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Post-season scam

A few years ago, the University of Minnesota football teams went to the Insight Bowl. Aren’t you thrilled? If you’re like me, though, you might be wondering what the heck the “Insight Bowl” is: the team had a 6-6 record, which isn’t anything to get excited about, and the bowl doesn’t seem to have any connection to Minnesota or any kind of regional association.

If you’ve also been wondering about the mysterious proliferation of post-season bowl games, you need to read about the economics of the college football bowl system. They’re a big scam, and our athletics administration gets sucked right in.

The racket works like this: Through required purchases of anywhere from 10,000 to 17,500 tickets, schools essentially pay for the right to appear in a bowl. The bowls keep the ticket and sponsorship money. Bowl execs also negotiate their own TV contracts.

After taking 50 to 60 percent off the top, the bowls then write checks to the teams’ conferences. The conferences, in turn, split that money among their schools. (Profits from the five Bowl Championship Series games are spread to varying degrees among all conferences.)

But only about half of the 35 bowls offer payouts large enough to cover team expenses. So the conferences use money from more lucrative bowl games to cover losses from the barkers.

“You don’t lose money going to bowl games, at least not in the Big 10,” says Minnesota football spokesman Andy Seeley.

But that’s true only in a technical sense. In the Gophers’ case, the Big 10 covered the university’s $1.3 million blemish from the 2009 Insight Bowl. What insiders don’t mention is the humungous pyramid of cash schools are leaving on the table.

“They should go take economics 101,” says Dan Wetzel, a Yahoo sports columnist and co-author of Death to the BCS. “Lost profit is lost money to any other business in the world.”

And these losses are staggering.

Last year, the nation’s bowls paid schools roughly $270 million. Just for playing middlemen and providing 70-degree temperatures, bowl execs grabbed a larger cut, north of $300 million.

Why does this continue to happen? Because the people who make the choices about participation in these events are basically bribed: they get week-long vacations in places like Arizona, and no long term investment in the health of the institution.

College presidents could easily put a stop to the shell game—if they had the will, which they don’t. They tend to be a lot like coaches, a job-jumping species forever on the hunt for more prestigious posts. This march to greater altitudes requires staying within the good graces of trustees and big donors, who enjoy free bowl vacations as much as everyone else. Besides, many presidents wield less institutional power than their own coaches, as Penn State’s pedophilia scandal revealed.

So they behave like congressmen, allowing their schools to be pillaged to preserve their political capital. Better to kick these decisions to athletic directors and conference commissioners.

Faculty at universities often have an adversarial relationship with the administrators. Now you know why.

Comments

  1. outaworkee says

    The alumni association for the U of Minnesota, from which I graduated, often tries to get me to rejoin. I have never been a sports fan of the U. So, when I ask what benefits that they provide other than sporting events, it gets very quiet on the other end of the conversation. It’s all about the sports.

  2. jakc says

    The other thing about bowl games is that the costs are grossly overstated. It’s not uncommon for a Big 10 team to take 600 people (team + band + alumni + others) to a game. And in the bonuses paid to coaches and its easy for a team to “lose” money going to the Insight Bowl. Sadly, the public is unable to do math

  3. says

    Not exactly like the enormous salaries of these jerks keeps them from falling for a few bribes. “For the good of the team,” yay.

    No need to keep tuition affordable, when you can always corrupt education for useless feats of competition. Call it preparation for real society and its values, I guess.

    Glen Davidson

  4. says

    Sports Illustrated ran a similar article a few weeks ago; one thing that came through clearly is that the bowl games are corporations, complete with overpaid CEO, whose product is one football game a year. Essentially parasitical, they got their hooks into the college game many decades ago, and are a pretty good model for how to use wealth, privilege and empty talk of “tradition” to perpetuate yourself.
    There is a whole lot of money in the game these days, so much that the likes of Washington State U. in little Pullman, WA, can afford to pay the football coach $2 million a year now. And here in Eugene, the athletic department is swimming in so much money that they gave ex-coach and A.D. Mike Belotti a severance payment of, if memory serves, $2.3 million last year, when he willingly left to take a job with ESPN.
    In many U.S. States, the highest paid public employee is a football or basketball coach.
    It’s fairly disgusting. And I like sports.

  5. 'Tis Himself, OM. says

    One thing I like about baseball and hockey is they run their own farm systems. Football and basketball have their farm systems run by colleges and universities.

  6. magistramarla says

    Mens sana in corpore sano
    This is the original reason that we should have inter-collegiate sports – to teach young people that it is important to have a sound mind in a sound body. College sports, like so many other things in this culture, have been ruined by the pursuit of the almighty dollar. This is why I will not support them, on any level.
    The one exception is the athletic department at my daughter’s alma mater, Cal Tech. Watching that lovely bunch of nerds play basketball is just plain fun. They made a film about the one year that they ever had a winning season in the history of the school. We watched it with our daughter, and I laughed ’til I cried. This is one of the few schools in the country that still maintains the proper spirit of using sports to enhance the main reason for the institution’s existence – academics.

  7. says

    Bowls are just examples of the worst excesses of the American sports system. Nowhere else in the world would a sports superstar like Andrew Luck be playing for little more than peanuts when compared to the billions raked in overall by the sport he’s playing.

    In the UK, a young superstar soccer player Luck’s age would already be a multi-millionaire and not have to be holding his breath every time he’s knocked to the ground in case he has a career-ending injury before he earns a single penny.

    But then, American sports in general seem to operate in a bubble divorced from what goes on in the rest of the world. And I don’t mean the fact that Americans play different sports than everyone else. It is, ironically, given the conservative nature of the nation as a whole, the fact that nowhere else in world sports does such anti-capitalistic, socialist systems like the MLB, NFL, and NBA exist.

    Drafts, salary caps, balanced schedules, and revenue sharing all combine to ensure that the weakest, most dysfunctional teams get a leg up every single year so that they have a better chance of winning next time, and the fix is in.

    In world soccer, and most other pro sports played elsewhere, they have a solution for dealing with poor performing teams that one would think would fit right into America’s current love affair with conservative economics — relegation. If you can’t stand the heat, then you don’t get to play with the big boys again until you have proved you can (by winning promotion).

    Of course, the real reason why American sports is in love with socialistic practices — the money and power that comes from operating as a cartel in all but name. More socialism in sports translates to more money for the already wealthy, which is why not only do they not rail against it, they embrace it and encourage it. Socialism’s okay, as long as its the rich and powerful who benefit the most, I guess…

  8. freelunch says

    Oh, yes, basketball and football are far more corrupt in the college programs than hockey and baseball because good players who are not good students have to find some way to get into and stay in a college with a big-time program.

    Once upon a time, the Big Ten did not allow any teams to go to any bowl game that was not in Pasadena, but they have been suckered into letting other bowls use the value of their name, even if the executives of the Big Ten cannot count, and even waste money allowing mediocre teams to go to money-losing bowls.

    We can fix this:

    1. All teams that are going to bowl games must have a winning record.

    2. No bowl can require any ticket sales of the participants.

    3. Any bowl that claims to be a charity and does not send 50% of total revenue to the target beneficiary will be cut off by the NCAA for three years.

    4. Any bowl that claims to be a charity and has been giving itx executives more than the charity in any of the past five years is automatically disqualified.

    Sure, it is absurd that we have big time sports in college and I would not complain for a second if semi-pro sports were kicked off campus, but given the power of sports and mindless alumni enthusiasm for sports, cleaning up the corruption is a start.

  9. DLC says

    for the Bowl Game providers it’s all about the money.
    Would that half the alumni associations paid 1/10th of the money they blow on football to the science department. At least then the money would be used to increase the knowledge level. You know.. the kind of thing colleges and universities are supposed to do. . .

  10. Active Margin says

    @magistramarla

    Didn’t the men’s program break a 300+ game losing streak earlier this year?

    FWIW, I would be the proudest dad in the world if my children ever went off to play basketball at CalTech. In fact, I’d be equally proud if they didn’t even make the squad!

  11. brett says

    Outaworkee mentioned the alumni factor, which I think is also partially at the root for why the sports teams (particularly “high-prestige” sports teams like college football) get so much largess at the college level. This is the type of stuff that gets rich alumni to donate money when you call them up, and the school administration might be happy to let the conference pay up so that they can soak the alumni into donating more money.

  12. briansmith says

    Depressingly enough Rick Telander documented many problems in college football years ago in The One Hundred Yard Lie. In it, he pointed out that most football programs lost money for their schools, so the most common justification for the programs is false.

    It’s only gotten worse.

  13. rogerfirth says

    Back when I lived in the Bay Area, one of the schools (either San Francisco State University, University of San Francisco, or whatever) was running a series of television ads I really liked. Perhaps my favorite was one showing a hockey goalie, having shot after shot taken on him. He was falling all over the place and every shot went into the net. It was hilarious — he was a total failure. The voiceover introduced him as Dr. So and So, professor of something, and went on to list quite an impressive resume. And then it finished with “University of XXX. XX years and still no sports program.”

  14. Erp says

    I think my school has some problems with sports oriented alumni, but, it also has wealthy alumni (and probably worth more) who do scream if they feel the university is easing off on academic standards for anyone. In a story from school history (late 80’s IIRC) the men’s basketball coach insisted a star prospect must be admitted as he would turn the program around, admissions said he wasn’t academically qualified, the coach threatened to resign if he wasn’t admitted, the university went looking for a new coach. Some alumni were upset, most supported the administration. I hope this would still hold true today. The football team isn’t doing too badly this year; they even managed to sellout the stadium a few times (though I think the sport that most consistently sells out for the last couple of decades is women’s basketball).

  15. wcorvi says

    This is NOTHING! UofArizona had a 2-9 record last year and got ‘invited’ to play in a bowl game. We have the Fiesta Bowl in AZ (which gives vacations in Minnesota! In January!) that was bribing legislators to turn over huge bundles of tax dollars at a time the state was firing teachers and denying health care to the poor. It is, of course illegal to accept bribes – uhh trips to various pro football games – to study how football is played, I guess. It is also illegal to not report such bribes in financial disclosure filings. But, not to worry, the AZ legislature is being investigated for this. The investigation evidently is VERY thorough, as it has already taken about a year, with no findings in sight.

  16. says

    Whenever I see a post about college football I just feel so happy to live in Canada and not have to put up with this level of foolishness.

    My mind boggles at the idea that alumni will pony up more money if you have a good sports program. If that is the case I can’t help but feel there is something wrong with your alumni.

  17. slc1 says

    Re magistramarla @ #8

    Speaking of Cal Tech, back in the 1940s through the 1960s, they had a football coach named Bert LaBrucherie who had previously coached at UCLA. When asked by news media how he could voluntarily move from a big time athletic program like UCLA to a small one like Cal Tech, his response was that coaching big time college football was no longer fun because of the pressure of winning (by the way,his record at UCLA was 60-10-2) and that he was perfectly happy at Cal Tech. This was in the 1940s which were almost benign compared with the current situation in big time college football.

  18. sisu says

    Mens sana in corpore sano
    This is the original reason that we should have inter-collegiate sports – to teach young people that it is important to have a sound mind in a sound body. College sports, like so many other things in this culture, have been ruined by the pursuit of the almighty dollar. This is why I will not support them, on any level.
    The one exception is the athletic department at my daughter’s alma mater, Cal Tech. Watching that lovely bunch of nerds play basketball is just plain fun. They made a film about the one year that they ever had a winning season in the history of the school. We watched it with our daughter, and I laughed ’til I cried. This is one of the few schools in the country that still maintains the proper spirit of using sports to enhance the main reason for the institution’s existence – academics.

    Marla, if you’re just looking at large universities – maybe. But I’d say that any DIII school has a similar philosophy. DIII doesn’t allow for athletic scholarships, so student athletes truly are students first. At my alma mater, more students participated in intramural and club sports, such as Ultimate Frisbee and rugby, than played varsity sports.

  19. freelunch says

    sisu,
    Lately DIII football has gotten stuck in a rut with the same two teams playing each other seven straight time in the Amos Alanzo Stagg Bowl, a real championship, unlike the BCS joke.

  20. mikelaing says

    Whaaaaa?! Next thing you’ll be telling me is that Pro Wrestling is fake!
    Long live the San Diego County Credit Union Poinsettia Bowl, moth%rf*#$errrrrrr

  21. sisu says

    @freelunch the BCS is absolutely ridiculous. But the bowl system is such a moneymaker for the NCAA and its schools that I don’t see it going away any time soon.

  22. jimnorth says

    The only way the science department gained new facilities at my glorified sports camp was after the new athletic center was built. It’s still unfinished, but on the bright side, the new football stadium was built in record time last year…

  23. says

    It’s not just the bowl games, college athletics in general is a huge waste. In 2009, out of 120 schools that are FBS level, only 14 had athletic departments that turned a profit. More than half had football teams that were profitable, but that money got sucked up by the other non-profitable sports.

    It doesn’t have to be this way. The problem is that administrators are unable or unwilling to constrain athletic department spending. The source of this evil, in my view, is that college presidents and trustees live in perpetual fear of their own athletic departments. The second they propose cutting spending, or implementing a hiring freeze (like they do with the library every other year), the coaches and ADs will take it to the public.

    The problem is that people are under the mistaken impression that college football is a huge boon, and that money spent on football is a wise investment. If they were disabused of this lie, and informed that the tax payers and students are mostly being scammed, then maybe there would be widespread support for reform. Then football could actually benefit the public like it has the potential to do.

  24. jayarrrr says

    Where I work, our basketball coach decided that 1.5 Mil wasn’t enough, so he “went to Disneyland” with the family and just happened to have lunch with an AD from an unnamed school. The Alumni and the Booster club dug deep and came up with an additional 1.5 Mil to keep him here.
    Oh. Well.Like they say, “Make STEAM!”

  25. Rich Woods says

    As a total foreigner to this sports system I have to state that I know absolutely nothing about it.

    > they get week-long vacations in places like Arizona

    But I’ll go along with the bribe because I’ve always wanted to see a desert. Where do I sign up?

  26. David Marjanović says

    Mens sana in corpore sano
    This is the original reason that we should have inter-collegiate sports – to teach young people that it is important to have a sound mind in a sound body.

    Juvenal was quote-mined.

    That sentence fragment comes from a satire, where Juvenal mocks all-brawns-no-brain athletes, and the whole sentence is: Orandum est ut sit mens sana in corpore sano! We should pray that there be a healthy mind in [such] a healthy body! How beautiful would it be if there were a healthy mind in that kind of healthy body, but, alas, there isn’t.

    There’s nothing wrong with having sports facilities on campus so students can have fun in ways that don’t involve sitting around all day. But having universities compete with each other, whether in sports or elsewhere, is deranged.

  27. Geral says

    I like football, but I hate the corporatism of college football. It’s SOOO cheesy seeing all these corporate named bowl games, and all our replays sponsored by another corporation. Ugh. I wish I had adblock in real life.

  28. jentokulano says

    I don’t agree with the current system either but there’s more to it than stated in that article.

    Bowls are held in the southern-tier states because it sells more tix in winter.

    The Insight Bowl has tie-ins (contract) with the Big 10 and the Big 12. The Big 10 is upper midwest, so there’s your regional affiliation.

    Under NCAA rules, a team is granted two more weeks of practice if they make a bowl game. This is an advantage.

    The Universities get a chance to (and a deal on) advertise on a major network when their team represents. It is believed (though I’ve never seen a study) that this increases OOS enrollment. It raises the profile for recruiting as well.

    It’s an advantage for the players future prospects and gives them more playtime. The NCAA season is tiny compared to the pros.

    More promoters have applies to create bowl games. They’ve been denied for several years in a row.

    Part of the deal with being in a conference (not all times are, ex. BYU went independant this year)is that it creates a fund buffer should a team become bowl eligible. Otherwise, a team could potentially make it to a bowl and say “no it will break us”.

    Tie-ins have to be arranged in advance for it all to work out. It’s just the way the math works out that a Bowl with, say, a promised PigFuck Conference tie-in for the 3rd-place team has to take a team with a 6-6 (overall, not usually conference play) record. Overall record often includes a pre-conference show-game (like WYO inviting NEB, even though there’s no chance, but it sells out the stadium;) but that shouldn’t be compared to the conference record (against similar programs).

    Event promotion in the USA is always Corp or LLC. Should it not be?