Why can't Goodenow just understand?

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EJsens1

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Tom_Benjamin said:
The reason salaries are never reduced in arbitration is that in every single case both the player and the team agree the player is entitled to a raise. The only question is "how much"?

If only the player can file for arbitration, how does the team 'agree' to the player being entitled to a raise???
 

Tom_Benjamin

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Craven Morehead said:
If only the player can file for arbitration, how does the team 'agree' to the player being entitled to a raise???

In every case, the owners have submitted a raise to the arbitrator. The qualifying offer was turned down. If the team wants they can submit any amount. They can try to convince the arbitrator that the player deserves a huge pay cut. They never do because the player is always going to get a large increase. The dispute is always between large and larger.

The owners win more of the cases than the players do. The Canucks have never lost an arbitration case. The most recent was Morrison. Brendan asked for $3.5 million using Bonk and O'Neill as comparables. The Canucks submitted their last offer which was $2 million. The arbitrator awarded $2.25 million. The fact that Morrison was the lowest paid number one centre in the NHL at $675,000 before this contract is irrelevant.

The next day, the hockey media declared that Morrison "won" a 300% increase in salary.

Tom
 

dawgbone

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Tom_Benjamin said:
NHL salaries go up and go down.

When was the last time the average salary in the NHL went down?

The reason salaries are never reduced in arbitration is that in every single case both the player and the team agree the player is entitled to a raise. The only question is "how much"?

Wrong. I can guarantee that not every case had both the player and the team agreeing the player deserved a raise. An example? Richard Matvichuk.

This is logic? The issue is not whether salaries awarded in arbitration have gone up significantly over the past ten years. The market has gone up significantly so of course they have. If player awards have risen faster than the market, the system is clearly inflationary. If awards went up slower than inflation, the system is a drag on salaries. If the inflation rate is about the same, the system is behaving as it should.

I don't have the data. The NHL does. If they want to show arbitration is inflationary, they can easily show that it is inflationary. They have not done that. Instead they spin out a percentage increase won by players in arbitration and pretend that proves a point. Why? Are they that stupid? Are they that unprofessional?

Wrong again. The problem is the word market that gets thrown around. It's not a market, certainly not a free market. Can someone tell me how outside of professional sports 1 case can set "the market"? Once one player gets a contract, the market is set... sorry, that's not a market being set. That is one case, or one precedant. So it isn't that salary arbitration inflates or drags the market, but instead it's a single precedant that effects arbitration awards... the market has nothing to do with it. The market would involve looking at the whole group of comparable players, and getting a mean, or even better a median salary number out of that. That would in fact be the market... except they don't do that. It's usually the single highest value that is pulled out, which isn't the market, but instead one precedant.

Nope. They do think you are that stupid and it looks like they are right.

Funny you should talk about stupid. You seem to have bought Goodenow's opinion of the Levitt report hook, line and sinker. The NHLPA's hope is that people won't actually read it, and read the fact that the PA has been challenged by Levitt to discuss his findings. The fact of the matter is, they won't.

Why is that?

Because they'd get thier rear ends handed back to them mighty quick. They want nothing to do with the Levitt report because they have no way to discredit it. They'll take shots in the media over it, in an attempt to win the P/R battle, and to get people to go on their side... but they sure as heck won't touch it with a 40 foot pole.

You should ask yourself why. Why, despite the challenge, won't Goodenow and his cronies meet face to face with Levitt to question him over the report? If it's really that easy to discredit, how come they are so vague about their issues with the report? They lob a lot of potshots, but nothing concrete, and nothing relevant.

Why is that?

The answer is simple. It's a heck of a lot more right, and a heck of a lot more accurate than they are leading everyone to beleive. And because of the posturing going on, accuracy is something they are avoiding like the plague.
 
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EJsens1

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Tom_Benjamin said:
In every case, the owners have submitted a raise to the arbitrator. The qualifying offer was turned down. If the team wants they can submit any amount. They can try to convince the arbitrator that the player deserves a huge pay cut. They never do because the player is always going to get a large increase. The dispute is always between large and larger.

Then how can you argue that arbitration is not inflationary??? Maybe I misread what you said above, but it seems like you are arguing both sides here. I'm not trying to start a debate with you, as I'm certainly not an expert in business or the CBA, but I'm just confused a bit. Do all players who file for arbitration make under thge league average??? If they don't, I thought they only get qualified and don't receive get the 10% increase for making less then the league average, so wouldn't that mean 'not every' case means there is an automatic raise necessarily???

The owners win more of the cases than the players do. The Canucks have never lost an arbitration case. The most recent was Morrison. Brendan asked for $3.5 million using Bonk and O'Neill as comparables. The Canucks submitted their last offer which was $2 million. The arbitrator awarded $2.25 million. The fact that Morrison was the lowest paid number one centre in the NHL at $675,000 before this contract is irrelevant.

The next day, the hockey media declared that Morrison "won" a 300% increase in salary.

I'm starting to think its irrelevent that a "winner" is declared. The bottom line is that Morrison still got more money then what the final Canucks offer was, which you said was $2 million. Its still inflationary from what I can see. Is there something else that I am missing(there is no sarcasm in there, a genuine question)???
 

dawgbone

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Tom_Benjamin said:
In every case, the owners have submitted a raise to the arbitrator. The qualifying offer was turned down. If the team wants they can submit any amount. They can try to convince the arbitrator that the player deserves a huge pay cut. They never do because the player is always going to get a large increase. The dispute is always between large and larger.

Wrong again. Once again, Richard Matvichuk. The Stars felt he didn't deserve a raise after a dismal season, he felt he did. The stars offer in arbitration was not a raise.

Sorry bud, but you are flat out wrong.

The owners win more of the cases than the players do. The Canucks have never lost an arbitration case. The most recent was Morrison. Brendan asked for $3.5 million using Bonk and O'Neill as comparables. The Canucks submitted their last offer which was $2 million. The arbitrator awarded $2.25 million. The fact that Morrison was the lowest paid number one centre in the NHL at $675,000 before this contract is irrelevant.

That may be the last contract they offered him, but what did values did they use in arbitration? I'll guarantee you it wasn't $2mil... they would have had to have been stupid to have gone into arbitration with an offer of 3 times what he made the previous year. The owners lose whenever an arbitrator gives the player more than the team was willing to pay. If the team was offering $2.4 mil before the hearing, and the player ends up with $2.9, the player won. The players, not the teams usually come out on top in arbitration.

Sure, there's the odd case, like Matvichuk, where the owner wins... but they are few and far between.

The next day, the hockey media declared that Morrison "won" a 300% increase in salary.

Well he did win a 300% increase in salary. It may not have been the 550% he was looking for, but it was more than what the team was offering him.
 

YellHockey*

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Craven Morehead said:
Then how can you argue that arbitration is not inflationary??? Maybe I misread what you said above, but it seems like you are arguing both sides here. I'm not trying to start a debate with you, as I'm certainly not an expert in business or the CBA, but I'm just confused a bit. Do all players who file for arbitration make under thge league average??? If they don't, I thought they only get qualified and don't receive get the 10% increase for making less then the league average, so wouldn't that mean 'not every' case means there is an automatic raise necessarily??

The problem here is that lots of misinformed people are comparing apples and oranges. They're comparing the salary of a fifth year player for one season to a sixth year player for the following season. They really should be comparing the salaries of sixth year players for one season to sixth year players in the following season.

Here's an example. Say you want to test to see if some radically different testing technique helps kids learn better in the fifth grade. You don't test the kids after the fourth grade, retest them after they've done the fifth grade and then say, "they know more then the year before so the technique must make kids learn better!". You test the results of the kids being taught using the new technique with the kids from the year before who weren't using the new technique.
 

Tom_Benjamin

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Craven Morehead said:
Do all players who file for arbitration make under thge league average??? If they don't, I thought they only get qualified and don't receive get the 10% increase for making less then the league average, so wouldn't that mean 'not every' case means there is an automatic raise necessarily???

Players who make more than the ALS receive a qualifying offer, too. It just doesn't include the 10% raise. Arbitration is a process that is designed to ensure fairness in a process when a player is forced to negotiate with one team.

In most cases, contracts are very easily settled. The player either accepts the qualifying offer (or the team cuts the guy loose without qualifying him) or the team and the player agree to a value.

What about when there is no agreement? The player has an option of a holdout or arbitration. In arbitration both sides submit a case. The arbitrator is supposed to award a contract that is "market value" for the player. In other words, Brendan Morrison is supposed to be awarded a salary that is about the same as comparable players at a comparable stage in their careers. The result is binding on the player, but not binding on the team.

Players win the right to arbitration after five years in the NHL. Those first five years the salary is controlled by the entry level system. As a result, player salaries across the league double at about age 25 when the player wage is no longer constrained. We would expect, therefore, that arbitration awards to players filing at the first opportunity would also on average double.

(That's what is so bogus about the NHL and Bill Daly on this subject. Daly points at the awards and says "Look! Arbitrators double the salaries of players who file!" That is meaningless because the salaries of players who don't file also double.)

The process in the Morrison case if the media reports were correct went like this:

1) The Canucks made a timely qualifying offer of $725,000 to retain Morrison's rights and opened negotiations. Morrison rejected the offer and demanded Radek Bonk-Jeff O'Neill money.

2) Negotiations stalled with the parties about $500,000 apart. The Canucks were offering $2.5 million, Morrison wanted $3 million. Morrison files for arbitration.

3) Morrison submitted a demand for $3.5 million to the arbitrator and cites his comparables. The Canucks submit $2 million claiming Morrison did not have nearly the career statistics of Bonk and O'Neill - he had only one year at theirv level of production - and claiming that Morrison benefited more from his linemates.

4) The team can choose to make awards one year or two. The Canucks chose two and arbitrator awarded $2.25 million and $2.5 million.

The Canucks were delighted. Morrison would have done better if he accepted the Canucks last offer and passed on arbitration. This year the Canucks and Morrison agreed to a $3.55 million deal without going to arbitration.

I'm starting to think its irrelevent that a "winner" is declared. The bottom line is that Morrison still got more money then what the final Canucks offer was, which you said was $2 million. Its still inflationary from what I can see. Is there something else that I am missing(there is no sarcasm in there, a genuine question)???

It is possible that the arbitration system drives up salaries. It is not supposed to drive them up, but a flawed system could have that result. The key question to determine whether that is the case is "Have the awards been, on average, for more than the market value of the player? Do the awards follow a league wide standard or do they set a standard?"

I have studied the system carefully because I have completed arbitration briefs for a player agent. I don't believe the awards have been, on balance, for more than the player is worth given the prevailing market. I can only think of one award that set a standard in ten years.

Keep in mind that the NHL (and the NHLPA) have the right to fire any arbitrator without cause. If they don't like the decisions, they can get rid of the arbitrator. The worst single decision made was Bryan McCabe's first award and the NHL immediately - and correctly in my view - fired the guy. They agree to the arbitrator and they can the incompetent ones.

Have the awards been, on average, for more than the market value of the player? I don't think so, but my opinion is anecdotal. The point is that anyone with a passing knowledge of statistical analysis could devise a dozen ways to test whether NHL arbitration awards followed the market or set the market.

If the NHL was serious about arbitration as an issue and they see it as a real problem, they do a statistical study, present it to Goodenow and say, "Something is wrong. Look! Arbitration awards are setting market value and they are supposed to be reflecting it."

Why don't they do that? I think the most reasonable answer is that the owners don't really care about arbitration. They care about getting a salary cap system and the premise is "We need a salary cap system because the existing CBA doesn't work."

How do we know the CBA doesn't work? Because the arbitrators double player salaries! Gasp!

Tom
 

thinkwild

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Craven Morehead said:
Then how can you argue that arbitration is not inflationary??? Do all players who file for arbitration make under thge league average???

Arbitration is a only a tool for RFAs, who by definition dont have the leverage to negotiate their full market value. The ALS is just a number. That they are over the ALS doesnt mean they are overpaid. Overpaid is if they are getting more than their true market value. Unfortunately we can only guess what that would really be if RFAs were allowed to offer their services in a true free market for their services.



I think of a mythical example of a Carpenters For hire Personnel company. I bid on contracts for work, and then send out my carpenters on salary to do it. And I have the worlds best carpenters which allow to be bid on big expensive contracts for fancy spiral staircases and elaborate woodworking. I also have some of the best young apprentices trying to land with me full time at the big rates. Once you have apprenticed for 13 years, you are entitled to make up to $90,000 a year or even 90% of your per diem if you are a good one. But for your first 13 yrs, you are an apprentice on capped hourly wages. You start at $7/hr and each yr you negotiate raises with your boss until your apprenticeship is finished. Then you get seniority and the big money.

So after 4 years, the young apprentice goes to his boss and says, look, im just as good as the vets, I know I cant expect the money they make when im still an apprentice, but I still think I should get a bigger raise than the rest of the apprentices who can only build something half as well as me. Instead of the normal raise to $12/hr in my 4th yr, I should get $16/hr like often happens in other companie with people of my level...

They decide to settle through a carpentry board arbitrator who agrees the young apprentice is very good, and he should get $16/hr.

Now the company goes to its clients and says, look he went from $7/hr to $16/hr. Our costs are more than doubling with these huge increases in pay to our employees. How can we afford to to stay in business and compete against the other Carpentry Personnel Companies who pay way more. You can see why I will have to charge you more for your carpentry work, salaries are out of control. Next time Im going to negotiate a total payroll cap that is 60% of the revenue I get from the contracts I send them on. And I will define the revenue, and they will have to believe me.

Say all my employees have to buy their supplies from me, and I have started a company on the side that because it was selling to them, grew into a huge lumberwarehouse with expert carpenters on hand to help customers. Because of them, this side business makes lots of money because people like getting advice from the best carpenters. If I didnt have them in my personnel services company, my warehouse would make less money. But Im not going to tell my carpenters that. They have no right to ask for bigger raises because of that, that is unrelated carpentry services revenue.
 

thinkwild

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dawgbone said:
Excuse me, but they do it now. There are teams who limit the amount of their revenue that they spend on salaires. There is nothing illegal about it, which was exactly what he said. The owners cannot collude and make a league wide agreement that each team will only spend $30mil on salaries... now, I might have read it wrong but he seemed to be talking about the teams as individual corporations, not in terms of colluding with each other.

Yes this is a budget. This is what the players are saying the owners should do. If they dont have the money, dont spend it. Stick to your budget. No one will complain about that. Do what is in your best interest.

dawgbone said:
I agree... but if you have a city where the fans are willing to come out, shouldn't that team be worth saving? Hey, if Carolina can't get 11,000 fans out to a game, maybe they aren't worth saving, but what about a team that sells out 95% of the building the whole year?

Any specific team in mind?
 

me2

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thinkwild said:
Would purchasing the Canes for $50mil, getting a sweetheart deal on the arena where you get all the revenues and a municapal restructuring fund or a slots license pays its expenses for you? Absolutely. And there's a market there. If not, move it somewhere it will like they do in the NFL, but I think theres a market there.

How much money should he make on his $50mil investment a year? More than $5mil? More than Brind'amours salary? THe difference between losing a few mil or making a reasonable profit is one expensive UFA by a GM and scouting staff being paid in the millions. Its reasonable to ask that of management I think rather than expect the players to foot the bill. Thats what they are paid so much to do.

Of course there's 10's of millions in profits available if you go deep in the playoffs. A couple years of that can wipe out a decade of paltry losses while you were rebuilding and developing a product. Not to mention the new franchise value of Carolina when it is successful, selling more tickets at higher prices and winning in the playoffs.


How can the players not want to buy it when you put it that. 3-4c from every dollar the players earn in just one year and they could own it. You'd think they'd be falling all over themselves to get that deal done.
 

thinkwild

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And they are buying into teams. If they can find partners anywhere near the stratosphere of the current owners. An NHL players meagre salary will leave him hard pressed to own a team. The arena can be a long term business deal and you need the resources to pull that off profitably and deal long term with the revenue fluctuations. But I bet in the end, Mario does pretty well from owning his team. And if Gretzkys investments pay off, maybe one day he can actually parlay it into full ownership of the team.
 

me2

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thinkwild said:
Arbitration is a only a tool for RFAs, who by definition dont have the leverage to negotiate their full market value. The ALS is just a number. That they are over the ALS doesnt mean they are overpaid. Overpaid is if they are getting more than their true market value. Unfortunately we can only guess what that would really be if RFAs were allowed to offer their services in a true free market for their services.



I think of a mythical example of a Carpenters For hire Personnel company. I bid on contracts for work, and then send out my carpenters on salary to do it. And I have the worlds best carpenters which allow to be bid on big expensive contracts for fancy spiral staircases and elaborate woodworking. I also have some of the best young apprentices trying to land with me full time at the big rates. Once you have apprenticed for 13 years, you are entitled to make up to $90,000 a year or even 90% of your per diem if you are a good one. But for your first 13 yrs, you are an apprentice on capped hourly wages. You start at $7/hr and each yr you negotiate raises with your boss until your apprenticeship is finished. Then you get seniority and the big money.

So after 4 years, the young apprentice goes to his boss and says, look, im just as good as the vets, I know I cant expect the money they make when im still an apprentice, but I still think I should get a bigger raise than the rest of the apprentices who can only build something half as well as me. Instead of the normal raise to $12/hr in my 4th yr, I should get $16/hr like often happens in other companie with people of my level...

They decide to settle through a carpentry board arbitrator who agrees the young apprentice is very good, and he should get $16/hr.

Now the company goes to its clients and says, look he went from $7/hr to $16/hr. Our costs are more than doubling with these huge increases in pay to our employees. How can we afford to to stay in business and compete against the other Carpentry Personnel Companies who pay way more. You can see why I will have to charge you more for your carpentry work, salaries are out of control. Next time Im going to negotiate a total payroll cap that is 60% of the revenue I get from the contracts I send them on. And I will define the revenue, and they will have to believe me.


Excellent solution. Now all you have to do is convince the NHL players to work for $16/h and prospects for $7/h. Even Bettman might waive the $32m cap plan.
 

me2

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thinkwild said:
No problem. Meantime im sure you'll have the owners agreeing to $3 tickets.

No problems at all. We'll get the players a team bus and some tents to save money on travel costs. Pack their lunches before the trips. If they win we'll shout them some McDonalds.

This is working out great. Should I call Goodenow and Bettman or will you?
 

quat

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thinkwild said:
Yes this is a budget. This is what the players are saying the owners should do. If they dont have the money, dont spend it. Stick to your budget. No one will complain about that. Do what is in your best interest.
Sure, but this is proven to be not viable for a league of teams, ie the NHL. What you say makes sense, especially if you don't particularily care if teams fold. What the owners are after, all 30 of them, is what is best for them as a group rather than as individuals. As you've pointed out, teams like Toronto or Philly will always do well regardless. The fact is though, they realize that an even playing field breeds healthy competition and more interest in their sport and product, which leads to more money. This is good for all player, and likely better for all fans.

The model we have now is best for the best players (short term anyhow... though it could be argued that a decrease in the interest in hockey would substantially lower their market value), best for the fans with teams that have large populations and a strong hockey base, and probably overall not that good for the owners of the strong franchises (ie loss of franchise value due to other teams folding... though this is debatable), and certainly very bad for owners of the smaller, weaker fan base/population teams.

I think what the owners are after would be better for Canadain hockey fans because, I don't really think there will be enough long term interst in hockey in some of the US markets, and with some kind of cost certainty, cities like Winnipeg or Quebec could realistically estimate costs vs revenue and we could see NHL hockey grow in Canada.

In the second example, Canadain cities could eventually pick up failing franchises, and they could certainly be somewhat viable especially if hockey loses even more of it's ability to generate income in the US, but they would always be lame duck teams in that they would never have the financial deep pockets that the present big seven would have for salary.
 

Brent Burns Beard

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The fact is though, they realize that an even playing field breeds healthy competition

are you implying that todays NHL doesnt have healthy competition ? this lockout isnt about a "level playing field", its about finance. even the owners know that the league is already pretty much balanced competitvly.

dr
 

dawgbone

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DementedReality said:
are you implying that todays NHL doesnt have healthy competition ? this lockout isnt about a "level playing field", its about finance. even the owners know that the league is already pretty much balanced competitvly.

dr

No... an even playing field doesn't mean healthy competition. It means that whether you are a large or small market, you can compete financially.

It's a financial level playing field... not an on-ice level playing field.
 

John Flyers Fan

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dawgbone said:
No... an even playing field doesn't mean healthy competition. It means that whether you are a large or small market, you can compete financially.

It's a financial level playing field... not an on-ice level playing field.

If you were an owner and paid $250 million USD. for the Colorado Avalanche, shouldn't you expect to generate more revenue than an owner that paid $150 million Cdn. for the Ottawa Senators ???
 

copperandblue

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John Flyers Fan said:
If you were an owner and paid $250 million USD. for the Colorado Avalanche, shouldn't you expect to generate more revenue than an owner that paid $150 million Cdn. for the Ottawa Senators ???

It's not about generating it's about spending... if you can generate twice as much as some other teams but were REGULATED to spend the same amount as everyone else, then isn't that a good thing in terms of your investment?
 

BD

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mr gib said:
why should they?


why should you.

choice is to accept or walk

can you afford to walk. i don't think so. i think players are puffing too much of the union smokey rhetoric of no salary cap in a sport making far less than other sports that do have it. the unions voice falls flat, and fans are not buying it. kill your sport, do whatever you want. but why should they accept a salary cap...b/c your sport is in trouble, and if you can't see that clearly, I'd stay to skating ponds. the ownership is a bunch of morons. but here's rub...they are the "owners". the people eating it or paying huge money to keep a team in town for fans who are pretty pissed off at your/union's companyline of no cap. These fans who you have polarized, most of whom just don't agree with you/union. These fans who both you, union and owners, need to keep this sport alive. We are your lifeblood. And your lifeblood is rebelling from this impasse created by mismanagement, greed, and obtuseness in the face of real economic and sport/audience realities.


wake up, i beg of you.
 
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