Who Cares About a Player When They Are “Gone?”

Broke AthleteIn 2009, Sports Illustrated arrived at the statistic that 78 percent of all professional football players declare bankruptcy within a 24 month period. The statistic has been proven to be false.

In April 2015, the National Bureau of Economic Research (NBER) re-worked the numbers and found that it was more like 1.9 percent of players go bankrupt after two years, and after 12 years, it is closer to 16 percent.

This news is not cause for cheering and celebration. Jordan Weissmann, writing for Slate.com (April 13, 2015) pointed out a few flaws in the NBER study that even we mere fans can understand.

The first flaw is that the study was conducted of 2,016 players drafted between 1996 and 2003. It does not account for undrafted free agent players with league salary minimums who sign for less than a drafted player and have a more difficult time clinging to a team.

The other point that Weissmann makes clear – this is important – is that a person doesn’t need to be bankrupt in order to be “penniless.” Bankruptcy filings can be expensive, and if you have wasted away all of your money and possessions, what’s the point of preserving your assets if you don’t have any? Or, an ex-NFL player could have a small job, and could just be paying off just enough to stay ahead. Finally, despite all of the hype and advertising by bankruptcy law firms, bankruptcy is embarrassing; an ex-player who went from a big salary to nothing, may not want to admit it.

In other words, sometimes you can go from having enough or even more than enough, and then going broke.

Really don’t know

We really don’t know how many professional football players wind up broke after 24 months or 12 years for that matter. It’s somewhere between 16 and 78 percent and if we want a number as a starting point, we’ll just take an average of 55 percent.

There is one last percentage to introduce: 7.2 percent. That’s about the average personal bankruptcy percentage filed in the U.S. on an annual basis.

Many professional athletes declare bankruptcy or lose all of their money way ahead of the general population.

While I sincerely applaud the recent stories of Lions WR Ryan Broyles and his wife for living on a budget of $60,000 a year, I am much more curious about the thousands of professional athletes, especially football and baseball players, who wind up penniless. Why does it happen and what can be done to prevent it?

The NFLPA and many sports agencies dispense financial advice and have financial advisers. The athletes are well aware of these services. Yet, they still “lose” their money; they still wind up broke.

My position is that a lot of the money is lost because the athletes have failed to develop an ethical compass. You might expect me to say that of course, but in this particular situation I believe it to be absolutely true.

If we develop a strong ethical sense, it leads us to a greater sense of ourselves and that is extremely powerful. Whether I consult to an association executive or an athlete, I never discuss salary, contracts or performance bonuses and frankly, it is none of my business.

What I am intently interested in are the unethical influences surrounding the professional association executive or the professional athlete and how the person I am consulting is responding to them. Is the person making good ethical choices – or bad; is the person seeing bad consequences from his or her actions? If so, how can we try to put the person back on the right track?

I understand what negative influences can do to a person and I also understand the “heady feelings of power” that come with sudden fame and fortune. An athlete signing for $5 million or $10 million, especially an athlete who grew up with very limited means, not only feels empowered but becomes open to numerous unethical influences.

People are attracted to his or her “power,” and it is virtually always an unethical energy. If an athlete allows unethical behaviors into his or her life, it will always lead to bad consequences. The really rotten thing about those taking advantage of athletes, coaches, association executives and the like, is that as soon as they perceive that the “power is gone,” they will leave to find greener pastures.

Who Cares about a Player When They Are “Gone?” No one. Sports Ethics is on a mission to protect athletes, coaches and associations from unethical influences that destroy reputations, careers and finances.

 

 

Chuck Gallagher, President

Sports Ethics, LLC

(828) 244-1400

 

 

 

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