The NCAA's Name And Image Trojan Horse
The NCAA dropped another document from their name and image rights working group, which spawned the usual round of not-skeptical-enough headlines. These days, a lot of people react owlishly to anything the NCAA does, though, and there was a significant amount of pushback on those headlines. The NYT article linked has good content, but how many people bother to click through?
The state of things follows.
1. Public relations comes first
We had Richard Hoeg on to talk about the previous edition of this working group's recommendations. Hoeg's general thrust was that certain weasel words in the list of recommendations looked like outs for the NCAA to change as little as possible while offering the appearance of something real. And repeatedly issuing these recommendations creates wave after wave of headlines about how the NCAA is really listening this time while nothing's happening underneath the hood:
Rep. Donna Shalala (former Miami prez and Wisconsin chancellor) said the NCAA's announcement today was too vague to understand or prompt any real action. "No one comes to Congress with vague ideas."
— Dan Murphy (@DanMurphyESPN) April 29, 2020
The NCAA is aware that their house of cards is in a strong wind and is hoping to present themselves as a trustworthy organization that should be in charge of how it collapses. Thus leading to…
[After THE JUMP: no, not Traveller]
2. The Trojan Horse
The NCAA is seeking various things in order to open up these name and image rights. This list is asking for a couple reasonable things and three ponies with wings:
Asking the federal government to supersede the emerging patchwork of conflicting state legislation is reasonable. The NCAA is an inter-state organization and having different rules apply to athletes in different states is a problem worth addressing.
The next three items are absurd. The NCAA wants to enshrine "athletes are not employees" into federal law and acquire an antitrust exemption that would shield them from the avalanche of lawsuits that keep chipping away at their exploitative business model. It says everything you need to know that the NCAA want to "safeguard" their athletes from employee status. As the ongoing NLRB battle between universities and grad students demonstrates, employees have rights. You don't safeguard people from rights.
This might have worked 20 years ago but these days dumping on the NCAA is a bipartisan endeavor, and congress isn't buying what the NCAA is selling. Republican rep Mark Walker:
“Truthfully, I am hopeful, but does it change the need for legislation? No,” Walker said. “Because to me federal legislation is a backstop to make sure the NCAA doesn’t come back and say of these proposed changes, these three don’t work, and they end up in a ditch.”
…the NCAA wants to be able to assess the market value of endorsement deals to ensure they’re not being abused for recruiting purposes. That process would almost certainly be an antitrust violation without a statutory exemption from Congress, the very idea of which made Walker chuckle.
“I’m not sure we’re ready to hand out free antitrust exemptions at this point,” Walker said.
Ross Dellinger reports that after talking to legislators the antitrust exemption is a "long, long shot."
3. The out
I share Andy Schwarz's skepticism about what happens when the NCAA doesn't get its ponies.
I *think* this means that this is all a dead letter unless Congress agrees to exempt the NCAA from antitrust laws. While Congress has done some dumb things before, I sure hope they don't fall for this okey-doke, but regardless, assuming Congress will act quickly is unlikely. https://t.co/r6thM96haP
— andyhre (@andyhre) April 29, 2020
The report attempts to paint group licensing—the variety necessary for the video games to come back—as a legal impossibility, because athletes can't organize as long as they're "safeguarded" from their rights.
More on why the working group considers group licensing such a problematic hurdle: pic.twitter.com/uwAIeLcAVz
— Max Olson (@max_olson) April 29, 2020
You can probably think up ways around this "hurdle" in 30 seconds. The NCAA chooses to emphasize it because it wants to paint a picture of a legally fraught landscape that prevents the NCAA from doing what it really wants to. The landscape is indeed legally fraught, but it's because the NCAA is a cartel that places restrictions on what schools can do.
This is unlikely to work.
4. Federal legislation is likely… at some point
The NCAA's right that Congress is going to have to step in and do something. They are also right that they have lost the name and image battle. This is a rear-guard action in which they're trying to establish a perimeter around amateurism. They are likely to be technically successful in this regard. Universities won't pay players directly for a period of time after NIL legislation goes into effect.
Earning caps and integrity checks aren't going to happen, which will turn NIL rights into an above-board booster slush fund for recruits. This is fine. It'll codify something that's already happening at most schools and it'll likely turn some athletic department donations into direct cash payments to athletes. This is also fine.
“Safeguard the non-employment status of student-athletes.”
I’ve never wanted to see the NCAA burn more than right now.
I have no idea how the wording for these things are chosen, but in my mind the guy who came up with that line got a high five from the person sitting next to him. (In my mind, the NCAA also ignores social distancing guidelines.)
I believe they are referencing that if the students become employees they (the students) may have to pay taxes on all of their benefits (free tuition, lodging, etc.)
Honest question - do students on academic scholarships pay taxes for their "free" tuition? Lodging? how about student stipends?
This wording is here because the NCAA still wants to illegally have a cap on compensation.
I just hope eventually NCAA will wise up and start controlling things that they can actually control - academics. Athletes getting paid was never going to be controllable as we have seen over last several decades. Without subpoena powers (even when they had FBI info, they did nothing with it), it was a moot point. At least now everything will be above board and out in the open.
Where they do have SIGNIFICANT control is academics. NCAA should just focus on athletes being students and classes they take are legit. Scandals like what happened in North Carolina should never happen. Instead of wasting efforts on limiting pay, they should focus on academics where they can force universities to comply. If they adopted rules like scholarships based on graduation numbers, they can even have significant influences on athletes getting paid.
NCAA just needs to focus on what it controls and not what it cannot.
I agree stuff like what happened at UNC shouldn’t, but it’s not a great example of things the NCAA should try to control since according to their own rules, they couldn’t do anything about it.
"No one comes to congress with vague ideas" - Rep. Donna Shalala.
I almost spit out my drink.
The funniest thing about the NCAA is that they have spent so many decades huffing their own farts that the one bipartisan conclusion in Washington DC is, "These guys have no f'ing clue what they're talking about." I mean, you kinda knew that from the way they get laughed out of court constantly, but jesus.
Cheating will just move from under the table to above and it all will come shamelessly out of the shadows.
It won't be cheating anymore. Michigan will pay the best players, they will be employees, it will be great.
"If we end prohibition all these people will buy liquor from stores above the table instead of from a bootlegger!"
I mean, yeah man. That's the reason to do it. Rules don't make markets go away, they just turn them into black markets. Turning the unfair murky NCAA black market into something above table and reasonable is a huge success.
Yes and no. Rules certainly do effect markets, and in some cases, effectively go away.
THIS ^^^^^^
THIS ^^^^^^
The NCAA is like the banker who told Henry Ford that cars would never replace horses. Instead of finding reasons NOT to do something, start thinking of solutions. They have a chance to be a leader of change, not the last person standing when the music stops.
Frankly, I think there are plenty of solutions where there could be controls, limits, distribution plans put in place with NIL if the NCAA progressively worked on it - perhaps with athletes instead of against them. Pro-sports heavily regulates their signing bonuses and approves which agents are licensed.
I'm for paying the players but I'm worried there will be unforeseen consequences that negatively impact the nature of college sports. I'm not sure what those would be, but they always happen. Anyone who thinks they know exactly how this will go doesn't know what they're talking about. That's why I blame the Ncaa for this. They should be leading and making sure there's a good system that increases athlete compensation while maintaining college sports as well as they can. Doesn't look like they'll ever come around though.
It’s okay for you to lament the loss of college athletics as you know it but you should not fear the altered future of college athletics. Maybe you will even like it. But if it is ultimately worse in your view, at least take comfort in knowing it’s less exploitative.
Oh yes, your average college scholarship athlete is soooooo exploited! They are given the opportunity to get a 6 figure product (e.g. a college degree) and are expected to, shoot oh dear, play a freakin' game in order to earn it. Now you can argue the well NCAA sports are the minor leagues for pro sports angle, but that is going away in basketball with the D or G league, which leaves the 800lb gorilla of football. The inequity of payment to athletes is going to be illustrated in the trenches of football as the differential between those who will go pro and those who won't becomes obvious. There were some comments about the ambiguous statements of of potential damage, there is an obvious one. The tiering of talent and pay is going to cause problems on teams
What "unforseen" circumstances are there? You sound like the NCAA now. "Not sure what will happen, but it won't be good". I know how this will go down. The bag men will be out of a job. People will be able to pay players above the table and UM will have the most to pay....period.
Yes, players will need to pay taxes...big deal.
Just let us funnel some cash to get some DTs from down south ASAP.
If student athletes are employees won’t their scholarships be taxed? Why shouldn’t the NCAA maintain a distinction between it and pro sports? I mean the reason we all love Michigan is because it’s something different. Its something special. Intangible, sure, but special because it’s different. It’s the reasons there’s value independent of the pro leagues. I understand the view that more should share in that value, but eroding it is short sided.
I get the hatred of the NCAA but the bias infiltrating the “reporting” here is just as bad. There is no balance or analysis. That’s why I came to this blog originally, i hope Brian can get back to that soon.
Just because college athletes are given the same rights as every other human on the planet, doesn't mean you can't keep pretending that college football and basketball aren't big business, even at Michigan.
I’m not sure what rights you’re referring to, but that’s not my point. My point is that NCAA should maintain the distinction between Pro sports and college because there’s a meaningful difference and a difference that has value.
I don't think anybody is saying that the schools are going to pay players directly. The whole point of NIL is that the players are allowed to use their own NAME to get paid. They will get taxed on what they earn from their name. Lacrosse players under scholarship will not need to pay any taxes on the scholarship and they probably won't get much NIL money either....big deal.
Not sure it’s that simple. The typical tax analysis is everything is income unless there’s an exclusion. Once players start making money from their NIL for playing, the scholarships they receive for playing are potentially at issue. Right now the facade of amateurism is protecting that, but once that facade breaks down I’m not sure that it’s that black and white. I’m not a tax expert so I may be wrong but what I know about tax law from my practice is that it’s rarely that simple.
Why would they have to pay taxes on their scholarships? No one else that gets one does and they're still allowed to make money. Why is it so important for athletes to be treated differently than everyone else?
I think the unspoken time bomb in this is the reference to gender equity.
Do they really expect equal endorsements for the non revenue and women’s teams?
Why would neutral entities, whoever is paying for endorsements, have to abide by title ix?
Dang. Are you on the bomb squad? You disabled that one so efficiently and saved NIL!
I think the NCAA must be sending undercover agents to chat boards to bring up these stupid arguments.
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