Pro-Hockey Bailout Advocates Can't Skate Past the Facts
Author:
Walter Robinson
1999/10/27
Advocates for a taxpayer bailout of Canadian NHL clubs have received some deserved bruising bodychecks over the past few weeks.
Respected sportswriters like Stephen Brunt (Globe and Mail) and Damien Cox (Toronto Star) have written columns which show that the NHL tax fairness plea is a façade to cover up poor management in a league with deeper systemic problems. Both Ontario and Quebec have shut the door on any sort of dedicated sports lottery to help the clubs. And now the Public Policy Forum has submitted its report to federal Industry Minister John Manley. In a nutshell, the report says give up.
During the last six months the Canadian Taxpayers Federation (CTF) has led the charge against a taxpayer bailout of Canadian NHL franchises. To be clear, we are big hockey fans. But we can not support tax dollars meant for public goods being diverted to any private enterprise, including our beloved game. In the process, the CTF has discounted - through solid research and academic evidence available on our web site - many of the claims made by the hockey bailout advocates.
The facts are clear. Pro-sports have a negligible economic impact on metropolitan economies. Canadian taxpayers are already doing their fair share (season ticket tax write-offs, government advertising in the arenas, etc.) for the NHL. And player salaries have jumped by 480% over the last nine years. Furthermore, NHL owners have twice extended the current collective agreement with the NHL players association under which this escalation has taken place.
While the CTF has fought against a corporate welfare solution for the NHL, the same can not be said for most federal MPs. Liberals have been sheepishly quiet. The NDP - champions of the downtrodden - has been equally mute. And Mr. Manning and Mr. Clark fare no better. Both have taken the easy political route and ducked this issue at almost every turn. The only party to have actively taken a stand against a bailout is the Bloc Quebecois. Figure this one out
But the NHL owners are making one final push. The Ottawa papers now talk of potential U.S. buyers for the Senators and suspect polls indicating support for a bailout are popping up. But this last ditch spin doesn't stand up to some plain facts.
To start, a respected national poll conducted for the Industry Canada found that 85% of Canadians believe hockey's biggest problem is runaway salaries. There was no majority support for any sort of tax tinkering to help NHL teams. And as Damien Cox notes, clubs in the NHL are in trouble on both sides of the border.
"Over the past 21 years, seven NHL clubs have gone out of business. Six chose to move and/or sell their franchises, while one, chose to merge (with an existing franchise-ed). Out of those seven teams - only two operated out of Canada. Today, franchises in Tampa Bay, Phoenix, Buffalo, Carolina and Washington face futures as uncertain as teams in Calgary, Edmonton and Ottawa."
Let's also remember that the poster boy for the NHL's woes, Ottawa Senators owner Rod Bryden, signed unproven rookie Alexandre Daigle to $12 million contract in 1993. And the Vancouver Canucks, hardly a success story over the past few years, now boast the sixth highest payroll in the NHL.
Other arguments, such as the myth of market size as a determinant of club success are also under attack. In addition, it seems that the ability to leverage the marketing of a NHL team with other pro-franchises through a regional TV network is becoming a prerequisite for financial success for owners. These facts and others are abundant and compelling; pro-hockey subsidy advocates can't skate past them. Politicians should say no this extortion: game over.