Hockey Headlines

Tuesday, 14 October 2008

Election Day In Canada

Today marked the day where registered voters in Canada went to the polls to determine who will run the country for the next four years. At the time of writing this, it appears that the Conservative Party will hold a minority government yet again, proving that this early election was nothing more than a lesson in futility. Now you're probably asking yourself "why is he writing about something that means nothing to me, and has nothing to do with hockey". There is a tie-in to hockey, and it has to do with being conservative when talking about the NHL's economics. Gary Bettman has never done this, and - thanks to the rhetoric and white lies he's told us - he resembles a politician.

I'll frame this entire concept by saying that everyone who is reading this must click over to the Globe and Mail's excellent article, entitled The Giant Sucking Sound. The article looks at how the NHL's economic model is failing for both the "have" teams and the "have-not" teams.

I have been preaching about how flawed the salary cap is for some time. It is nothing more than a sham to move dollars from the successful teams to the unsuccessful teams with no punitive measures for the teams that don't pull their weight.

The article states that "some teams build their business models around their revenue-sharing windfall and strive to keep their own revenues below the threshold where they will have to contribute". Does this not seem entirely wrong to you? Instead of helping the league grow and get stronger, there are teams that simply refuse to turn a profit in order to collect money from teams that work hard to make money. I'm not suggesting that people abandon the idea of giving when they have the ability to, but is owning an NHL franchise akin to running a glorified charity for rich businessmen?

If the Toronto Maple Leafs spend $50 million on player salaries, why should they have to pay out an additional $12 million to teams that spend similar amounts, but can't turn a profit because people don't come to the arena? Is that fair for the Maple Leafs? Why is the NHL not breathing down the neck of those that take this donation year after year after year?

If sports are a microcosm of society, should there not be some sort of league bailout for six or eight franchises? It's not the Canadian teams that need help. It's not teams like the New York Rangers or Philadelphia Flyers or Detroit Red Wings who are looking for handouts. It's the same teams over and over again that have their hands outstretched - Nashville, Atlanta, Florida, Phoenix, NY Islanders, and Buffalo.

Two of those teams - Buffalo and the Islanders - are simply unfortunate due to poor management of their teams. Tom Golisano seems to be more interested in his political career and making the Forbes' Richest People list than he is in owning the Sabres. Charles Wang, owner of the Islanders, simply appears to have no clue in how to run a hockey franchise, and his team has suffered because of it.

Other teams, however, have pulled themselves out of states of peril to become successful, profitable franchises. The Ottawa Senators, behind the ownership of Eugene Melnyk, have marketed themselves very well, and turned some very nice profits since claiming bankruptcy. The Pittsburgh Penguins, since Mario Lemieux took the reins, have been lucky in drafting some very marketable stars, and they've become a stable franchise once again by making themselves competitive.

So why should Ottawa and Pittsburgh be forced to pay for other people's mistakes? Why should Montreal and the New York Rangers shell out huge amounts of money to save hockey in Phoenix when they spend all of one night in that city a year?

Why does the league permit teams like Atlanta to only spend the cap minimum on players' salaries, yet gives them a pile of money because they can't turn a profit in a city where hockey has failed a number of times? Does the NHL not learn anything from its history or the history of others? The Atlanta Flames failed, and moved to Calgary. The Atlanta Knights of the IHL failed, and moved to Quebec. The Atlanta Thrashers are currently failing. Does anyone see a pattern here?

Look, I get that Bettman talks about the NHL's revenue as being strong. League revenues probably are. However, the league is made up of 30 franchises, and a third of those franchises are not pulling their weight. This is a serious problem, and it's one that Gary Bettman and the owners need to face sooner than later.

The US economy collapsed under the weight of mismanaged investments and underhanded deals. Money that didn't exist was being shuffled around so fast that no one could keep track of who owned what and who sold what.

The NHL seems to be following this pattern. If teams are shuffling money around, the current economic situation will collapse sooner or later. If society truly goes into a recession (and some are predicting that it may already be happening), NHL franchises will be forced to go into conservative mode in order to turn a profit.

If the NHL goes conservative and spending slows, does the cap finally stop going up? Can teams that are bleeding red ink finally attempt to turn a profit under a cap system that will help those who need the help? Can this "revenue sharing" idea but put to rest?

All I know is that if all 30 teams are turning a profit, there's no need to share money. Everyone is successful, and everyone - including the players - should get a share. But if even one team end up in the red ink, the economic model needs to be reshaped.

If you cut your hand, you stop the bleeding immediately. If you don't, there could potentially be a large number of problems that develop. Other body parts could be affected, other body parts will have to compensate for the losses, and the overall health of your body will suffer. It's a simple concept, really, and one that a child could comprehend. You cut your hand, and you stop the bleeding in order to begin the healing process. You apply medicine if necessary, and you nurse the wound back to health in order to maintain a healthy body overall. If the hand cannot be saved due to the damage or infection, you amputate. The greater good of your body's overall health is more important than saving the affected appendage.

Why can't the NHL, specifically Gary Bettman, see this metaphor?

Until next time, keep your sticks on the ice!

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