Salary Cap Inflates Prices
Ever wonder why there has been so many ridiculously huge salary cap hits being handed out all over the place?
I guess we only have the NHL to blame.
With the salary cap going up from last year about $5 million, teams have found that they can spend more than is needed. Even looking at the signings that have happened already, there have been some major overspending. Here are some contracts handed out that I thought were a bit much:
Now, I didn't want to critize all of those contracts, the point is that they are being paid too much in my opinion.
The fact of the matter is that free agency can be a gold mine for players. Look at Joel Ward and Sean Bergenheim. They got hefty raises and it was because of their playoff performances. So in essence, to get a FA to sign, you need to overspend a little bit. That's understandable and it happens all the time. You see the Brad Richards bidding war? Whoever went the highest got him.
As for everyone else, it might be the simple matter of supply and demand. The free agent crop was at best mediocre. The only big-big name of the year was Richards and he got what he deserved.
Because the cap went up, it only makes sense that player salaries will go up. Agents have obviously noticed that if a team has a little more cap space, take a bigger piece of the pie. And why not? Their job is to get thier client the highest amount of money possible. At the end of the day it's a business.
I'm okay with teams overspending a bit, but my worry is that in time it will catch up to them. Teams like Detroit and Buffalo and Toronto won't be affected that much because of the billionaires running the show. It's teams like Florida and Phoenix who will meet their downfall. Florida is overpaying just to get to the cap floor (which by the way is almost 10 million dollars higher than the original 39 million dollar cap floor from 2006).
The current CBA is set to expire on September 15, 2012. This is the final year of the current CBA as the NHLPA will no longer have the option of to extend the current CBA. Should neither side reach an agreementprior to the start of the 2012-13 season the rules of the current CBA wil be grandfathered in until anew settlement is ratified, which could mean another lockout (potentially).
With Atlanta already biting the dust, more teams could be on the way. The point of the salary cap was to decrease the NHL's percentage of spending on player salaries (which is at about 75% of league revenues). The current cap is so high that the number of player salaries outdoes the league's revenue, which would not be good. With the NBA and NFL already going through CBA related issues (both are locked out for now), the NHL can not afford to lose another season due to legal squabling. The NBA and NFL can recover from it because of the huge American fanbase, but hockey suffered in 2005 and it would suffer in 2012-13.
The 2005 lockout started the same it is now; with teams overspending. Remember Bobby Holik's monster contract? It probably kick started the debate back then. Ville Leino's contract should raise some eyeborws, as his career high in goals is 19. And Buffalo will pay him 4.5 million dollars for next season. That's $236,000 for every goal. Seems pretty steep to me.
Hopefully the league can do something about these skyrocketing salaries before it's to late.