College Athletics Still Proving How Much Money Can Be Made When Labor Costs Are Zero

America's best business model still humming along nicely.
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It certainly is well down the list of priorities for Chris Murphy, but a tweet from the Connecticut senator on Wednesday should send a chill down the spine of everyone who gets filthy rich off college football.

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“It’s breathtaking how many people manage to get filthy rich off college football except for the actual athletes that everybody is watching play,” Murphy tweeted, linking to another tweet from The Washington Post’s David Fahrenthold, who won a Pulitzer in 2017 for his work reporting on Donald Trump’s charity claims, but in this case was highlighting another sham.

“THIS IS AMAZING!” Fahrenthold tweeted. “The Outback Bowl prez makes $1M a year. His job is to organize *a single football game*, played by unpaid athletes.” This, too, was a quote tweet, linking to a post from Steven Rich, the Post’s database editor for the investigations unit.

Rich’s tweet was not a quote tweet, but was a link, as he noted that the Outback Bowl had blocked Post sportswriter Will Hobson after his story about said “prez,” Jim McVay, headlined, “He runs one amateur football game per year. He makes more than $1 million.

The story is clear about the Outback Bowl being an outlier with their “decision … to pay McVay, year after year, more than many of his peers” while being “historically … among the stingiest when it comes to giving to charity.” Still, the peer executives cited are making in the neighborhood of half a million dollars apiece to run organizations that put on not one, but two, events per year.

Meanwhile, the Rose Bowl was charging $7 for bottled water, Illinois coach Lovie Smith just got an extension through 2023 after going 9-27 in the first three seasons of his initial six-year, $21 million deal, and the Pac-12 Conference is looking for private equity investors.

It’s that last one where a “hey, this nonsense is on my radar” tweet from a senator should set off some alarm bells. Granted, the Pac-12 is doing a self-valuation in estimating “that a capitalized NewCo could be valued at approximately $5 billion to $8.5 billion,” but the Pac-12 also is struggling when you put it next to conferences like the SEC and the Big Ten, which makes you wonder how much those conferences, let alone the NCAA as a whole, might be worth from this perspective.

The answer is an unfathomable amount of money, making lots of people who are not college athletes filthy rich. That’s the entire model of college sports as a business, except that people in college sports generally would tell you that they are not a business, what with the higher education, charitable works, non-profit status, and so forth.

It is, of course, absolutely a business. The problem is that when you start selling private equity stakes in your amateur athletics conference, it becomes impossible to pretend otherwise. The Pac-12 is blowing up its own spot, and while Chris Murphy isn’t going to be convening any hearings about it anytime soon, if you’re someone with $500 million that you’re just dying to invest, you have to ask yourself if it’s worth the headaches of doing business with a 12-university conglomerate with disparate interests, in addition to the possibility of someday getting hauled up to Capitol Hill to explain just what it is that you’re doing with that whole “not paying the stars of the entertainment product where they charge $7 for a bottle of water” thing. It might be a better idea to just take that half a billion, find someone else with half a billion, and go in together on a pro sports team instead.

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