Is a five-year contract limit good for the NHL?

I see a few fans who see the NHL owners demands for a five year limit on contracts as a positive.

So to a fan, long-term contracts are not preferable.  And it will help the owners to have an imposed five-year limit on contract length.

In a way that's true, it will allow GM's to say to players "Jeez, I wish I could give you a ten-year deal, I really do, but my hands are tied by the CBA..."

I'm not sure it will help competitive balance though.

Thought experiment: Seth Jones has just reached free agency after playing All-Star quality defence for the Calgary Flames for ten years.  He signed two five-year contracts, an entry-level deal as prescribed by the CBA, and then a generous but sub-maximal second contract, also as prescribed by the CBA.  He's now unfettered and evaluating his options.

The Flames have offered him the maximum dollar amount five-year deal they are allowed to given the strictures of the CBA and the salary cap.  So have twenty other teams.  The only reason the other nine teams didn't is because they're at the cap limit and can't clear the room, otherwise they would have offered the Norris Trophy candidate the same deal.

So now Seth thinks.  "Calgary is kind of a nice town, I love how they made me the Parade Marshall the past couple of years.  I have lots of friends here.  Cowboys was fun while I was still single.  But I can make the same money and not be so much in the public eye if I go home to the States.  It would be neat to go home to Dallas.  I could go to New York or L.A. or Anaheim and rake in endorsement cash.  I could go to a Florida team and golf whenever I want, the wife really hates the snow."

Calgary would have a tough time retaining him.  They can't 'renegotiate' his contract, only extend a current deal in the last year of the contract.  It would have to appeal to his 'loyalty' after he'd played there nine years, but how loyal does the kid need to be to a team when the league has depressed his earning capacity to a level far below market value?  He didn't ask to be drafted by the Flames, they just happened to suck the season that he reached his draft year.

Remember how Erik Cole was about to re-sign with Carolina last July, since the offer he got from them was about the same as that offered by the Canadiens, and maybe a couple of other teams if I remember correctly.  Pierre Gauthier then raised his offer, tacking on an extra year and a No Trade Clause, and that won the auction.  The Canadiens only got Erik Cole because they were 'allowed' to make him a better offer.

In this same situation, where a lot of teams were trying to entice a free agent to their team, but can't separate from the pack because they're all offering the max for a single player and a five-year term, the Cinderella teams will never find Prince Charming.  If there's an(other) artificial brake or ceiling on salaries, a lot of players might just say "Screw it, for the same money I'm going to be a King and meet starlets."  The Rangers and Kings will be the big winners.