Vladimir Putin and Hockey's New Cold War

The collapse of the Russian economy has meant hard times for the KHL--especially for the players, some of whom are going without pay.

by Joshua Kloke
Sep 13 2014, 12:00pm

Photo via Wikimedia Commons

Russia's Kontinental Hockey League began in 2008 with the greatest of promise. It sought to bring a sustainable, high-level, North American-style organization to a country that treats hockey as a second national religion. The KHL, it was hoped, would even compete with the NHL for the title of world's best hockey league. But now, as Russia's economy collapses due to falling oil prices, the KHL may be collateral damage--depriving fans in Russia of their favorite winter pastime, and threatening the livelihood of hundreds of players, including 85 North Americans.

The undoing of the KHL began with the 2014 Winter Olympics in Sochi, Russia. Under immense scrutiny and pressure to deliver a gold medal on home soil, the Russian men's national team could not get through the pesky Finnish side in the quarterfinals, losing 3-1. The loss exposed the fragile state of Russian hockey. National team coach Zinetula Bilyaletdinov threw star forward Alex Ovechkin under the bus, and the team--decades removed from the vaunted Red Army days--once again failed to win a medal. (Russia has not medaled in hockey since taking bronze in 2002.) Something had to give.

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So Russian President Vladimir Putin, did what he does best: pull strings. His idea was to reduce spending on overseas talent, and renew focus on nurturing Russian players. This way Russia could begin to once again approach the skilled, tactical, and disciplined style of its glory days--a fair notion, especially considering the grim state of the Russian economy.

But is Putin simply covering his own ass? Is he merely attempting to prevent any further international hockey embarrassments, especially given that Moscow and St. Petersburg are joint hosts of the 2016 IIHF World Hockey Championships? Because after all, by discouraging international players from signing KHL contracts, Putin is building walls around a hockey landscape that is becoming increasingly bereft of international talent.

The first casualty of the KHL-takeover was Alexander Medvedev, president of the KHL since its inception. Medvedev--an executive at the massive state-controlled energy firm Gazprom, who is also rumored to have KGB ties--once promised to have 50 teams in the KHL by this year. The plan hinged on modeling the KHL after the NHL's business model, but the plan failed.

The KHL debuted with 24 franchises and currently sits at 28. In a league where teams make the majority of their money not from ticket sales but from sponsorships, Medvedev's resources ran dry: large corporations in Russia were not nearly as interested in sponsoring teams while taking massive losses themselves. The fragile viability of the KHL began to reveal itself and attendance plummeted. Teams such as Atlant have lost sponsors and are at risk of folding, while many within Putin's circles would like to see the KHL rid itself of teams in Croatia and Slovakia.

In December, Medvedev was replaced by Dmitry Chernyshenko, president of the Sochi 2014 Olympic Organizing Committee. One can only assume the transition was smooth, at least if you go by an almost comical transcription of a conversation released by the Kremlin between Putin, Medvedev, and Chernyshenko.

Hockey and the Kremlin: never far apart. (Especially at the 2009 KHL All-Star game in Moscow.) Photo via WIki Commons.

Still, the worldwide drop in oil prices has hit the KHL particularly hard. The sponsorship-heavy league is reliant on firms like Gazprom, and firms like Gazprom are suffering in the current economy. Meanwhile, with the value of Russia's largest export dropping, so too is the value of its currency. And as the ruble has fallen, so too has the relative value of KHL contracts. A sense of panic has begun to set in among North American players in the league. Not that talking about it is a good idea.

Canadian player Jeff Glass spoke out about his salary concerns with Lada Togliatti and was reportedly waived the following day. The league, or at least some PR flacks within the league, are attempting to quell the issue. Numerous requests for North American player interviews by VICE Sports were met with replies stating that players "...won't talk about money."

If fear over whether their next paycheck will be delivered is indeed an issue, some players are doing a fine job towing the party line.

"I think the North American media makes things out to be worse than they really are," American forward Chad Kolarik of Avangard Omsk told VICE Sports.

"There's a couple guys on a couple teams that might have had trouble getting paid, but as far as I know things are getting figured out," he added.

The drop in the value of the ruble caused panic amongst foreign players, but with Putin's buddies taking the KHL in a new, stingier direction, it's doubtful team representatives will be knocking on their door with new contracts to smooth things over.

"As a whole the KHL seems to be taking the course of spending less," says U.S.-based Russian hockey writer Slava Malamud.

"Spending less on foreigners for sure. The dropping Russian ruble means their salaries are much less than they signed up for."

This course of action is a threat to players such as HC Ugra's Barry Brust, a 31-year-old goalkeeper and former Los Angeles Kings draft pick.

When asked about fluctuating salaries, Brust said it was the promise of a high salary that led him to the KHL--he wasn't expecting to make as much anywhere else.

According to Russian law, player contracts must be paid in rubles. So until oil prices begin to rise, there are lean times ahead for many KHL teams.

"The next year is going to be very tough for the KHL because of the budgets of clubs, which are based on oil prices which aren't viable anymore," says Russian-American Puck Daddy writer Dmitry Chesnokov. "I don't discount a couple of clubs folding or taking a sabbatical."

Chesnokov believes the KHL's salary cap could shrink by 40-50 percent and that while the league may impose a Major League Soccer-style model that allows teams to sign designated players outside of the salary cap, "it's doubtful teams will go after North American players, instead targeting European players and keeping things closer to home."

While it's almost impossible for one to be fully conscious of the tangled web Putin weaves throughout Russian politics, business, and hockey, some KHL teams have had enough and are making modest efforts to put Russian hockey back in the hands of the people and reduce Putin's power over the league.

Definitely the man to fix your hockey league. Photo via WikiMedia Commons

Some 1,500 miles east of the Kremlin, on the vast Siberian plain, lies Khanty-Mansiysk, an oil-rich town of 80,000 people, and home to HC Ugra. The team currently sits in tenth place in the Eastern Conference, three points out of a playoff spot.

And the district governor Natalia Komarova has had enough.

HC Ugra is a publicly-funded team and with the price of oil continuing to fall, no local sponsors are stepping in to provide funding. So Komarov is threatening to disband the club, opting instead for public funding to be directed towards amateur and youth sports.

It's a noble pursuit, especially considering the dismal attendance at HC Ugra's recent games. But caught in the crosshairs are Brust, and fellow Canadian Ben Maxwell, another former NHL pick now wearing Ugra's blue and green.

"We've played 40 games so far and only a couple of those games have had a sold-out building," said Maxwell, a 26-year old former Montreal Canadiens draftee.

And poor attendance isn't just specific to their rink.

"At the start of the season we went to play against the Red Army at their home in Moscow," Maxwell continued.

"They've got this huge history as a team and I was expecting an incredible atmosphere. But when we got there things were pretty dim. The building was historical and all that stuff, but no one really showed up for the game. Apparently no one wanted to see us play."

While Maxwell didn't want to discuss his own personal salary in detail, Ugra doesn't enjoy the cleanest track record: Finnish forward Ilari Melart revealed earlier that he had not been paid by the club for months and that he was not "in Siberia for charity."

"I have a contract for next year too, but who knows what's going to happen," Brust said. "There's so many examples of things changing in a hurry over here. Hopefully everything works out."

On the other end of the KHL spectrum lie top teams such as SKA St. Petersburg and Dynamo Moscow, who are currently in secondand fourth place respectively in the Western Conference.

Dynamo Moscow defenseman Mat Robinson, a 28-year-old from Calgary spoke about his experiences playing for a top-flight outfit, admitting that "If you're on a bigger club, you get treated better."

With a stacked roster that includes KHL posterboy Ilya Kovalchuk, SKA St. Petersburg is one of the most prestigious franchises in Russian hockey. But their reputation is more a result of their lavish spending than their success on the ice. They have never lifted the Gagarin Cup, the KHL's championship trophy, or even played in a final.

Despite the tough economic times facing the competition, SKA St. Petersburg's pursuit of the Gagarin Cup knows no limits. Consider the case of star Finnish goaltender Mikko Koskinen.

Koskinen refused to play out his contract for Sibir Novosibirsk when the Russian ruble began to crash, and was ripped in the Russian media for it. Shortly thereafter, he was traded to SKA St. Petersburg. Despite the Russian law that requires players in Russia to be paid in rubles, Koskinen has not been voicing any complaints since the trade.

SKA St. Petersburg did not respond to request for comments about Koskinen's compensation. Malamud, meanwhile, wondered whether there are "other ways to compensate him."

SKA St. Petersburg is run by Gennady Timchenko; one of Russia's richest and most powerful people and head of the Board of Directors of the KHL.

"[It's] very important politically for the KHL to have [SKA St. Petersburg] eventually win something," said Malamud. "Hockey in Russia is very political and always has been. It has always been about showing the west the might and beauty of the Soviet system. With Putin in power, he has bought into the idea of making hockey a political tool. He wants to make hockey some sort of unifying force."

This was Putin's intention when he appointed Chernyshenko to head the KHL: a more unified version of Russian hockey. But in creating that, Putin is also handicapping the league's ability to become popular and attract players with name-brand appeal, and injecting it with the same sense of suspicion that now runs through all of Russia's major institutions.

Chernyshenko, for instance, is deeply tied to state-owned companies that have been the subject of U.S. sanctions, including Volga Group, an investment firm he heads that manages the assets of SKA St. Petersburg owner Timchenko.

Putin has placed people very close to him at the top of the KHL. But while attempting to stabilize the the league that was already garnering negative publicity for its inability to do right by international players, he has also brought the eyes of the world upon it for the wrong reasons. The KHL is now another little piece of Putin's empire, and another potential flashpoint in a tense global standoff.

Ak Bars Kazan celebrate their 2009 Gagarin Cup victory. Photo via Wiki Commons.

Through it all, Russia's failure on the ice in Sochi lingers. But utilizing the KHL as a tool to develop Russia's national team may not pay dividends in the near future, if at all. The core of Russia's recent Olympic squad, including NHL stars Alex Ovechkin, Semyon Varlamov, Evgeni Malkin, Andrei Markov, captain Pavel Datsyuk, and KHL player Ilya Kovalchuk, have an average age of 31. It's likely that not all of them will play in the 2016 World Cup of Hockey.

And while the junior team gave the victorious Canadians a scare during the January 5 gold medal game at the IIHF World Junior Championship, they were an erratic bunch throughout the tournament, swinging wildly between dramatic offensive highs, foolish defensive lapses, and childish penalties. You don't have to be Tolstoy to see how the wildly unstable Russian national teams mirror the unstable league meant to foster them--and the unstable country meant to foster the league.

In the late 80s, when the NHL opened its doors and saw an influx of Soviet talent, there were concerns over the future of the league and the game itself. Some saw the Russian invasion as just that: an uninvited intrusion on the traditional North American approach to the game. Traditionalists looked to the dichotomy in the 1972 Summit Series, the first grand meeting of international hockey superpowers and their dramatically different approaches: the brawny, guts and glory Canadians and the skilled, disciplined Russians.

That the Canadians prevailed was a validation to many of the virtues of North American hockey, but fans of today's game have benefitted from an influx of Russian talent. Games from the 80s now look scattered; only through the synthesis of different approaches has the NHL become a truly entertaining league. If the KHL becomes little more than a breeding ground for the Russian national team, then the global game will suffer in quality and in popularity. Just as hockey in North America benefits from the presence of Russian and other European stars, hockey in Russia and Europe can benefit from North Americans.

The more opportunities for high-level hockey players, the better. Better for the players themselves, better for the business of hockey, and better for hockey fans. Putin may be stabilizing the KHL in the short term, but fogging up the league with dictatorial politics and corruption will only damage it in the long-term. And by making the KHL a less desirable place for North American players to play, he is only rebuilding a wall in the hockey world that took decades to bring down in the first place.