Discussion in 'The Business of Hockey' started by Flames Draft Watcher, Nov 19, 2004.
wow some of those proposals are just... bad. points not $$, league reviewed contracts? I'm surprised that the union is not begging to go to the table and sign one of those ideas. Since the League has no intention of bargaining, I guess that's what the NHLPA has to choose from.
Thanks for the link. Very interesting.
I read the Bill Daly chat transcript and seeing those offers showed how much of a farce the league negotiating committee truly is. If anyone who sides with the owners can say that those deals that were put forth were fair, then you need to give your head a shake. Those were some really, really, really bad deals. I had to admit I thought the players union were joking when they said that the proposals they received from the owners were less than 100 words. I see these proposals and can honestly say that the players union weren't lying about that and that the longer this goes on and the more stuff like this comes out, the more it looks like the owners were never interested in negotiating a fair deal to begin with. All of this though leads me to one question: Is Harry Sinden on the owner's negotiating team?
i feel the same way FF10. the league hasn't made a fair effort to negotiate. as well, it seems as if though the league is using an excuse (not talking the "same language") to lock out the players. further, this owner's lockout has been in the works for years now. how is that negotiating in good faith???
meanwhile, the players have made some concessions and do acknowledge some of the league's problems (despite being skeptical of the actual total money lost in the past years). however, they do need to make a sensible offer that will make some owners think to put an end to their lockout. a 5% rollback and a lenient luxury tax isn't enough. a more approrpriate offer would include a 1:1 dollar tax (for every doller spent over the limit). but i fear that only a soft salary cap at the least would salvage a season.
The latter paragraph was one he repeated several times. There is several interesting things I note in what he is saying.
For one, he notes that the winning teams would have a 50% higher payroll than teams that dont make the playoffs. Which would be natural as they would have made the extra playoff money and could afford it. Seems obvious, but I think it warrants repeating. His cost certainty isnt meant to get rid of payroll disparity, and in fact he is worried we think he is trying to eliminate it.
Along with this he acknowledges that the system will allow for payroll disparity. I think it is interesting to note that he is stating that feature as if its a concession, that he is selling it to the players and fans, by suggesting that the system will indeed allow for Payroll disparity.
And he reassures us, that this idea will still allow for guaranteed contracts, and agents to keep their functions. He recognizes players had those as valid concerns,
As well he says concerns about salary stratification between high and low salaried players can be negotiated. Stratification will happen.
Regarding Levitt, I think its worth noting how he describes it. Levitt states his numbers fairly reflect the results of the league, Accurately reflect the state of the business. Reflect. Forbes shows that there are other ways of "reflecting" the business.
Regarding 1:1 luxury tax, philisophically speaking, my only recourse when we dont have economic modelling data, Im not convinced this is necessarily a better solution for fans or even teams than a lower tax rate. A one for one luxury tax would seem to cement the advantage of the ultra large markets, as they could easily double the threshold payroll while paying the taxes while few other teams could. It would also likely raise less money. The purpose of the luxury tax is to alleviate revenue disparity. To share with teams losing money. Not for them to necessarily use for buying players but to cover their legitimate losses. The assumption is that only by getting closer to a 100% tax is it properly acting as a cap, but it doesnt properly act as a cap, it only furthers the disparity and raises less money for redistributiuon.
The 100% tax I dont think is necessarily the way that best achieve the objectives the luxury tax/revenue sharing is best designed to accomplish. A 100% luxury tax is nowhere close to the same as a strict cap at that level. It does not come closer to acting as a cap. It could further exacerbate the disparity problem in fact.
I don't think there can be any doubt what this labour dispute is about. If the players offered to tie salaries to "designated" revenues, nothing else would matter. In other words, they could have exactly what is in today's CBA as long as they add an escrow provision that kicks money back to the owners if payrolls go over XX% of "designated" revenues.
Meehan had an interesting comment after the player agent meeting. He said that the player offer was a good response to the problems articulated by the league. The NHLPA asked the NHL to specifically outline the problems with the old CBA, and the NHL articulated three problems:
1) Salaries are too high and the owners are sustaining significant losses.
2) Payroll disparities are too high which makes the low revenue teams too hard to market
3) The entry level system has loopholes that defeat the purpose.
The NHLPA offer specifically addressed each concern. The luxury tax is as much about revenue sharing as preventing the big money teams from spending. That's why the NHL rejects it unless it is like Burke's proposal, a defacto cap.
The first NHL proposal on the subject had taxes imposed on all payrolls above the league average and the tax distributed to all teams below the league average. While it isn't possible to say exactly what that would have done, it surely would have reduced payroll disparity. The teams above average would spend somewhat less and the teams below would have the resources to spend somewhat more.
The player proposal was directed at the precise problems articulated by the league. The 5% said "The players will cover half the current loss. The owners are responsible for the other half." The luxury tax addresses payroll disparities so that teams can more easily sell false hope to the chumps who think their team is losing because of money. The loopholes were eliminated in the entry level system.
These proposals weren't even considered by the league. If Bettman was an honest human being instead of a slug, he's admit the truth which is that the only thing wrong with the old CBA is that profits weren't being guaranteed by a salary cap. Since the players aren't willing to guarantee owner profits at their expense, they aren't talking Bettman's language.
They are talking English. Bettman is talking in slimy slug.
Thoose where some real neat and creative proposals the NHL offered. The hard cap was the best one out all of them and the NHLPA should quickly accept it before its too late and Lonny Bohonos and Rocky Tomphson become the new Iginla and Kovalchuck of the NHL.
thinkwild, i doubt a 1:1 luxury tax would further widen the disparity at all. there's already a 60 mill difference between the lowest and highest paid teams. there's great disparity already. plus, a luxury threshold with some teeth will significantly punish big market teams that go over the established limit. it'll get them to their maximal budget much quicker, thus reducing the amount of money they may actually spend on players themselves. as well, if the league wants more revenue sharing, it should implement a an additional lower tax threshold which is marginally punitive.
You have the IQ of a rock.
The large teams already have cemented their financial advantage. Cutting them back with a $1 for $1 cap allows the lesser clubs to keep closer to the richer clubs than the current free for all. It also helps them keep their own players longer using distributed tax from the overspenders.
You can't have it both ways. The only way it could raise less money is if teams didn't spend on extra salary. Lets see if the Wings have $70m to spend
The salary cap is $30m + 1 for 1 tax
The wings now spend $50m on salaries and $20m for tax
The salary cap is $30m + 25c for $1 tax
The wings now spend $60m on salaries and $10m for tax
The top one seems better for a poor club. Maybe the Wings baulk at the $1 for $1 and only spend $50m total, $40m for salaries and $10m for tax. Same tax and $20m less in payroll than a 25c tax. Looks like another win for the poor clubs.
Look at the above examples. How does it further the disparity? Teams like the Wings, Philly and TO would probably run $45m in payroll + $15m in tax in a $1 for $1 above $30m system. The poorer teams get to share in the $15m from each of these teams while only being at a $15m payroll disadvantage.
Poorer teams get more money to give to their players, spreading the wealth. The rich teams get a substantial advantage from spending $15m extra. Suits most teams.
How is a weak luxury tax a benefit? Lets take the NHLPAs 20% rate of tax. A $40m payroll at $1 for $1 above $30m can raise $10m in tax. A 20% tax above $30m would require an $80m payroll to raise the same tax.
I don't really see too much wrong with many of those proposals other than the thresholds set on them. I think it's fair for the players to ask for more than 50% of the revenues for one, and understand that it's a hard task to determine what the true revenues are. Ideally, if the two sides could agree to what the revenues were, and then agree to what percent each side wanted of the revenues, these proposals could work.
I specifically liked the proposal of linking winning to salary. I don't think it should exclusively count during the playoffs, because many players contribute to a winning season which counts for a lot as well. I don't mind seeing the payroll disparity if that disparity is linked to winning versus the money that a team can afford to spend. Based on that, even the poorer teams like Carolina or Anaheim can end up with a higher payroll for their winning seasons and then it falls back down to earth if they don't repeat their performances. It's when these teams have a Cinderella run like that and then repeat those performances but carry the inflated salaries from the run that hurts the economic balance. I don't mind Detroit having the highest payroll in the league if they win the Cup, but as long as that payroll is a result of winning the Cup, not part of the reason why they won that Cup.
Some of those systems were pretty strange but a couple don't look too unreasonable. I think the PA has got to do a little better on their next offer if any progress is going to be made. This whole lockout is pretty silly and I find that I don't really miss the NHL playing right now. But the problems must be solved.
I think the point is that if the NHLPA wants to discuss a deal, they have to choose one of those 6 deals or slight variations of them. The league does NOT want to bargain, it has a deal in mind that the PA must agree to and the PA is telling them to shove it.. This is why both sides are not talking.
Personal insults suck.
The problem is that the PA made an offer in Sept that they knew wasn't going to be accepted as it was a worse deal than what was offered a year ago. Fact is that like it or not, the PA is going to lose this battle. It's a question of how badly that they want to lose.
Not even close to the truth.
Daly on "Off the Record" was quite clear in stating that the owners were prepared to discuss ANY formula that ties salaries to revenues. He specifically refered to the NBA "soft cap" solution as one that they would willingly negotiate with the players.
I guess its which propoganda you choose to believe.
Hmmm...I heard the words directly from Daly's mouth, on record, in a public forum. He was simply stating their stance. Call it propoganda if you like, but obviously for Bettman, the NHL is prepared to negotiate any deal that ties salaries to revenue. I'm citing the individual and your citing an anonymous agent in a second hand report of what he reportedly heard and saw in a closed door meeting.
What do you think more accurately reflects the NHL's stance?
And, for the past three months, neither side appears overly thrilled at finding a middle ground.
Well, if NHL really means business, they can start up by making the real financial books of all the teams public (not artificial URO's), or at least reveal them to NHLPA without any gag orders. (See NHLPA website for details)
Thus the real revenues would be open for everybody to see and open to debate, to see who's hiding something or distorting facts.