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Ice and Easy
Michael Farber
September 13, 2004
Ending hockey's labor woes isn't difficult--if the NHL and the players can agree on the one move that will give the league a chance to survive
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September 13, 2004

Ice And Easy

Ending hockey's labor woes isn't difficult--if the NHL and the players can agree on the one move that will give the league a chance to survive

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The world looked rosy for the NHL players involved in the World Cup of Hockey last week as the rollicking party bus gaily sped the sport toward Dead Man's Curve. A potentially debilitating lockout was mere days away--the current collective bargaining agreement expires on Sept. 15--but the dressing room chatter was all about hockey: U.S. coach Ron Wilson's scratching a doughy Brett Hull, the Scandinavian smackdown between Finland and Sweden, and Canada's early dominance, which made it the favorite to reach the final in Toronto on Sept. 14. "The [lockout] is there," said Canada's Jarome Iginla. "But in this environment it's pretty easy to forget."

If only it were that easy for everyone else. A coproduction of the NHL and the NHL Players Association--the very entities now snarling at each other across the bargaining table--the World Cup is a celebration of the game's possibilities. In less than a week, though, the festival will be over and the game will most likely go dark. A lockout might ultimately rescue the NHL by leading to a new economic system. It could just as easily decimate a league already suffering from slender TV ratings and the perception that hockey is a niche sport.

The impasse is not about numbers but philosophies. NHL commissioner Gary Bettman, 52 and in his 11th year on the job, was an NBA executive when that league went to a salary cap, in 1984. Having witnessed the tonic effect of that move on pro basketball's finances, he is staking his legacy on gaining a similar system for his league. The NHL contends that its teams lost a combined $273 million in 2002-03; last month Bettman claimed that owners would lose less by shuttering their arenas than by playing games. Unless he gets a system that directly links salaries to revenue, Bettman is prepared to stamp his feet, take his pucks and go home.

But you threaten the most stubborn of pro athletes at your peril. Hockey players tend to shove back, especially when they have an inspiring, Harvard-educated former minor league right wing as their leader. Since taking over as head of the Players Association in 1991, Bob Goodenow, 51, has transformed an impotent union into a stiff-spined little army. Depending on your point of view, the recalcitrant Goodenow is either a serial contrarian or a workingman's hero. There's no denying that he enjoys the support of his tough-minded disciples, and Goodenow is convinced that the injudicious allocation of team resources has caused the NHL's fiscal mess.

Goodenow champions the supremacy of a market-based economic system and will fight fiercely against a salary cap. If Bettman can't or won't come up with an alternative to a cap, this standoff could be--to borrow from 17th-century philosopher Thomas Hobbes's take on life--nasty, brutish and long.

But there is a sensible way out. Bettman has so far refused to consider one compromise solution, even though Goodenow has indicated that it might be acceptable: a luxury tax. The best kind would have a bite bigger than major league baseball's largely ineffective model. Set payrolls at $35 million (the average now is just under $44 million). If a team exceeds that cap, it's taxed 33 cents for every dollar it spends up to $45 million. From $45 to $50 million the tariff jumps to 66 cents. Beyond $50 million there would be a 100% tax on the dollar, with the money going into a revenue-sharing pool. That ought to discourage even the profligate Rangers from signing yet another sexy, big-ticket dud.

The rest of the issues--arbitration, entry-level contracts and bonuses, the age of unrestricted free agents--are essentially bookkeeping and can be hashed out once the main question is agreed upon. Still, some NHL executives privately project a lockout will last until January. Why not avoid all that unnecessary pain and settle this now, the way it is most likely to be settled then, with a well-constructed luxury tax? The NHLPA has shown a willingness to bend on this central issue. Bettman ought to realize that and abandon his salary-cap obsession. You can't always get what you want, but sometimes you get what you need.

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