Now What? Part II

Erving "Magic" Johnson co-owner of the LA Dodgers 

In the first installment of the "Now What?" three part series, I explored the problems many professional athletes encounter in their post-sports careers.  Professional athletes usually retire with large sums of money that they must then put to some use.  As was previously discussed, athletes like Curt Schilling and Allen Iverson chose paths that inexorably led them towards bankruptcy and humiliation.  In part II, I will delve into the lives of those professional athletes who have experienced financial success following productive and lucrative careers in sports.

Michael Jordan was the greatest basketball player the world has ever seen.  Few people would truly disagree with that statement.  What is the answer to this question: "Who was the greatest point guard ever?"  Not everyone (Celtics fans), would say Magic Johnson, but I would.  Johnson won 5 NBA championships, 3 league MVP trophies, and 3 Finals MVP trophies, and those are only a few of his accolades.  Magic Johnson, by all accounts, had one of the most prolific NBA careers of all time, but it was cut short when he discovered he was HIV positive.

For many professional athletes at the height of a hall-of-fame career, this news would cause them to become recluse.  Instead, Johnson decided to begin his second career, as a businessman.  Not long after retiring from the NBA in 1995, Johnson began searching for investors for an urban rebuilding project he predicted would become a money maker.  Most rejected his proposal, but friends urged Johnson to use his considerable wealth for the venture.  Johnson's proposal was to put in place food, retail, and entertainment stores into predominantly poor, black, and hispanic neighborhoods in Los Angeles.  He believed he understood what the people in these communities wanted.  Where most saw dilapidated  shopping centers, Johnson saw a business opportunity, one in which he could dually profit and supply desired demands to lower-class citizens of Los Angeles.

He showed his business acuity by meeting with gang leaders, the California Public Employees' Retirement System, and other community leaders in order to perfect his investment plans for urban Los Angeles.  He instituted different food and beverage options in the blacker area movie theaters, switching from the usual options to sweeter drinks, spicier hot dogs, and buffalo wings.  Johnson racked up business success after business success, eventually leading him to create Magic Johnson Enterprises, a company Forbes estimates to be worth over $700 million.  He owns 5% of the Los Angeles Lakers and recently joined Guggenheim Partners and Stan Kasten in buying the Los Angeles Dodgers.  Success after a professional sports career doesn't even begin to describe Magic Johnson, he is a  tycoon.  

Mo Vaughn, MVP turned Businessman

If Magic Johnson represents one end of the spectrum and Allen Iverson the other, Mo Vaughn sits comfortably between them.  Maurice "Mo" Vaughn played professional baseball for 13 seasons, accumulating just over $100 million in the process.  He made 3 All-Star teams and was crowned the 1995 American League Most Valuable Player.  Two events, one negative and the other positive, happened in Vaughn's post-MLB career.  First, the Mitchell Report demonstrated that he knowingly took performance enhancing drugs supplied by Kurt Radomski.  Second, he decided to invest in creating better living spaces for poorer New York City residents.  


Towards the end of his MLB career, the Anaheim Angels traded Mo Vaughn and his $70+ million contract to the New York Mets.  Once in New York, Vaughn experienced debilitating injuries that forced him to retire in 2003.  After retirement, Vaughn, the child of a high school teacher and principal, decided to give back to the city he felt he had failed.  Instead of donating money to non-profit charities, Vaughn decided to assist New York City and simultaneously begin his second career.  The former Red Sox 1st baseman created OMNI New York LLC., a company whose main goal is to invest in and repair low-income-housing.  Vaughn partnered with savvy businessmen and others more experienced in the world of low-income housing in order to create a juggernaut of a company that has bought and rehabilitated 1,142 housing units in New York City.  The company has been a success, and in 2009 Vaughn moved to purchase and recondition low-income housing near Boston, another city in which he played Major League Baseball.  

Good deeds can include profit

While former athletes like Curt Schilling and Allen Iverson squander their millions by investing poorly and spending like a teenage girl at Coach with daddy's Mastercard, others like Johnson and Vaughn became successful businessmen in their post-sports careers.  So, why did it work out for Mo Vaughn and not Curt Schilling?  Vaughn found a niche market, diligently researched the venture, and then asked for help from those with more experience than he.  Johnson utilized his knowledge of the day-to-day lives of low-income minorities to eventually provide them with products they desired.  Somehow, both Johnson and Vaughn were able to help communities, as many former professional athletes do, while simultaneously finding a way to make a profit.  Building your own video game studio, so cleverly named 38 Studios, depicts a self-centered man who wanted to first have fun and secondly run a business.  Johnson and Vaughn saw their ventures not as fun, but money-making opportunities that would both benefit the community and create new careers for themselves.  


If professional sports leagues were to write a manual for how to succeed after retirement, Magic Johnson and Mo Vaughn should be included.  In addition to businessmen, former pro athletes have successfully run non-profits (Dikembe Mutombo), become broadcasters, or chose to remain in sports as coaches (Robin Ventura) and administrators (John Elway).  The end of an illustrious sports career does not imply success after the fact, but with so many positive examples, there must be hope for all of them.  
Next time you watch a former profession athlete receive a community service award, provide play-by-play analysis, or buy/rehabilitate low-income housing, remember the numerous ways in which that person could have selfishly slapped the American Dream in the face by squandering their millions, but instead decided to take the opposite path.

Now What?: Part I

Athletes dazzle us with their incredible competitiveness, talent, and will to win.  Following a player from prospect to professional athlete to veteran provides fans with exhilarating and fulfilling memories.  During these careers, most professional athletes earn exorbitant amounts of money, placing them in the United States' top tax bracket as well as the everyday citizen's category of rich.  One question remains: "Once retired, what do athletes do with the money they made during their careers?" This three part series will explore the financial highs and lows of professional athletes after they retired from their given sport.  Part one focuses on athletes who'se retirements have been marred by financially difficulty.

Curt Schilling

Curt Schilling is in trouble.  By all standards, the former Phillies, Diamondbacks, and Red Sox pitcher needs help.  Following retirement from Major League Baseball, Schilling decided to create and run his own video game company.  He called it 38 Studios, named for his jersey number throughout his career.  From an outsiders perspective this venture seemed harmless.  A rich man who wanted to exploit the video game craze, and, more importantly, put his personal stamp on the project.  Unfortunately for Schilling, venture capitalists did not agree with Curt's optimism for the company, refusing to invest millions of dollars in the video game studio.  In response to a lack of funds, Schilling sunk about $50 million of his own into the company.  In his 18-year career, it is estimated that Schilling made just over $114 million.  


Despite putting almost 50% of his MLB earnings into 38 Studios, the company required more money for day-to-day operations.  Thus, Schilling applied for and was subsequently granted $75 million in loans from the state of Rhode Island.  The recent recession has caused strife for most state economies, but Rhode Island has been hit harder than most.  38 Studios recent filing for chapter 7 bankruptcy only deepens an already hurting state economy that, like George Foreman, cannot afford another Muhammed Ali sized punch, lest they fall to to the mat in defeat.  Schilling faces numerous other issues including an inability to pay for his employees health insurance, and failing to pay some employees' salaries.  Overall, I think it reasonable to call 38 Studios a sunk venture in need of serious help.  Schilling screwed the pooch in every way, showing his ineffectiveness as an entrepreneur, CEO, and citizen.  While Schilling could do no wrong on the mound, he did everything wrong when it came to investing his millions and running a company.  

Allen Iverson

Schilling does not constitute the only famous millionaire athlete to incur financial troubles after retiring from professional sports.  Not to pick on former Philadelphia athletes, but no conversation concerning athletes financial troubles can begin or end without including Allen Iverson.  The former 76ers MVP guard has hit rock bottom.  After securing himself as one of the greatest professional basketball players of all time, and racking up over $200 million, Iverson retired from the NBA in 2010.  During that illustrious 15-year career, Iverson supported more than 50 of his closest friends, a family, and his "thug" desires.  "The Answer", as Iverson was known during his career, owes $859,000 to a Georgia jewelry store and $2.5 million on a house in Denver, Colorado.  In addition to simple debt, Iverson's wife has filed for divorce, which could cost the broke former NBA All-Star even more money.  


So, to recap, Schilling took his riches and invested poorly, irresponsibly managed his business, and now wants help cleaning up the mess he made.  Iverson lived above his means, leaving us wondering how a millionaire could be so stupid, and faces more legal issues due to divorce.  These two former athletes shed light on a number of common problems that plague former professional athletes.  Poor investments, frivolous spending, unreasonable loyalties for friends, and familial issues lead to the most prolific falls from grace.  


What can we learn from these regrettable situation?  First, we learn that no matter how iconic and rich a person is, the ability to lose everything remains constant.  The American Dream is built upon every person striving for more and greater life pursuits.  More often than not, one of these chief goals is to attain wealth.  Professional athletes are blessed with special talents, and simultaneously work incredibly hard, thus earning themselves the title of millionaire.  Unfortunately, earning millions of dollars does not imply financial acumen or the ability to make informed and well-calculated decisions.  


So, what are the issues involved, and how can athletes help themselves to avoid financial ruin?  First, athletes need to take their educations more seriously.  Almost every NFL and NBA player attends college, but few take advantage of the gift of education.  Maybe, instead of majoring in fitness and exercise science, athletes should consider taking a few classes in economics.  This might be a smart decision, even if said athlete plans on leaving school early for the pros.  Second, finding smart, experienced, and trustworthy financial advisors to educate, instruct, and assist in investments and money management might prevent future financial collapse.  This advice only grazes the surface, and with so many professional athletes wasting their fortunes every iota is necessary.


In the second and third installments of this ongoing series, I will delve into professional athletes' successes in retirement, the future of post-athletic financial activities, and my take on the whole situation.    

On Sportsmanship

No one denies that sports create a hyper competitive atmosphere in which two opponents square off in order to beat the other.  These situations create tension, cause adrenaline to flow, and stir up emotions like frustration, anger, ecstasy, and relief.

While watching game 7 of the NBA Eastern Conference Finals between the Miami Heat and Boston Celtics, I came to the conclusion that both teams, were they to win, deserved the victory for their effort and tenacity throughout the series.  These two teams had their differences, but in the end, the both teams showed heart and played with fiery competitiveness.  The Heat won game 7 and thus earned the right to move on to face the Oklahoma City Thunder in the NBA Finals beginning tomorrow in Oklahoma City.

With about half a minute left in the game and the score skewed in Miami's favor, Doc Rivers, the Celtics head coach, removed his star players from the game.  The Heat allowed the clock to run out, thus beginning a celebration in the American Airlines Arena in Miami.  Instead of walking onto the court and shaking hands following the final buzzer, Celtics point guard and center, Rajan Rondo and Kevin Garnett respectively, left the court for the locker room.  Back on the court, the two head coaches shook hands, as is customary, and the other players gathered amongst a throng of reporters and player personel to shake hands.  Whether these players actually congratulated each other or merely made dinner plans is unknown, but one thing is for sure, Rondo and Garnett were no where to be seen.  The ESPN cameras made sure to follow the two Celtic stars as they left the court and headed directly for the away locker room.

Flyers and Penguins players shaking hands
 following a hard fought playoff series

This sparked a conversation between me and my friend Jake concerning sports and sportsmanship.  Jake, a devout hockey fan and player, remarked that he disliked the post-game activities of the players, and he especially expressed disappointment in Garnett and Rondo for leaving the court without even shaking hands.  He pointed out to me that at the end of every NHL playoff series the players from both teams line up in the middle of center ice and shake hands.  This tradition does not exist for every regular season game or even every playoff game, but is mandatory after a playoff series.  The NHL seems to understand something the NBA does not, that sportsmanship is important.

Professional athletes are role models and should act accordingly.  In Baseball the winning team usually celebrates by shaking each other's hands in the middle of the infield, while the losing team retreats directly to their respective locker room.  As a high school baseball player, we were expected to shake hands with the opposing team following the final out, lest you found yourself being chewed out by the coaches.  In American Legion Baseball every player and coach lines up before the game and recites the official pledge, which states: "I will keep the rules.  I will keep faith with my teammates.  I will keep my temper.  I will keep a stout heart in defeat.  I will keep my pride under in victory.  I will keep a sound soul, a clean mind, and a healthy body."  Imagine if every NBA player had to recite those lines in front of 20,000 fans and millions of television viewers.  It would never happen, but it should.

Every statement in the American Legion pledge speaks to sportsmanship.  First, all players should abide by the rules of the game, also known as, "no cheating".  Every player should have faith with his teammates because teammates should be respected too.  Keeping one's temper under check, having a stout heart in defeat and quelling one's pride in victory all point directly to good sportsmanship.  Players should not gloat when they win or throw a fit when they lose, these are characteristics of immature children, not honest competitors.  Finally, keeping a sound soul, clean mind, and healthy body refer to respecting oneself as much if not more than one's opponents.  So, to recap, according to American Legion Baseball, players should respect their teammates, the other team, and themselves.  I would think that if 16 year olds can abide by these simple maxims that professional athletes could do the same.

At the end of every soccer match the players cheer for the fans.  They say "thank you" to their fans for supporting them in victory or defeat, a gesture never seen in the four major American sports (Baseball, Basketball, Football, and Hockey).  Not only do the players shake hands with each other and thank the fans, often times they will exchange jerseys with the opposing team's players in order to have a momento with which to remember the match.  Don't get me wrong, there is no love lost in soccer, but no matter how hard fought and grueling, following any given match, the players make a public showing of good will towards each other and the fans.

The issues with sportsmanship and professional sports are many, but they are easily ameliorated.  NBA commissioner David Stern should fine both Rajan Rondo and Kevin Garnett for walking off the court before the end of game 7, and issue a separate fine for not shaking hands with their opponents.  After incidents like the "Malice in the Palace" and Metta World Peace's "accidental" elbow to James Harden's head, the NBA needs to portray less of a thug image.  Fining two of the NBA's best and most visible players is a good start, but David Stern should also institute a rule saying that both teams (we are only talking 12 players per team) must lineup and shake hands at the end of every playoff series, similar to the NHL.  It should take place before the customary celebration and trophy ceremony so that the fans, both in the arena and on TV, see that despite the fierce competitive spirits portrayed during the games, the players are peers who respect each other.

The NBA is not the only league in need of a sportsmanship makeover.  Major League Baseball and Bud Selig should direct all teams to shake hands following the end of every playoff series.  The celebratory dog piles seen at the end of every MLB playoff series make for great TV, and are well deserved, but after the dust has settled, both teams should lineup and shake hands before retreated to their respective clubhouses.

Wade and Rajan Rondo

As Garnett and Rondo left the court prior to the final buzzer sounding, the ESPN commentators made quick mention of the Celtics' early exit, but said nothing else concerning the matter.  I assumed that the next morning I would hear SportCenter anchors talking about the unsportsmanlike conduct displayed by Rondo and Garnett, but instead they barely made mention of it.  As a sports fan I was very disappointed.  Usually pundits salivate over their chance to mention a sports star's improprieties, but not in this case.  If a player is arrested for DUI, accused of rape, or in the middle of a divorce, cable news channels pounce on the story, reporting up to the minute details as if martians had just landed on earth, but a lack of sportsmanship goes unreported.

So, let's all remember that a sporting event, while fun, exciting, and important, is just a game.  Nothing is more important in competition than respecting your opponents, your teammates, and above all, yourself.  Parents remind your children, friends remind your friends, and fans remind your fellow fans that we should all show some sportsmanship and be respectful of one another.