cap is one option but not the only
one, that there are many different options available but none they're willing
to talk about publicly. In my opinion it's been Bettman who's been the slippery
one thus far. At least with the union we've got some idea as to what they're
willing to discuss.
And the NHLPA is willing to discuss a luxury tax. They said
so in their October proposal, which was a remarkable statement to make since
they were unwilling to accept such a thing during the last lockout. To me,
that's indicative of their willingness to address the league's claims of
financial distress. I do agree with you that the union should provide evidence
to the contrary that the league isn't losing money, but you've gotta admit,
that's kind of hard to do when the league won't let you audit their books.
Please understand, guys, I'm not in the players camp on this one, in fact, I'm
not pleased with either side. It just seems to me that the union appears
willing to negotiate and seem better prepared than they were in the past, while
the owners toss blame at the union, the agents and their rival owners, and
offer up nothing but weasel words about "cost certainty". Some may consider it
futile to lay blame for this mess, but I believe those who are most at fault -
the owners - have a dubious reputation, and that in turn has made me cynical as
to what the outcome of the next CBA will be.
DArcy, I just
don't understand this blame shtick you keep running with. It's irrelevant. If I
and 100 other people own a condo in a giant Condominium complex and we as as
tenants get assessed an additional "upkeep" fee every month if garbage is found
by the swimming pool I'd be right pissed if only 1 of the 100 owners keeps
leaving beer cans lying around and I haven't. That's the case with the owners.
One guy makes a mistake and sets the market upward leaving the other owners no
choice but to fall in line or fall hopelessly behind on the ice. Tough choice
to make. You say "weasel comment" about cost certainty. What's weasel about
that term. If I owned a 100 million dollar asset I'd like a little certainty on
my costs too ... who can blame them? The owners can't just counter a silly 5%
offer or they'll end up with a process that meets a roll back number in the
middle and does nothing else to stop salary escalation - it's common sense. The
NHLPA rolled that baby out for PR reasons and it appears you bought it and
swallowed it hard.
Bill
Pax: What's a bit upsetting to me, and I believe Lyle alluded to this in
his article, is the fact that the sides don't seem to be talking. The owners
have their idea, the players their idea and they're light years apart. But it
would be nice if they'd use those proposals (cap vs. 5% pay decrease) just as
end posts for a negotiation. Why aren't both sides sitting in a room everyday
talking to one another, shooting ideas across the table? The "it's our way or
the highway" approach both sides seem hell bent on only hurts the fans and the
already battered image of the NHL as a bush league in my opinion. However, if
there's going to be a "winner" in this my money is on the players. As usual
they seem united and I've already read and heard stories about a possible break
in the ownership between the bigger money teams and the "smaller" money
teams.
Lyle
Richardson : Bill - You're right, the lack of negotiations is very
frustrating for all of us right now. That being said, I think what we're going
to see is a lot of public posturing while the real negotiations talk place
quietly behind closed doors. Goodenow prefers the "11th hour" gambit as he
believes it works to his favour, but Bettman, to his credit, is also a dogged
negotiator and isn't pressured by deadlines. As we near September, I think
we'll see more serious discussions between the two sides which will increase as
"D-Day" approaches.
Whether we have a new deal by then remains to be
seen.
DArcy
McGrath- :This "blame shtick" is nothing of the kind, nor is it
"irrelevant". It's simply the facts. What's "irrelevant" about trusting the
owners, a good number of whom signed off on the current CBA, to ensure they
won't make a mockery of the next one? What's "irrelevant" about pointing out
that they've so far done little, if any, negotiating with the union thus far?
"One guy makes a mistake?" There are numerous "mistakes" made by the owners
over the past ten years. How about the "mistake" Bill Wirtz of Chicago with his
pitch for RFA Keith Tkachuk back in 1995? That was copied by the Rangers in
1997 with Joe Sakic and the Hurricanes in 1998 with Sergei Federov. How about
the majority of Group II free agents getting significant raises, even when in
some cases they staged, or threatend to stage, lengthy holdouts? Those are
"mistakes" made over and over and over again. How about the Boston Bruins
making a mockery of the restrictions on entry level salaries with their
bonus-laced offer to Joe Thornton? That "mistake" was copied again and again
throughout the league, so much so that when players finish their entry-level
salaries, they're now seeking substantial raises because their bonus clauses
paid them well over the rookie cap.
What about the "mistake" that, despite having the option of
walking away from arbitration awards, only one team - the Bruins - ever
exercised that option? The rest either paid out the arbitration awards or
traded away that player's salary to a club more willing to pay it. What about
the continued "mistakes" of the UFA market,which until last summer was a
spending frenzy that continually drove salaries higher and higher? Those are
more than mere "mistakes", D'Arcy, and they're not "irrelevant". They're
important to remember when one decides to put their trust in the league and the
owners to "get it right this time". What's weasely about "cost certainty" is
Bettman has not given us anything of substance as to what it means. He denies
it means a hard salary cap of $31 million, but then suggests a cap is "one
option" of many. OK, well, what are the other options? Share them with us and
the union. If you don't necessarily have a cap in mind, then what do you have
in mind?
He claims it's a "concept that has a definable relationship
between revenues and expenses." That's nice, but what exactly do you have in
mind, Gary? A salary cap? A luxury tax? Revenue sharing? A poke in the eye?
What?? It certainly isn't a luxury tax because back on June 27th Bettman said
he doesn't believe such a system would work. And there's already rumblings that
the big market clubs will resist any attempt to get into a major revenue
sharing scheme with their small-market cousins, and Bettman is on record as
claiming such a scheme wouldn't work without "cost certainty". So round and
round we go, and all signs seemingly point to a cap. And I'm disappointed with
your response regarding the union's October proposal being nothing but mere
window dressing for a gullible public. Granted, most news releases on both
sides goes for PR effect, but behind all that is substance, D'Arcy. It's the
same with the NHL's claims of losses. I don't doubt for a moment there are
teams losing money and some are already in dire straits. All I'm suggesting is
that if the league truly wants to get the union onside toward working out a new
CBA, then why not open their books to the union and allow them to check them
out. Hey, the LA Kings had no problem allowing one of their fans, who is a
portfolio manager and equity analyst, to check their books when he questioned
their claims of financial losses. His findings not only proved the Kings were
losing money, but also stood to lose more. So why not open 'em up for the union
and settle this nonsense once and for all? I'm merely calling it the way I see
it, and the way I see it is, the owners have to get their bloody act together
if we're to put our faith in them to come up with a better mousetrap, and they
must be more willing to work with the union.
Lyle Richardson "Mistake contracts", D'Arcy. Exactly what by
your definition constitutes "mistake" contracts? All of the UFA ones since
1995? Some of them? A handful? And what about the RFA signings since 1995? All
of them? Most of them? A few? "Held hostage?" Nobody put a gun to Neil Smith's
head when he made his pitch for Joe Sakic, or to Pete Karmonos's for his offer
to Sergei Fedorov. Certainly nobody forced teams to sign their rookies to deal
that exploited the CBA. They all knew what they were doing in that instance
blew apart the entry level cap. The only thing they were "held hostage" to was
their own fear that their North American first round pick would hold out for
two years and then go back into the draft where they'd be snapped up by another
club. Few of them had the balls to call the bluff of those rookies and their
agents. And with European rookies, they hold their rights until they turn 31,
so why would a team like the Wild cave in and give Marian Gaborik the same deal
as Thornton? Yes, they want a star player to sell their club around, but they
could still afford to wait him out. I'm willing to bet most of those rookies
would gladly sign to the entry level cap for three years just for the chance to
play in the NHL, earn their spurs and then go for the big bucks.
Remember, that's all part of the business of hockey, the
give and take between a team owner, represented by his GM and a player,
represented by his agent. So what does that say about the business "savvy" of
the owners? Still trust 'em to "get it right next time?" The lawyers on both
sides helped draft the current CBA, based on recommendations made by owners and
the players, represented by the NHLPA, whose player reps were involved in the
process. As for "lawyers" finding loopholes to exploit, sorry, D'Arcy, but
you're wrong on that count. It was the players agents and the general managers
who sought to exploit them. They may have used lawyers to ensure what they were
doing wasn't violating the CBA, but you can bet they went on orders from both
sides. "To blame owners for trying to be competitive" is not what I'm doing.
I'm blaming them for not using the CBA to their advantage, something they've
only started doing since last summer. There's nothing competitive about a small
group of big market teams turning the UFA market into their own grab bag,
leaving the small-and-mid markets to fight over the scraps that remain. There's
nothing competitive about driving player salaries so high that small market
clubs (like your Flames) struggle to retain their best players.
And besides, D'Arcy, didn't you just say that they were
being "held hostage" by "mistake contracts"? So where's the competitiveness in
that? I simply don't understand how you can say "blame is irrelevant", when
it's pretty much the same bunch that put the NHL in this mess in the first
place! How can it be "irrelevant" that they've conducted their business so
poorly since 1995? How can we be sure we can solely trust them with their "cost
certainty" scheme when they won't even tell us what they have in mind, other
than to say they must tie player salaries to revenues and a salary cap is one
option, but then won't tell us what else they've got in mind? Suppose they get
an agreement that is tilted even further in their favour than the current one
and they still screw things up? Will it be irrelevant then? Do we still trust
them to "get it right next time"? There will always be the human element in
business deals, but what it takes is simply better management of the agreement
by both sides.
We've already seen both last summer and so far this summer
that most of the owners, when they collectively set their minds to it, can use
the current CBA to their favour and thus keep player salaries affordable. My
question is, why the hell didn't they do this earlier? I believe the likelihood
of a lockout would be greatly diminished if they had used it the way it was
intended. The players, with probably few reservations, would've still accepted
the current deal because it would still compensate them fairly, while the
owners would still have largely affordable payrolls. Obviously there would be a
few issues they'd debate about, but we certainly wouldn't be hearing talk about
losing next season to a lockout. As I stated earlier, D'Arcy, I'm well aware
that statements from both sides are as much about winning a PR war as it is
about breaking news, and I'm also well aware that talks go on behind the scenes
all the time. As I said to you before, don't underestimate the players resolve
on this one, as they're in far better shape to withstand a lengthy shutdown
than they were ten years ago, and they were willing to lose the entire 94-95
season. I simply don't see them trying to undercut Goodenow now, after all the
gains he's made for them despite a CBA that should've worked more in the owners
favour than in theirs.
Frank
Thorpe: As I said to you before, don't underestimate the players resolve on
this one, as they're in far better shape to withstand a lengthy shutdown than
they were ten years ago, and they were willing to lose the entire 94-95 season.
I simply don't see them trying to undercut Goodenow now, after all the gains
he's made for them despite a CBA that should've worked more in the owners
favour than in theirs.
See this is the problem that I have with the
NHLPA. They are not in better shape to withstand a lengthy shutdown, because
the league which is already on life support won't survive. My god the NHL has
lower ratings then the other 3 major sports, Arena Football, Poker, Nascar.
This is the wrong time for the league to do a work stoppage. They need to
generated revenue and interest not push fans and sponsors away.
I'm
glad the players have their money set aside, hopefully they can live the rest
of their lives off of it. Playing hockey for millions will probably be a
thing of the past if this season is lost completely.
Lyle
Richardson : As I noted earlier in this debate, the average NHL player has
$2 million in savings, can draw on a substantial strike fund from the union as
well as an investment account, plus royalties from trading cards, video games
and so on. That's not counting what they might earn in Europe or from personal
investments, businesses and endorsements. They're in much better shape now than
they were ten years ago when they far more to lose and far less to fall back
on.
The league isn't on "life support", but it obviously needs
to get its financial house in order or it very well will reach that point. By
getting a workable deal in place working in conjunction, rather than against,
the players union, will be a significant first step. After that, they can focus
on improving their on-ice product which is a major reason why the TV ratings
are in the toilet and the NHL ranks behind those aforementioned sports,
including the more dubious "poker".
"Playing hockey for millions" won't be a thing of the past
under a new agreement even if the league gets it's mysterious "cost certainty"
into place, but the days of third and fourth liners and fifth and sixth
defensemen and backup goalies earning over $1 million per season likely will be
regardless of the outcome. The top players will still earn millions, but I
suspect the days of salaries in the $8-$10 million range could become a thing
of the past. Some of them probably won't like it, but that is what must go into
place for the league to pull itself out of it's current financial mess.
Regardless of the outcome of the next CBA, it'll be predominantly up to the
owners to ensure it works, since they're the ones who pay the salaries and
abused the current one which was slanted in their favour. If the usual suspects
once again find ways to exploit it, we'll be right back in the same mess again
in five years time, as I suspect the next CBA won't be extended as the present
one was.
DArcy McGrath: Blame is irrelevant in that the system
dictates that winning and being competitive will always be the root of
franchise killing contracts until the human element is taken out of the mix ...
hence the talk of cost certainty.
Once again ... listing four examples doesn't make the
ownership as a group guilty of anything. These guys all want to win. Because of
that they all have to pay the going rate or they risk the season at hand and
possibly their fan base in some markets. That's the bottom line. The examples
you listed and others have set the bar in some cases, meaning owners that would
love to be fiscally responsible are put in a situation where they need to
either pay the going rate or suffer the consequences. Pretty tight spot to be
in. So yes ... they are held hostage by a system that doesn't keep the
mavericks in check. You dismiss my lawyers finding loopholes comment but then
say agents who sought to exploit them ... guess what? Many player agents are
former or current lawyers doing exactly what I said they were doing. Exploiting
holes in the CBA. I've never once said that it's all the players fault, in fact
it's the opposite, I don't blame a single player for getting all they can
possibly get. I did say blaming the owners in a silly waste of time as they
nature of the beast is to drive up salaries to win in a market that doesn't
protect all the owners from the ones that refuse to follow the bottom line.
Lyle
Richardson : So if the same mistakes are made this time around as last
time, you're cool with that, is that what you're telling me? That the owners
shouldn't have to account for the blunders made, both singly and collectively,
during the past ten years? Sorry, but that doesn't wash. If we want to ensure
the "human element" is taken out of mix, there must be a certainty that the
owners (more so than the players union) are willing to be more collectively
responsible. You can parrot "cost certainty" until you're blue in the face but
if the owners conduct their business in the same manner as they did over the
past ten years, nothing will change, and we'll be right back in the same mess
again in five years time. I'm still amazed that you can flippantly dismiss
those examples I cited earlier, D'Arcy. As I noted earlier, some were
responsible for free spending that pushed salaries out of hand and contributed
to the difficulties faced by small and mid-market clubs. All were guilty of
signing rookies to bonus-laced contracts that punched holes in the entry level
cap, and all were guilty of paying out substantial raises to RFA players, be it
through negotiation or arbitration, which also contributed to the rise in
salaries.
Those examples were just the odd occurrence, D'Arcy, they
happened again and again and again over the past ten years. It's only be the
uncertain future of the league past September 15th that has forced them to act
more responsibly. Yes, D'Arcy, I'm well aware that some of the player agents
are or were lawyers, but not all of them are, OK? And that doesn't take away
the fact that the agents did this with the players blessing. You make it sound
as though the owners and players are dumb sheep being led by the nose by
lawyers. Sorry, but if somebody screws up a job, you don't say, "oh well, fair
play to you, no sense laying blame". It's called responsibility, OK? When in
Buddha's name are the owners supposed to be responsible for their mistakes, be
they singly or collectively? I'm not going to give them or the union a free
pass. Folks wanna know why we've reached this point and I'm more than happen to
point out who is responsible. BTW, D'Arcy, are you familiar with the book
"Money Players" by the Calgary Herald's Bruce Dowbiggin? Or "The Defence Never
Rests" by the same author? Or "Game Misconduct" by Russ Conway? Or "Net Worth"
by David Cruise and Allison Griffiths?
DArcy McGrath: To
be honest man, I don't get the feeling you've been actually reading what I've
said (no offence by the way).
From the beginning I've pointed out that competition drives
bad decision making by the few, and the market moves as a result, forcing the
more fiscally prudent owners into a rock and a hard place situation of either
getting killed on the ice, or getting killed on the balance sheet with no
safety in-between. Look back ... that's all I've said. No passes to owners that
are stupid, no disagreement that some contracts have been foolish, but just
pointing out that a few mavericks have actually done most of the damage.
Therefore you need a system to protect owners from themselves. Players always
act on their own behalf (get as much as they can) and I have no ill will for
them doing so. You don't really need to change the system from the players side
unless you fear the overall good of the game. Owners, if looking out for
themselves like the players will take one of two directions. Stay prudent to
the business model and at least break even, or do what it takes to win. Therein
lies the problem. You need to keep the latter group away from the piggy bank.
Hence cost certainty. To preach to me about accountability, responsibility, and
blame is a waste of time ... we just may disagree Lyle, that doesn't make you
right. I'm well aware of Bruce Dowbiggen ... if you're quoting some of his
theories I can see why we don't see eye to eye. Major blow hard in our market
that is dead wrong more often than he's right.
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