So Jeff Skilling got a new sentence handed down for his role in the financial shenanigans at Enron. Actually, it’s a reduction of the sentence he was given back in 2006 for stuff that happened throughout the 90s and caused the company’s collapse in 2004. In case you’ve forgotten:
Enron’s collapse put more than 5,000 people out of work, wiped out more than $2 billion in employee pensions and rendered worthless $60 billion in Enron stock. Its aftershocks were felt across the city and the U.S. energy industry.
That’s over and above defrauding local power companies and gouging “Grandma Millie.”
For years, Enron was able to make people think things were much better than they were. They were able to make people believe they were making money.
Which brings me to this item from ThinkProgress:
America’s colleges and universities used more than $2 billion in student fees — an average of more than $500 per student — to subsidize rapidly growing university athletic budgets, as Ohio University professor Richard Vedder wrote at BloombergView today. Those fees can top $1,000 a year at some schools, and as Vedder writes, reliance on them ends up making college more expensive for students and often places the burden on the poorest students. And most of the time, students don’t even know they’re paying the fees.
In addition to student fees, athletic programs are relying more on money from general university budgets, so taxpayers are also spending millions of dollars a year to cover shortfalls as athletic budgets continue to grow faster than academic budgets.
Now, I have long thought that the accepted wisdom of “sports brings in money and students so we have to fund it” was flawed. If sports are really profitable, why are students and taxpayers paying so much money to support them? I have suspected that the “accounting” used to make sports profitable would have made Jeff Skilling drool. How did they pay for the stadium? It would never have been built without wealthy donors who like having their names on buildings. What about the maintenance for that stadium? Oh, that’s a different budget. What about the scholarships for athletes? Another budget. The coaches? Oh, they’re faculty so that’s yet another budget. Security, ticket sales, advertising the big game? Three different budgets. So most of the expenses of a good athletic program are offloaded onto other areas, leaving only the juicy profits and the bragging rights.
The idea that the money for sports is — really, truly — being paid for by students rips back the curtain on the Great Oz. In an age where the cost of college is rising much faster than either inflation or the wages they can expect to earn, where a student loan crisis is on the horizon, how can any college justify these costs?
No wonder so many young adults don’t know how to handle money. Where would they have learned?
In case you didn’t get the title, University of Nevada Las Vegas’s sports teams are the Rebels. Enjoy this unintentionally hilarious radio ad.
In Closing: a few items on the NSA, FBI, and the government spying on us including a petition you can sign; some stuff on food, obesity, additives, and whatnot; about time somebody used some freaking common sense; assorted nonsense about the latest attempt to make abortion so hard to get that it might as well be illegal; and corporate America running amok or returning from insanity.