Friday, August 12, 2011

NCAA vs. The Academy

Over at The Sports Economist blog Robert E. McCormick and Robert D. Tollison, two professors from Clemson University, argue that the NCAA works against the interests of American universities.  Here is an excerpt:
What is the root of the problem here? We assert it is the enormous economic rents, or free money, that have been created by the NCAA cartel. Moreover, no college or university can be expected to withstand the ill-gotten gain that lurks underneath the NCAA banner. The NCAA is a cartel of the major athletic universities in the United States that sets wages, playing conditions, and other aspects of intercollegiate athletics. Most prominently of these is a restriction on payments to football and basketball players. These two sports create billions of dollars in local and national revenues via gate receipts, TV contracts, and ancillary merchandise, not to mention millions of dollars annually at member schools in donations by alumni and other supporters of athletic programs.

Coaches sign multi-year multi-million dollar contracts while players get tuition, room and board, and recently, only because of an important court case (White v. NCAA), some pocket money to cover the cost of living. Big chunks of these revenues also go to support other men and women athletic teams on campuses, swimming, track, golf, soccer, and the like. None of this would be possible but for the overarching cartel agreement between all of the major U.S. colleges and universities operated under the umbrella of the NCAA.

Both of us have long held, along with numerous other economists (such as Gary Becker and Robert Barro), that the NCAA’s cartel harms the market, the world, and the athletes, but now we are prepared to claim more. To wit, this crisis in athletics puts the American system of higher education at risk.
Does athletics threaten higher education?  I don't think so. Their argument hinges on the impacts of failures in athletics governance on the moral fiber of the university:
We contend that the moral fiber of the university is one of its most powerful social virtues. It helps bring young people to adulthood with a care and concern that things are done correctly and on the up and up ethically. There is a clear positive implication of our argument. Cheating teaches cheating, and it is a mistake to think that our kids will not watch what we do instead of what we say. The scandals that now infect the best universities in the land will almost surely lead to more and more academic dishonesty and disregard for the basic traditions of the academy if something does not happen to reverse course. Cheating in the athletic department begets cheating in the classroom and perhaps generally  in life.
I don't find this particularly compelling nor their remedy that college athletics should seek a return to pure amateurism:
If amateurism is a shrine, then let us all worship it. The fans should get to see the games for nothing or nearly so (the costs of facilities and game day services). The coaches should be faculty or volunteers as they are in Little League and in local neighborhoods. It is not amateurism, but the business of intercollegiate athletics is a growing cancer bound to infect other storied American institutions of higher education.
Richard Vedder, of Ohio University, writes at the Cronicle's Innovations blog offers a dose of realpolitik coming out of the recent university presidents summit held in Indianapolis::
There are all sorts of reforms with both positive academic and financial implications, such as dramatically reducing team sizes (e.g., from 85 to 60 in football), season length, practice time, maximum travel distances for most games, red-shirting, and freshman participation. Put athletic departments under general university administration, not in separate empires of their own. Put limits on coaches’ pay and the number of assistants, weight trainers, PR specialists, etc. Outlaw athletes-only dorms and eating facilities in order to integrate athletes more into the campus. Don’t let athletes sleep in motels the night before home games. Make athletes more like students and less like privileged jocks. Require capital costs of athletics to be considered as part of expenditures (somehow, the NCAA thinks stadiums are given to universities by God). Reconfigure the formula for TV revenues so the financial incentives for winning are reduced. Require athletics to pay overhead fees (a “tax” if you will) to university administrations for the costs associated with overseeing programs, covering capital costs, etc. Require full public disclosure of every dime spent on ICA, broadly defined. The list goes on and on.

As a couple of former Big Ten presidents have told me privately, this is not going to happen. University presidents don’t want huge fights with their alumni and associated Bubba fellow travelers, with trustees, legislators, governors, and above all, with coaches and athletic directors.
College athletics is presently experiencing tremors -- whether they foreshadow a big earthquake remains to be seen.


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