What the Penn State scandal can teach us about capitalism


Photo courtesy of AKZphoto.

I read an article by Pat Forde after reading a post by a user on the Huey Football Forums. Thought provoking stuff.

First of all, the situation at Penn State is a travesty. I hope the victims and their families are able to find some closure and move on with their lives. No one should have to endure this type of trauma.

As for the article, I agree with most of what Forde says.  Penn State should lead an effort to help end child abuse in all of its forms. Their status places them in a unique position to lead in this regard. Donating all profits from their 2012 season would be a great way to continue what they’ve already started.

I do, however, have some differing opinions on a few of the implications of the article.

The article begins with a few words on the recent scandals involving the football programs at Penn State and North Carolina. It then provides, as an example, Oregon’s plans to build a new football facility with money donated by Nike’s Phil Knight. The cost will be $68 million dollars and will include a hot tub and sauna for the coaches with water proof video equipment for watching game film. All of this, in the face of a current NCAA investigation of Oregon football.

Excessive? Probably, but the reality is that college sports have become big business because people have a passionate interest in the games, the outcomes, and the story lines. People shell out a lot of money to watch these teams play and to always know what is happening in the sports world. ESPN is making millions on this, and so are a lot of other people. It is why sports writers have jobs, and why you can watch a full 10-12 hours of college football on Saturdays in the Fall.

It is also why Penn State has the platform that will allow them to become a catalyst for positive change in the aftermath of what happened there.

Football and Capitalism

On Saturdays in Eugene, when the Ducks are home, 54,000 people show up to watch them play football. Millions more may watch on TV.  Phil Knight of Nike notices this and makes a business decision.

This decision is to invest $68 million dollars in the product of Oregon Football.

The result is Oregon gets a new facility, fully branded by Nike, and accompanied by a contract for Nike equipment. The facility helps Oregon sign top high school football recruits. The recruiting advantage leads to more wins. Wins lead to more exposure. More exposure leads to greater visibility of the Nike logo. Nike sells more shoes, shirts, hats, etc.

Phil Knight is marketing his business. He also has the added benefit of seeing his Alma Mater win more football games. It’s a win-win for him.

It will also benefit the Eugene community by injecting $68 million into their local economy. They also get a more marketable university. Better economy and more students. Its a win-win for Eugene as well.

Oregon football is getting a $68 million dollar football facility from Nike’s Phil Knight. Photo by Avinash Kunnath

I am not defending excessive spending, just commenting on how things work in a capitalistic economy. The problems Forde is talking about come when capitalism isn’t tempered with an ethical foundation.

Is it really about football?

Forde also states that the Penn State scandal is a football issue. I disagree.

It’s a cultural issue.

We value money, power, and fame in the United States. It’s pervasive in our pop culture, our business practices, and our government. There will always be people in a capitalistic society who hold these values above all else. Our children see the effects of money and power all around them, all the time. In our country you have little value to society unless you are rich, powerful, and influential. It’s not an excuse, and I’m not absolving anyone of culpability, but its easy to see how this can happen.

College football generates millions of dollars. As such, people will seek out a way to get part of the money. This extends to power and influence as well. That’s human nature and part of capitalism. It’s deeply ingrained as the American Way. In most cases, people are able to temper these values with some form of ethical standard. They see a limit to what is acceptable in working to meet these goals. Others will work to meet them in any way possible. Human capacity for social conscience differ widely and is likely associated with neurological functions.

Our job as a society is to make sure people are able to work within this system with a clear set of ethical standards. We need to develop citizens with the fortitude to stand up for what is right, even if it means loss of money, power, or fame. Obviously we try to do this, and are usually successful. Unfortunately some people don’t buy in to altruism and will always look out for their best interest regardless of consequences.

And sometimes these people become part of major universities, the CEO’s of massive companies, and politicians.

Maybe we could just remove big time sports from the university system, but that wouldn’t solve the problem. It would only shift it to another venue. I think it would be more beneficial to cure the disease rather than treat the symptoms.

Let me know what you think in the comments below.