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Why they make so much

When college football coaches get a lot of money, people complain about the injustice of it. Some of those complainers are fans, who have romantic ideas about college sports. But they’re the reason coaches make so much.

In this piece at the Boston Globe, I tell complaining college sports fans to look in the mirror. An excerpt:

But if those fans want to find someone to blame they should look in
the mirror. They are the source of that salary they find so exorbitant.
Their desire to revel in victory is what drives the university to pay
not an exorbitant salary but merely the going wage, what it takes to
attract a talented coach away from other universities and the
professional ranks.

At Alabama, that fan is tired of losing to
Auburn. At Oklahoma where Bob Stoops makes more than $3 million to
coach the football team , alums from Oklahoma want to revel in
victories over Texas. Now and then, they expect a national
championship. At Ohio State, Jim Tressel makes a few million to ensure
that the Buckeyes stay competitive with Michigan.

What I didn’t have room to explore in the piece is the role of large public universities in the escalating rewards to college football and basketball success. If you look at the top 20 teams in each sport, you’ll see the dominance of large public universities with an occasional USC in football and Duke in basketball. Part of the reason for this is the political pressure large numbers of alums put on Presidents of universities and implicitly through politicians to have a successful team.

The other interesting topic is the NCAA. One reader came to the defense of the NCAA as a well-intentioned organization that tries to keep the game honest.

I disagreed.The NCAA relentlessly prevents universities from paying their players in any remote fashion. They have so much trouble keeping the market from working that they ban any scholarship athlete from taking any job of any kind while on scholarship. That’s to prevent the restaurant owner from overpaying the busboy as a form of bribe.

What they did to Alabama in a recent recruiting scandal is what they do to every school that tries to reward any player. They punish them. Some see that as a virtue because it stops something we call "cheating." But what we call cheating is a natural consequence of trying to stop market forces from working. Because that avenue of competition is ruled out, colleges pay coaches large sums of money and build absurdly luxurious dorms and practice facilities as a way of attracting good players.

The NCAA is a cartel. It is a way to reduce competition among rivals. It has no moral compass, no intentions. Anything resembling a moral compass is hype, spin and PR that exploits the public’s romance about university life. They’re not evil, either. They’re just a way to make life easier for colleges and their leaders who see football and basketball as a way to make money and to have goodies to hand out to supplicants who want access to good seats, and the opportunity to rub elbows with glamorous coaches and players. Expecting the NCAA to put the interests of students first is like expecting Congress to pass a law against "special interests." It just isn’t in the nature of the beast.

The NCAA is a private, voluntary organization. IMost cartels die quickly because of the temptation to cheat on the agreement. The form that the cheating takes here, is to build luxurious dorms–there’s no way to limit and monitor luxuriousness. If you could, they would. But that’s mild. So why doesn’t more cheating occur? One answer is that it does and that there’s a lot more under the table payments going on than the NCAA discovers.

The other answer is that no one team can cheat. If one team refuses to abide by NCAA regulations, and leaves the NCAA, they have no one else to play against. You need a group of teams to defect and start their own league. The appeal of that is that by ignoring the NCAA, they could pay the best players and have the best teams and get even more TV money etc. But the risk is high and the overt payments to players might handicap viewership and fan interest for cultural and romantic reasons. Even so, a group of teams did defect in some sense a while back and get their own TV package. Notre Dame did it, too. And the BCS is a sort of cartel within the cartel–it essentially recognizes that not all cartel members are created equal and deserve equal treatment.

College sports is a big business. I have no problem with that. (Though whether it should be tax exempt is another question. The threat of removing that exemption does limit the venality.) But it is a big business built on the bizarre illusion that it’s not a big business. It’s a big business we like to pretend is a game.  To pretend it’s a game and complain it acts like a business is human but illogical.


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