Skullclamp, a card in Magic’s recent Darksteel expansion, has the dubious honor of being the mostly recently banned card in the game. Like the Black Lotus so many years before it, Skullclamp quickly became overpowered and ubiquitous, and therefore degenerate. First, the stats:

Name: Skullclamp
Casting Cost: 1
Type: Artifact
Artist: Luca Zontini
Rules Text: Equipped creature gets +1/-1. When equipped creature is put into a graveyard, draw two cards. Equip 1 (1: Attach to target creature you control. Equip only as a sorcery. This card comes into play unattached and stays in play if the creature leaves play.).
Oracle Text: ditto
Flavor Text: None

Skullclamp’s obscene power comes down to two words: card advantage. The definitive node on the subject is very helpful in understanding this concept (recommended reading), and to quote Saige:

“Simply, it's being able to draw more, and/or better, cards than your opponent.”

The more cards you have, the more likely it is that you will have a threat that your opponent can’t deal with. Or, conversely, the more cards you have, the more likely it is that you will have an answer to any threats your opponent produces. Having superior card advantage means not having to rely on the luck of the draw; you have drawn so often (or so accurately, in the manner Saige describes in the latter half of card advantage) that you almost always have the card you want, when you want.

For that reason, card-drawing effects are supposed to be expensive. Ancestral Recall was banned because it draws three cards for one blue mana. That's just far too much for far too little. Even today's best card-drawing effects are a third as effective, or three (or more) times the price.

So, what about Skullclamp? It only cost one colorless mana to play, and another one colorless mana to equip. But then, the equipped creature has to die for you to draw 2 cards. “That doesn’t sound so cheap to me,” you might say.

In some ways, that is correct. However, this is where the lateral thinking comes in. Creatures are just a different kind of resource. Some are very inexpensive; some are even free. Some, like the modular creatures in Darksteel, do good things when they buy the farm. There are plenty of situations in Magic where you want your creatures to die, and Skullclamp is one of them. It makes your opponent's decisions harder. Every time they want to kill a Clamped creature, they know you get two cards out of the deal, reversing the card advantage they would get from removing your creature. Even better, if you have a way to equip at instant speed, you can Clamp a creature which is about to kick the bucket anyway.

But why stop there? The other ability on Skullclamp, the +1/-1, makes it easier to kill your own creatures. Just equip the Clamp on a guy with one toughness, and *BAM!*, you get two cards. There are plenty of ways to generate a small army of one-toughness creatures. With a Skullclamp in play, you can think of them as all having “(1), Sacrifice this creature: Draw two cards” written on them. This is as good of a card-drawing engine as you would ever hope to find, that is, until you figure out how to equip Skullclamp for free…

While the card-drawing effect is makes the card noteworthy, it’s actually the +1/-1 effect that lead to Skullclamp’s power problems. In playtesting, the card boosted the equipped creature’s toughness. And it sucked. According to Aaron Forsythe at WotC’s R&D, the Clamp was written off as a marginal card before the last minute change of +1/+2 to +1/-1. Having already closed the book on Skullclamp, the R&D team didn't realize what a huge difference that change made.

Of course, the playing community outside Magic R&D never had the bad version of the card to taint their imaginations; they immediately saw how the toughness-reducing effect and the card-drawing effect synergized. In the following sanctioned tournaments, an unprecedented number of people were running the Clamp. As Forsythe said in the announcement of Skullclamp's banning, “Look, for example, at the Top 8 decks from Ohio Valley Regionals. Or at those from the more recent German Nationals. Combined, those 16 decks contained 58 out of a possible 64 Skullclamps. Never in my memory have I ever seen a card show up in those numbers.”

Skullclamp faces the same issues as Black Lotus did. A colorless artifacts, any color deck can use them. Plus, they grant powerful abilities that are generally confined to a specific color: the Lotus’ mana-acceleration and fixing is a green ability, the Clamp’s card-drawin is even more heavily entrenched in blue. With those cheap and colorless artifacts, red decks could have just as good card-drawing as blue decks, black decks just as good mana-fixing as green decks, and so on.

This subverts the very reason why there are five colors in Magic: in order to efficiently manage your resources, you need to make sacrifices and choices. The five colors hang in balance with one another, each color’s strengths complimenting its opposing colors’ weaknesses. Ostensibly, the more you want a strongly blue ability, like card-drawing, the more of your deck you need to devote to blue resources at the expense of all others. With the Clamp, you could have powerful card-drawing while devoting your completely red resources to strong red abilities, such as direct damage. All of the strengths, none of the weaknesses; the five-way balance is thrown out of whack.

And to reiterate, like the Black Lotus, the Clamp’s colorlessness adds to the ubiquitous-ness with which it was played. This, as we have seen, is bad for the metagame. It shrinks design space and discourages innovation. It’s boring. One of the cool things about Magic is the ability to cobble together niche cards to get a cross-color ability you wouldn't normally get access to. These combinations can be beautiful and sublime, like a chess move, or football play. Skullclamp is a disincentive for this kind of creativity. IMHO, banning it was the right move for this reason alone.

Of course, I don’t own any Skullclamps, so I might be slightly biased.

Forsythe, Aaron, “Skullclamp, We Hardly Knew Ye,” Latest Developments., June 4, 2004,