In NHL deal, federal mediators help pad pockets of wealthiest stakeholders

About a month after the Federal Mediation and Conciliation Service intervened in the latest National Hockey League lockout, owners and players reached a tentative deal Sunday that is a huge win for NHL team owners, especially of the least profitable teams.

With owners and players at an impasse over how to divvy up the league’s $3.3 billion in annual revenue, a big win for owners means a big loss for players, who will see their share of revenue drop from 57% under the previous CBA to 50% under the new agreement, which runs through 2019.

There is also little to cheer about for local business owners and NHL, team, and arena employees, each group having been impacted in their own way by the months of idleness caused by the lockout.

I don’t follow hockey and I’m generally indifferent to the outcome of the negotiations.

As for the players getting the short end of the stick? Don’t feel too bad, 700 athletes will still take home better than $2 million a year in average per player compensation, plus enjoy a new defined benefits plan in retirement.

The rub is in the hypocrisy of the FMCS, a $47 million a year operation, funded 100% at taxpayer expense, finding it a worthy use of public funds to provide free mediation services to millionaires and billionaires.

FMCS’ self-described mission is “preventing or minimizing the impact of labor-management disputes on the free flow of commerce.”

While that iteration of ‘mission’ is little more than a thinly veiled euphemism for the ‘promotion of and advocacy for labor unions,’ you don’t even have to be opposed to such efforts in principle to see that the FMCS is in practice, just one more government office spending oodles of taxpayer money on little if anything of value.

On defending worker’s rights (even if they are millionaire workers), the FMCS fails, as NHL players will see a huge drop in their share of revenues.

Even on the score of promoting the free flow of commerce, the FMCS doesn’t deserve much praise.

If owners and players found it more advantageous to delay the start of the season than agree to a deal, THAT reality – and NOT the intervention of federal mediators – represents the real free flow of commerce at work.

In so far as the new deal places artificial limits on the ability of team owners to offer higher pay to players, and in doing so helps prop up unprofitable teams, the FMCS’ involvement makes an otherwise free exchange begin to look more like a government manipulation of the free flow of commerce.

The distortion is even more egregious when you realize that ALL of the league’s 13 unprofitable teams last year were from U.S. cities, while 2 of the top 3 money makers (Toronto Maple Leafs and Montreal Canadiens) were from Canada. Protectionist lately?

The Federal Mediation and Conciliation Service pays 249 federal employees an average of $140,000 a year (whatever happened to public service?!) to pad the pockets of federal workers at taxpayer expense, wealthy team owners at wealthy players expense, and domestic industry at foreign competitors expense.

Why doesn’t Congress do away with the FMCS?

It’s true what they say I suppose, about government bureaus being the nearest thing on this earth to eternal life.


At least the fans will be happy that their beloved teams will finally be returning to the ice.

As George Cohen, FMCS director, put it:

“Fans throughout North America will have the opportunity to return to a favorite past time.”

Is he right though, or will the fans even take notice?

From that same article over at HuffPo, Marc Ganis, president of Chicago-based sports business consulting firm Sportscorp Ltd:

“[The league] didn’t hear a hue and cry from the fans, especially in the United States, when hockey wasn’t played. That’s very distressing. That indicates there’s a level of apathy that is troubling. In contrast, in the NFL when there was a threat of canceling a preseason weekend, the nation was up in arms.”

I don’t think it takes an expert consultant to tell you that if your annual revenues trail those of the NBA, NFL, and MLB, and if nearly half the teams in your league are in the red, there might not be many people watching.