Who Says College Football Is In A Recession?
by Jay Coulter on Jun 26, 2009 3:00 AM CDT
in Football
24 comments
What recession?
If you own a home or have a 401K you've undoubtedly felt the current recession. If you are in sales you face it every day. People and businesses are scared and keeping their wallets closed. Today, the Alabama unemployment rate is nearing 10 percent according to government records. Many believe the actual total is much higher.
As a backdrop to all of this we get word yesterday that Alabama officials are negotiating a contract extension and raise for football coach Nick Saban. The same thing is being discussed with Bob Stoops at Oklahoma. Before I go any further, this is not a Saban bashing article and I'm not solely going after Alabama. It runs deeper than Bama and Auburn's not immune.
In what's widely accepted as the worst economic times since the Great Depression, we are seeing athletic departments around the country bring in record profits on the backs of fans that can't pay their rent in many instances.
I still remember like it was yesterday, my first Auburn game - October 4, 1975 - Auburn vs. Virginia Tech. Ticket price: $7.00. Today, that wouldn't buy two Cokes in Jordan-Hare. Unfortunately, college football has caught up with its professional brethren in making it nearly impossible for the average family to afford season tickets. Let's face it, most can't afford to take their families to one game.
Is Saban really worth more than $4 million a year? To be fair, is Chizik worth $2 million considering his five wins in two seasons at Iowa State? Truthfully, from an economic standpoint, Saban is probably closer to being worth his salary than Chizik is his paycheck - at least at this point. I believe most of you would grudgingly agree.
But the point is both salaries are insanely ridiculous and to think Alabama and others continue to pile on more money borders on criminal. We are all so accustomed to hearing and reading these salary numbers that we don't stop and think about them in real terms. Birmingham News reporter Ian Rapoport posted a cool salary calculator yesterday that compares any salary to that of Saban's. Looking at it in real terms is mind boggling.
Let's compare Saban's salary to that of someone who makes $50,000 a year. For the record, the average annual family income in Alabama is $40,232 according to The Kaiser Family Foundation. Here's how it shakes out...
If you make $50,000 a year, your hourly wage for a 40-hour work week is $24.04.
If Saban worked 40 hours a week, 52 weeks a year, his average hourly wage would be $1,923.08.
Each day, you make $192.31, while Saban makes $15,384.62.
Your weekly paycheck is $961.54; Saban's is $76,923.08.
It would take you 80 years to earn what Saban makes in one year.
That's 1.78 lifetimes* to earn the average $4 million that Saban makes each year in his eight-year contract.
I'm as big a capitalist as the next person and many of you are probably saying Saban is worth it because Alabama is willing to pay it. Point taken. But with bigger stadiums, higher paid coaches and huge television contracts, we are running the risk of having an entire generation of kids not get the opportunity to see a game at Jordan-Hare or Bryant-Denny Stadium on a football Saturday.
Is it really worth it?
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capitalism and such
I’m as big a capitalist as the next person and many of you are probably saying Saban is worth it because Alabama is willing to pay it.
Well, first of all I’m not aware of any corporation called Alabama. There’s a state and a university by that name, and I’d imagine it’s the latter which is supposed to be a non-profit educational institution cutting his checks. (Yeah, I just implied that an SEC football factory is an educational institution rather than a sports institution with an education unit attached. I’m quaint like that, but everyone knows we Vandy fans don’t really get it.)
However, it is certainly the market operating in the sense that any coach’s salary reflects only what the boosters and other fans are willing to pay. Until the public literally takes more pride in the local institution’s physics dept. than the football team, that’s not likely to change. It may require people starving in the streets or at least unable to buy tickets and merch before anything changes. I hope we don’t get to that point.
Since the NCAA is not exactly a market of corporations, but rather an organization of colleges that can and do collude to set ground rules for fair play, I’d love to see a consensus develop that would put sport in its place. Not sure what that would look like in the concrete: Salary cap for coaches (and maybe even players)? Mandate that each dollar of facilities spending be matched by a certain amount of academic spending? I’d love to hear suggestions.
Of course any attempt to get the horse back in the barn is going to be met by howls from somebody. Florida and Texas will claim a coaching salary freeze keeps them from their rightful competitive advantages. Boise State or Utah or maybe even Vanderbilt can claim that a facilities freeze unfairly prevents them from upgrades needed to compete. Someone’s going to be unhappy with that outcome.
Eager to hear your thoughts.
I agree on both points
It is getting ridiculous when you think about the cost to go to the ballgames. If you are only trying to go to a couple it is not that big of a deal, for most fans. But when you figure in the cost of TUF, then the season tickets themselves, and the cost to get there, not to mention the food and drink prior to the game… it adds up really fast.
Then to add insult to injury, no matter the school, you can count on at least two cupcakes on the schedule. You may or may not attend those games, and if you don’t that is just money lost because you have already bought the seats.
Philip is right, until fans finally stand up and say that they have had enough, this problem will continue. The only way that will happen is for fans to stop paying the ridiculous prices. Almost every Auburn game is on TV this season. There will be no blackouts, I can stay home and watch them in a dry and regulated temperature and for only the cost of my monthly cable bill. I can even pause the game to hit the bathroom or kitchen, should I feel so inclined. While this is not my preferred method to watch a game, it will happen more often than not this season. No not because I am a fair weather fan, but because of some family obligations, and they come first.
Without the “butts in the seats” the coaches salaries can not escalate to this level, and then Colleges and Universities can get back to what they are, learning institutions with sports programs. You are correct that most NCAA Schools and almost all SEC schools are sports programs with a school attached.
If you are a War Damn Eagle, you can War Damn anything.
You get paid what you are worth
Each Day, you generate beans in value for your company, while any major college football coach generates mega dollars for their Program and University.
It would take you 1000000000000 years to generate the profits (donations, ticket sales, concessions, parking, apparel, ad revenue) what any major college football coach generates in one year.
Coaches salaries are not a problem in College Football. If the fan bases can support their salaries then they will continue to rise.
I agree...
with everything you say except your last statement—that salaries are not a problem in CFB. I think that eventually, as Jay gently alludes to, you have a revolt from the fans about how much money they are willing to pay/donate for tickets. Sure, most schools having a rockin’ product to sell, but there will be resentment one day from the ordinary non-connected fan. If you don’t think that class warfare doesn’t exist, go watch a national election in this country.
Granted, it wouldn’t be a palace-coup, but there would be some sort of backlash. I’ve quit giving money to the university in general because of the wasteful ways of the athletic department. And everytime one of those sweet-voiced co-eds calls me, I’m sure to tell her why. That’s how I’m revolting. Granted, I KNOW that the athletic department is separate from the overall university fund, but they both have the name AUBURN attached, and my checkbook and I can’t tell the difference.
by War Eagle Atlanta on Jun 26, 2009 2:43 PM CDT up reply actions
Great post
and in all fairness, you could probably insert any major college university in your statement in place of Auburn.
"When people fear their government, there is tyranny; when the government fears their people, there is liberty" - Thomas Jefferson
by BamaReturns07 on Jun 27, 2009 1:43 PM CDT up reply actions
Jesus War Eagle....
I wanna cry after reading your response.
BINGO…Winner!
Its so funny how education took a back seat to athletics.
http://blog.al.com/auburnbeat/2009/06/auburn_athletic_department_pla.html -- Maybe we’re not that only ones that think so. But more could be done.
Think about it. 4 Million a year in salary. Thats not just saban, several coaches make that much money these days. I know that they brings alot into the dept through donations but Damn! Couldn’t you use that money for building better labs, with better equipment. Giving out more scholorship opportunities. Paying your professors more money, and/or getting better professors. There is so much more you could do with the money.
Somewhere in the process we lost our direction of things, Our aim. Not just in sports either. We became money driven. Money hungry. Always starving for more. Sad thing is, I’m just as guilty as the rest. Until we all say “thats enough” it will just continue, and become more and more inbedded into our society.
ya'll are
on to something here. another area that i feel deserves more scrutiny is the endowment funds for many universities. i was reading an article by michael lewis a few month back about what the endowment funds for the ivy league have turned into. and this is essentially, hedge funds with maximizing the return on investment as their primary goal. alot of schools have billions tied up in investments, and many are earning (even in these times, especially YTD for 09) more in returns than they are giving out in scholarship funds each year. this is true at ASU as well.
it’s seems like making higher education available to more students and maintaing or heaven forbid, increasing the level of academic integrity, have gone by the wayside in pursuit of other goals. namely fancier buildings and pet projects like ASU’s edward r murrow school of broadcasting. i know some folks who work in the television and film industry and have gone to that school. the quality of teaching isn’t any higher than at a local CC, yet it’s got a nice name and is inside a new shiney building in downtown PHX, so naturally ASU is going to charge more for it, meanwhile any professors with a lick of talent are still being treated as adjunct faculty and will soon head back to the private sector so they can get paid.
higher education is like healthcare and the defense industries at this point. it’s rife with corruption and incentivizes moral hazard.
at least college football is relatively untarnished, at least, no more than it was in the 80’s.
welcome to the SEC kiffykins...
by tempebamafan on Jun 29, 2009 10:32 AM CDT up reply actions
Senator Charles Grassley
from Iowa was looking into college endowments about a year and a half ago and was considering legislation that would force schools’ spending a minimum portion of the endowment in order to get tuition down. The Ivies have (had) endowments in the billions of dollars, yet their tuition was out of reach of most students.
Harvard’s endowment was $25B before the crash. Most schools have taken a beating like the rest of us. Naturally, there’s no more calls for them to quit sitting on that pile of money anymore.
by War Eagle Atlanta on Jun 30, 2009 3:13 PM CDT up reply actions
Personal responsibility anyone??
I agree that it would be a shame if a generation of kids never got to enjoy an SEC Saturday within the confines of any of our member institution stadiums, but is that a valid objection to the rising coaching salaries? The market is set at what we are willing to pay and we are apparently willing to shell out every last dollar we have to ensure we have the best coaches and the best facilities.
If at some point the market exceeds what we as consumers are willing to bear, then your revolt happens and prices will lower to ensure supply and demand reach their happy medium once again. The tough part in all of this is wondering when we as fans will say “enough is enough”. WEA mentions that he no longer writes checks to Auburn, but for every person that stops writing checks, three others write their first. Maybe the idea that we love college football so much that we are willing to sacrifice financial stability says more about the unhealthy obsession (of which I’ve been very guilty) a lot of us in the region carry about a game played 4 months a year between 18-22 year olds.
At some point we have to look ourselves in the mirror and acknowledge that we created this monster. We demand the best and are willing to spend the $$ to make it happen. I have a few friends at work that aren’t from around these parts that don’t seem to get why people are more attached to their collegiate football teams than the actual institutions of education here in the South. My reply is always “90,000 people don’t pay to sit in a Sociology lecture”.
http://hobnailboot.wordpress.com/
90k people don't pay to sit in a sociology lecture?
Sure they do! And it’s called tuition! Thankfully, they’re not all in the same lecture hall at once. Okay, except for down in Gainesville, possibly!
by War Eagle Atlanta on Jun 27, 2009 9:21 AM CDT up reply actions
"[B]ut for every person that stops writing checks, three others write their first."
My dad transferred two of his season tickets to me in the early 1990s (only the second time the UGA AA has allowed such a thing since he started buying season tickets almost 50 years ago), so when the 2009 season rolls around, I will have the great fortune (at 43 years of age) of once again returning to the same place from which I’ve watched games in Sanford since I was but a pup. Many of the seats beside, in front, and behind mine are occupied by people around my age I’ve known since childhood; adults whom I met as infants; widows and widowers whose dearly departed I high-fived or with whom I discussed special teams issues. And I’ve seen these people only for a few hours six or seven times a year.
I think this is an under-appreciated feature of college football games, and I’m not sure it’s possible any more. If I hadn’t gotten season tickets from my father (for which my minimum contribution is more than twice what my father’s was, since UGA is kind to its season ticket holders and for many, many years (generations, even) has not raised the minimum contribution requirement for renewable season ticket holders — just for the first-timers), I’d have paid the same amount and ended up God knows where, biding my time to “move up” in priority, since there’s no way I would or could drop five figures to make a one-time, sudden jump in seat quality.
As seats become available (as when my parents sadly decided to stop renewing theirs a few years ago — a development that’s added a melancholy moment or two to my game day experience), one thing I’ve noticed is that someone will occupy them for a season, then they’re gone. I don’t think all of them moved up to the club level or skyboxes, either. I think it’s just too difficult to make that kind of annual commitment for most people, so maybe it’s just a one-year splurge. It’s not exactly easy for me, either, but when you’ve been regularly going to the same exact spot every year for 40 years, it’s sort of impossible to stop.
Nice post.
It details all the good things about holding onto seats for years, passed on down by the generations. It’s good for those people who have them, but it doesn’t address all those recent people who made large donations to the athletic department at Georgia who were then DENIED any tickets?
My personal belief is that tickets should be a generational thing: work your way up to the best seats you can, but when you pass, the tickets don’t. They get thrown back into the pool for the next person who’s paid their dues to take. I just hate feeling like the Bolsheviks trying to tear down the Tsar and his aristocracy everytime I suggest that.
by War Eagle Atlanta on Jun 29, 2009 9:30 AM CDT up reply actions
then consider yourself
one of the Soviets
as they were really the only decent people in that whole fiasco, the only ones who acted honestly and without deceptive ulterior motives. so it of course follows that once the Soviets were crushed, the Bolsheviks named their country after them! =P oh history…..
welcome to the SEC kiffykins...
by tempebamafan on Jun 29, 2009 10:07 AM CDT up reply actions
история?
ты знать русский история? (Tye snayu ruskaya sstorya?)
by War Eagle Atlanta on Jun 30, 2009 2:59 PM CDT up reply actions
Inheritance
As far back as I can remember, renewable season tickets at UGA could not be passed along upon the death of the holder except to the spouse. Children cannot inherit. It was sort of buried in my comment, but on only two occasions in the last 50 years, holders were able to transfer some or all of their tickets to someone else. Otherwise, if you don’t buy them, they go back into the pool and are snatched up according to priority (established by cumulative giving).
And when they’re snatched up, the minimum contribution is almost certainly higher (depending on how long the previous holder had them), so revenue goes up almost every time somebody stops renewing season tickets, or it at least stays the same.
Attrition happens. What I wonder is why, once my folks’ tickets became available, has somebody not snatched them up and kept them? (Maybe that says something about me, but I’m pretty sure the seats are good enough to overcome even my personality flaws — besides, it’s not just the ones next to me, but others in the general area.) On the other hand, I should probably consider myself lucky that the Widettes haven’t made themselves at home on my row.
I read...
an article in the AJC about a year ago about some family that has had the 50 yard line tickets ever since Sanford Stadium opened in the 30s, so I assumed that was the policy. Even if it wasn’t, people with serious connections still get an exception.
by War Eagle Atlanta on Jun 30, 2009 3:01 PM CDT up reply actions
Professional baseball..
is an example of people voting with their feet. Ballparks were filled with chirping crickets and fans decided they could only afford to watch the games on tv. Let’s face it. For lazy people i.e., the average American, it’s a hassle fighting the traffic to drive to the park, hussle for a space, and then fork over a week’s pay for the wife and kids just to sit in the nosebleed section. And god forbid anybody wants to eat or drink at the game.
I agree, it would be almost impossible to impose a salary cap. The leagues would have to come up with something, and they might shoot themselves in the foot in the long run by doing so as the “talent” follows the money.
But there is a limit to what the market will bear ala ticket prices.
Whether you like it or not...
college football is a business like any other. You’ve got to do what you have to to make it as successful as you possibly can. I think Alabama is doing a great job. Sure they are paying a ton of money to Saban every year, but they’re getting more in return every year. In fact, if I recall, the boosters donated the money to pay his salary, so the school isn’t even paying for it.
The way I see it is that you pay people what they are worth. If you have an employee who has worked wonders for your company and brought in all sorts of money and success, you pay the guy enough to keep him happy and wanting to stay.
Same thing here. Saban’s brought quick success and money for the school. He’s very good for Bama and they want to do what they feel will keep him happy. I think anybody in any career should get paid what they are worth to the company they work for. I think Bill Gates and Steve Jobs deserve the money they make because of what they’ve done for their respective companies. Don’t see a difference in college football.
As far as tickets to games go, it’s the same way. I’ve unfortunately never been to a big Bama game (ex. LSU, UT, AU) because I’m too poor. But it’s just perfect business sense for the school to do it that way. Besides, even if the tickets were cheaper, I would probably not be able to get tickets anyway because of how fast they sell out. It’s supply and demand. When there’s lots of demand, raising the price can even things out a bit. I’d love to go to a big Bama game, but I know I won’t be any time soon. I’m perfectly happy just watching it on TV. I know one day I’ll have some opportunities most likely, but it’s not like the people can’t watch the games, they can at least see it on TV.
And besides, when the fan base is as big as Alabama’s and Auburn’s, unless you have connections or a student or something like that, what’s the chance that you’re going to be one of the 80 or 90 thousand in that stadium when there’s millions of fans that want to go to the game as much as you do?
To further elaborate on your point
face tickets are not that expensive. Its trying to get them, and many times paying extra on the secondary market that puts it out of reach for most people.
"When people fear their government, there is tyranny; when the government fears their people, there is liberty" - Thomas Jefferson
by BamaReturns07 on Jun 28, 2009 9:31 AM CDT up reply actions
True.
…..Rock concert tickets are astronomical, these days, too. Or pretty much any tickets to live events. It was several hundred bucks for two tickets to the Davis Cup, last spring.
…..Demand is a fluid thing. After the Franklin firing last fall, the Track Em writers met up for the Arkansas game at Jordan Hare. War Eagle Atlanta bought a good lower-level ticket right outside the stadium for $25. Just depends on whether things are going well, or not.
And I
crowded in next to Acid and his brother, right next to the infant, who would cry everytime I would yell!
Baptism by fire, for sure!
by War Eagle Atlanta on Jun 29, 2009 9:18 AM CDT up reply actions
Tell me about it
my cost for the Kenny Chesney tickets were $190 for the pair. Worth it? Nah. Great concert, but I’ll pass next time. Oh, and that was FACE value. Aftermarket on most years are ridiculous; I bought an extra pair to try and earn my money back but ended up having to sell for face (and getting lucky, too).
"When people fear their government, there is tyranny; when the government fears their people, there is liberty" - Thomas Jefferson
by BamaReturns07 on Jun 29, 2009 4:41 PM CDT up reply actions
more seats ='s fewer opportunities to see the games?
really? cause i thought more seats meant more availability to purchase seats, which in turn would drive down the price of said seats. though what do i know, i’m just a Bama fan, and you Jay are obviously an economic wunderkund, tell me, has the federal reserve board reached out to you yet about that seat on the Federal Open Markets Committee? dont tell me you told them you were too busy? the country needs you Jay, we need you.
welcome to the SEC kiffykins...
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