Ottawa has a very big decision to make. Erik Karlsson, he of the astronomical defensive scoring, potential Norris winner, and at the ripe old age of 21, is due a new contract. Though to read about it, it seems like what he’ll earn is as disputed as his claim to the Norris.
Some reference Mike Green’s $5.25MM / year, implying that, like Green, Karlsson is an offensive specialist. Others reference Drew Doughty’s $7MM / year and over many more years, implying that Karlsson is a complete, and foundational, player. There are even a few that think Karlsson will exceed that amount, especially if he gets fewer years and if he beats out Shea Weber, who is about to earn something insane, for the Norris. Eugene Melnyk, for what it’s worth, hopes Karlsson remains “reasonable.”
Melnyk’s comment is actually pretty appropriate in a league where reason is usually the first victim of contract negotiations. The community of savvy businessmen that are the NHL’s General Managers can sometimes display the memories of goldfish. Every July 1st, a few big markets who make free agents a pillar of their team-building strategies (and smaller ones aspiring to be like them) get into escalating bidding wars over the scraps from the UFA table. Poorer teams, in a bid to hang on to their talent, offer decade-spanning “long-tail” contracts to their RFAs to spread out the financial burden. Prices and term are artificially raised. The next generation of players start salivating. The result being that when you have a player like Erik Karlsson—very young, very promising, but in only his third season—he gets paid for potential and the assumption that he will maintain his current level of play.
The league is bogged down with player contracts that are insane relative to the value earned. It gets so bad that every once in a while, when a new CBA needs to be negotiated, the GMs paint pictures of financial apocalypse, teams are allowed to buy out contracts without salary cap penalties, or salaries are rolled-back altogether at the expense of all players. As soon as the bidding re-opens, the flavor of the week gets paid.
Alex Ovechkin is, or at least was, a generational player. To do anything but give him what was the most lucrative contract in the history of the sport would have been viewed as asinine and obtuse by a public whose perception is fueled by a hyperbolic media. George McPhee probably would have had a fan mutiny on his hands if contract negotiations had dragged out any longer than it takes to wire some cash overseas. A couple of seasons later and Ovechkin is playing 14 minutes a night for Dale Hunter, setting new career lows in points every season, and with a brain-melting $97 MM still outstanding on his contract. (Dellow has a nice post on the subject here.)
He may be only the most extreme example, but take a look: every team seems to have at least one of these guys—Vinny Lecavalier, Eric Staal, Brad Richards, Roberto Luongo, Thomas Vanek, Dany Heatley, Ilya Kovalchuk…even Sidney Crosby if you take his concussions into account. These players establish themselves as elite and then begin a precipitous drop in productivity until, finally, they inhabit veteran roles, sometimes as top six players. Valuable, to be sure, but not providing an equal return to the vast investments made. Those who do produce above-average seasons sometimes do so with preferential ice-time and zone starts. Their teams, having spent so much to procure their services and often handcuffed by no-trade and no-movement clauses, have little choice but to push all their chips in and hope they didn’t buy a lemon. Even those who produce at an elite level for many years are hard pressed to produce relative to their salaries. And I’m not even getting into the Scott Gomez, Rick DiPietro and Ilya Bryzgalov contracts.
(If you have oodles of time, here’s a 100 page thesis on player salaries and performance. The author concludes, basically, that you can link salary to performance in a statistically siginificant but generally inaccurate way. I haven’t delved into his methodology enough to know if he’s privileging point production over defensive play. There’s no mention of CORSI or Zonestart from what I can see. Forbes’ article on ‘efficient’ teams is probably a more, eh, efficient read. Interesting to see New York in the top five, having reformed, a little, from orgiastic spending.)
It’s a question to keep in mind when teams consider taking on Rick Nash’s contract by trade, making a bid on Zack Parise, or when rebuilding teams like Ottawa or Edmonton look to re-sign their young stars. Conventional knowledge suggests you can’t compete without having some core players to build around, but the prices for those types of players seem insane in a league where half the teams are constrained by the salary cap and the other half are barely scraping by financially.
Dirk Hoag over on On the Forecheck made the point forever ago that the Nashville Predators’ version of “money puck” is premised on a very basic assumption that GMs overpay for point production and undervalue defense. This might be because point production is very easy to understand in terms of its quantifiable value, and it may be simply because their teams are much more exciting to watch with offensive dynamos in the lineup. But for years, Nashville let seemingly integral players walk and they only got better. Building from the net out, they’ve been a goaltender factory, and consistently draft and develop premier defensemen. (That trend is now apparently set to end, with the team ramping up to spend a billion dollars on Ryan Suter and Shea Weber, having already locked up Pekke Rinne.) They trade for and sign great two-way players. You’d never see them getting involved in a Kovalchuk derby. While it may be true that you need to overspend on that flashy point-producer to get your team over the hump into true contention territory, it’s hard to imagine building around these types of players.
Which brings me to the uncomfortable question of what to do with a player who we all love to death and want desperately to see in a Senators uniform for many years, but who might just command a contract in excess of the monster Heatley and Spezza deals handed out post-Cup-run. As a premier point producer, Karlsson is a particular risk for massive overpayment. There’s no question that Karlsson has made Ottawa a team worth watching this year; he’s the engine for MacLean’s entire system. But I can’t emphasize enough that that’s this season. Paying with the assumption that Karlsson is going to be a perennial Norris contender, while nice to imagine, isn’t really realistic.
I’m not exactly advising that we package Karlsson up and trade him, but what I think needs to happen, in as professional and respectful a manner possible, is for the club to play hardball with the RFA. There’s going to be enormous pressure on Bryan Murray to show up with a blank check. He could walk out of those meetings with pretty much any deal and, so long as he doesn’t make Karlsson the highest paid defenseman in the league, he’ll be lauded for getting a “complex” deal done. But the true ramifications of this deal won’t become apparent until a couple of seasons down the line, when perhaps the team is trying to re-sign their other young players. By then it’ll be another GM’s problem.
The thing is, signing these types of elite players isn’t something that GMs have to do all that often, and it can be tempting to simply lock them down and keep an eye on the jersey sales. The short life-span of your average GM probably doesn’t encourage austerity and conservation. These problems are systemic, but it doesn’t mean we can’t be aware of them.
I would point, I suppose, to our very own, homegrown cautionary tale, who goes by the name of Wade Redden. I’m sure it must have been tempting, having chosen Redden over Chara and knowing how important his puck-moving skills were to the team’s system, to lock him up long-term. And perhaps Ottawa did try to do that. In the end, he signed for only two seasons, after which he was allowed to walk and, as we all know, was signed to a monster contract by the New York Rangers, who enjoyed the worst seasons of Redden’s career and are now paying him to be a mediocre player on their AHL squad.
Ottawa doesn’t have the kind of money to bury their mistakes in the minors.
Karlsson is the main reason, in my mind, that this season of Senators hockey was so much fun to watch. But with Melnyk hinting at an internal cap, a raft of prospects in the system who represent the future of the organization, and other teams constantly shooting their own feet off with these enormous deals, I’d much rather overpay for a few short years than lock this franchise in to a lifetime of nervous hoping. I hope we get to see Karlsson play for many years to come, but more than that, I hope he plays like he did this year. Senators management only has control over one of those two things.