Should College Athletes be Paid?
Maybe it was the annual spectacle of March Madness and the fact that UCONN came out of nowhere as an underdog to win their 3rd national NCAA men’s basketball title. Maybe it was the excitement of watching the UCONN football team playing in its first ever BCS Bowl against Oklahoma last year. Whatever he reason, the media and sports critics always ignite a fresh debate over the merits of paying college athletes for their services to the schools. Over the past few months, PBS, ESPN and HBO each aired major specials and documentaries on the relative injustices or justice – deepening our your view – of the current college Division 1 (D1) system that allows amateur players to generate billions (that is correct, billions) in revenue each year for their respective schools and the NCAA organization, but prohibits them from receiving a dime of it or any compensation that might be offered from other sources deemed private or public.
Coaches can sign multimillion-dollar contracts, endorse products, and rake in lucrative speaking fees. Is this fair? Are we being ethical and righteousness treating young and innocent individuals in this matter? Should we as a society allow these individuals to be taken advantaged in this matter? These are just a few questions many people ask, and the answers are not clear-cut as one might think. To pay or not to pay? The question everyone asks every year since the explosion of D1 College sports over the past couple of decades. The debate over the pros and cons in paying college athletes won’t end until changes are made or someone does something about the current system. My goal throughout this paper will be to present and clarify some of these arguments and why someone could make changes amendable to everyone involved.
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I will focus my arguments and debate on three major issues. (1) Should we pay students athletes and how much should they be paid? (2) How would they get paid and the challenges in managing this process, can the schools afford it? (3) And finally, what ethical issues, if any, would this pose to our schools and society at large? In conclusion, I will share my opinion and recommendation on what should be done to address this ongoing dispute. My discussion through out this paper will focus on the “Primetime” college sports programs in the NCAA; Men’s College Basketball and College Football. As these two sports represent virtually the face of the NCAA and college sports on TV and to the public. While the other college sports are as important to student athletes and schools, they don’t drive the same level of viewing power and revenue numbers for the NCAA and their respective schools. In my opinion college is suppose to be a place you go to earn an education and determine your future career. Although many college athletes are going to the school that offers them the most money potential at the next level of their carriers, paying the athletes based on their current star power or future potential could have the potential to turn the entire college arena into a bidding war.
You would stop seeing athletes go to a place because of tradition or loyalty, but instead to whom would pay them the most money. This in turn would kill the magic of college sports and the purity of the game. Where only a few large schools would have enough capital and buying power to buy the top performing and premier student athletes. If this would to happen, the Butler Bulldogs would have never made it to the NCAA College Basketball finals against UCONN just this past May, as Butler could never compete with the deep pockets of schools like Duke, Syracuse, UCONN, and Georgetown, just to name a few. You may also see “free agency” enter college sports. Although they would have to sit a year, what would stop players from jumping universities because of money? It would dramatically change the college sport world, as we know it today. Butler again comes to mind, as most of their top athletes would jump ship to another school after they finished 2nd in the 2010 NCCA finals, in the hope of getting more money.
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In the long run, paying college athletes will make it ok to pay non professional athletes and thus you could then see high schools develop the same principles. If you are paying a player at the college level because they bring in money, then Bloomfield High, New Britain high and other dominant high schools would do the same, and you then re-create the problems I already mentioned. While the arguments above raise good concerns, I do have some major issues with college athletes not getting paid as well. If an ordinary student receives a grant or scholarship based on their intellectual power of monetary limitations, then it’s perfectly legal for the student to get a job while in college and use that money for whatever they want. I’ve seen this happen. One of my friends in college got a $50K scholarship to Northeastern; no strings attached (except for keeping up the GPA), paid tuition with that money, and then used his talents after schools hours to become an independent contractor while still attending school. He made enough money on the side to buy a used car in cash and pay for a couple of spring break vacations and a few other “luxuries” currently unavailable to college athletes.
While college athletes get free room, board, books, tuition and fees covered by the scholarship, they don’t have the luxury or option to earn extra money for additional expenses (car, travel, vacation, nice dinner, etc.) as they spend most if not all of their time practicing or traveling when outside the classroom, limiting the amount of time they have to find any part time job. On the other hand, they are plenty of non-athletic students in college who have an equally difficult time having a “normative college experience” because the job that they do work is used to cover the enormous expense of room, board, books, tuition and fees. Furthermore, many of those non-athlete students have to take on mounds and mounds of debt to be able to afford the very things the athletes are given. I bet more than a few of them would gladly give up their “play” money for the chance to finish college without being $100-150k in the hole. That being said, I am convinced that student athletes deserve the same opportunity regular students have. They should have the opportunity to earn additional money to cover expenses currently covered by their parents, friends family or bank loans. Do I feel that the players should be paid some amount of money to pay for additional expenses? Yes. The amount of money these kids generate is in the Billions and they get nothing (monetary) in return, as if these athletes use college as the tool that it is, then they should at least be getting an education.
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However, it does not make sense for college players to have no money and barely able to get by, while someone makes a substantial amount of money off their talents. However, the payment should be controlled and limited to a defined amount. More on this a little later. In the past, Maryland’s head basketball coach Gary Williams made a public statement in which he denounced the present system of not paying athletes. His proposal was to give those players in revenue-producing sports a stipend of $200/month. While I agree with Mr. Williams approach and argument, I disagree with the payment amount and structure. In my opinion his argument makes perfect sense and achieves a realist solution. He points out that college athletics – specifically basketball and football are making a fortune for the NCAA, the schools, the coaches, the staff and filtering down to just about everyone else in the athletic department and sometimes even to other parts of the school. However, not a cent is being given to those who are actually providing the product on the court and field. You know, the product that we love to watch and talk about during water breaks in the office, the product that creates so much exhilaration every weekend to millions of people across the US and world! Again, I realize the argument is that they are being given free housing and a free scholarship, etc.
The problem is that there isn’t another kid at the school that has to have a life based upon $0 extra income to buy what he wants. As I mentioned above, these individuals don’t have the time to work and earn extra money, so they will be tempted to take some extra cash or a trip or a meal at a fancy restaurant from a “friend” or “acutance”. Who wouldn’t be? And there lies the problem. The student athletes under the current system will always be faced with the hard decision not to break the rules and laws, which honestly, other students don’t have to deal with. As I pointed out before and Williams makes the same point, regular kids are allowed to receive living expenses and spending money as part of financial aid from family, friends or even strangers. Since athletes cannot, they are clearly being discriminated against. The student athlete might bring thousands if not millions of dollars to the school and more importantly the NCAA in one way or the other, but how much does any other student bring to the school? In addition to the moral argument of making students paid employees of the school while attending school, there’s the cost argument. Can the NCAA and schools really afford it? The answer might surprise and shock you at the same time.
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The NCAA negotiated an $11 Billion (with a B) deal for the 2011 NCAA tournament. Not the regular season, just the tournament – and that’s just NCAA basketball. Doing some analysis show that, there are 346 Division One schools in basketball. If each one of them has 13 players, that’s 4,498 players. Divide $11 Billion by 4,498 and you get… over $2 million per player! These figures clearly indicate that both the NCAA and schools could afford to pay the students athletes some monetary figure, more on that later. Clearly the argument is no longer about money! Or is it? Between 2004 and 2010, fewer than 7 percent of all Division I sports programs generated positive net revenue, according to NCAA data. Fewer than 12 percent of all Football Bowl Subdivision (FBS) schools — 14 out of 120 — did so in fiscal year 2009. For that matter, the NCAA reports that only 50 percent to 60 percent of FBS football and basketball programs make money. In other words, a significant chunk of top-level FBS programs are losing money. Should those programs be obliged to pay their football and basketball players, even though they aren’t actually producing a net profit. Paying student athletes large sums of money based on their natural ability would destroy the college sports, as we know it today and potential drive schools out of business into bankruptcy.
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Obviously a large majority of D-1 schools can’t afford to pay students athletes even if it was legal today. So, where’s the money going? As I mentioned before, the NCAA is signing record deals with the networks, shouldn’t that money go back to the schools? Nobody can answer this question with certainty, but one thing is clear, the NCAA could afford to compensate the student athletes, based on their current revenue streams. My recommended solution will address this disparity in D-1 schools and their ability to lash out money to pay student athletes. Indeed, with many coaches and college experts, the biggest problem with paying players isn’t a money issue. It’s the legal and structural chaos that would result. In an interview with PBS’s Frontline that aired a few weeks back, NCAA president Mark Emmert said it would be “utterly unacceptable … to convert students into employees.” Emmert had reason to be adamant. What happens when college athletes become employees? Can they collectively bargain? Can they strike? Do injured players receive workman’s comp? Are players at state schools eligible for subsequent retirement benefits? Do only football and men’s basketball players receive salaries? Should a star point guard earn more than a third-string center? Should an All-American quarterback earn more than his entire offensive line? Who decides and who controls all of these decisions? The NCAA? The School? Since student athletes are prohibited in gathering any additional money, the NCAA is making efforts to help support the future of college sports by helping to funnel $750 million over 11 years into funds strictly designed to benefit these athletes.
This money is ideally going to be used by the NCAA to help fund student-athletes who are looking for clothing, emergency travel, educational and medical expenses, personal needs and also a injury insurance. Even though this is a very nice touch by the NCAA organization, it however does not address the real issue of allowing college athletes in earning money, which can be used a the discretion of the student-athlete. Until that day comes, the future student-athletes have a lot of hard work, dedication and lessons to be learned from before they are all worthy enough of being able to accept salaries for their individual efforts. It is a fact that since its birth, the NCAA has grown into a multi-billion dollar industry and some experts feel college athletes should begin to benefit financially from the large revenues. The NCAA brought in more than a billion dollars more than what the NBA generated globally in the 2009-10 season, according to the most recent estimate from Forbes. One of the biggest revenue-creating sports a part of the NCAA today is college football that has come a long way since the establishment of the Harvard, Yale and Princeton football association.
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Recently in the last five years a few football teams have financially stood out amongst their competitors in the NCAA. NCAA players, coaches and officials constantly argue for the paying of student-athletes because for them the primary reason for massive profit earnings is due to the thanks of the hard work of their student-athletes. College athletes are constantly seeing their jersey numbers on the racks of their campus bookstores but instead of seeing any of the profits all they see is their coaches racking in multi-million dollar contracts year after year. In total there are 119 Division I-A football teams competing in the NCAA today and out of those a reported 42 of those team’s coaches received more than $1 million salaries, at least nine receiving more than $2 million. In Basketball, the University of Connecticut last year signed a 5-year contract with coach Jim Calhoun worth approximately $11M – including speaking and media fees.
This is one of the biggest reasons why players argue for their own salary incomes due to the financial successes of their own coaches and seeing them living extravagant lifestyles. Meanwhile, would each salaried player on a given team be paid the same amount? If not, who would decide whether the All-American linebacker deserved more money than the All-American wide receiver, or whether Kemba Walker was more valuable than the star power forward, Jeremy Lamb. Would 18-year-olds be negotiating “contracts” with officials in their athletic department? Would they be hiring agents before high-school graduation? And how would all this affect those sports programs that depend on football and basketball revenue to stay afloat? To pose an discuss these questions is to realize that paying college athletes merit salaries based on their “book value” is simply unrealistic and unfeasible. Still, the current NCAA rules are deeply flawed, and many players are indeed being exploited. Let’s face it: Big-time college football and basketball basically function as minor-league systems for the NFL and the NBA, respectively, while creating massive profits for everyone except the athletes. Scholarships are financially valuable, sure.
But according to many experts, the average scholarship falls about $5,000 short of covering an athlete’s “essential” college expenses. Closing that gap — My proposed solution would address the majority of these concerns, if not completely eliminate them. Many experts have reach a determination that college sports have already effectively become professionalized. Given the N.C.A.A.’s abandonment of standard honored amateur principles, many experts argued, that there’s not a good enough reason preventing athletes from engaging in the same entrepreneurial activities as their celebrity coaches. Big-time college athletes should be able to endorse products, get paid for speaking engagements and be compensated for the use of their likenesses on licensed products. After all, aren’t non-athlete students allowed to go on a TV show like “MTV SpringBreak” and receive money for their appearances and efforts? If non-athletes students are allowed, why can’t students athletes appear on ESPN shows and get paid for it? They should! They should be allowed to also negotiate an actual contract with the N.B.A. as part of a final project in a finance class, and have an agent from the day they decide to. In the past few years, the NCAA has cracked down on players taking illegal benefits from “agents and boosters”. USC was under two years of probation for the Reggie Bush affair. Cecil Newton openly shopped his son around to SEC schools. And just a few months back, the University of Connecticut was found guilty and punished by the NCAA for violating its rules and laws. Schools, coaches and athletes decide to take these risks and break the rules because they know what’s a stake, millions and millions of dollars.
All of these things are clearly against NCAA rules, but how fair are the rules? We all know how much money colleges bring in off of the hard work of these kids, and we all know what it’s like to be young and poor. Should college football players be paid or at least allowed to accept benefits? After long hours of research, deliberation and studying both sides of the argument in paying student athletes for their services to the NCAA and respective schools, I came up with the following recommendations. Frist and foremost, student athletes should continue to receive scholarships from their schools with the same benefits as they receive today. I also think that we should not pay large salaries to these athletes based on their personal ability or star potential as it would turn college into even more of a business and less of an academic institution. Furthermore if would open the floodgates for paying athletes very large sums of money. It has been said again and again; more money more problems. However, I also believe that it is unfair for these athletes not to receive anything for the services they provide to their schools which yield millions and millions of dollars in profits, prestige recognition and increase in student enrollments, all very positive for the school’s bottom line. In my opinion, students’ athletes should receive from the NCAA NOT their schools a yearly payment (for all 4 years) equal to the average school annual tuition amount– in other words, take all D1 schools, average out the full tuition across all schools and make that the payment to every school athlete.
This money would come from the lucrative contracts the NCAA signs with TV networks, clothing companies, etc. While in some cases this represents more income than what students could need, it would eliminate calculating complex and unfair student payments, and give student athletes additional spending money. It would also avoid any student athlete from choosing one school over the other because of this payment, as it would be the same independent of what school they eventually select. This approach would also eliminate the fact that a majority of D-1 schools have a negative balance sheet and realistically can’t afford to pay any student athlete’s salaries. If not else, it certainly would be a great deterrent for the vast majority of otherwise good players, but not ready to jump to the NFL or NBA early.