Economics and the mid-life crisis have much in common: Both dwell on foregone opportunities

C'est la vie; c'est la guerre; c'est la pomme de terre . . . . . . . . . . . . . email: jpalmer at uwo dot ca

. . . . . . . . . . .Richard Posner should be awarded the next Nobel Prize in Economics . . . . . . . . . . . .

Saturday, February 19, 2005

Hockey: We Had to Bomb the Village to Save It

People from my generation will remember the subtitle of this posting as a quote from LBJ or General Westmoreland or somebody during the Vietnam era. We hooted with derision when it came out. And as James Taranto (last article at this link) points out, that is vaguely analogous to what has happened in the NHL.[h/t to JC]:

Hockey, for crying out loud, is another Vietnam!

I've been asked by several commenters to my last piece why I was so rough on NHL Commissioner, Gary Bettman. I have had to think long and hard about this, because I probably shot that last post off too quickly. I have finally realized several things about the lockout [I'm a slow learner, which is why I'm an academic instead of out there competing in the real world]:

  1. As Chris Bruce posted to the Econ-Law e-mail list, it seems clear the players underestimated either the losses of the owners or the strength of their convictions, probably the former. I can't say as I blame the players much here; owners in other sports have been known to overstate their alleged losses dramatically. But if, as Tom Luongo says in his superb piece on the lockout, the NHLPA refused to look at the books, it is time for the players to get a new leader. It is probably time, anyway, as I note later.
  2. I, personally, do not enjoy the game of chicken. I do not like watching it played, either. I don't know why I hold the owners more responsible than the players for playing it so publicly, but to my ear the tone of Bettman's releases was more of "We're gonna get you" than was Goodenow's.
  3. Too many people blaming the players do so out of jealousy: "They're making millions to play a game; they should just sign a deal and play," is the type of thing I've heard too often, and it is irritating, especially considering the wealth of the owners, too, and considering the incomes of other entertainers.
  4. As I have posted before, I don't much like hockey anymore. I hold the owners in general and Bettman in particular responsible for this. So does Brian Goff. So does Michael Farber at Sports Illustrated. Eric McErlain at the superb Off-Wing Opinion says some pretty similar things.
  5. In his defence, Bettman was quite possibly correct that the deal offered on Tuesday was the best offer the players will ever get. [digression: there are still some stories circulating that some owners and some players are trying to resurrect a deal and will meet on Saturday; other sources think it unlikely that a deal will be reached.] Tony Chapman of Capital C, which places a lot of sports advertising said on Sportsnet Thursday night that with this season canceled and the next one in doubt, advertising with the NHL has plummeted dramatically. His estimate is that even if the NHL begins play on time next season, the total revenues for the league will be no more than 2/3 of the revenues in the 2003-04 season. The implication is that the expected marginal revenue product of playing ability will be very low, compared with the players' expectations.
  6. The result of the previous point is that a LOT of money has been left on the table, not just from this year's playoffs, but from next season and into the future as well. When negotiators fail to take that money off the table, there is good reason to expect they haven't done their jobs. Also see this piece by Phil Miller, co-blogger at The Sports Economist.

This posting has become far too long. More on other points later.

Who Links Here