Thursday, June 28, 2012

Sidney Crosby is a Socialist, and WE LOVE IT

By GTOG Staff

No one really doubted that Sidney Crosby would be a Pittsburgh Penguin for life or that he would take less money than he could command on the open market to make it happen. And no one doubted that Mario Lemieux and Ron Burkle would pony up something in the neighborhood of $100 million in guaranteed money to keep him.  It all came together this week with what we imagine was a handshake that momentarily caused the sun to orbit the earth.

Crosby signed a 12-year, $104.4 million deal, which is essentially a 12 year extension of the contract he already has.  He's 24-years-old, arguably the best in the world at what he does, he's due a new contract, and Sidney Crosby decides he doesn't want a raise.  And that he doesn't want a raise for the rest of his career.  Think about that.  The $8.7 million cap hit remains, and as a consequence there is more money left to pay the players Crosby and the Penguins hope will help him challenge for Stanley Cups for the rest of his career.  How much will it help?  Check it out after the jump...

In the summer of 2007, Crosby signed his first big contract: 5 years, $43.5 million.  But in 2007 that $8.7 million cap hit had very different implications: it constituted more than 16% of a $50.3 million salary cap.  By 2011-12, the cap had continued to rise steadily to the point where Sid's salary accounted for 13.5% of the Pens' cap space.

The news is only getting better.  Despite historically bad ratings during the Stanley Cup Finals, the league has never been healthier.  The league anticipates a cap of $70.2 million for the coming season, and we're going to do this math for you because we have a calculator:  Sidney Crosby's salary will now account for 12.4% of the Penguins' cap space.  There are a lot of unknowns going forward, but one thing is likely: that percentage will continue to shrink.

Of course there is risk involved -- find us a $100 million transaction where there wasn't risk.  Sure, Sid is "one hit away," but so is everyone.  And if, God forbid, that hit happens, chances are it won't affect the most important thing that keeps the Pens competitive -- the salary cap.  If Sid gets another concussion, a BAD concussion, there's a real probability that he would retire, especially if it happens a few years from now after he gets a lot of the cash from this front-loaded deal.  But as devastating as that would be, retired players don't count against the cap.  It's unlikely (though concededly possible) that Sid would go through the endless will-he-or-won't-he that he went through the past two years for the rest of his career.  It's more complex, but the easiest way to look at it is this: he's either healthy and a bargain, or injured and off the cap.

Finally, if you hear anyone tell you the new Crosby contract means the Penguins are less likely to extend Geno Malkin, make sure they know they have that exactly backwards.  Neither Burkle, nor Lemieux, nor Shero, nor Crosby has issued a decree that Sid must be the highest paid player on the team.  As long as the cap grows instead of shrinking, there is no reason the Penguins would opt to build a team around only one of the best players in the world when they can have two of them.  The Crosby salary cap hit does not magically bar Geno from asking for a higher annual salary, nor does it bar the Penguins from giving it to him.  In fact, it makes it more affordable.  The term could be shorter, Geno could follow Sid's lead and re-up at $8.7 million per, we could be dealing with a completely different landscape in the wake of a new CBA, or all of the above.  And if Geno signs an 8-year, $80 million dollar extension in 2 years, we'll put money on his first congratulatory call being from Sid.

"Geno! You're super rich, too!"
We can smell the possibilities.  So, we're guessing, can Zach Parise.  He knows that in Pittsburgh, everyone is covered.  What a day for the socialists.

Like two sons we're equally fond of

1 comment:

  1. I heart Sid. I love that it'll be his number in the rafters next to 66. And I love that that matters to him.

    As far as Geno - I think the roll over into the new CBA will help on that front. Geno very likely won't even be allowed to sign a 10 year deal. He can do what he wants (a shorter deal for a larger annual salary?) - without it being compared directly to Sid's. If Sid gets the privilege of a longer deal, Geno gets the privilege of a higher salary. I genuinely don't think either would care - and they can both be their own men, so to speak.