Framing the Issue and Reasons for Optimism
A friend of me recently asked whether I thought the media was doing a better job covering the CBA negotiations than they did in 2004. “The players seem to be winning the PR war,” he said, “And the hockey reporters seem to be a lot more sympathetic to the plight of the players.”
“They are winning the the PR war because Gary isn’t bothering to fight,” I replied. “And the sympathy for the players stops short of opposing Bettman on the only issue that matters.”
During the 2004 dispute I wrote things that I thought were blindingly obvious but found myself completely out of step with the hockey media. Once again I find myself reading the same facts and hearing the same quotes as all the other hockey writers and drawing conclusions that are completely different than the ones suggested by the narrative playing in the MSM.
The media narrative isn’t exactly wrong, but I don’t think it is right either. Here’s a typical framing of the dispute from Rick Gano at the Globe and Mail:
The league wants the players to give up a significant amount of salary to stabilize the industry while the union maintains that goal would be best accomplished with the wealthy teams doing more to help their struggling counterparts.
I frame the dispute: “The league wants the players to give up a significant amount of salary. It is money. They don’t need a reason.” The distinction may be subtle, but making that distinction puts a different spin on things. This negotiation is not about a need to stabilize the industry and it isn’t about the plight of struggling counterparts. The lion’s share of the money Bettman drags out of the players will end up in the pockets of the rich teams just like it did the last time. Even if the league had zero struggling teams they would be demanding the money and threatening a lockout.
I think everybody in the process understands this. It is the same plan that was sucessfully executed in both football and basketball. The league expects to get this concession because it will bring the NHL into line with the NFL and the NBA. Plus, it is a lot of money and the players are there for the plucking. End of story. As Chris Campoli said, “They just want the money.”
(Speaking of the hockey media not biting the hand etcetera, on this issue – the only one that counts – almost every hockey writer pretty much agrees with the league because, well, just because. Does Gary need more from the press this time around?)
Anyway, Donald Fehr understands what is going on:
“One of the things which appears to happen in the capped sports, is no matter what the economic circumstances are claimed to be, whether they are claimed to be losses as we had in basketball this last time, or whether there’s an acknowledgment there are no financial problems, as we had in the NFL this last time, it doesn’t matter. The position is, we have a cap and the cap has to be lowered.”
Sooner or late the owners are going to say, “This is our final offer. Take (about) 50% of the revenues or you are sitting until you do decide you want to play for (about) 50% of the revenues.” For a host of reasons, the best the players seem able to do is surrender quickly. Caving in is the smart choice – and that’s exactly why Bettman is squeezing very hard.
“I still don’t see how the framing of the issue changes anything,” my friend said. “Yours is just a more cynical view.”
When the problem is framed “Who bails out the sad sacks?” there is a mess. The owners say the players. The players say the rich teams. Some fans say dump the sad sacks. There is no good answer. There is no deal. There is nothing.
When the problem is framed “The owners want more and the players will have to give it to them” there is a more interesting story, a story being missed in the media. I was fairly skeptical when the players hired Donald Fehr because I didn’t see what he could possibly do to change the equation or do anything to get the players out of their box. He’s obviously been wrestling with this seemingly impossible problem for more than a year. What is his plan in the face of the owner’s position? Surely it is more than an offer to take a paycut and some meaningless revenue sharing suggestions. Why does Fehr want to negotiate in dollars and delink the percentage? What’s with the final year option? What is (the famous and brilliant) Donald Fehr up to?
His opening proposal surprised me and after chewing it over, I think we can guess at the outline of his strategy. I can even imagine how he can push the league into a settlement.
On the other hand, the hockey media is filled with doom and gloom after Gary Bettman airily dismissed the player’s proposal. Harrison Mooney puts it as well as anyone when he wrote:
Hockey fans hoping that CBA negotiations could be resolved quickly were disheartened early this week when Donald Fehr described a “meaningful gulf” between the players and the owners. A few days later, another pretty important gulf has sprung up: with less than a month to go until the owners’ September 15th deadline, the NHL and the NHLPA have still yet to agree on which proposal is the basis for their negotiations.
Anyone hoping the two sides are on their way towards bridging the gap had best be concerned, because it should be clear by now that, as it stands, they’re building two separate bridges.
They are indeed building separate bridges, but that’s okay in this case. It appears to me that Fehr and the players have decided they will give up the money. They are going to settle for (about) 50% of the revenues hopefully before they miss any games. The objectives are to push the (about) part as high as possible, b) change the system enough to give the players a chance to hold on to their (about) 50% over the long term and c) end the regular threat of work stoppages in this industry. (Good for them, I say, on all the objectives, but most particularly the one that spares the fans from this soap opera every few years.)
Another reason for optimism is that while Gary Bettman grumbled about the significant gap, he did not specifically rule anything out. I think he is going to come back to the players ignoring the player request to negotiate the cap in dollars, but offering them a fatter percentage as he heads the negotiations toward (about) 50%. He would be building his own bridge, but it is still being built with money. He started by demanding $430 MM a year. The players offered $150 MM, albeit in different form. If he responds with a percentage that represents a clawback of $320 MM… Then Fehr tweaks his bridge again… Sooner or later they will have a deal that (whichever bridge is crossed) represents (about) a 50-50 split going forward.
At this point the players will have given Bettman his money. Bettman will have realized his objective. The only difference would be that the owners would have to pay a significant penalty to repeat the squeeze several years from now if they accept the player bridge. They would have to give the players a fat raise – back to 57% of revenues – for a year to set up a lockout. It provides the opportunity for the league and the NHLPA to quietly negotiate a split that is (about) 50% of revenues indefinitely.
If the NHL is playing a larger game in lockstep with the NFL and NBA they will not be knocked off their path. But if they really want a deal – a good deal – and long term labour peace, they’d have to look very closely at the last offer they see. Will they really want to shut down the sport today to preserve their negotiating power several years down the road? Pay a real cost today for gains that won’t materialize for several years? Is that worth a half season?
Perhaps not. Perhaps the owners will cut the deal. It might work out just as well for them as the current system and if it doesn’t work for them, they can always pay to get their hammer back.
Is that what Donald Fehr is doing? If so, I’m impressed. Is labour peace in our time really possible? I’ve got hope. Out of step again, but cautiously optimistic.