They Never Learn

Well it's been almost a full week of free agency in the NHL and one thing is painfully clear, the owners still haven't learned a damn thing. They lost a year of hockey, did irreparable damage to the sports credibility and popularity in the United States, lost a large chunk of their fan base in the markets they had set up south of the Mason Dixon Line and implemented a low salary cap designed to curb the spending of large markets teams like Toronto, New York and Detroit and for what? For nothing.

Two years after starting off with a hard cap at 39 million the NHL raised the cap to 50 million. A league that had told everyone that would listen it was hemorrhaging money and could not support huge salaries anymore has suddenly begun to turn a profit despite no national television contract and limited exposure outside of the core markets. Yet last week the owners got together and somehow figured that raising the cap 11 million dollars in two years despite no new revenue streams is good business.

Actually, there is a new revenue stream in the NHL, just not the type Garry Bettman would have you believe. Part of the CBA is it's so-called revenue sharing system. I say so-called because in reality, it isn't. It is, in fact, something more akin of MLBs luxury tax, only in this case teams are punished for making money, not spending it. Yeah, you heard me.

Wrap this around your head. The CBA states that the teams that turn the most profit must give a percentage of it to the teams that are losing money. As a result, successful teams like the Maple Leafs and Red Wings not only risk losing players to free agency each year, but also cover the expense of their contracts should a team like Florida, Columbus or Atlanta sign the player. As I mentioned in an earlier entry, the Nashville Predators receive somewhere between 4-6 million per year from the Toronto Maple Leafs, ensuring that the Predators can re-sign players despite not being able to truly afford them. The Edmonton Oilers are turning a good profit each year, but have to hand the money over to teams that are robbing them of talent.

As a result of this phony revenue sharing system owners in the United States continue to raise the salary cap knowing full well they don't have to cover all the expenses anymore. It's been an incredible black comedy lately with small market teams complaining about the spending habits of New York, Colorado and Detroit in the recent free agent frenzy. These are the same owners and GMs who voted to raise the cap yet again and allow the bigger markets to start out-spending their rivals yet again.

Perhaps even more damaging then the return of the 50 million dollar contract in the stipulation that the minimum spending level must also rise with the cap. The spending floor in the NHL currently sits at 34 million. This seems only fair, as it keeps teams from gutting payrolls then leeching off the bigger markets, but keep in mind prior to the lock out several teams like Columbus, Minnesota, Atlanta and Florida had self-imposed spending limits tanging between 25 to 30 million. Even then those teams lost money, and now they are forced to spend more.

This is an enormous mess in the making but no one seems to be noticing. Just as it was when owners began forking out 8 to 10 million dollar contracts at the turn of the century, this practice of spending money teams don't have while forcing others continuously raise their payrolls, the whole time stealing money from the markets that turn a profit, will drive the NHLs finances into ruin. Money that does not exist is being spent while profits that aren't even their own are being added to the books by teams and owners who just a few years ago canceled a season on the premise that they were going broke. And just think, Bettman is a certified accountant.