Note: The weekly Taki post is up. Behind the green door we have the Sunday podcast, a post on the joy of work and a review of the movie Giant, which I hated. Most of this is available to those who buy me a beer. They are not hosting podcasts yet, so that is exclusive to SubscribeStar for now.
Last week, the American sporting world was sent into a frenzy over news that the University of Texas and the University of Oklahoma were planning to leave the Big 12 conference for the Southeastern Conference. In addition to stripping the Big 12 of its flagship institutions, it would make the SEC into a juggernaut. They would have half of the dozen or so major brands in college football. This would no doubt set off a frenzy of moves by the rest of college football in order to keep pace.
For those outside the United States, college athletics is a big business and a big part of the sporting tradition in America. It all started innocently enough when groups of young men at college would challenge the young men of another college in some sort of athletic competition. Before long it was formalized and became a part of the identity of the college, a way for the students and alumni to bond. The colleges found it was good advertising, so they would offer good players free tuition.
Into the 1980’s college sports, not unlike professional sports, was mostly the plaything of rich people. Wealthy alumni would give money to the school so they could build arenas, pay players, and hire top coaches. To be a top donor to a college was a prestigious thing, so successful alumni were motivated to give back. Then the world changed in the 1980’s with the explosion of television. With the spread of cable, television revenue exploded, and it poured into college sports.
It is fair to say that college sports, particularly college football and college basketball, shifted from semi-professional and informal to professional and formal. Prior to the cable age, top coaches made a nice living, but the rest were paid like any other employee of the university. Today, top coaches are the highest paid employees on campus, by a factor of ten. The college athletics department is a 100 million dollar enterprise with hundreds of staff and players.
College football is the primary driver. Football is the most popular television sport in America by far. College basketball also plays a role, but it is primarily football that is driving the economic revolution in college sports. Unlike the NFL, the fans of college football have a bond with the players, as the players, in theory, are attending classes at their school and will be proud alumni one day. Despite the obvious exceptions, this is true, and the players remain part of the community forever.
Both college basketball and college football offer good examples of the dangers of an unregulated marketplace. Into the 1980’s, all college sports were governed by the NCAA, which tried to maintain college athletics as amateur endeavors. With the flood of TV money, the power of the NCAA has declined to the point where they have little say over the governance of football or basketball. Instead, what has erupted is a free market free-for-all where the big try to eat the small and even some of the big.
Prior to the financialization of college sports via the conduit of television money, college sports were a regional enterprise. Schools organized locally into conferences, which supplemented the NCAA in governing the sports and provided local management of the routine items like scheduling and tournaments. With billions in TV money, these conferences were not only empowered to break free of NCAA governance, but they could also go to war with one another in an effort to gain market share.
Contrary to what libertarians claim, this explosion in competition among suppliers did not result in lower prices to consumers or great variety of product, but rather a massive contraction of the marketplace along with spirally costs to consumers. In the 1980’s colleges gave their students free tickets. A college football game was a cheap afternoon of fun for the fans. Today, students pay for seats through their tuition and the fans often have to donate thousands for the right to buy tickets.
Further, the sport of college football is contracting. That is the significance of the latest news about Texas and Oklahoma. The old model was a conference anchored by a few big brands, like Texas and Oklahoma. The league shared revenue and cooperated in scheduling and promotion. The anchor schools got to control the league for allowing the smaller programs to freeload off their brand a little. That model is collapsing as the big brands now seek to combine and exclude the smaller schools.
Like the computer business, college football is headed to a world in which a small number of big names control the market and work to exclude everyone else from the revenue stream. In the 1980’s there was a dozen computer makers with different takes on the home computer. Today there is basically one type of PC. The same happened with mobile phones. The unregulated technology market collapsed into an oligarchy, and we are seeing the same thing happen with college athletics.
Something similar happened with boxing in the 1980’s. It used to be that every large city had weekly boxing shows where up and coming fighters battled one another for recognition and the dream of a title shot. Television put boxing on every week as a normal part of its content. Friday night fights was a thing into the 1970’s, until the cable television explosion. Within short order, greed and corruption removed boxing from the public square and now it is barely an afterthought.
This will probably happen with college sports. There are now minor leagues popping up to pay high school basketball players rather than have them compete in amateur leagues or go to college. It will soon be like tennis, in which promising players turn pro once they hit puberty. Also, like tennis, the interest from the general public will decline. A few stars will make millions, but the rest will be used to maintain a system that was busted out by the usual suspects.
The point of all this is that markets are man-made things. They are not like mushrooms that spring up wherever man leaves nature alone. In order for a market to function, each transaction in the market must have a disinterested third party with the power to enforce both ends of the transaction. It must also have the power to prevent a monopoly of supply or demand. Like a sea wall, this governing authority prevents nature from taking its course and turning the market into an oligarchy.
Boxing never had a governing body to impose order, so it collapsed into a chaos of greed and corruption. College athletics is going through the same process and will meet the same end. Without some entity to guard the interest of the whole, the participants will cannibalize one another until the system collapses. This is the nature of markets and it is why markets can only exist when a controlling authority tasked with preserving the market has the power to impose order on the market actors.
The crackdown by the oligarchs on dissidents has had the happy result of a proliferation of new ways to support your favorite creator. If you like my work and wish to kick in a few bucks, you can buy me a beer. You can sign up for a SubscribeStar subscription and get some extra content. You can donate via PayPal. My crypto addresses are here for those who prefer that option. You can send gold bars to: Z Media LLC P.O. Box 432 Cockeysville, MD 21030-0432. Thank you for your support!
Promotions: We have a new addition to the list. Havamal Soap Works is the maker of natural, handmade soap and bath products. If you are looking to reduce the volume of man-made chemicals in your life, all-natural personal products are a good start. If you use this link you get 15% off of your purchase.
The good folks at Alaska Chaga are offering a ten percent discount to readers of this site. You just click on the this link and they take care of the rest. About a year ago they sent me some of their stuff. Up until that point, I had never heard of chaga, but I gave a try and it is very good. It is a tea, but it has a mild flavor. It’s autumn here in Lagos, so it is my daily beverage now.
Minter & Richter Designs makes high-quality, hand-made by one guy in Boston, titanium wedding rings for men and women and they are now offering readers a fifteen percent discount on purchases if you use this link. If you are headed to Boston, they are also offering my readers 20% off their 5-star rated Airbnb. Just email them directly to book at firstname.lastname@example.org.