Time For Radical Steps To Make University Fees Affordable

In my last post I suggested that the real scandal involving American universities is not the admissions bribery by desperate parents but the inexplicable, inexorable increases in university fees that are burying millions of students under a mountain of debt.

            I mentioned the case of a young relative of mine who went to university in 1985 when tuition, room and board amounted to about $15,000. Inflation between 1985 and 2019 averaged 2.54%. This means that an inflation-adjusted $15,000 in 1985 amounts to $35,238 in 2019.And yet many private, renowned, universities are now charging double that amount. A year at Yale, for example, will now cost more than $70,000.

            The only thing that shocks me is why more parents aren’t demanding exactly how universities can justify increasing their fees more than double the inflation rate. When do parents begin to revolt and start examining very closely just what they’re getting for all that money, start demanding that the universities make some radical changes, start looking for more reasonable alternatives? Just how far have universities strayed from their basic purpose of education and research?

            Perhaps the first question is why it takes four years to get a university degree. British universities take only three years to deliver quality education. Think of the money that could be saved if American universities squeezed more out of the year.

            Another reality stands out clearly with even a casual glance at any university’s glossy promotional brochure. They have become far more than mere educational institutions. Along with teaching and research they have become hospitality, entertainment and athletic conglomerates – each piece of which is very, very expensive. This involves, of course, increasing the university administration with more and more non-academic deans, each of whom costs well over $100,000 when you include their staff and expenses. Un-bundling  the conglomerate structure could include a cull of these non-academic administrators.

            Take the hospitality part. It is possible for the universities to sell some of their expensive living and dining facilities to professional hospitality companies who would then offer that accommodation to the students who would have the option of living there or going elsewhere. Think of the immediate cash inflow and reduction of maintenance expenses for the universities. Some alumni might scream to see Marriott’s name engraved over the dormitory, but presumably some of those savings would be passed on long-suffering parents.

 

Maybe Marriott's name should be over this dormitory

            The brochures also stress the elaborate and extremely well-equipped student union/entertainment/gym centers. Fine, but who pays for it. Again, wouldn’t the universities be financially better off sub-contracting that business to professionals. Students who want to use those facilities would pay extra, but the kid who never goes near them would not be burdened with having part of his tuition used to fund those centers.

            And then there’s the very touchy subject of athletics. Let’s take the Ivy League as an example. And I’m speaking here as a former Ivy League varsity athlete. While they are by no means national football and basketball powerhouses, Ivy League schools take athletics very seriously indeed. It is not unusual, for example, for an Ivy League team to bid for a national championship in sports like lacrosse, crew, or ice hockey. A mid-sized Ivy League university offers about 30 men’s and women’s intercollegiate athletic programs. Each of these teams has at least one -- usually more – coach in addition to equipment, medical insurance, travel expenses, facility expenses, etc. Then there’s the Director of Athletics and his/her staff. In short, it’s a very expensive business. Hard to justify why any portion of the tuition for some kid who is tied to a physics lab all day should go for this activity.

 

Yale: 2018 national lacrosse champions

            Don’t get me wrong. I love athletics and enjoy a good football game as much as anyone. But when parents are sacrificing so much to pay for their kids’ education there has to be a better way to pay for them. I propose ending university financial support for athletics. Shift that burden to the alumni/supporters willing to pay for them. Some schools have taken the first step in this direction by establishing sports foundations that help fund a broad range of athletic programs. I would go further an require all athletic funding to go through these foundations. The university could maintain control/oversight of the foundation to make sure the programs do not compromise the fundamental educational principles of the university.

            The football program of the University of Alabama-Birmingham offers a very interesting example. When the president of UAB announced in late 2014 that the school was dropping football there was a huge outcry. Over the next six months interested alumni, local business leaders, county and state officials felt that the football program was so important for the entire community that they raised enough money not just to restore the program but to build a new stadium. This was a classic win/win. Supporters got their football and the university could get back to what it is supposed to do.

            Universities could use some of the savings from these cuts to increase their course program and pay professors more. Instead, what many of schools are doing is hiring desperate post-grads on one-year minimal-wage contracts, so-called 'adjunct professors'. It’s a little like a law firm charging a client at a full partner’s rate only to have the actual work shunted off to a low-paid (relatively) first year associate. Instead of getting professors committed to teaching and/or research students face this revolving door of one-year wonders who offer no long-term commitment. I wonder if parents even realize just how much their kids are getting short-changed?

            It all comes down to examining very closely exactly what one wants from a university education. If you want the full conglomerate package you’re free to pay for it. If, however, you want a more tailored approach offering a high-quality educational experience without the extras you’re going to have to look very, very hard. Maybe it’s time for some bright entrepreneur to adapt the budget airline approach to education. Charge for what’s important, but forget the in-flight snacks.

The College Admissions Scandal Says Much More About Parents Than Kids

The admissions scandal rocking American universities says much more about parental angst and insecurities than it does about educational dreams of their children. From my days as a student working in the admissions office of an Ivy League university and then as what they call an ‘alumni interviewer’ the biggest challenge was satisfying the parents’ lofty goals.

Most parents insisted on being in the room when their son or daughter was being interviewed. They would constantly pull out dusty documents referring to the kid’s skill in kindergarten or success in a grammar school pageant as evidence of underlying genius and high potential as a Nobel Prize candidate. Every time the candidate tried to get a word in edgewise the parents would jump in. ‘Oh, he’s so shy he won’t say anything about himself.’ No worries there. The parents will fill that gap.

This snowflake has clear Nobel Laureate potential

            But more worrying than their desperate promotion was their complete ignorance about the reality of American higher education or its importance in later life. In answer to a question about what attracted the student to this particular university the parents would quickly intervene. ‘It’s in the Ivy League,’ as if nothing else mattered. I would gently try to remind them that while the Ivy League universities are indeed excellent there are hundreds of other universities scattered across the United States that are at least as good if not better than the eight (more if you include Stanford, Duke and MIT) Ivy League universities. One of the things the Ivy League has done extremely well, I would mention, is to market itself as the destination of tomorrow’s movers and shakers. ‘There certainly are other choices,’ an Ivy League admissions officer would intone with a look of slight disbelief at his own words, ‘But . . .’ The unspoken implication was that any other university might just leave your kid working the night shift at McDonald’s.

             It ain’t necessarily so. From a size, location, curriculum point of view any one of these other universities might be better suited to their child. The kid would look hopeful, but the parents would give me a look that would shrivel a cactus. ‘What? Are you crazy? How do I tell anyone at the Greenwich Country Club that my kid barely made it into something like the local Community College?’

Harvard may not be the best choice

Savvy families without piles of cash to throw around play the game much smarter. Their kids might just attend that local community college for a couple of years and then transfer to their state university often living at home to save money. The upshot is that the kid graduates without being buried under a pile of student debt.

            Anxious parents are also missing the larger point about the alleged importance of an elite university. While the choice of undergraduate university may mean a lot for the parents it plays  a smaller role in any student’s future success. Throughout my career I have seen countless successful people whose road to the top did not include a stop in the Ivy League. Hard work, raw talent and bit of luck still count regardless of the pedigree of the university.

            Then would come the inevitable question about money. ‘Alright,’ the parents would ask, ‘enough of these test scores and grades. What’s the bottom line? Just how much of a donation is it going to take to get my kid into a decent school?’ In my naïveté I would say that donations don’t really figure in the admissions decision. How wrong I was. The parents were absolutely right. Unless their kid had trouble writing his own name a large donation usually helped a great deal – especially if the kid was a good athlete. But there’s a humorous side to this policy. I once heard an outraged parent complain loudly that he had donated a few million dollars only to find that the university had put his name on a boiler room two levels underground.  

            But the real scandal giving such a huge advantage to wealthy students is the spiralling cost of university education. A friend struggling with two – soon to be three – children in university had an interesting observation. In 1985, when he was in university, the median household income in the U.S. was $29,000. Tuition at an Ivy League school was about $10,000. Room and board amounted to another $5,000. Altogether about 50% of household median income. Today that figure has exploded. In 2017 average household median income was $59,000. Tuition, room and board at an Ivy League school (as he is painfully aware) is more than $70,000 – 119% of median household income! And he said the schools have the incredible chutzpah to solicit donations on top of that! When he told an official from what the universities grandly call the ‘Advancement’ office (fund raising to most of us) he would think about a donation as soon as the school got serious about reducing costs the official scuttled away, never to be heard from again.

            Easy access to federal student loans has helped fuel this leap in costs. But universities themselves have done very little to check runaway cost increases. As they succumb to what the military calls ‘mission creep’ they have strayed very far from the basic academic purpose of training young minds.

            If the upshot of this current admissions/bribery scandal is some brief embarrassment for rich parents who should know better an opportunity will have been lost. If, however, it prompts universities to do some serious soul-searching about real, radical cost cutting then some good might come out of it.

There are some radical ideas for reducing the expense of higher education while improving the educational experience. But I’ll save them for another post.