|Jerry Sandusky and Joe Paterno
Photo credit: Paul Vathis/Associated Press
Apparently, Joe's $13 million pension, his access to a private jet, and his million dollar salary were not enough for him. He had to sign on as a shill for Bank of America. No wonder he didn't spot Jerry Sandusky seducing little boys in the Penn State locker room. Joe was too busy autographing footballs.
And the alumni association for Penn State University, Joe Papa's employer, also had a special deal with Bank of America. According to the same Pittsburgh Post-Gazette story, Penn State received more than $2.7 million in fees and royalties from a deal to help a Bank of America subsidiary market high-interest credit cards to Penn State students and alumni.
Penn State's alumni association received a "1 percent kickback royalty" on retail purchases made by Penn State alumni on the Penn-State branded card and the association got 0.5 percent of purchases made by Penn State students.
Of course, both deals were confidential. We would not know about them were it not for a 2009 federal law that requires colleges and universities to file copies of their agreements with credit card companies with the Consumer Financial Protection Bureau. At one time, more than a thousand colleges and universities had deals with credit card companies. Today that number has dropped to about 600.
According to the Consumer Financial Protection Bureau, some universities made millions on these deals, but others got very little. The University of St. Thomas, a Catholic university in Houston, Texas, only made $2,365 on its credit card deal in 2012. Why sell your soul for peanuts?
The Pittsburgh Post-Gazette story is another indication of the corporatization of American colleges and universities. Instead of focusing on their mission, which is to provide students with a high-quality education at a reasonable price, they wandered into the banking business, taking kickbacks from credit card companies in return from helping them peddle high-interest credit cards to college students.
This tawdry tale provides yet another reason for a federal open-records law that would require all colleges and universities that receive federal student-aid money to make all their records available to the public.
Associated Press. Joe Paterno earned $13.4M pension. ESPN College Football, May 22, 2012. Accessible at: http://espn.go.com/college-football/story/_/id/7959425/joe-paterno-earned-134m-pension-penn-state-nittany-lions
Jo Becker. Joe Paterno Won Sweeter Deal Even as Scandal Played Out. New York Times, July 14, 2012. Accessible at: http://www.nytimes.com/2012/07/14/sports/ncaafootball/joe-paterno-got-richer-contract-amid-jerry-sandusky-inquiry.html?_r=0
Consumer Financial Protection Bureau. College Credit Card Agreements. Accessible at: http://www.consumerfinance.gov/credit-cards/college-agreements/
Tim Grant. Penn State leads U.S. in earnings from collected credit card royalties. Pittsburgh Post-Gazette.com, January 11, 2013. Accessible at: