Receiving a scholarship is not the same as receiving a salary

On Mike and Mike today, Syracuse coach Jim Boeheim was asked about the Northwestern football players’ unionization drive. He said that he supported what he considered to be their two main goals – better medical protections, and financial aid that more fully accounted for the full cost of attendance at universities, which the current grants-in-aid to athletes don’t accomplish.

But Boeheim also rejected the idea that the players are employees and took the opportunity to muse about how much money they were receiving in the form of a scholarship: “I’ve never thought players were employees. It just doesn’t make any sense. And if you didn’t give them a scholarship and you paid them and they practiced twenty hours a week, I don’t know, you’d have to pay them $100,000″ in order for them to pay – presumably after they were taxed on that income – what Boeheim described as the $60,000 necessary to meet the full cost of attendance at Syracuse University.

I know I’ve already belabored this point, but in cutting through the obfuscation and misdirection that permeates this debate, it’s important to understand that the scholarship is an in-kind payment, not usable in the way that ordinary income would be and pretty much without value if the player isn’t getting a real education, which is too frequently the case at virtually all major college athletic programs.

Boeheim and other defenders of the status quo continually try to characterize the grant-in-aid in market terms in a system that defies almost all ordinary market principles, including in its monopoly power to engage in price-fixing, which limits the payment to players to no more than the cost of a scholarship. Defenders of the status quo speak out of both sides of their mouths on the question of whether college players are employees. On the one hand, they categorically reject the premise. On the other, they try their level best to insist that the compensation athletes receive very much approximates that which a reasonably well-paid employee would receive. But even on their terms, this doesn’t make sense. If I were receiving $60,000 a year to work at UNC, but then UNC turned around and charged me, say $20,000 in something called “tuition and fees” for the privilege of showing up at my office, I wouldn’t really be making a pre-tax income of $60,000.

To be clear, some athletes in the big time programs can and do make the most of their educational opportunities. But that doesn’t change the fact that the form the compensation takes is primarily devoted to paying for the privilege of enrolling in classes – plus room and board – when no one with a straight face can argue that this is the primary purpose for which the athletes in question are being brought to campus.

You can still say that they are being given a great opportunity, one for which many athletes and their families are understandably and profoundly grateful.

But you can’t argue that this is a model of compensation that any ordinary employee who was contributing significantly to a major revenue-producing enterprise would recognize as acceptable, certainly including the extraordinarily well-compensated coaches who tie themselves in knots floating market analogies that don’t hold water.

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