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BCS shouldn't be punished for success

Antitrust laws provide an incentive for parties to pursue their complaints in court: A prevailing private party gets triple its actual damages, a handsome return for anyone injured by anti-competitive behavior. If a university won a suit against the Bowl Championship Series, its payoff could be as good as going to a BCS game three successive years or more.

Being lawyers, Sen. Orrin Hatch, University of Utah President Michael Young and Attorney General Mark Shurleff presumably understand how to avail themselves of these legal remedies. That those who complain have not brought a suit suggests that the antitrust case against the BCS isn't quite the slam dunk they claim. Indeed, instead of suing, those who generally rail against an overreaching federal government have decided that an overreaching senator browbeating the BCS will get them what they apparently do not believe they can obtain in court.

But it might simply be that their unwillingness to sue is because the critics are really less interested in whether the BCS is a cartel than whether it's being "unfair" by not sharing its ill-gotten cartel gains with particular non-BCS conferences and teams.

Bowls were created to attract fans. The Rose Bowl, for example, apparently believed it would get more people to Pasadena to watch a Big Ten team play than teams from Utah or nearby states. Long before the BCS, the premier bowls had large payoffs that weren't shared. The BCS originated when bowls agreed that they would pair the best teams, with the "best" pair rotating yearly among the participating bowls. They sold this idea to a television network for a lot of money and had the chutzpah to label the pairing a "championship." Something of value was created: Instead of a No. 2 2 ranked team playing a No. 7 team, the No. 1 and No. 2 teams were paired. (Joint action to create something of value is permitted, at least in some forms, under federal antitrust laws.) These bowls guessed that in most years highly ranked teams would be in the conferences with which they already had contracts, but eventually agreed to invite high ranked non-BCS teams.

In all this, non-BCS conferences are injured by not being in the BCS in the same sense that I'm injured by having built a home in Provo 20 years ago rather than in Park City or by having a modest income because I didn't develop Google.

The critics apparently assume that — but for the BCS — the Rose Bowl, for example, would routinely invite the U., BYU or Boise State when one or more had a highly ranked football team. But this didn't happen before the BCS was formed. Does anyone believe that it would happen if the BCS disappeared? The Rose Bowl is free to invite whomever it wants to its party. Those who get invited will get big paydays. Those who don't will not.

An antitrust violation?

Hardly.

Moreover, if non-BCS conferences can consistently offer better teams that draw lots of tourists and TV viewers, they're free to work with sponsors and TV networks to create a bowl game.

Economic competition does many things, but one thing it doesn't necessarily do is deliver "fair outcomes." To suggest that the antitrust laws should force those who create a thing of value to share their income with others is not just overreaching, it's an invidious undermining of markets. Antitrust laws have problems and critics, but there is general agreement that they should foster competitive market outcomes and innovation, not fair economic outcomes. That the BCS figured out how "to build a better mousetrap" means that it gets the rewards.

If Mr. Hatch and others are really interested in antitrust issues or even basic fairness, they might look at the NCAA, which wins the highest position on most top 10 monopolies lists. Specifically, they might look at the explicit agreement among universities to pay student athletes nothing while their coaches make, in some case, millions.

It's telling that in professional sports, where there are no agreements among teams to set player salaries, coaches make considerably less, not more, than the athletes whose talent draws fans.

J.R. Kearl is a professor of economics and a graduate of MIT. He lives in Provo.