The face of paying players isn’t the blue-chipper — it’s the role player

“Company man” isn’t a status many strive to attain.

None of us aspire to be a cog in the machine, our labor and loyalty assumed to exist in perpetuity. We don’t want to be taken for granted. We’d like to believe we’re unique. We each want our due. We want to be a valued piece and to be compensated as such.

“We” are not Missouri guard Terrence Phillips.

If the NCAA brass could construct the ideal student-athlete, the gang in Indianapolis could do worse than Phillips.

• He steadfastly defended a program its historical nadir — even during predawn visits to IHOP.
• He urges you to buy volleyball tix.
• He wonders if he could keep pace during a mile run with MU distance queen Karissa Schweizer.
• He’s fond of Truman’s dabbing.
• He loves the UM System’s plan to lower the price tag of textbooks.
• Since September 2016, he served as chair of the SEC men’s basketball leadership council and was thrilled to attend the conference’s spring meetings.

Of this much, I’m confident: Terrence, if his schedule allowed, would nonchalantly walk backward and distill campus history on a Summer Welcome tour.

He is a True Son. There can be no doubt about it.

The man earns every bit of the roughly $42,400 grant-in-aid he receives as a scholarship athlete, plus the $429 cost-of-living stipend deposited in his bank account each month. So it’s hard to fathom, for all of his loyalty and love, that, as part of the the 60 percent of college basketball players whose values exceed the aid the receive, the junior-to-be may still be getting shorted.

Often, the face of thinkpieces accusing the NCAA of exploiting college athletes belongs to those like Michael Porter Jr. We’ve already delved into the value the 6’10 wing might create for Mizzou, which is getting its first member of the one-and-done fraternity.

While I’ll touch on Porter’s situation, my thoughts often turn to four-year players like Phillips or Kevin Puryear, those who generate their fair share of money and are paid in the form of a degree.

Under normal circumstances, the arc of Phillips’ time in Columbia would fit neatly into the NCAA’s marketing pitch that most athletes go pro in something other than sports. Technically, it’s true. Scrutiny, though, reveals it to be a farce. Phillips generates revenue today, but the implicit promise is that the future wages he earns as a result of his degree will suffice.

Porter can tolerate his nine-month stay on campus by looking at the rookie wage scale and dreaming of the $23.1 million contract he could sign next June. Phillips? He won’t know the value of his compensation for years to come.

Ray Carlin-USA TODAY Sports

What’s Phillips Worth?

If we’re going to wring our hands over the plight of Phillips and his ilk, we need to know how he helps MU’s bottom line.

The same literature that helped sketch out Porter’s value remains useful. Unlike Porter, the arrival of a three-star prospect doesn’t radically alter the trajectory of a program. Those recruits “are unable to improve team performance until their sophomore years,” a USF study reported. It doesn’t mean role players are a financial drag. Buried in the appendix are tables outlining the marginal revenue products of typical recruits. They tell us that an average three-star recruit will produce $21,000 in additional revenue for the program two years after they arrive.

The same study also shows us Mizzou does generate a positive return on its investment in grant-in-aid for a player like Phillips. Additionally, author and economist Richard Borghesi estimated the “fair compensation” a recruit might receive on the open market.

Using 2014 data and the NBA’s 50/50 revenue distribution, Borghesi calculated the NCAA could distribute $90.8 million for freshman contracts.

Doling out that money equally, a three-star recruit would, after deducting grant-in-aid, receive almost $91,000 in cash compensation.

That figure, fittingly, dovetails with the findings of another study, which used players’ statistics and the distribution of pro salaries to estimate the median value of college players. The authors estimated the average college guard was worth $91,491 (using stats) and $117,503 (using pro salaries) during a portion of the one-and-done era.

Why Pay Him At All?

Our brains are reptilian when we broach the topic of a college player’s value, failing to evolve since Ronald Reagan occupied the White House.

Let’s go back in time.

In 1984, the Supreme Court deregulated the market for broadcasting rights to college football, finding that the NCAA’s rules violated federal antitrust laws. A year later, the NCAA men’s basketball tournament expanded to 64 teams, and four years after that, the TV rights were worth $1 billion.

All the while, sneaker don Sonny Vaccaro traipsed from campus to campus, paying coaches to outfit their players in swoosh-adorned kicks.

Today, the ’80s seem quaint. A year ago, CBS agreed to fork over $8.8 billion to extend its tournament deal until 2032. Major conferences are awash in revenue, with the heaviest inflows coming from networks in which they own a stake. Michigan, for example, expects to bank $51.1 million in revenue from Big Ten Network. Long before they got into the TV business, schools rightfully discerned their players are enticing billboards for shoe companies. In all, 28 schools generated that more than $100 million in revenue in 2015-16, according to USA Today.

Still, as The Washington Post extensively detailed, a scant few turn a profit. The culprit: lavish spending. On practice facilities and locker rooms. And coaches. And administrators.

These departments are conferred non-profit status as part of their school’s educational missions, and many cite this as a reason they plow profits—or at least the few that turn them—back into their operations.

“Lost in the chatter is this: If universities are going to compensate athletes for supporting multi-million dollar sports programs, the idea that these organizations are tax-exempt nonprofits becomes absurd,” John Sununu pointed out in the Boston Globe.

When players sign grant-in-aid agreements, they receive pay in the form of a promissory note. They forgo pay in the present for the promise of greater future earnings reaped by having a college diploma. Yet players generate very real money now, and their labor affords adults overseeing them a sense of long-term financial security. Sure, Missouri head coach Cuonzo Martin could get fired after four seasons, but he would have earned at least $11.4 million in salary and would be handed a $6 million buyout.

No doubt, Martin would hate being unemployed, but $17.4 million in compensation from MU is a soothing balm for his ego.

Keep in mind, too, that economists’ projections — at least for college basketball — wouldn’t bankrupt programs. Here are Richard Borghesi’s estimated salaries in a free market for freshmen players, based on their recruiting rating:

• 5-Star: $613,000
• 4-Star: $166,000
• 3-Star: $91,000
• Low-Star: $50,000

Now, let’s apply those values to Mizzou’s existing roster, using the 247Sports database:

• Michael Porter Jr.: $613,000
• Jeremiah Tilmon: $166,000
• C.J. Roberts: $166,000
• Blake Harris: $166,000
• Mitchell Smith: $91,000
• Reed Nikko: $91,000
• Terrence Phillips: $91,000
• Kevin Puryear: $91,000
• Cullen VanLeer: $91,000
• Jordan Geist: $50,000
• Jordan Barnett: $166,000
• Kassius Robertson: $50,000
• Total: $1,832,000

Using the same methodology, though, would lead to Kentucky spending almost $6 million on its roster. Fortunately, New York Times columnist Joe Nocera put forward an intriguing plan for a salary-cap to pay athletes.

Every Division I men’s basketball and football team would have a salary cap, just as the pros do — except the amounts would be vastly lower. In basketball, the cap would be $650,000. In football, it would be $3 million. It is ludicrous to argue that the Power 5 programs cannot afford this; the combined $3.65 million is barely half the $7 million that Michigan Coach Jim Harbaugh made this season. (I would also drop the number of scholarships in college football to 60, which is closer to the size of an N.F.L. team, from 85 in the top tier.)

Second, I would impose a minimum salary: $25,000 per player in each sport. This would obviously not make the athletes rich, but it would give them enough to live like typical college students.

Now to the free-market aspect: The minimum salaries consume only half the cap. The rest of the money would be used as a recruiting tool, so that a star player could be offered additional money as an inducement to go to a particular university. One university might want to offer a star halfback $40,000, while another might offer him $60,000. The player would make a choice based not on a recruiter’s sweet-talking promises — or not solely on that — but on cold, hard cash.

The premise underlying Nocera’s idea is economically sound. Currently, labor rents — the difference between what players are paid and the revenue they produce — flows toward paying for gaudy facilities and hefty coaching contracts.

Why? Because if you’re not paying players a wage close to their marginal revenue product, you have to find other forms of compensation, appealing to 18-year-olds with slick custom finishes and the idea they’re foregoing pay for elite development.

Under Nocera’s logic, we admit what grant-in-aid agreements truly are: one-year contracts. This admission helps the NCAA’s rules make sense.

For example, forcing a player to sit out a year after transferring schools is effectively a non-compete clause. Using Nocera’s framework, a school would pay the cost of attendance for the player, who in turn gives up a year’s salary to move on to a new home. Right now, we decry the growing transfer epidemic in basketball. Attaching a financial stake to switching programs might lead to recruits more carefully weighing their initial choice of school.

I’d also go a step further and let players cash in on their likenesses. We already allow coaches to receive outside income for public appearances, TV commercials and hosting camps, provided they disclose all sources of their earnings to school’s compliance department. Would this eliminate bag men or under-the-table payments? I can’t make any promises. A transparent system, though, would be a proactive first step.

No, A Scholarship is Not Worthless

Before we go any further, I want to be clear: A college scholarship remains immensely valuable.

On average, a college graduate will earn $830,000 more in his or her lifetime than a worker with a high-school education. Scoffing at a full scholarship is also foolhardy in an era where student loan is a debt is a fact of life — the average amount for MU graduates is $26,000.

Look no further than the Mizzou, where the in-state tuition is set to rise 2.1 percent this fall and cost of attendance will run $27,964 — a nearly 21.8 percent increase from five years ago. Already facing a hefty bill, families are getting squeezed as MU tries to backfill a hole in its budget from a projected seven-percent decline in enrollment and a 12-percent budget cut by state legislators committed to a program of fiscal austerity.

And that’s not even accounting for the hangover and PR hit from protests that roiled campus two years ago.

In this context, mustering sympathy for the plight of student athletes is a tough ask.

Parents moving their children into dorms this August will pay more to send their children to a school using dorms as glorified hotels on football weekends, masking faculty buyouts as early retirements, and weighing whether to shutter some academic programs. Naturally, they might wonder whether the dollars they’re sinking into the entire endeavor will pay off.

A degree isn’t a chainsaw. Its utility is based in part on your labor and the sweat equity you put into it. In a way, students are customers. But they can’t go stamping into the bursar’s office demanding a refund for flunking a chemistry class they didn’t take seriously.

It doesn’t stop students and their parents from viewing Mizzou as a factory whose central task is pumping out hirable workers. If they’re paying a premium or incurring debt to make it happen, it’s only natural to be envious of a student paying nothing at all—a peer who happens to play hoops.

Except, their child isn’t spending 34 hours per week—the equivalent of a full-time job—as part of a multimillion-dollar business masquerading as amateur sports.

On top of that, a disproportionate number of the players generating those revenues are black, serving a role described by Kevin Blackistone as “gerbils on a wheel that produce the financial energy for all intercollegiate sports to survive and prosper.”

Eighty percent of basketball players end their career after college. For as much as the NCAA and schools tout rising APR scores as a sign of progress, independent data reveals a large portion of their work force don’t collect the “pay” they were promised. Yes, some responsibility falls on the players themselves to capitalize on the grant-in-aid provided. But the very structure of college athletes emphasizes the opposite message.

Rewarding Loyalty

What draws us to college athletics are players like Phillips — those who not only don black and gold but revel in representing the institution.

We conflate that loyalty, however, with shunning outright cash payments. The NCAA and athletic departments conflate the idea the notion of wages with the idea that these players would no longer be students, which in a way is silly. Students are paid all the time.

As callous as it might sound, the labor provided by certain players shouldn’t subsidize the operations of other programs. If it really matters to Mizzou to offer a diverse array of Olympic sports, the university should pay the expenses.

Now, about paying salaries. Would a coach overvalue a player’s worth? Absolutely. But presumably, we pay coaches for their scouting and coaching acumen. Over time, you would expect their ability to gauge talent and translate it into a financial sum would improve. Hell, in college football, some programs have created the equivalent of GM positions on their staffs. One imagines a day when they could consult with an athletic department’s financial arm to manage a salary cap like the one proposed by Nocera. And you could even allow boosters to fund the pool of money used to write paychecks.