Killing the Golden Goose

The NFL is in the midst of a labor dispute. Both the Players Union and the owners would like to make more money, so naturally they're deadlocked. It gets complicated quick, but the owners are offering the players more than 56% of the total revenues. The players want more than 60% of the money.

The first step is that each team will have to get under the salary cap ($94 million) by midnight Thursday. The contracts are written in expectation of a salary cap in excess of $105 million, so lots of big names will get a pink slip in the next few hours. The Chiefs will likely lose Will Shields to start with and it goes downhill from there. We'll see how things pan out.

I can't help but think that the Players Union is hurting most players. Only a few guys are going to benefit from that extra 4%. Because of this impass, the players are getting hurt because:

• The NFL will stop paying some benefits like the 401k the league had been matching 2-1. In effect this will be like a pay cut across the board. But the average guys who take home $300,000 will be hurt more than the star who takes home $3 million.
  
• Older players or players with expensive contracts will get cut in droves. The older players may never play again, ending their career too early. The expensive players, even if re-signed, will be restricted by the rules from getting the same kind of money anywhere else.
• Free agency will require six years, instead of four. Young players will be stuck with old teams and old contracts, with no way out.
  
• Rookie contracts will be up in the air, even though some teams, like the Redskins, will need to be composed of almost a third new players. We might see mass rookie holdouts.
  
• Average players in competitive positions are at risk if this leads to a strike in 2008. The replacement players may not be that much worse than some of the blue-collar guys who might find themselves on the outside looking in. This actually happened a little in the 1980's.

Ultimately, the players need the NFL worse then the League needs these specific players. Why? Because everytime an undrafted player becomes a starter (Priest Holmes for instance), or everytime a backup quarterback wins the Superbowl (Tom Brady), or everytime a team plugs different players into the same scheme and gets the same results (Broncos' running game), the Players Union is undermined. Even with 32 teams, there are more players out there than opportunities.

Advantage: Owners.