The NCAA Must Change the Rules in Order to Solve College Basketball’s Existential Crisis

The NCAA has always been willing to change the rules to suit its needs. With the feds circling and top teams under fire, this is one of those times.

The schools wouldn’t abide by the rules. The NCAA president predicted chaos. College sports stood on the precipice of disaster. So what happened?

The schools changed the rules, and everyone survived. Many thrived. The leaders of college sports today would do well to remember what happened seven decades ago, because they’re about to face a similar choice.

The headlines will grow increasingly dire as more information emerges from the FBI’s investigation into college basketball. On Friday, Yahoo! writers Pat Forde and Pete Thamel published the contents of spreadsheets the FBI took from the office of former NBA agent Andy Miller. The story included a who’s who of recent college basketball stars, and the fact that the FBI has wiretaps and witnesses suggests that dozens of high-profile basketball programs could be charged by the NCAA with—at the very least—using players who had broken the NCAA’s amateurism rules and therefore rendered themselves ineligible and—at worst—having coaches or other school employees arrange payments in networks that included agents and shoe company executives. The worst-case scenario? Duke, Michigan State, Kentucky, Texas, USC, Alabama and many others could find themselves headed for a hearing with the NCAA’s Committee on Infractions, and those programs could face harsh sanctions.

Report: FBI Has Spreadsheets Detailing Payments to Families of College Basketball Players

This scandal will be cast as an existential crisis for college hoops in particular and college sports in general. And it could very well be an existential crisis if the people in charge of college athletics let it become one. If the schools simply enforce the rules as written, programs will go down, coaches will get fired and at some point in the near future CBS and Turner will televise an NCAA tournament almost devoid of name brands and star power. Or the schools could use this FBI investigation as a jumping-off point for a much larger conversation that could help them solve several major potential issues going forward. To understand why the latter is the smarter choice, they should turn back the clock 70 years and consider their own history with the NCAA.

Before we proceed, let’s establish something that tends to get lost when discussing NCAA rules and potential punishments.

• No matter how many times an NCAA official or millionaire coach says it, there is nothing morally wrong with giving someone money for being good at sports. There also is nothing morally wrong with giving even more money to a person who is much better at sports than other people.

That position is utterly unassailable. Want to test how unassailable? Replace “sports” with “singing” or “plumbing” or “building websites” and think about how stupid it would sound to defend the idea of a cabal of competitors coming together to make rules to fix the price of labor in those markets.

What We Know About Each School Implicated in the FBI’s College Basketball Investigation

Now that we’ve established that simple premise, let’s examine how the fallout from the FBI investigation could affect the schools and the NCAA. The important thing to remember is that the schools—which make and ultimately enforce the NCAA’s rules—have always moved the goalposts when it comes to amateurism. When college sports first became popular near the turn of the 20th century, coaches were not supposed to recruit off campus. They were only supposed to use players who happened to be students of each particular school. Athletic scholarships were not allowed. Because humans are competitive, not all coaches adhered to those rules. Some offered players jobs or found ways for their tuition to be paid.

Eventually, the schools decided that if everyone was going to give athletic scholarships under the table, they would simply allow athletic scholarships. But they wanted to standardize the practice. The names, the amounts and the mechanisms have changed, but the current college basketball situation isn’t all that different from the brief period in which the NCAA’s member schools lived by something called the “Sanity Code.” The code was enacted in 1948, and it codified the scholarship. Schools could pay a player’s tuition and cover one meal a day during the playing season. Schools could not provide room and board but could give players jobs to work off the costs of their lodging and food. Later, the NCAA sent surveys to schools to ensure the Sanity Code was being followed. Seven schools (Boston College, The Citadel, Maryland, Villanova, Virginia, Virginia Military Institute and Virginia Tech) answered honestly. They weren’t following the Sanity Code, because they believed they should be allowed to offer room and board as part of the athletic scholarship.

The only penalty on the NCAA’s books at the time was expulsion from the NCAA, but a vote to expel the schools the media dubbed “The Sinful Seven” failed to reach the required two-thirds majority. It was a popular theory that the seven were stalking horses for a large group of mostly Southern schools that wanted to loosen the rules. In 1951, the Sanity Code was repealed. Iowa professor Karl Lieb, who served as the NCAA’s president at the time, predicted college sports would descend into madness. He was laughably wrong. The schools simply moved the goalposts again with new rules that allowed for tuition, room and board.

In recent years, schools have added cash stipends that allow the athletic scholarship to match the actual cost of attendance that the schools report to the federal government. Why did this not breach their moral code? Because the Ninth Circuit ordered them to allow it when the NCAA lost a case brought by former UCLA basketball player Ed O’Bannon.

NCAA president Mark Emmert is predictably picking up where Lieb left off. “These allegations, if true, point to systematic failures that must be fixed and fixed now if we want college sports in America,” Emmert said in a statement Friday. “Simply put, people who engage in this kind of behavior have no place in college sports.” Emmert’s first statement is correct. This is a systematic failure that must be fixed. His second statement is wrong. “People who engage in this type of behavior” are capitalists trying to make money. This is America. That’s what you’re supposed to do. Such people have a place in nearly every enterprise in this country. Emmert and his seven-figure salary should understand that. The problem is they’ve been forced underground by the schools’ decision to collude to keep overhead low. Change the rules, and the behavior is no different than, say, a coach getting shopped around by his agent to get a bigger paycheck from either his current employer or another employer. Emmert hasn’t ripped Jimmy Sexton for getting Florida State-turned-Texas A&M football coach Jimbo Fisher the best deal. What’s the difference here?

The schools and NCAA have always been flexible regarding the rules when it suits their needs, and this appears to be one of those times. Given the star power of the programs involved, Too Big To Fail could come into play as NCAA officials imagine CBS and Turner asking to renegotiate the terms of their multibillion-dollar deal to televise the men’s basketball tournament. How valuable is the television product if the blueblood schools are serving postseason bans?

Or perhaps CBS and Turner would weather a few years without the name brands and not ask for a dime back. Still, the schools also need to consider the fact that these particular issues are a direct result of their rules. This particular black market—where shoe companies, agents and schools work together to funnel money to basketball players—exists because of the arbitrary compensation cap imposed by the schools through the NCAA rules. (And because the NBA doesn’t allow the players to go directly to the pros. The schools can’t do anything about that, but they must live with it.) Take away those rules, and the underground market rises to the surface, where transactions can be tracked, catalogued and taxed.

This would infuriate fans of schools who faced recent NCAA judgments. Louisville (basketball) and Ole Miss (football) are dealing with sanctions handed down because of the rules the schools may need to adjust in the wake of this much larger scandal. Their anger would be justified, but the schools need to take the long view here.

There are two reasons why. First, with no changes, the schools will scandalize themselves, harm the value of a product they sell to television networks and invite this to happen again. The FBI may cool off the agents and the shoe companies for a little while, but don’t expect the federal government to dump millions into investigating something like this again. While there are state laws against agents paying athletes and federal conspiracy laws that can be twisted in a way to make the schools seem like victims, there are no laws against a non-agent simply paying someone for being good at basketball or football. The agent laws are rarely enforced at the state level. The NCAA enforcement department—which has no subpoena power—should view this as a one-time affair. Everyone will be back doing exactly the same thing within five years if the rules don’t change.

More importantly, the rules may have to change anyway because they’re about to be challenged in federal court by the antitrust attorney (Jeffrey Kessler) who helped bring free agency to the NFL. Loosening them ahead of this could soften the impact of a verdict that goes against the NCAA and the Power 5 conferences. The people who run college sports probably would rather build their own new system than have the courts impose one on them.

Report: Top Programs Implicated in Federal Investigation

What might that new system look like? The most sensible answer is the Olympic model. You can read about it in more detail here, but these are the basics: Schools would continue to only pay full cost-of-attendance scholarships. Anyone else who wanted to pay the athletes could pay them. This would eliminate any Title IX concerns because every athlete would have exactly the same opportunity to get paid. The market would decide who got how much. Does that mean boosters would pay the players? Yep. (But they already pay them under the table now.) Does that mean agents would pay football and basketball players? It sure would. (They also pay them under the table now.) Would the players have to pay taxes on anything they make? Of course. Would this increase the gap between the haves and the have-nots? Nope. Alabama, Ohio State and the like would still sign the highest rated football recruits. Duke, Kentucky and the like would still sign the highest rated basketball recruits. (But maybe SMU, which thrived when it was paying big under the table, could become good at football again.)

The amounts wouldn’t be astronomical, either. People between the ages of 17 and 21 make for notoriously risky investments, so after a few years most boosters probably would opt for the relative safety of donating for a new dorm. Agents already have set their market, so it’s difficult to imagine the prices rising too much. For example, Yahoo! reported that former NC State point guard Dennis Smith is listed in the Miller documents as having received $43,500 in payments and $73,500 in loans from the agency. (It should be noted that the information currently available does not suggest any of this money was for attending NC State. Smith’s value to an agent is based largely on potential endorsement deals.) Those amounts total $117,000. That is a lot of money. But is it that much for the best player on a team that, according to data submitted by NC State to the U.S. Department of Education, brought in $14.6 million in revenue during the 2016-17 school year? Smith’s take—which as far as we know didn’t come from NC State—represented one 124th of what the basketball program took in. Add the $23,976 that NC State had to pay for Smith’s scholarship as an in-state student, and it still represents one 103rd of NC State’s total basketball take. Relatively speaking, that’s a bargain for a guy who averaged 18.1 points and 6.2 assists as a freshman in the ACC. (And one could argue that based on NC State’s 15–17 overall record and 4–14 ACC record in Smith’s only season, some more cash should have been spread around to get the guy some help.)

The schools could end the scandal now if they’d just remove the stigma from paying college athletes for being good at sports. Much of society has already come to that conclusion, and most the people who believe college athletes shouldn’t be paid are the types who swallow anything a governing body decrees. All the schools have to do is say it’s O.K., and it will then be O.K. Justice Department honchos might be mad that they wasted millions investigating something that isn’t really a crime, but it wasn’t really a crime when the investigation began, either.

Like their counterparts decades ago, school presidents and athletic directors stand at a crossroads. They can continue a misguided moral crusade against an act that isn’t actually bad, or they can begin to build a new system that will help them avoid such scandals in the future.

All they have to do is the thing they’ve always done. Move the goalposts.