Are coaching conflicts of interest ruining college football?

To the delight of college football fans in Baton Rouge, and the distress of those in South Bend, head coach Brian Kelly was recently lured from Notre Dame to Louisiana State University (LSU) by a contract that is likely to pay him more than $100 million over 10 years. Kelly isn’t the only one to come away wealthy from the latest round of coaching moves. Lincoln Riley will reportedly be paid about $110 million for jilting the University of Oklahoma in favor of the University of Southern California, and Michigan State University’s Mel Tucker will be earning $95 million just to stay put for a decade.

Whether you regard these stratospheric salaries as a cultural outrage or simply the result of an efficient market, there is one often overlooked aspect of coaching contracts that should cause alarm among administrators, fans and, above all, parents. They virtually all include so-called “incentives” that can endanger the players themselves.

The problem with coaching incentives – providing additional payments for achieving certain records or winning particular games – is that they create potentially severe conflicts of interest between a coach’s income and his players’ safety. Consider one of the most lucrative provisions in Kelly’s new contract at LSU.

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In addition to his annual base pay of over $9 million, Kelly will receive $500,000 every year his team becomes “bowl eligible” by winning at least six games. Imagine a situation in which LSU’s record is 5-6 going into the final game of the regular season. With $500,000 at stake, could Kelly make an objective decision about bringing a previously injured star player back into the lineup? Kelly’s incentives to win at any cost only go up from there. Winning the Southeast Conference championship brings him a $250,000 increase for every remaining year of his contract – potentially $2,250,000 – and winning a national championship adds another $500,000 annually (up to $4,500,000).

Incentives can be even more specific, if less munificent, for coaches a little lower on the pecking order. Under his recently extended contract at the University of Kentucky, head coach Mark Stoops gets $250,000 for winning each game after the sixth. The University of Nebraska’s Scott Frost took a $1 million pay cut after several years of poor performance, while retaining six-figure incentives for division, conference and bowl game victories. Michigan State’s Tucker stands to clear up to $975,000 for a post-season trifecta.

So it goes in every power five conference (and probably in the lesser ones). In close and crucial games, the rewards dangled before head coaches can make them choose between protecting vulnerable players and maximizing their own income.

A coach would certainly never admit endangering a player in order to win a game – no matter how much it added to his own bottom line – but nobody is immune to motivated reasoning. That is what makes conflicts of interest so invidious. They operate at the level of subliminal temptation, rather than deliberate choice.

Effective conflict of interest rules are designed to isolate temptations and prohibit mutually exclusive reward structures, rather than rely on the good faith of a decisionmaker. This is especially necessary in situations involving both a power imbalance and opaque judgments, as in the heat of a football game.

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In law, an attorney may not represent multiple clients with inconsistent claims or defenses. In business, an executive may not take advantage of a corporate opportunity. In medicine, physicians may not refer patients to their own pharmacies or imaging facilities. In these situations, and many others, every good intention in the world is not sufficient to overcome the underlying conflict between a patient or client’s needs and a professional’s financial self-interest.

Conflicts of interest may often be resolved by disclosure and waiver, but not in college football. Players are not parties to the underlying contracts and cannot freely exercise informed consent. Testosterone-fueled young men are socialized to trust their coaches and primed to take daring and even reckless chances. They will almost never understand the coach’s cash incentives to jeopardize their well-being, and they are dependent on his approval for continued playing time. College football players need coaches whose strongest incentives are to safeguard them from career-ending injuries – concussions, torn ligaments, fractures – unencumbered by payouts for putting them at risk.

There are two likely arguments in favor of coaching incentives, but neither one holds up.

First, the incentives are fairly small relative to the overall contracts, so perhaps they could not much influence a coach’s decisions. But if that were true, why negotiate for them at all? There is no point to an incentive that doesn’t incentivize. 

But don’t performance incentives align the coach’s interests with his team’s? When the team wins, the coach wins. That was Pete Rose’s rationalization for gambling when he was manager of the Cincinnati Reds. Although Rose only bet on his own team to win, that still affected his strategy and distorted his decisions. He was banned from baseball for life.

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I do not begrudge successful coaches their extravagant salaries, but their judgement should not be clouded by the prospect of extra pay when player safety is hanging in the balance. Only a few points behind in the waning minutes of a money game, with the team’s best receiver still recovering from an aching but conceivably serviceable hamstring, should the coach have half a million bucks riding on whether to keep him safely on the bench?

In the world of college football contracts, the devil is in the incentives.

Steven Lubet is Williams Memorial Professor at the Northwestern University Pritzker School of Law and the author of “The ‘Colored Hero’ of Harpers Ferry: John Anthony Copeland and the War against Slavery.”