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Bruce Dowbiggin

Stanley Cup In Canada? All That Glitters Is Not Silver

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For Canada’s glittering NHL prizes, the Edmonton Oilers and Toronto Maple Leafs, time is short. Having reaped a harvest of top draft picks through persistent losing they now sit atop the NHL, ready for a championship. The Oilers are still in the Western Conference championship series, battling Dallas in what seems like an even matchup. We’ll see.

Toronto, as we know, expired ignominiously in the opening round versus a very average Boston team. Knowing that their window is closing the Leafs fired coach Sheldon Keefe in favour of no-nonsense Craig Berube. But their wobbly balance between offence and defence remains to be exploited by opponents. It is exacerbated by the huge amounts paid to their Core Four Auston Matthews ($13.25), William Nylander ($11.5), Mitch Marner ($10.9) and John Tavares ($11 M).

That was lost in the relief of Toronto signing Matthews last August. Alas, despite Matthews netting 69 goals in the regular season, it was not enough. We suggested as much at the time:

1) While Matthews has yet to prove he can lead the Leafs anywhere but a golf course come May, he remains their best hope for any assault on the 56-year Stanley Cup drought. It might be a stretch to say the 40-plus-goal scorer in the regular season led them to their first postseason series win last April against Tampa. Patrice Bergeron he ain’t. But he didn’t hold them back, either. Not every Leafs star can say that. 

He’s at a point (26) where a number of NHL stars have morphed from stats producers to win producers. Bryan Trottier, Steve Yzerman, Joe Sakic and Vincent Lecavalier are a sampling of guys who added leadership their tool box in mid-career and went on to multiple Cups. We will see if Auston does likewise.

2) Matthews’ decision to remain in a Canadian city is a huge relief for the league which has recently seen American stars abandon or ignore Canadian cities for the lure of their home country. Indeed, Matthews would likely have gotten all the perks of this deal elsewhere— plus the anonymity of being an NHL player in a city obsessed by the NFL, NBA or MLB. He could’ve maxxed his take-home pay going to one of the NHL teams benefitting from no-state-income-tax. And the NHL would get a huge problem with Canadian fans.

As Canada’s economy wobbles and players have a choice on lifestyle, Matthews’ decision to live in the Toronto fish bowl means that at least one CDN team is relevant. And, let’s be honest, he has a chance of winning the Cup that he wouldn’t in six other CDN teams. If that doesn’t pan out his contract is movable should he desire to move on before 2028.

3) Speaking of relief, getting the deal done is a break for new Toronto GM Brad Treliving. It was he who, as Flames GM, had to negotiate the escape of Americans Johnny Gaudreau and Matthew Tkachuk from Calgary. Had he not been able to retain Matthews in Canada’s largest market it would have not been a job enhancer. Now, he has to find a way to squeeze all Toronto’s glamour boys— hello William Nylander— under the cap and leave room for what they still need. Good luck, Brad.

4) Matthews’ commitment to Toronto means that a number of teams who’ve been delaying bold moves and hoarding trade bait in anticipation of his potential trade or UFA market can now move to Plan B. There were a number of U.S. teams poised to offer the Leafs the moon and stars— NHL version— at the trade deadline or to sign him next summer. This should now signal some activity by teams anxious to deal.

Ironically, the Leafs used to be that team waiting for a Toronto Moses to emerge in the UFA market. Remember Brian Burke’s unseemly longing for Steven Stamkos? Even when they got their local guy in John Tavares, the Islanders star was past his peak and has proved a millstone under the Toronto salary cap. This time they get a star in his peak years.

5) Matthews’ league-leading benchmark of $13.25 M. over just four years allows the NHL salary grid to fall in place behind him as the salary cap takes a bump in 2024-25. His deal will be the comparison for the next superstar contract that enters the unlimited FA portal in the future— although his max salary may chafe some stars who match Matthews’ production but have taken their teams deep into playoffs or winning a Cup. Don’t they deserve more? The expected rise in the league cap over the four years of the Matthews deal may help assuage that.

6) Finally— and most amusing— has been the response from hockey sweats to Matthews getting $13.25 M. For four years? To this crew who talk lovingly about The Game, this seems an awful lot to pay a guy for playing a boy’s game. That much? This just in, Matthews is criminally underpaid as one of the Top 10 players in a modern sports league. 

The dizzying $13.25 as NHL No. 1 would make him the 113th highest-paid player in the NBA, the 103rd highest-paid player in the MLB and the 88th highest-paid player in the NFL. As one perspective, Toronto-born Shai Gilgeous-Alexander of OKC Thunder— starring for Canada’s national team— pays about $13.25M per year in income tax.

Sure, there are differences among the revenues of the Big Four pro Leagues But, as we’ve written extensively, the @NHLPA sold out its stars in the 2004-05 CBA negotiations to protect average players and grinders. (Actually, it was a small group of stars pushed by their agents to stab Bob Goodenow’s strategy in the back.) They like to mock the product in CBA talks. 

Limiting the maximum contracts to 20 percent of the cap allows the league to have higher minimum and median salaries than NFL and MLB. (Hands up those people who buy tickets or digital packages to see the third line and fifth defenceman?) And pay lip service that it’s still Don Cherry’s Original Six league. With its cozy business plan there’s been little incentive to push the NHL’s business model beyond more expansion.

Also of note, if NHL doesn’t make its revenue target under this #CBA Matthews and the other players will have money clawed back in escrow. Great deal, huh? None of the other leagues has escrow, a device thought up by an NYC law firm and foisted on gullible NHL stars in secret meetings to break the 2004-05 lockout. Everything since then has been pantomime labour negotiations.

So good luck, Leafs fans. Enjoy Matthews and the star-spangled Toronto lineup. Things could change with the same guys making more money. But don’t hold your breath. 

Bruce Dowbiggin @dowbboy is the publisher of Not The Public Broadcaster  A two-time winner of the Gemini Award as Canada’s top television sports broadcaster, he’s a regular contributor to Sirius XM Canada Talks Ch. 167. Now for pre-order, new from the team of Evan & Bruce Dowbiggin— Deal With It: The Trades That Stunned The NHL & Changed Hockey. From Espo to Boston in 1967 to Gretz in L.A. in 1988 to Patrick Roy leaving Montreal in 1995, the stories behind the story. Launching in paperback and Kindle on #Amazon this week. Destined to be a hockey best seller. https://www.amazon.ca/Deal-Trades-Stunned-Changed-Hockey-ebook/dp/B0D236NB35/

BRUCE DOWBIGGIN Award-winning Author and Broadcaster Bruce Dowbiggin's career is unmatched in Canada for its diversity and breadth of experience . He is currently the editor and publisher of Not The Public Broadcaster website and is also a contributor to SiriusXM Canada Talks. His new book Cap In Hand was released in the fall of 2018. Bruce's career has included successful stints in television, radio and print. A two-time winner of the Gemini Award as Canada's top television sports broadcaster for his work with CBC-TV, Mr. Dowbiggin is also the best-selling author of "Money Players" (finalist for the 2004 National Business Book Award) and two new books-- Ice Storm: The Rise and Fall of the Greatest Vancouver Canucks Team Ever for Greystone Press and Grant Fuhr: Portrait of a Champion for Random House. His ground-breaking investigations into the life and times of Alan Eagleson led to his selection as the winner of the Gemini for Canada's top sportscaster in 1993 and again in 1996. This work earned him the reputation as one of Canada's top investigative journalists in any field. He was a featured columnist for the Calgary Herald (1998-2009) and the Globe & Mail (2009-2013) where his incisive style and wit on sports media and business won him many readers.

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Bruce Dowbiggin

How Betting Could Save Over-Expanded Leagues With Competition Problems

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It’s not often that we get new traditions every day in the NHL playoffs. We’re used to octopus on the ice. Plastic rats, too. Ron Maclean using obscure Blue Rodeo lyrics to explain the icing rule. But now there is a new tradition, unlike another.

Bitching about betting ads during the broadcasts of games. Get any group of plus-50s fans together to talk about the playoffs and you’re guaranteed to hear a volley of complaints about the incursion of gambling commercials now peppering the HNIC playlist. Or, for that matter, the TBS hockey playlist in the U.S.

The grievances range from the interference in the play (“I just want to watch a game, not a pitch for the over/ under on Stu Skinner goals-against”) to corruption of youth (“We are teaching a generation of young people that gambling is okay”). Some are annoyed by the presence of Connor McDavid who has morphed from a punchline in Wayne Gretzky’s gambling resumé to a serious dude warning kids about responsible gambling.

The reliance on advertising from casinos and gambling sites is a swift jolt for sports broadcasters who clearly see a golden goose and are not going to let it get away. As we’ve said before, we have yet to have a signature funny commercial for gambling that takes it mainstream. Right now, in Canada particularly, the quality of ads is lame.

But. Let’s discuss the “corrupting youth” argument that seems to be the loudest voice from non-gamblers. As we discussed in the Shohei Ohtani case, gambling— in the form of betting, fantasy sports, office pools, pick-a-square etc.— has been a vast underground source of gambling that the abolitionists ignored for decades. Legalizing it has removed much of this action from the grip of organized crime. As Ohtani’s case showed, the sunlight of public betting allows for (mostly) better monitoring.

As well, the leagues don’t share in the betting revenues, removing any question about the integrity off the outcome. They do promote betting sites and casinos where betting takes place. But the earnings from that belongs to others, not the leagues.

Second, the generations of pecksniffs deploring these ads have watched ads for alcohol on sports broadcasts for decades. In case you’ve been on Mars, alcohol is highly addictive and a drain on society’s healthcare resources. Yet none of them made a puritanical peep about protecting youth from ads for beer that financed HNIC for 50 years. Consistency in this griping would be nice.

Third, there is a fundamental misunderstanding about gambling that most of the opponents miss. Yes, the money is staggering. It has brought to pro sports league revenues so they can pay NFL QBs $50 million a year. With the threat of regional cable broadcasting— and its revenues— collapsing in North America, a new source of profits is imperative.

It also favours the house. Winning 57-58 percent of your bets is considered excellent. But here’s something no one talks about. Recreational gambling is an answer to the problems created by bloated leagues of 30-plus teams. The chances of your favourite team winning the Stanley Cup or Super Bowl have shrunk to microscopic in most cases. As we pointed out in our 2021 book Cap In Hand, the pressure of salary caps has led organizations to adopt either a “we’ll go for it” stance for a “tank for a top pick” approach.

What used to be a healthy middle class in leagues— fifteenth place—is now a ghost town as teams either rise our fall accord to their title hopes. Trading deadlines midway through a season allow teams to dump big contracts or gather depth for a playoff run. By the end of the season the standings are a sandwich with no filling.

So how are broadcasters to maintain interest in lame squads losing at a prodigious rate? What do you say to keep fans coming back even when they know the inevitable result? Enter recreational gambling. The NFL has floated its boat on the power of pools, fantasy and illegal wagering for years. It knows its TV numbers would plummet without people tuning in to see how their fantasy teams, props bets and parlays are doing.

Allegiances to your bets are the coming thing in sports viewership. Not for nothing does ESPN— an NFL, NBA and NHL rights holder— feature a “Bad Beats” section on its sports desk coverage every night. It highlights the outcomes where winning and losing defies imagination. Canadian networks are still treating their betting tips as stand-alone segments, not incorporating a betting win/ loss segment. But with the Blue Jays and Raptors floundering they’ll need alternatives to recognizing the inevitable. Enter betting.

As well, the playoffs—usually a windfall for teams/ leagues—leave considerable inventory unrealized. Quick series make for diminished handles and lost ticket sales. For instance, in this year’s NHL playoffs, the losing team in the 14 series so far has averaged just 1.78 wins per series. The NBA is far worse. Losing teams in this year’s postseason are averaging just 1.2 wins per series.

It’s anticlimactic and predictable and expensive for leagues. So if you’re paying the kind of money the stars now command you have to get the secondary sources of revenue cranked up. That spells betting. Like it or not.

Bruce Dowbiggin @dowbboy is the editor of Not The Public Broadcaster  A two-time winner of the Gemini Award as Canada’s top television sports broadcaster, he’s a regular contributor to Sirius XM Canada Talks Ch. 167. His new book Deal With It: The Trades That Stunned The NHL And Changed hockey is now available on Amazon. Inexact Science: The Six Most Compelling Draft Years In NHL History, his previous book with his son Evan, was voted the seventh-best professional hockey book of all time by bookauthority.org . His 2004 book Money Players was voted sixth best on the same list, and is available via brucedowbigginbooks.ca.

 

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Bruce Dowbiggin

The Debt Pipeline: Canada Is Drowning In Debt

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“How did you go bankrupt?” Bill asked.

“Two ways,” Mike said. “Gradually and then suddenly.”— The Sun Also Rises, Ernest Hemingway, 1926

For those outside Calgary, the rupture of the major water-carrying pipe is a local annoyance, divorced from their lives. The fact that it now appears it will take 3-5 weeks to restore normal water delivery in the city— original estimates from the mayor said 3-5 days— is tough luck for inhabitants of Canada’s energy city.

Even that estimate is being treated skeptically by a public who were manipulated and abused by the political structure during the recent Covid years. Testing shows that this same pipe— it’s large enough to drive a car through— has five more “hot spots” that could lead to further trouble. In short, repairing and maintaining the infrastructure in Calgary is going to be a huge investment. Married to the city’s debt crisis, a new transit line and the need for other infrastructure projects it’s daunting.

But it’s not a localized problem. Toronto’s new crosstown subway project is years over budget even as the city punts on repairing / replacing its vital Gardiner Expressway. Montreal’s bridges are a construction meltdown. Vancouver, Edmonton, Halifax— name the city. They’re all faced with crushing repairs while looking down the barrel of the debt gun.

How bad is the debt bomb? The voice on the other end of the line was grave. This retired financial executive says Canada is effectively bankrupt. He’s seen this coming after his almost 50 years in the Canadian industry. A decade of profligate government spending, Canada’s massive debts and electing activist politicians have brought Canada to a nasty place.

The weak spot in Canada’s wall is government debt, he says, and when the inflection point arrives it will happen in a hurry. As Mike Campbell said in The Sun Also Rises about what brought on his bankruptcy,  “Friends. I had a lot of friends. False friends. Then I had creditors, too. Probably had more creditors than anybody in England.”

Canada has friends. Allegedly. Successive Liberal governments have allowed “friendly” China to acquire Canadian debt during a period of accelerated buying in the past decade. Meanwhile, China still owes Canada $371 million in loans it incurred decades ago, and it is not expected to repay them in full until 2045.

But recently it’s been revealed that “friendly” China has also been actively interfering in Canada’s elections. It placed spies in Canada’s top-secret biolabs in Winnipeg. It is buying up farmland in PEI and other Canadian provinces.

That has left Canada’s PM, the one who said he admired China’s ability to get things done outside democracy, stammering and obfuscating. He knows that in his current predicament he can’t afford to rile the Chinese, who blithely let Canadians die of Covid-19, a virus they spread to the world.

Already, Canada pays C$46 B a year to service its debt, more than Ottawa expects to spend on childcare benefits ($31.2 billion) and almost as much as the cost of the Canada Health Transfer ($49.4 billion). Hard to believe Canada’s GDP per capita was actually higher than the US. Now, there is a $30.5k USD gap.

Should China decide to push the go button and pull back its bond paper in Canada, the result, says this executive, will be seismic. To rescue a credit-choked economy interest rates could jump back as high as the 18 percent rates of the 1980s. To say nothing of boosting personal tax rates. In case you’re part of the Denial Squad, here’s the take governments exact at the moment. Think they can take more?

NL – 54.8%

NS – 54%

ON – 53.53%

BC – 53.50%

QC – 53.31%

NB – 52.50%

PEI- 51.37%

MB – 50.4%

AB – 48%

YT – 48%

SK – 47.5%

NT – 47.05%

Not good. Canadians who think the warning signs will give them time to adjust are badly mistaken. Paraphrasing the words of Mike Campbell, the long debt descent will happen “suddenly”. Within 48 hours of China (or any other Canadian bondholder) employing the poison pill much of Canadians’ savings will be wiped out. The real estate market— which is the default savings account for millions— will implode.

You won’t hear any this from finance minister Chrystia Freeland who claims her debt-financed spending (based on international comparisons) shows Canada with the lowest level of debt in the G7. But the Fraser Institute points out, “By using net debt as a share of the economy (GDP), Canada ranks 11th lowest of 29 countries and lowest amongst the G7. By using gross debt as a share of the economy, Canada falls to 25th of 29 countries and 4th in the G7”.

If you don’t like statistics you can always just pop down to the grocery store to check out how $4.99 blueberries cost $7.99 now. The debt crisis should lead the newscasts each night. It will when reality strikes suddenly. But for now, Trudeau’s purchased media are more interested in Pierre Poilievre fear stories and TikTok videos of cats.

Bruce Dowbiggin @dowbboy is the editor of Not The Public Broadcaster  A two-time winner of the Gemini Award as Canada’s top television sports broadcaster, he’s a regular contributor to Sirius XM Canada Talks Ch. 167. His new book Deal With It: The Trades That Stunned The NHL And Changed hockey is now available on Amazon. Inexact Science: The Six Most Compelling Draft Years In NHL History, his previous book with his son Evan, was voted the seventh-best professional hockey book of all time by bookauthority.org . His 2004 book Money Players was voted sixth best on the same list, and is available via brucedowbigginbooks.ca.

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