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The NCAA’s Tactical Retreat Doesn’t Help Student Athletes

The NCAA’s $6 billion business model faces its most serious mortality risk in recent memory - that posed by its own malignant hypocrisy. But don’t call the funeral director just yet.

Last week the organization abruptly decided to stop selling merchandise bearing school logos and player names. As Bloomberg noted, the NCAA is also currently defending itself in a California court against a challenge to its ban on student athletes profiting from their own names and likenesses. The organization is considering getting out of the video game licensing business too, as it faces a federal lawsuit over the use of athletes’ images in games it produced in partnership with Electronic Arts Inc.

Mark Emmert, the NCAA’s president, said that selling athletic jerseys from its member schools was a mistake. “It’s not appropriate for us. There’s no particularly compelling reason why the NCAA ought to be reselling jerseys from institutions.”

Meanwhile, a Heisman-Trophy-winning student athlete, Johnny Manziel, is under investigation for accepting money to sign his own name on memorabilia thousands of times in violation of NCAA rules.

It makes sense for the NCAA to engage in a tactical retreat. Intercollegiate athletics is built on the idea of virtually free labor in lucrative, high-profile sports, mainly football and, to a lesser extent, basketball. A little of the money from these endeavors goes to support lower-profile campus athletics that cannot support themselves. Most of it supports extravagant compensation for coaches, athletic directors, university officials (especially presidents) and the NCAA itself. I have written before about the ways in which the NCAA and its member schools profit while denying proper compensation to student athletes.

It’s important to remember that the NCAA’s decision will not stop schools from exploiting their own names and players’ fame for profit. The NCAA itself is nothing more than the amalgamation of its constituent schools, which have an overwhelming interest in keeping student athletes in their place. On the conference call discussing the policy change, NCAA Division I Board of Directors Chairman Nathan Hatch made clear that there were no plans to alter the rules prohibiting athletes to profit on their signatures, saying, “We stand by the NCAA’s commitment to amateurism.”

Amateurism, in this case, means that athletes shouldn’t profit from the fame their talent brings to them. Their schools, of course, should.

The cracks in this longstanding arrangement are starting to show, however. Student athletes are beginning to push back against a power differential which leads them to enrich their schools while putting them at risk.

I cannot claim to know why Manziel, an incoming sophomore at Texas A&M University, might have risked losing his remaining three years of college eligibility by blatantly flouting NCAA rules. He is alleged to have taken part in six autograph sessions for dealers, violating NCAA policy in a way that was almost certain to be discovered.

Maybe he thought the spectacle of tossing one of its brightest stars off the gridiron would prompt the NCAA to back down – unlikely, considering how much money is at stake for the colleges, but a possible motive if he overestimated his importance in the scheme of NCAA football. Maybe he figured that after winning the Heisman as a freshman there was nothing left to accomplish on campus, and he wanted a good excuse to turn pro before a potential injury ruined his value in the NFL. Maybe he just thinks it is wrong that his school and the NCAA can sell his name while he can’t.

Whatever his motives, Manziel seems to be on the leading edge of a rebellion that could take down the NCAA business of “amateur” sports, which makes money for everyone except the athletes competing on the field. But considering how much money is in play, that model is not going to die without a fight.

Larry M. Elkin is the founder and president of Palisades Hudson, and is based out of Palisades Hudson’s Fort Lauderdale, Florida headquarters. He wrote several of the chapters in the firm’s recently updated book, Looking Ahead: Life, Family, Wealth and Business After 55. His contributions include Chapter 1, “Looking Ahead When Youth Is Behind Us,” and Chapter 4, “The Family Business.” Larry was also among the authors of the firm’s book The High Achiever’s Guide To Wealth.

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