If only colleges could exploit coaches the way they exploit players.

Right now, this piece is in the lead for my best example of “… and, a pony” wishful thinking for 2013.  And it’s only mid-January.

Sauer has labeled buyouts such as Auburn’s $7.5 million goodbye package given banished head coach Gene Chizik in November “shameful.” As the president of the North American Association of Sports Economists, he carefully tracks coach salary trends, which seem at odds with the academic mission of universities.

“We’re getting close to that, if we’re not already there,” said Sauer, 56.

He blames a “non-cooperative competitive equilibrium.”

The professor’s explanation: “Given the rules of the game, (Nick Saban) is getting paid roughly market value. The rules of the game are the problem. The demand is there to compete and to win, so you have to go out and compete to win, so that bids up the price for things.”

College head coach salaries wouldn’t be so out-of-control with a salary cap applied by the NCAA or conferences.

A Rice vs. Idaho national championship game is more likely.

“(Schools) can’t cooperate like the NFL because it would be illegal,” Sauer said. “The NCAA is cornered by competitive forces and anti-trust law. When the NCAA tried to put in rules which attempted to restrict pay to (basketball) assistants, they were sued and lost.”

Damn it!  If only the courts weren’t so short-sighted, the schools could keep all that money that Jimmy Sexton is squeezing out of them they’re overpaying coaches and use it to… to… well, I don’t know.  Maybe let Michael Adams invite a few more folks to a bowl game.

If a school doesn’t want to pay an absurd salary to a coach, nobody, not even Sexton, is holding a gun to its head forcing it to do so.  That’s the marketplace at work.  And eventually, if you make enough dumb decisions, you’ll be forced to cut back on your spending.  Unless you’re Maryland, that is.

About these ads

17 Comments

Filed under It's Just Bidness

17 responses to “If only colleges could exploit coaches the way they exploit players.

  1. Macallanlover

    I don’t understand Sauer’s label of a 3 year exit package as “shameful”. Three years is pretty common payout protection for executives that are terminated without cause. You can debate the value of the job being out of line but this is a high turnover position and highly compensated individuals having “protection” is the norm. I am more surprised it has taken so long to get multiple years deals for assistants, and that is still in the early stages of happening.

    • I agree with you. I think it’s just part and parcel of a certain inherent jealousy in academia about the outsized salaries some coaches earn.

      • gastr1

        It is that. But it’s more about academic priorities than anything else; faculty, deans, etc., believe the university should pay its top researchers and top admin the highest salaries, and even those are very infrequently going above 500K. And faculty are fully aware that student-athletes are not too often not getting a very good education and are representing the university for free.

        On the other hand, University presidents, alumni, etc. believe the university should be as visible as possible in order to keep donations high, keep the best students applying, etc., and football is a way to do that for those that cannot be Yale or the U. of Chicago.

        • Debby Balcer

          Research skills are rewarded more than teaching skills. Aren’t colleges supposed to be in the business of educating students that mission seems like the least important one to the research universities.

          • gastr1

            Debby, knowledge comes from research. Teaching, hopefully, comes from people who have knowledge and therefore have researched. Additionally, in order to be on top of what’s current, you have to keep researching.

            Believe me…I work with some people who have not lifted a research finger in years, and they are the worst teachers you can imagine because of the stagnation of their ideas.

  2. Go Dawgs!

    The market forces in college football are what they are because college administrators allowed them to get that way. And schools do have the option to pay less. Right now Vanderbilt has a Top 25 program for pennies on the dollar being spent at Alabama. And our own University of Georgia has resisted the seeming spending spree on assistant coaches that some of our rivals have been on. Whether that’s for better or worse is anyone’s guess. One thing is for certain, Tennessee didn’t have to pay Derek Dooley the 20th highest salary in the nation based on his resume at Louisiana Tech. Their program was in a bad spot, but not so bad that they couldn’t get a coach to come lead their program. They merely got outnegotiated and were desperate and, frankly, stupid.

    The key that the people in academia don’t seem to get (and I say that as the son of an academic and one with a degree from and a great deal of love for the actual University of Georgia) is that the money being spent on coaches and athletic programs isn’t being spent at their expense. Mark Richt’s bowl bonus isn’t coming out of the budget for a new science lab. It comes from TV contracts from television networks that wouldn’t be broadcasting the Quiz Bowl otherwise, it comes from ticket sales from people who aren’t going to buy season tickets to six or seven Saturday chemistry lectures a year, and it comes from donations from alums who want to see football succeed. If you do away with Georgia football tomorrow and turn Sanford Stadium into the third P-J auditorium, that money disappears. Some alum donations would shift from athletics to academics, but I don’t think a very large percentage would… after all, UGA is already awash in money from alumni donations.

    • Gravidy

      Thanks. You just saved me from typing something very similar.

    • Silver Creek Dawg

      Shorter version (paraphrasing Bear Bryant)-

      “You ain’t gettin’ 80,000 people to show up at Alabama to watch a kid perform a chemistry experiment.”

    • gastr1

      “The key that the people in academia don’t seem to get …is that the money being spent on coaches and athletic programs isn’t being spent at their expense”

      They get that–at least the ones I know do. It is an issue of values and priorities and university identity, not just where the money comes from. Would UGA be ok tomorrow without Sanford? Sure. Some might say it would even be better. Not me, mind you, but some would.

  3. readyForSomeFoosball

    I can’t find the exact breakdowns, but the portion of these salaries paid by the actual institutions rather than their separate athletics fundraising arms, apparel and media companies, etc, is relatively small. Rock star researchers have a similar relative multiplier benefit to their universities as rock star coaches to their athletic departments, but of course the absolutes are different. A handful of successful coaches might cost an AA (not the University) $4-8 milliion per year, but they can bring in 10+ times that. A large cadre of researchers might cost a University a similar amount, and they’ll bring in money about 10+ times that.

    • Silver Creek Dawg

      I believe I read that CMR is paid only about $400K by the University itself. The rest comes form the AA, which is a separate entity unto itself.

  4. AusDawg85

    As an economist, shouldn’t the professor understand that:

    Buyout Clause = PV of Tenure

  5. Jerry Sandusky

    Lost in the coaching salaries controversy is the bigger problem–overall increase in salaries for professors and other administrators in colleges and universities. The academics may complain about the coaches but at least the coaches are self-supporting. The profs and administrators are WAY overpaid and that means higher tuition. The cost of an education at a private school has reached the point of absurdity. Sorry, but a tenured prof has no business getting paid $200K much less the $500K some are getting. Then there are the Mike Adamses of the world–con artists masking as educators–who rake in a cool $1 Mil+ . Kids are graduating with crushing debt from student loans now and the university salary problem is the biggest reason.