The recent decline in the value of the Canadian Dollar (the “loonie”, as we Canucks affectionately call it) recently prompted me to speculate over the adverse affect a long-term decline could have upon Canadian NHL teams.
Given the current Canadian government’s heavy investment in the country’s oil industry, the “loonie” shouldn’t decline to the extremely low rates of the turn of this century, when it was often worth between .65 – .70 cents US. That created a dire situation for most of Canada’s franchises, leading to a short-term revenue-sharing scheme to help those clubs stay afloat until the “loonie” improve.
During the late-1990s through the early years of the last decade the frequent lament from Canadian teams, and the media which covered them, was the low-valued “loonie” hampered their ability to ice competitive teams. These teams couldn’t afford to retain their best players when they became eligible for free agency, let alone bid competitively for top free agent talent or acquire expensive talent via trades.
Between 1995-96 and 2003-04, the Vancouver Canucks missed the playoffs four straight seasons (1996-97 to 1999-2000). The Calgary Flames went seven straight seasons (1996-97 to 2002-03) without a playoff berth. The Edmonton Oilers missed three seasons (1995-96, 2001-02, 2003-04). The Maple Leafs missed in 1996-97 and 1997-98. The Montreal Canadiens missed three straight seasons (1998-99 to 2000-01) and again in 2002-03. I don’t count the current version of the Winnipeg Jets because, of course, they were the Atlanta Thrashers during that period.
The Ottawa Senators had the best playoff record, making the post-season every year but one (1995-96) during that period. They were often among the better teams in the Eastern Conference, yet in 2003 the club went bankrupt and was saved by NHL commissioner Gary Bettman bringing in billionaire Eugene Melnyk to purchase the franchise.
When the salary cap was implemented in 2005 many Canadian team owners and pundits hailed it as a means to ensure Canadian clubs could afford to spend competitively against their American rivals. The truth, in fact, was the rising “loonie” enabled them to do that. Indeed, throughout the previous CBA and into the first season of the current ones, the stronger Canadian dollar allowed Canadian teams to keep pace with the rising salary cap, with most spending annually up to the cap ceiling.
So, did a strong Canadian dollar actually help Canadian teams improve? Did it increase their chances to win the Stanley Cup?
The 2011 Vancouver Canucks certainly benefited from the stronger dollar, enabling them to retain their best players and make other necessary acquisitions which helped them reach the Stanley Cup Final.
The 2006 Edmonton Oilers were able to exploit the low $39.5 million salary cap, as well as an improving dollar, to acquire Chris Pronger, Michael Peca, Sergei Samsonov, Dwayne Roloson and Jaroslav Spacek, who all played significant roles in the club’s surprising march that season to the Cup Final.
The 2007 Ottawa Senators acquired playoff rentals Mike Comrie and Oleg Saprykin, but they advanced to the Cup Final that season largely due to the depth of talent already on the roster due to years through years of smart drafting and trades.
For the most part, however, the Canadian teams didn’t significantly benefit over the long term from a strong Canadian dollar and a salary cap.
From 2005-06 to 2012-13, the Canucks missed the playoffs twice. Though they finished first in the Northwest Division five straight seasons from 2008-09, since the 2011 Cup Final they were bounced in the first round in consecutive seasons, and aren’t a lock for a playoff berth this season. In recent years their spending to retain their best players resulted in limited cap space, handcuffing efforts to bolster their overall roster depth.
The Flames reached the Cup Final in 2004, but after that management invested heavily in veteran talent at the expense of youth hoping to return to the Final. The predictable result was the Flames slowly but surely weakened. They’ve missed the playoffs in every season since 2010 and undergone two management changes. They’re currently in the midst of a long-overdue rebuild and will miss the playoffs again this season.
Since their 2006 Cup appearance, the Oilers missed the playoffs in seven consecutive seasons, largely because successive GMs over-valued and overpaid key players. They’ve been rewarded with high first round picks but they’re still lacking depth in goal, on defense and their checking lines. Like the Flames, they won’t make the playoffs this season.
The Senators also fell into decline following their Cup Final appearance. They moved from stockpiling skilled talent via trades and the draft, which made them a perennial playoff team during the years when the Canadian dollar was weak, to spending (sometimes too much) to retain or pursue veteran talent. They missed the playoffs twice (2008-09 and 2010-11), resulting in a return to drafting and developing affordable talent.
Since 2005 the Toronto Maple Leafs have annually topped Forbes.com’s ranking of the NHL’s wealthiest teams, but throughout that period they missed the playoffs seven straight seasons, finally ending their drought in 2013. Despite their wealth and willingness to spend, they struggled to ice a playoff contender, and this season are battling for a wild card berth in the Eastern Conference.
The Canadiens are often among the NHL’s wealthiest clubs. While their playoff record has improved since 2005-06 (missing the playoffs only twice), they’re no closer to being the perennial Cup contender they were from 1944 to 1993.
As for the new Winnipeg Jets, a salary cap and a wealthy owner hasn’t significantly improved their fortunes since their move in 2011 from Atlanta. They missed the playoffs the past two seasons and appeared destined to do so again this season.
It’s interesting to note that the Senators and Oilers iced better teams during the period when the Canadian dollar was at its lowest value than when it was stronger. The Maple Leafs had no trouble making the playoffs using rosters stocked with expensive talent when the “loonie” was weak, yet when it was stronger they missed the playoffs for seven straight seasons.
The sad decline of the Canadiens, Canucks and Flames in the late-1990s was as much the result of poor management as it was to a weaker dollar. Since 2011, the Canucks management has come under question for their roster moves and how they’ve managed their cap space.
Since the late-1990s the Canadiens and Maple Leafs went through six general managers. The Senators went through five while Flames are waiting for their fifth. The Canucks and Oilers went through four.
While a significant, long-term decline in the value of the Canadian dollar would undoubtedly hurt Canadian NHL franchises, it’s apparent management is more important in improving the lot of these franchises if they’re to end the country’s 20-years-and-counting Cup drought.