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NCAA's Emmert claims schools will go Division III if players are paid

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During his testimony on Thursday at the O'Bannon trial, NCAA president Mark Emmert indicated that if athletes are allowed to get paid, LSU-Alabama would start looking a lot more like Williams-Amherst.

This isn't the first time a major face in college athletics has threatened to turn Division I sports into Division III (the major difference being that D3 schools don't offer athletic scholarships). Last year, Big Ten commissioner Jim Delany — who will testify on Friday — echoed Emmert's sentiment, only to admit later that he was bluffing.

Emmert's comment was based on the assertion that just 25 percent of athletic departments make money, but that argument is logically flawed. As sports economist Andy Schwarz pointed out at a House hearing last month, there's a difference between losing money and being a money-losing industry.

"The idea that this is a money-losing industry is incredible," Schwarz said. "If you look at a money-losing industry, you wouldn't see rising employee [coaches] pay, you wouldn't see firms flocking to join the industry. The money is in the system. It's just that it's being denied to the primary generators."

Schwarz compared the NCAA to a rich investment banker on Wall Street who makes over a million dollars per year. That's a lot of money. But what if the same investment banker buys a lavish apartment on the Upper East Side and a vacation home in the Hamptons, and then has some kids and needs to change his lifestyle? Of course, he won't want to do that and could claim he doesn't have money to raise his kids. But he does if he reallocates his money.

Schools are not going to drop out of Division I and absolve themselves of commercialism, because they enjoy the money that sports bring in. SEC schools are not going to give up $34 million a year in television revenue because they suddenly have to give $3 million of it to athletes.

Moreover, the NCAA can't decide whether the Division III model is ideal or a bad thing. They use it as a threat, since schools clearly want to make more money, but they also praise its purity in commercials.

You can't have both — well, the NCAA has, but it likely won't be able to for long.