Both parties decided to extend the deadline because negotiations were going fairly well and they felt as though things were headed in the right direction.
As of today, it seems, negotiations are not headed in the right direction. The players have flat-out decided that they don't want to go to an 18-game schedule and the owners have decided that they don't want to share a high level of financial data with the players.
I've already outlined the issues with an 18-game schedule, so I'm more interested in the issue with sharing financial information. Right now, you can get a general idea of how each NFL team is doing by taking a look at the Forbes list that comes out every year that values each team and shows basic financial information (debt, operating income, franchise value, stadium value, revenue), but that doesn't tell the whole story.
There's no access to information on cash flows or net income, which are two basic statements that any publicly traded corporation has to provide to its shareholders, nonetheless its employees. The issue there is that the NFL is definitely not a publicly traded corporation, it's a private enterprise with 32 owners that are mostly private people.
The two sides are still about $750 million apart, which is a huge number. In the 16 days that they've been working with federal negotiator George Cohen, they've only narrowed the gap by $160 million and they haven't made much progress this week. What stalled things this week was that they players keep asking for hard financial data and the owners continue to refuse those requests. According to reports -- Cohen has asked everyone involved to not provide any information to the media, so concrete details have been hard to come by -- the owners have opened up the books to some degree, but have not provided the players with sufficient data.
It makes sense. The owners are asking for more money to cover expenses, so the players want to follow the money. The players are asking for more money and to see the books, so the owners don't want someone who chases a ball for a living to tell them how to run their business. If this were a factory outside Hattiesburg, the owners could fire everyone and hire new guys that wouldn't ask any questions. It's a private business, so they're not required to share anything with anyone. The trouble there is that there are more people out there that are qualified to work in a factory than there are people who are qualified to play quarterback in the NFL (or running back, or cornerback, or any of the positions, really). Just firing everyone and getting new guys isn't an option and both sides know it.
In the past few weeks, the players have strengthened their position and have banded together, which is awful news for the owners. Sure, there were articles about how the owners are swimming in money like Scrooge McDuck and a number of players live paycheck-to-paycheck. There have also been mentions of disenfranchised office workers and ticket attendants that will get laid off if there's a lockout. But, the Court of Public Opinion had always sided with the players, so that wasn't a huge victory for the NFLPA.
Where the players were suffering in the past was that they were in a horrible negotiating position. Players were calling each other out on Twitter, everyone was complaining that a deal couldn't get done, and the owners were fully resolute in their decision to lock the players out, buffered by some guaranteed money from the television networks even if the 2011 season didn't happen.
Two things happened:
- A judge in Minnesota overruled the contract the owners signed with the networks, which took away the guaranteed revenue stream.
- The players realized they were all in this together, stopped bickering, and started supporting each other. Veteran players with plenty of money in the bank have started an emergency fund for young veterans that can't meet expenses. Stars like Drew Brees have been attending the negotiation sessions. Other stars like Brees and Peyton Manning have agree to represent the players in a class-action anti-trust lawsuit if it comes to that.
I'm not 100% sure what decertifying the union means, but I know it's the biggest card the players can play and is similar in severity to the owners locking players out. Basically, a lockout or a decertification would cause negotiations to break down and would cause a ton of bad blood -- as if there weren't enough of that already.
As I understand it, decertifying the union means that the contract between the players and the owners is null and void and that the union is being wiped out, which would leave all players unemployed. They would then be able to file an anti-trust lawsuit against the NFL since they could make a case that they needed to fire themselves because the owners were using a monopoly to stifle negotiations and bust up the union. That means two things: Congress gets involved and the owners need to open up their books. Both those eventualities are bad for the game, but worse for the owners. They'd be the defendants in a lawsuit and they'd need to show the players all the financial data they've been fighting for the last two weeks.
For obvious reasons, the owners want to avoid this, which is why negotiations have been extended.
Here's the BIG thing: The deadline for the union to decertify is COB today, which is 5 p.m. Eastern time. The deadline for the owners to lock out the players is midnight. As far as I know, this is a one-or-the-0ther situation. Either the players say, "You can't fire me! I quit!" Or the owners say, "You can't quit. You're fired!" At this point, the players hold the advantage because they can quit seven hours before the owners can fire them.
I think the situation has reached the point where one side has to make a move. That means I was wrong about a lockout in 2011, because the players will probably decertify first.
A decertification is much worse than a lockout, because it means a lawsuit and a bunch of hearings in front of a federal court. The federal government is dealing with a lot of stuff right now. My guess is there's going to be more important fish to fry for the men and women of Congress. My guess is also that, even if a case gets settled, that won't necessarily lead to an NFL season in 2011.
So... that tells you negotiations are bad when the owners locking out the players is the better option.
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