The Irascible ProfessorSM

Irreverent Commentary on the State of Education in America Today

by Dr. Mark H. Shapiro
"Ninety percent of the politicians give the other ten percent a bad reputation."... ...Henry Kissinger

Commentary of the Day - March 7, 2003:  The Not So Public University.

Recently Jeffrey Selingo of The Chronicle of Higher Education published a lengthy piece on the decline of state support for public higher education that is worthy of comment.  As we all know, the states have been hit hard by the current economic recession.  State government agencies across the country have been squeezed by the downturn in revenue collections that reflect our current economic downturn.  However, as Selingo points out, public colleges and universities have been squeezed more than most other parts of state government.

The primary reason for the large cuts in state support for public higher education is that it is one of the few segments of state's budget that are truly discretionary.  In most states public higher education is not protected by constitutional mandate, unlike other services such as K-12 education and public safety.  In addition, in times of budget shortfalls governors and state legislators feel political pressure to protect those essential public functions that impact the daily lives of their citizens.  Governors generally don't want to reduce those highly visible services any more than they have to.  Since public higher education is not viewed as "essential" in the same sense that say highways or prisons are, it is an easy target for cuts.

As Selingo also notes, governors and state legislators often in the past have used higher education to balance the budget during past recessions.  Typically, however, they have made up for the cuts imposed during lean times by increasing funding when the economy improves.  However, this time things may well be different.  Rapidly rising costs for the federally mandated (but not federally funded) programs such as Medicaid and more recently the increased costs for homeland security have been taking a larger and larger share of state budgets.  As a consequence the percentage of state support received by public higher education has dropped considerably in the last two decades.  In 1980, state support was at the 44% level with the balance coming from tuition, fees, gifts, and endowment income.  Now the percentage of state support is down to 32%.  To compensate state universities and colleges have raised tuition significantly during the last two decades.

Flagship institutions -- those universities such as Pennsylvania State University, the University of North Carolina, the University of Washington, and the University of California that are in the same league as some of the best private universities -- have responded to the decline in state support by becoming more and more like the elite private universities.  They have spun off expensive operations such as teaching hospitals, they have boosted development campaigns to levels unheard of for public institutions a few decades ago, and they have raised tuition levels again and again.  Most of these flagship public institutions now receive roughly a third of their operating budgets from state funds, but some receive much less.  For example, the $300 million that Penn State receives from the Commonwealth of Pennsylvania accounts for only 13% of the total Penn State budget.

In many cases the leadership of these flagship state universities chafe under the restrictions imposed on them by state legislatures at the same time that state contributions are in steep decline.  Many would prefer to have the independence of The University of California system, which receives a block grant from the state that is distributed by the Regents according to policies developed internally to the system.

The flagship state university systems by and large have managed to cope with declining state support, even though with steep increases in tuition they no longer represent the bargain that they once did for their students.  The same cannot be said for the second and third tier public institutions.  These are the four- and five-year public colleges and comprehensive universities, and the two-year community colleges.  Typically, they have little in the way of endowment money, and their ability to raise tuition rates often is limited by state legislatures that mandate access but do not fund accordingly.  As a result, these institutions -- which often provide the only opportunity for higher education for students from low- and middle-income families -- are heavily dependent on a state funding base that is in serious trouble.  During economic hard times these institutions feel the greatest impact of budget cuts.  The effects are seen in canceled class sections, overcrowding in those sections that are open, poorly equipped classrooms and teaching laboratories, underfunded libraries, and poorly maintained buildings.  Because of the lack of classes, students often take longer to graduate.  Since tuition and fees often are not tightly coupled to the number of units a student enrolls in, the longer time to graduation becomes a de facto tuition increase for students who can ill afford it.

The most troubling aspect of the decline in state support for public institutions of higher learning, however, is the shift in opinion among governors and state legislators.  From the founding of the land grant colleges through the the latter half of the twentieth century public colleges and universities were seen as a "public good".  I.e., in addition to providing a benefit to the individual student, they offered a positive contribution to the public welfare by providing a steady stream of educated citizens who would take positions as teachers, professionals, and business people who would contribute to society through their service and industry.  And, who would repay the state many times over for the cost of their education through the greater tax revenues that would be collected from the higher earnings that their college degrees provided.

Unfortunately, these days too many myopic governors and state legislators view a college education only as a "private good" -- one that inures to the benefit of the individual student, but not to his or her community.  However, in our opinion public higher education remains a public good as well as a private good.  Most of the graduates of public colleges and universities, particularly the graduates of the comprehensive universities and community colleges, continue to live and work in the communities where they received their education.  On the average the graduates of public colleges and universities continue to earn more money than they would have without a college education, and they continue to contribute more in service and taxes than they would have without the degree.

Only a fool would deny that public colleges and universities are a public good.  But, then again politicians and fools often are one and the same.

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