It wasn't a good season for the University of North Caroline football team: with nine defeats and only two wins they ended at the bottom of the table in the Coastal Division. Not at all a good result for a team that has won 9 conference titles and that in 2015 picked up the regional division title. As their performance had been becoming gradually worse since then year-over-year, it made sense for the head coach to be let go. Fortunately for Larry Fedora, he still had four years on his contract and so UNC paid him the $12 million he would have earned had he stayed.
Goal
$12 million? Yes: the highest paid job at an American college, as we all know, is typically not a world-renowned Nobel Laureate or the chancellor, it's either the basketball or football coach. Alabama coach Nick Saban topped it all with over $11 million annually. While that is excessive, many top sports coaches have multi-million dollar contracts, running as high as $7 or $8 million for the best coaches. To put that in perspective, you could easily pay 40 professors with that kind of money.
To an outsider these salaries seem nothing less than absurd. Not because great sports coaches shouldn't be well compensated—Pep Guardiola makes close to $20 million annually at Manchester City—but because universities are generally seen as institutes of higher education and research, not sports. As a history professor at the University of Edinburgh put it: the $12 million that Fedora got as a going away present is more than the entire history department at UNC costs annually. So 32 professors that contribute to the university's primary goal—research and education—combined make about half what the football coach got. (To be fair, Fedora made $4 million per year, so the history department normally makes more than the football coach.)
To an outsider these salaries seem nothing less than absurd. Not because great sports coaches shouldn't be well compensated—Pep Guardiola makes close to $20 million annually at Manchester City—but because universities are generally seen as institutes of higher education and research, not sports. As a history professor at the University of Edinburgh put it: the $12 million that Fedora got as a going away present is more than the entire history department at UNC costs annually. So 32 professors that contribute to the university's primary goal—research and education—combined make about half what the football coach got. (To be fair, Fedora made $4 million per year, so the history department normally makes more than the football coach.)
Business
The question that surfaces each time in these situations is whether it's fair that the coach of a sports team is by far the highest paid staff member at a publically funded institution. Some argue that the history department does not bring in 50,500 spectators on a regular basis, the size of the Kenan Memorial Arena. It would obviously be fewer for basketball—the Dean Smith Center where UNC plays basketball hosts 21,750 spectators—but a basketball season is far longer. The profits from ticket sales and sponsorship deals are subsequently used to pay student tuitions and fund other sports programs that are not as profitable. So by the simple "rules of capitalism", it's only fair that a sports coach makes more than a professor.
People who make this argument, however, miss two crucial points. First of all, college sports generally do not make money, but are in fact a drain on a university's resources. Although college athletics is a $10 billion industry, there are only a few universities that actually turn a profit—UNC is not one of those. No matter how great a university sports team may be, they almost never generate the necessary revenue to actually fund themselves consistently. Even if teams perform well, the profits are not spectacular. College basketball may be a billion dollar industry, but that money goes to divisions first, not the succesful teams (Actually, it goes to the NCAA first, then the divisions, and then the teams). So when UNC won the NCAA Tournament in 2017, they had to share the $8 million in profits with fourteen other division members. Compare that to the $60 million Real Madrid made for winning the Champion's League.
A second point is that as fun as college sports are, universities are not in the business of entertainment. They are institutes of higher education. Their first goals should be high quality research and high quality teaching. It's hard to see how athletics make a contribution that justifies draining resources that could be allocated to either of these two goals. And while US universities are among the best in the world and have no trouble attracting billions in funding—Harvard has a $36 billion endowment!—they are also incredibly expensive to attend. Tuition at UNC will set you back well over $10,000 annually even if your a resident of North Carolina; if not, the costs will triple. This means that most students will have to go indo debt, deeply: after a four year undergraduate degree students owe on average more than $37,000 at a less than generous interest rate.
People who make this argument, however, miss two crucial points. First of all, college sports generally do not make money, but are in fact a drain on a university's resources. Although college athletics is a $10 billion industry, there are only a few universities that actually turn a profit—UNC is not one of those. No matter how great a university sports team may be, they almost never generate the necessary revenue to actually fund themselves consistently. Even if teams perform well, the profits are not spectacular. College basketball may be a billion dollar industry, but that money goes to divisions first, not the succesful teams (Actually, it goes to the NCAA first, then the divisions, and then the teams). So when UNC won the NCAA Tournament in 2017, they had to share the $8 million in profits with fourteen other division members. Compare that to the $60 million Real Madrid made for winning the Champion's League.
A second point is that as fun as college sports are, universities are not in the business of entertainment. They are institutes of higher education. Their first goals should be high quality research and high quality teaching. It's hard to see how athletics make a contribution that justifies draining resources that could be allocated to either of these two goals. And while US universities are among the best in the world and have no trouble attracting billions in funding—Harvard has a $36 billion endowment!—they are also incredibly expensive to attend. Tuition at UNC will set you back well over $10,000 annually even if your a resident of North Carolina; if not, the costs will triple. This means that most students will have to go indo debt, deeply: after a four year undergraduate degree students owe on average more than $37,000 at a less than generous interest rate.
Higher Education
I'm not saying this to argue that universities should not invest in athletics. One major benefits is that they offer disadvantaged students the opportunity to attend college through athletics scholarships—and once awarded even an injured student is entitled to them. While many scholarships don't cover all the costs of a university degree, most will at least compensate their students to some degree. There are also some less tangible benefits, like building community, spirit, and support—attending the Bruins basketball and football games made me feel part of UCLA more than I sometimes felt a part of the University of Groningen. Universities with great athletics departments may also be better at attracting tuition paying students and motivating these students. But if athletics is to make a contribution to higher education, it should not come at the cost of higher education itself.