Why Washington Is Trying to Rein In College Sports

From the New York Times, I'm Natalie. [music] Kitroof. This is the Daily. >> A sport has imploded before our very. eyes. And I don't say this. hyperbolically. >> In the 5 years [music] since student. athletes were allowed to get paid to. play, college sports has [music] gone. completely haywire. >> Give it a break. This is not the college. football we all grew up with. >> Each year, it's gotten a little worse. >> We have a broken system. Players are. moving from team to team chasing a. payday.

>> Malachi Tony 4.1 million. Carson Beck. four points evaluation. >> Million. [music] I think my biggest year. was six. He's a college kid. >> Colleges are amassing dark money war. chests. [music]. Programs that never stood a chance. before are becoming champions. >> The Indiana Hooers are the kings of. college football. And no [music] one, not the players, not. the coaches, not the athletic directors, can agree on what the rules around all.

this even are, [music] much less how to. follow them. >> We have no rules and we have no. governance. [music] This is just a. really sad state of affairs. >> It's not right and we got to find a way. to do something. Today, Stuart Mandel of. The Athletic explains why this week. Washington finally decided to step in. It's Thursday, October 1st.

Stuart Mandel, welcome to the Daily. >> Oh, we're starting right now. >> Yes. >> Okay. There was no real warning there, but I'm ready now. Thank you. Glad to be. here. >> So, earlier this week, something very. rare happened. a bill passed the Senate. with overwhelming bipartisan support. And even rarer, that bill is attempting. to regulate sports, which is a part of. American life that Washington generally. keeps its nose out of. So, we are. turning to you to explain this moment.

Help us understand what's going on here. Well, for the past 5 years, ever since. college athletes were finally allowed to. make money and specifically paid for. their name, image, and likeness rights, what we now call NIL, everybody's been. talking about how college sports is in. chaos, a term you often hear as the. wild, wild west. And so the industry, the NCA, the conferences, the schools. have spent a lot of time and a lot of. money lobbying Congress saying, "We need.

your help." So this bill, the Protect. College Sports Act, which was. co-sponsored by Ted Cruz, a Republican, and Maria Canwell, a Democrat, it covers. pretty much everything you can think of. in college sports. But what most people. focus on is how it regulates name, image, and likeness payments and then. how often the players can transfer. between schools. >> Got it. >> And on Monday night, it passed in the. Senate and it passed in a landslide. Final vote was 77 to 22. Now it goes to.

the House. Nobody can really predict. what's going to happen then, but in the. meantime, a huge bipartisan slam dunk. for the people who sponsored the bill. Maybe not so much for the people who are. on the other side of it. >> And this is being described as historic. Talk about why. >> it's historic because nobody can. remember a time when Congress. set out to regulate an entire sport. You. know, they they've regulated certain.

parts like NFL television rights and. whatnot. But here is Congress basically. saying, "Hey, we're dictating the rules. now. They want to take over regulation. of all of college sports. Okay, we're. going to get into the specifics of the. bill, what it actually does. But before. we do that, I want to talk about the. state of college sports right now. At. this point, I think everybody has an. opinion about college sports. There's a. lot of dark money flowing through this. world, and you, as a part of the amazing. team at The Athletic, which is a sports.

publication owned by the Times company, have done a lot of vital work to help. give us a clearer picture of the. landscape here. So, let's tell the story. of how we actually got to this point. where Washington is intervening in this. way. >> Well, I think it's safe to say that. college sports has changed more in the. last 5 years than it had in the 50 years. before that. And that all has to do with. a pretty important demarcation, which is. prior to July 1st, 2021, throughout all.

of our lifetimes, it was understood. college athletes cannot make money. They. cannot receive any compensation above. and beyond their scholarship. Right. In. fact, at one point in the NCA rule book, it said you can give them a bagel, but. not a bagel and cream cheese. That was a. real rule. >> Wow. >> But throughout the 2010s, public opinion. is shifting to, well, why don't the. athletes receive a cup of all this. money? [music]. People are reading about television. deals that are worth billions of. dollars. They're reading about coaches.

making5. $6 million a year, which is quaint now, but it was a lot then, and saying this. is not fair to the athletes. [music]. They deserve a cut. And that eventually. leads to state politicians around the. country making their own bills, making. their own laws that say athletes can. make NIL money in direct conflict to the. NCA's rules. And then a really big moment [music]. came in 2021 when the Supreme Court took. up an antitrust case in which the NCA.

was sued. [music] Not specifically about. NIL. The issue in that one was a cap on. educational expenses that the schools. offer the athletes, but same principle, right? There was a restriction in place. on a form of compensation [music] and. the Supreme Court ruled 9 nothing. against the NCA. And in a concurring. opinion that Justice Brett Kavanaaugh. wrote, he kind of expanded the scope of. their decision to cover a lot more than. just this one issue. He wrote [music].

that the NCA's business model in any. other industry would be flatly illegal. >> That's a quote. >> Yeah, that's what he wrote. So that's when the NCA caved. And so. July 1st comes and athletes can now do. endorsement deals. If I can sign with. Gatorade, you can, too. >> Jared Casey, you just made one of the. greatest game-winning catches in Kansas. football history. Where are you going.

now? Where am I going? I'm going to. Applebee's. >> So, pretty quickly, you started seeing. college athletes appearing in TV ads, for sports drinks, for fast food chains, local mom and pop shops in some of these. college towns where they're big. celebrities. >> Hey, this is Dakota Scrawler, wide. receiver from Louisiana. When your AC. isn't the coldest, you call [music] SOS, heating and cooling. >> SOS. >> And of course, social media ads. All of. these things that we would consider to. be fairly benign. What nobody foresaw. was that once they open that Pandora's.

box that NIL rights would be used for a. completely different purpose, [music]. which is boosters paying their athletes. to come to their favorite school. >> And just say what boosters are exactly. Boosters are donors to a university's. athletic department. [music] And the NCA. considers you a booster if you buy. season tickets, but what we think of are. the rich guys who donate tens of. millions of dollars and have their names. on buildings and they just want to win a. national championship. And so here's an.

opportunity [music] to basically be the. owner of a college sports team and pay. the players yourself. [music]. >> And how are they doing that? Well, in history prior to NIL, it was. all back [music] room shady under the. table stuff. Stuff, frankly, that was. hard to prove, but you always heard. rumors about it. And every so often, somebody would get busted [music] and. the player would be ineligible or the. school would get punished. Now that NIL. is allowed, you can do it all [music]. above board.

So NIL becomes a thing on July 1st, 2021. In the spring of 2022, not even a. year later, >> Nicole Evva has committed to Tennessee. $8 million NIL deal. >> The Athletic reports that a high school. quarterback in California, a five-star. recruit who hasn't committed to a. college yet, has signed a 4-year, $8.

million deal with a collective. associated with the University of. Tennessee. But I think 2 million a year. for a five-star quarterback prospect is. a freaking steal. >> So what's a collective? It's a bunch of. donors pulling their money together in. one pot that they can then use to. distribute to recruits because the. school itself can't do it. They would. get in big trouble. >> and pulling a whole bunch of money. together, $8 million in this case. >> Yeah. And that sent shock waves.

throughout college sports because nobody. realized just how quickly we'd gone to. multi-million dollar deals. >> Right. And it's easy to imagine how. these sums of money can begin to. transform the way these leagues actually. function. >> Absolutely. Because right around that. same time in 2021, the NCA also loosened. its restrictions around transfers. So. for a long time, if you wanted to. transfer to another school, you had to. sit out a year. So now they changed the. rule where okay, one time exception, you. can transfer and play right away. So.

that's 2021. And even within a couple. years of that, that one-time restriction. goes away. And unlike the pro leagues. where you can only sign somewhere as a. free agent when your contract's up, these college players can do it at any. time. It's pure unlimited free agency. And that opens the floodgates because. now these donors and these collectives. can use that money to entice guys to. transfer to their school. And now you. have teams that are turning over half or.

more of their roster in a given year. Just this past year, this past. offseason, Oklahoma State brought in 91. new players, which is quite a number. when there's 105 on the roster. >> Wow. >> The other big change is [music] right up. till that point, the schools themselves. couldn't be involved. All these NIL. deals were being done [music] by third. parties. But starting in 2025, again, because of another court case,

now for the first time, schools [music]. can pay their athletes directly up to a. limit. And that limit at first is $20.5. million per year. Those are not NIL. deals. [music] That's revenue sharing. >> This is a huge deal, right? Schools now. being able to directly [music]. pay players. Walk me through what the. goal was here. >> The goal was actually to stabilize the. system. The thinking at the time was. well if we the schools can control. [music] the payments then there's going.

to be less movement and the costs are. going to go down because as part of the. rules around revenue sharing they set up. this clearing house [music] that all the. outside NIL deals would have to get. approved. I talked to athletic directors. at the time who earnestly believed that. this would be the end of collectives. [music]. that the market would stabilize. And if. anything, it did the exact opposite. As. soon as they instituted this system, it. was a race [music] to figure out how do. we get around it.

>> What does that exactly look like? It. sounds extremely chaotic, but paint me. the full picture here. Yeah, it looks. like the NFL, if the NFL had no rules or. ability to enforce their rules, you have. on the school side, these programs, in. addition to the coaching staff, now have. a full-on personnel department with a. general manager with scouts who are. evaluating players from around the.

country all the time with an eye on, oh, maybe that guy might be available to add. to our roster next year. And on the. other side of that transaction, we have. agents for the players who no matter. what time of year it is and certainly. during the season are calling up those. GMs and saying, "Hey, I've got this guy. He's doing really well at this school. If he decides to transfer, how much. would you be willing to pay for him?". >> And they're doing that over and over. again. They're shopping these players. around. You're saying. >> they're constantly shopping these.

players around. In fact, the guy could. have one good game in September and. suddenly that's the window to start. calling around engaging interest. And. ultimately the goal is to get a bidding. war going cuz by the way, unlike in the. NFL where it's public information what. everybody makes, it's all private in. college. And so the agents can pretty. much dictate the terms. Hey, this school. over here is offering 2 million. Are you. willing to go to 3 million? And nobody. really knows if those are real offers or. not. So Stuart, how much money big.

picture are we talking about flowing. through this system? Now. >> that information is very hard to obtain. Everybody's very hush- hush about it. Like I said earlier, they're under no. obligation to publicize it. But this summer, myself and several of. my colleagues from the athletic set out. to try to find out what all of the 68. major programs are spending on football. because football is in most cases about. 75% of what they're spending on all of. their athletes. [music].

So eventually through calling every. source you can think of around the. industry, we arrived at a number that we. believe is accurate for all 68 major. conference teams. [music] And in many. cases, it was a lot more than most. people imagine. [music]. >> We'll be right back. >> All right, Stuart, how did you get to. these numbers? How did you figure out. what this marketplace actually looks. like? Well, one thing you figure out.

pretty quickly is coaches and GMs are. very reluctant to talk about what they. are spending on their own team, but they. love to talk about what their. competitors are spending. You also have. to be alert to the fact that everybody's. got an agenda. The coaches all want you. to think they're spending less than they. are because that lowers expectations. from the fans. The athletic directors. though, they want you to think they're. spending more than they are because that. makes them look like good fundraisers. [snorts]. So, we talked to GMs and coaches. We.

talked to athletic directors. We talked. to people that work at the collectives, agents who negotiate deals with these. schools. And eventually, we kind of. narrowed it down to a range for each. school. And and some of it depends on. which conference you're in and how much. TV money that conference makes. But on. the low end, we have schools that are. spending 10 to$15 million. And then the. richer schools at the top in Ohio State, Oregon, Texas, Miami are spending north.

of $50 million. >> So the idea that the market was going to. stabilize once the schools establish. direct revenue sharing and third party. deals have to be approved, the. collectives would go away. Clearly that. was not the case amongst the biggest. spenders. Can I ask a somewhat. provocative question, which is, is above. 50 million actually an outlandish amount. of money for a team that's actually.

generating enormous revenue for a. university? I know it's a big round. number. I know it's just football, but. this is a sport that produces some of. the most watched TV all year in America. >> Yeah. Yeah, I mean I think in a vacuum. you could make the case that it's not. actually that significant a number. relative to how much revenue comes in. But it's jarring because 5 years ago. that number was zero, right? It's a. market that happened overnight and in a. sport where nobody ever talked about how.

much money was being spent on the. players within 5 years $50 million on. just one school's football budget seems. quite dramatic, >> right? And the other dramatic piece of. this, I think, was just how inequitable. this system was shown to be. And. honestly, problematic if you're a school. that is only paying $8 million to your. players where your competition is. spending five times that amount. >> No question. It's a really alarming. takeaway from this that kind of.

accentuates just how wide the gap is. growing between the halves and have. nots. Now, there's always been halves. and have nots in this sport, but if you. happen to be one of the lucky schools. that has a billionaire booster like. Texas Tech does, Texas Tech's been a. pretty irrelevant program for most of. its history, but they have this uh oil. magnet Cody Campbell who played at Texas. Tech who's now on the board of trustees. and he's throwing money around and Texas. Tech va wins the Big 12 last year for.

the first time in his history. to a. single billionaire alum can make a huge. difference. >> He can he can make a huge difference. In. fact, another big concern is how all. that money affects transfers. >> I happen to think that the rise of. transfers has been good for the sport. overall. Indiana wins the national. championship last year, goes from losing. his program to national champion. They. could not have done that in the era. before transfers. But I'm not a fan of a. specific school, right? I cover the. whole sport. If you're a fan of an.

individual school, let's say NC State, I. feel like every year whoever the top two. or three players are in NC State, they. get poached by another school, a school. with more money. And yes, it makes it. hard to keep track of who's on your team. from year to year. Also, fans are so. loyal to their school and they have an. expectation that the players will be, too. And that's just not the case. anymore. Some players are going to go to. whoever will pay them the most money. And I recognize that that can be a.

really demoralizing thing for fans of a. specific school. >> Yes. I mean, what you've described is. not just a complete reordering of fans. relationship to college sports, but a. complete reordering of how college. sports actually work at the most. fundamental level, which then generates. quite a bit of frustration, including in. Congress, where lawmakers decide to. weigh in. So, let's talk about that, how. they actually weigh in and what is in. this bill. Walk me through it.

>> Well, the bill is kind of a college. sports mad li to be honest, but this is. my first time covering anything. congressional. I had to watch C-SPAN for. 3 hours for the first time in my life. And you know, one thing I've learned is. that it seems like everybody in Congress. is a big college sports fan, right? Everybody has a a school or multiple. schools in their state that they. represent and they all have a vested. interest in it. Ted Cruz has more. favorite teams than anybody cuz he's in. Texas, which has the most division one. teams in college football. So when.

ESPN's pregame show went to Austin for. the big Ohio State, Texas game, >> to be joined by Senator from the state. of Texas, Ted Cruz. >> Ted Cruz appears on the show to. basically shill for the bill. And he. gets, by the way, booed the entire time. >> Well, look, as you know, well, college. sports is an amazing institution. It. >> not because of the Bill, but because. he's considered a curse wherever he goes. to a Texas team's game. >> They just don't even want him in the.

stands. >> Most college athletic programs right. now, they're losing tens of millions of. dollars. And for Cruz and for the other senators. who were deeply involved in this, there. are really two issues that seem to. galvanize them the most. The transfers. and how much money the players are. getting. And so, how does the bill. address this? Well, with transfers, it. brings back that rule that the NCA had. very briefly, that restriction that an. athlete can only transfer once and play. right away. If they want to transfer.

again, they have to sit out a year. Meaning theoretically this would limit. that free agency mayhem where players. are hopping from school to school to. school every year. >> Correct. You would have far more of your. roster in place from one year to the. next. >> Okay. And what about the spending piece? How does it address that? >> It's important to note that the bill. does not include any specific limit on. what an individual athlete can make. It's a cap on how much the school can. spend on those athletes. Technically,

there's a cap now, but nobody's. following it. They're finding all these. workarounds in the bill. That number. goes up quite a bit to 48 million. But. now, all of those third party NIL deals. that the athletes get that they use to. supplement those payments, like now. those all count toward the calf. So basically, this regulation aims to. neuter those collectives and boosters. who are sending so much money through.

college sports right now. It's it's. trying to rein that outside spending in. >> Yeah, it's definitely a cost control. measure because right now, year to year. to year, these rosters are going up 40, 50, 60%, maybe even more, and they need. that to slow down. Now, there are. schools right now that are already. spending more than $48 million. We know. that from our reporting. Eventually, all. of the schools will get to that number. because in a free market, they might. even get to even more than that. >> I have to say, Stuart, there's a lot.

that's fascinating about this bill, but. I think it's really interesting that a. bunch of Republicans are supporting. what's essentially the government. intervening in the free market and. putting real restrictions on it. >> Yeah. Yeah. To get to that much. bipartisan support, you had both. Republicans and Democrats going against. what some of their traditional stances. would be. You have, like you said, Republicans who are trying to regulate a. free market. You've also got Democrats. who are supporting a bill that a lot of. its critics say is anti- labor.

>> If we're going to impose rules on. athletes, we should apply the same rules. to coaches. So within Congress, the Congressional. Black Caucus has already said they're. going to oppose this. >> because it's not about the athletes, it's not about fairness, it's enforcing. hypocrisy. >> Couple of the main issues are, first of. all, the elephant in the room. This bill. restricts what schools can spend on. their players, but not their coaches. And oh, by the way, the majority of. college football players are black and.

the vast majority of coaches are white. >> Right. It sounds like the critics of. this bill are pointing out what they see. as something fundamentally unfair, which. is that if you're trying to control. costs, why are you doing it only on the. backs of players incomes? Maria. Canwell's big talking point in pushing. for this bill was the escalating. expenses and how universities are now. having to subsidize their athletic. departments, but the main drivers of. those expenses over the years were. coaching salaries and buyouts, facilities, recruiting costs, none of. which are addressed in this bill. Just.

stepping back, Stuart, it is wild to. think about how quickly the sentiment on. this issue has shifted. I mean, to hear. you describe it 5 years ago, all the. momentum was behind these players, behind the idea of them finally making. money off of a system that had made. money off of them for so long. And now. with all the upheaval that's happened, the pendulum is swinging back to finding.

the limits of that spending to. controlling it to making it more. predictable and to handing power back to. management. >> Yeah, it's pretty fascinating to go back. to 2019 2020 when the states were first. starting to propose these NIL bills. California was the first one. I used to. say back then there's never been a more. bipartisan issue than NIL because these. bills would pass both blue states and. red states by huge margins. Like. everybody agreed, okay, it's time for.

the athletes to start getting a piece of. the pie. So it's like on July 1st, 2021, somebody flipped the switch and all the. power shifted in the other direction. And then I think you saw it in practice. You saw the chaos that ensued that this. went in a completely different direction. than people imagined and suddenly it's. okay. How do we rein some of this back. in? >> All right. [snorts] So, this bill has a. long way to go before it passes. It goes. to the House now. We don't know what's. going to happen there. But I want to ask.

Stuart, we've spent a lot of time here. talking about the finances of this sport. and the enormous business surrounding. it. We haven't really talked about the. games themselves, like how all this. upheaval is actually playing out on the. field. As someone, you know, who lives. in this world, who covers it so closely, how do you think the actual product that. we're talking about has changed because. of all of this? I mean, we have the.

Senate telling us this bill should. become a law because college sports have. been ruined by everything you've. described. Is that true? >> Yeah, that's what's crazy. For all the. angst, for the fact that it went all the. way to the Senate, Saturdays in the fall. have never been more exciting. [music]. When you're watching a great game like. Texas Ohio State a couple weeks ago or. LSU Miss, you're not thinking, [music].

man, this would be better if the players. couldn't transfer as often. If anything, [music] I think it's more exciting. because more teams have a chance, right? Indiana winning the national. championship last year was the best. [music] college football story of my. lifetime. The losingest major conference. program of all time flipped overnight. into a national power and won the. national championship and everybody. loved it. 30 million people watched the. national championship game. And yet. amidst all this, we're being told that. the whole enterprise is in trouble and.

an asteroid is heading toward it. So, I. mean, at the end of the day, the TV. ratings have never been better. The. attendance is [music] still great. So, all of the things that we're talking. about and addressing in here have had a. tremendous effect on how the people in. the business do their jobs. It's clearly. had a tremendous effect on the income. and livelihood of some of the elite. athletes. But, Fall Saturdays are still. undefeated. >> Turns out [music] college football is. just a really hard thing to break. >> They're trying hard to break it, but.

they haven't yet. All. >> [music]. >> right. Well, Stuart, thank you so much. for coming [music] on the show. >> Thank you so much for having me. [music]. >> We'll be right back. Here's. [music].

what else you need to know today. >> Suddenly, boom, the brakes of the wings. come up. We start dog diving. Like the. plane loses control. We fell down 15,000. ft, like 5 km. >> No. S now. >> In my head, I said, I don't deserve to. die like this. I'm so young. On. Wednesday, a Fly Dubai plane on its way. to Israel [music] made an emergency. landing after one pilot stabbed another. [music] and passengers and crew won a. fight to regain the flight control.

>> Like a massive turbulence and we didn't. know what happened. Then we saw that. there is a people running to the cockpit. and we understood that there was some. stabbing over there. The plane suddenly. plunged thousands of feet during the. attack, which was only stopped when a. group of passengers rushed to subdue the. aggressive pilot. Videos from the plane. showed at least one wounded man and. several others covered in [music] blood. All of the passengers and crew members. arrived safely in Israel by Wednesday.

night after [music] a replacement. aircraft was sent to retrieve them. As. they disembarked, they shared harrowing. stories of what had happened on board. with my colleagues Adam [music] Rascan. and Natan Odenheimimer. >> The most frightening moment was actually. for me after we arrived in Saudi Arabia. And every time I just thought of going. back to that plane, I just thought of. the moment where the plane collapsed and. maybe it could happen all over again. And then maybe. >> Israeli Prime Minister Benjamin. Netanyahu said that [music] one of the.

pilots had quote apparently attempted to. crash the plane with its passengers on. board, [music] nearly all of whom were. Israelis. The Israeli authorities are. investigating whether the incident was. an attempted attack on Israelis or a. [music] suicide among other possible. explanations. [music]. Today's episode was produced by Carlos. Prito, Adrien Hurst, Eric Krupkkey, [music]. and Asta Chathurvedy. It was edited by.

MJ Davis Lynn and Michael Benois with. help from Rob Zipco. Contains music by Marian Lozano, Pat. McCusker, and Dan Powell, and was. engineered by Alyssa Moxley. [music]. Our theme music is by Wonderly. That's it for the daily. I'm Natalie. [music] Kitroof. See you tomorrow. [music].