Imagine you work in a company with two employees: a skilled worker (call her Barb) and an unskilled worker (call him Bob). The skilled worker earns $20/hour, the unskilled $10. Bob, the unskilled worker, goes on strike, saying it’s not fair he earns less than Barb, the skilled worker since everyone should make the same.
Do you buy it?
My hunch is no, you think that Bob is making the wrong comparison. In our society, we don’t offer everyone equality of outcomes, but rather (at least in theory), equality of opportunity. I can hear someone out there saying “If the unskilled worker wanted to earn as much as the skilled workers, he should have acquired some skills.” And I agree – Bob’s jealousy of Barb isn’t a valid reason to give him a raise.
We can debate whether America truly offers equality of opportunity (and I think “no” is the correct answer), but for the moment let’s assume that’s the right standard – we’re all equal to pursue our full worth and a wage is “unfair” not because it is less than someone else makes, but only because it is set below our full market worth. If Bob makes less than Barb because he is worth less, that’s fair, because we’re all worth what we can get as long as we all have equal access to a competitive market where we can earn our full value.
So here is the not-so-radical corollary of that fairly simple rule: If the unskilled workers can’t assess their worth by looking at the skilled workers’ pay, then the skilled workers’ worth also can’t be determined by looking at the unskilled. If Bob can’t point to Barb as a valid benchmark, then neither should Barb be asked to be grateful she’s earning more than Bob.
The same applies to scholarships. If I get a $5,000 academic merit scholarship for being a National Merit Semifinalist, it’s not unfair that you get $10,000 for being a finalist. Make sense, right? But then answer this question – if the finalists are supposed to get $10,000, but you were a finalist and only got $8,000, were you treated fairly? After all, most people got $0, and even the semi-finalists only got $5,000. Why complain about $8,000, after all, isn’t $8,000 enough?
Feels wrong, right? And that’s because as Americans who participate in a market economy, we think we should be judged on what we’re worth, based on what we can get in the market, and not judged by what someone else is worth. Why would it ever make sense to tell me I should be happy with half of what I’m worth just because it’s still more than someone less qualified than me?
Before I read Ten Reasons Scholarship Athletes Are Better Off Financially Than Others, I correctly predicted that the whole thesis would rest on the fallacy that my worth should be judged by your value. College Athletes get better scholarships than “other” students, hence they are better off. But that’s like saying that oil rig workers earn more money than baristas, so they are better off. Maybe. Or maybe each is earning exactly what he/she is worth in a market economy, some working in a job with fewer skilled workers or working harder and more dangerous work, others working where there is more competition, but the risk of death is lower. And maybe if those oil rig workers have their salary depressed 10% by a wage cartel, they might be worse off than the baristas, even if they earn more money, because the wage cartel has prevented them from getting their full worth, while the baristas, despite lower pay, earn 100% of their market value.
I would argue that as long as the market is working to ensure fair competition, worker A and worker B are both equally well off, in terms of their equality of opportunity. And similarly, if B is working in a market with a collusive pay cap and A is not, B is worse off even if B’s pay is higher than A’s. The exploitation is measured by B’s falling short of B’s worth, not in exceeding A’s
Let’s go through the list of ten items and see if any of them ask whether the athletes are getting the same right of market value as “others”
Less Debt: Nope – no question of whether the less debt is earned or not.
Allowance to play: That’s a fancy way of saying a “small paycheck,” and nope, no question of whether the paycheck is set by market rates or not. Spoiler alert: since they would get more w/o a cap, no it’s not set by market rates.
Exploit another degree: Here he means that if you give another year of labor, you can start earning another degree, and again, no assessment of whether that degree equates to the athletes’ full market value or not.
Unique Skill-Set: This is basically saying that because athletes spend less time doing other stuff, they have more time to learn how to do sports. I’m not even sure this is a benefit, but in any case, there’s no assessment of whether receipt of this, um, “benefit” equates to the athletes’ full market value or not.
Better Healthcare: So yeah, I suspect athletes are injured more often than “others” and so they get more healthcare. Better? Maybe, though not clear you’d want to tell the parents of the “others” their children are getting worse healthcare. Nor would you want to tell a 28-year-old former college athlete who still needs surgery for football wounds but is no longer covered by the school’s policy that he should be glad he’s not a 28-year-old “other” with company-provided healthcare or workers comp from an injury sustained as an employee of the university. But in any case, no assessment of whether the difference in healthcare value equates to the athletes’ full market value or not.
Travel: Again, this is pretty dubious. Hey, “other” students – do you want to skip class to take a bus to another school? I wonder if a five-hour bus ride from Carbondale, IL to Muncie, IN would be something the average American would pay to do or pay to avoid. But again, no indication of whether this represents the athletes’ market value.
No Taxes: Ugh, this again. Generally, I assume people are trying to be sincere, but this one is such a crock, and the author has been told it’s a crock (by me) but he keeps repeating it. One wonders if he’s searching for truth or trying to obscure it. Want to read the details about taxes? See here: https://deadspin.com/no-paying-ncaa-athletes-wont-cost-them-money-1792711863 Want the TLDR version? As long as an athlete gets ~$3K in pay, he/she’s better off getting paid and getting taxed than not and if they are offered less, they can always just say no thanks. And this doesn’t even consider whether perhaps the paycheck might qualify an athlete for an earned-income tax credit. Oh, and by the way, “other” students pay/ don’t pay taxes on their undergrad scholarships identically with athletes. So not even sure how Yates would say athletes are better off than “others.”
All you can eat: Yes, after years of having their cream cheese consumption monitored, athletes can now receive as much food as their program wishes to give them. This is good. In this one spot, athletes are treated equally with “others” because both groups are allowed to receive as much food as the school wishes to provide. If only the same rules applied for pay.
Swag: Athletes get more stuff. Again, no assessment of whether the stuff equates with their value. Another Spoiler: It doesn’t.
Privilege: I don’t even know what Yates is saying here. Wyoming got a lot of value out of Josh Allen. That’s why Allen is better off? Exposure? Would Allen have gotten less exposure if Wyoming had paid him more? I’m just going to assume Yates tossed this one up on the wall in hopes no one got that far down the list to notice it was complete nonsense.
Now with the benefit of having seen the authors argument, I see my guess was right. He’s not judging our friend Barb on her own merits.
Instead, he said that if Barb works 2 hours and Bob works 1 hour doing the same thing, and Barb gets $12 and Bob gets $10, Barb is better off b/c she got 2 dollars more. But Barb is not better off just because she earned more than Bob, the question is whether she got her worth, not a penny more than Bob’s. If anything, she may be exploited – a victim perhaps of sex discrimination that lets her earn less per hour than Bob for the same work.
So then, how do I propose to measure exploitation, if not by comparison to some other group of people? Well, we can fall back on actual economics rather than NCAA spin. And so that is exactly what we’ll do in next week’s column – dig in on “The Economics of Imperfect Competition,” by Joan Robinson and try to frame the question of whether or not college athletes are better off than “others” under a valid economic benchmark.