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Game Changer

Our kids are turning pro. Well, not my kids, and chances are… not your kids either. But sometime soon student athletes – at least the elite players in high profile sports – are going to be able to make money from endorsements.

This is a seismic shift in the world of student athletics. Not just for the relative few who will be able to cash in, but perhaps for all student athletes. Because the magnitude of the change could impact the whole system in ways that are impossible to predict at this point.

It all started with the California State Legislature passing the Fair Pay to Play Act - a law that allows student athletes to profit from their “name, image and likeness”. In short, they will be able to earn money sponsoring products and services. The NCAA reacted by announcing they would “permit students participating in athletics the opportunity to benefit from the use of their name, image and likeness in a manner consistent with the collegiate model”. Some who favor these changes view the caveat “in a manner consistent with the collegiate model” with suspicion. Is that meant to be an out, a basis for foot dragging in the future?

It’s no secret that the NCAA would prefer college athletes to remain true amateurs. NCAA President Mark Emmert referred to the Fair Play Act as an “existential threat” to the collegiate sports model, and the organization has long taken a stand against athletes receiving compensation (other than via scholarships or small stipends).  The Associated Press recently reported that the NCAA, along with the ACC and Big 12 conferences, spent a combined $750,000 lobbying Congress in 2019 alone… clearly they want to have a say in any regulations coming out of Washington. 

But in the wake of the CA decision dozens of other States appear to be following a similar legal path. And while opposition exists, overall there seems to be broad bi-partisan support for allowing athletes to participate in the billions of dollars of profits their efforts are generating for the college sports industry. Make no mistake, it’s a bigtime industry. According to Bloomberg the top 13 college athletic programs each bring in more than $100 million annually (mostly from football and basketball). And top coaches garner multi-million dollar salaries that rival what is available at the pro level.

One thing that everyone seems to agree upon is that the US Government needs to step in to establish new ground rules. A piecemeal system of varying and contradictory regulations in each State would be a mess... for colleges, for the NCAA, and for student athletes.

So, is this change a good thing, or a bad thing?

Why it’s a good thing

Billions of dollars are being generated in college sports and none of it goes to the players who put their bodies on the line generating it. A large proportion of those kids are from underprivileged and minority communities. Money could help those players, and their families.

In addition, more athletes may be inclined to complete their educations if they are able to start earning while still in school. The window of opportunity for an athlete to monetize their ability is brief, and is artificially shortened by the current system because they can’t start until after they leave college.  As a result, it has become more and more common – particularly in basketball – for athletes to leave before graduation, or in some cases to skip college altogether.  Allowing them to earn while still in school reduces the incentive for athletes to leave.

One of the concerns about allowing student athletes to “turn pro” is that money is a corrupting influence. But money is already in the system. And to some extent it flows to the kids in an underground manner as attested to by periodic recruiting scandals.  For example, in 2017 the FBI and US Attorneys arrested ten individuals including coaches, managers and a sportswear executive on charges related to illegal payments to college basketball recruits.  Allowing athletes to openly earn money would reduce the appeal of illegal booster arrangements by bringing the payments “above ground”.

Why it’s a bad thing

The position long asserted by the NCAA is that the free education that top athletes receive is compensation enough.  College is supposed to be about the education, after all.  The NCAA holds that amateurism protects athletes from the potentially corrupting influence of cash, and is critical to maintaining a sense of connectedness between athletes and the rest of the student body.

Allowing athletes to earn endorsement money raises a host of complex issues.  What happens if the school has a contract with one sneaker company while the athlete is courted by another?  What impact might this all have on the Title IX requirement that female athletes receive the same opportunities as men?  Will athletes be allowed to hire agents?  What’s to prevent boosters from throwing money at kids to sway them toward signing with a particular school?  Will large, high-profile schools that maximize exposure (and thus earning potential) for players come to dominate even more than they do already?

Remember also that while revenue is primarily generated by basketball and football, it is shared among all sports.  According to Bloomberg, women’s basketball loses $163 million per year, and baseball loses $69 million.3   When this money doesn’t come from basketball and football, it has to be covered by tax dollars or tuitions.  To the extent that endorsement money ends up flowing more to athletes and less to athletic programs, there will be a deficit that will have to be made up somehow in order to maintain the other sports.

Why the good or bad of it doesn’t really matter

While the pros and cons will be debated, and there is still much to be decided in terms of how exactly this will play out, it certainly seems like the change is coming no matter what.  As the parent of two student athletes – one in middle school and one a high school freshman – my primary concern is how this change will impact the broader world of college sports.  Not just the relative handful of players who will be able to earn endorsement money, but the far greater number who benefit from the current system of youth and college athletics.

The benefits of youth sports participation have been well documented:

  • Even after controlling for family background and cognitive ability, involvement in extracurricular activities predicts higher grades; higher college aspirations, enrollment, and completion; greater self-discipline, self-esteem, and resilience; lower risky behavior such as drug use, delinquency, and sexual activity; and lower truancy rates (Zaff et al. 2003).
  • Furthermore, the effects of extracurricular activities appear to extend well beyond college: students who are involved in clubs and sports go on to earn higher wages, advance further in their careers, and even vote and volunteer more frequently than their less-involved peers.1
  • Girls in particular seem to benefit from athletics: Participation reduces the chances of developing heart disease and breast cancer, cuts rates of unplanned pregnancies, lessens obesity, and boosts body self-esteem. And the advantages extend into adulthood: Four out of five female business executives played sports as kids, and women who go on to play sports in college are 25 percent more likely than those who don’t to develop political aspirations.2

While relatively few athletes receive scholarships, and fewer still may end up earning endorsement money, many have educational and career doors opened for them because of sports.  Being an athlete is a differentiator, and can be the ticket into better schools than the student might otherwise have access to.  Anything that risks upending the current system should be viewed with at least some degree of wariness by athletes and their parents.

Given how much money is involved in college sports these days it seems only fair to me that athletes are able to participate in the profits.  That said, for the vast majority of athletes it truly is all about the education.  Hopefully Congress will bear that in mind and create a structure that allows some athletes to earn money while protecting the system that nurtures and supports all the rest. 

Patrick Foley

RecruitingInfo.com

What do you think?  Join the conversation: Should college athletes be able to earn money...    

 

 

1 Inequity Outside the Classroom: Growing Class Differences in Participation in Extracurricular Activities http://vue.annenberginstitute.org/issues/40/inequity-outside-classroom-growing-class-differences-participation-extracurricular

2 What's Lost When Only Rich Kids Play Sports https://www.theatlantic.com/education/archive/2017/09/whats-lost-when-only-rich-kids-play-sports/541317/

3 College Sports https://www.bloomberg.com/quicktake/college-sports-ncaa



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