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New Source of 'Tough Love' for Colleges

May 23, 2006

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Richard K. Vedder has a lot to say about higher education, and he hasn't exactly had a problem getting heard: He writes regularly for The Wall Street Journal, has published a book about college costs and prices, and has testified before Congress on several occasions. Last fall, Vedder got a major bump in visibility when Education Secretary Margaret Spellings included him among 19 members of a federal commission to study the future of higher education, and he has taken full advantage, becoming (arguably) the panel's most outspoken and (inarguably) most entertaining member.

Vedder, a Distinguished Professor of Economics at Ohio University, is about to have another platform for his work: a new research center to study issues such as cost, efficiencty and productivity in higher education. The as-yet unnamed institute -- Vedder said he recognizes that his initial idea for a title, the Center for Higher Education Accountability and Productivity (CHEAP), was "a little cheesy" -- will be financed ($200,000 in the first year) by the Searle Freedom Trust. The trust was founded by Daniel G. Searle and funds public policy research on U.S. domestic policy with what its executive director, Kimberly O. Dennis, calls a "disposition toward policy solutions that have a free-market focus."

Searle largely funded Vedder's 2004 book, Going Broke by Degree: Why College Costs Too Much, through a program at the American Enterprise Institute, and the attention that book garnered "got us thinking that there's really a lot more work to be done," says Dennis. "No one's looking into these issues, especially from the conservative side, and we wanted to support Rich's interest in trying to figure out why higher education is so expensive, and what kind of policy mechanisms we could adopt that might make it more affordable."

Vedder's book and much of his other work has focused on perceived flaws in higher education and on what he argues are the at times deleterious effects of public support for higher education -- like this passage from the introduction to Going Broke by Degree. "The arguments for public subsidies of higher education are, at the very least, highly debatable. A better than decent case can be made that perhaps government should, in general, largely get out of the higher education business, ending state subsidies and tax advantages for private donations. Moreover, the evidence is pretty persuasive that massive governmental infusions of funds, along with tax-sheltered private contributions, have contributed to the upsurge in higher education costs."

Passages like that have earned Vedder criticism in some quarters as an enemy of higher education, particularly public higher education. In a 2005 review of Vedder's book in the Journal of Labor Economics, for instance, Ronald G. Ehrenberg, an economist at Cornell University's Higher Education Research Institute, praised some of Vedder's conclusions about colleges' inefficiency and their failure to hold costs down, but essentially argued that in other places Vedder put ideology ahead of facts. "If you do read Going Broke, be careful to separate out in your own mind what is hard analysis from what is Vedder’s preconceived view on the proper role of government," he concluded. "As I have tried to indicate, many of the policy recommendations in Going Broke are based on the latter; not on the former."

Vedder bristles at that charge. "I'm not any more ideological than most of the people writing about higher ed," he says. "Most of them start with the conviction that higher education has an inherent noble good, a higher purpose, and that it should just assumed that expenditures on higher education serve a good purpose. I start with the view that traditional colleges are relatively isolated from market accountability, and I am skeptical of whether a lot of the public funding of higher education has had a good payoff.

"So I'm probably going to ask different questions than the traditional academics ask: Are we getting our money's worth out of our public investment? Despite huge growth in federal financial aid, do we have greater access among lower income students to the best universities than we did 25 years ago? Are there things traditional higher education should be learning from for-profit colleges?"

As "someone who has spent almost all the last 48 years of my life" either studying or working in higher education, Vedder also disputes the idea that he has it out for higher education.

"I'm a friend of higher education, but one who believes in tough love," says Vedder. "I love higher education, and I want to foster its vitality. But sometimes with one's own children, you have to criticize them, attack them, scream at them, discipline them. I look at higher education like a loved but sometimes troublesome child."

It's not hard to imagine that Vedder's new research center, whatever it is eventually called, might have a few spankings in store for America's colleges.

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Comments on New Source of 'Tough Love' for Colleges

  • David Kirp & higher-ed as a 'noble good'
  • Posted by R.A. Shaw on May 23, 2006 at 7:25am EDT
  • Regarding Dr. Vedder's comments about higher-ed researchers who start with an assumption of HE as a "noble good" --

    Separately, David Kirp from Berkeley has asked whether some aspects of higher-ed -- i.e., classic departments that now lose money -- should be financially subsidized by taxpayers to preserve colleges as a noble good.

    Well, that's all fine and dandy -- until some enormously valuable controversy happens (e.g., "Piss Christ," anti-Muslim drawings, Christians as "moral retards," "a million Mogadishus," Ward Churchill fights real Indians and Italian-Americans, anti-Baptist screeds, "Death to Israel" rallies, booing U.S. Sen. John McCain, calls for "U.S. out of North America," et al.).

    At those points in time -- thousands of taxpayer wallets slam shut. And no one can force them to re-open those wallets, notwithstanding any social good.

    Tom Friedman from the NYTimes once suggested public figures not use phrases like "Death to America" or "Death to Israel." Apparently, he thinks this would improve communication. Well -- it also might improve funding for social goods.

  • Tough Love for Colleges
  • Posted by Fred Carter on May 23, 2006 at 8:40am EDT
  • Does Dr. Vedder take role in his classes to make sure students who receive tax payers dollars are putting it to good use or does he like many academics cite academic freedom as a reason for not doing so?

  • A Must Read...
  • Posted by Adonis Metriotitas on May 23, 2006 at 8:40am EDT
  • No, not Dr. Vedder's book. I'm thinking of the Congressionally-mandated report from the 1998 Higher Education Act that rather conclusively found that increasing federal expenditures were not to blame for rising prices.

    Instead, rising federal expenditures and rising tuition are compensating for decreasing state expenditures for higher ed. So how, exactly, would further decreasing state support lead to anything other than skyrocketing prices and extremely limited access?

    Neither Vedder nor the conservatives driving this policy discussion are willing to face up to that report, which their own Republican majority in Congress commissioned (and also ignored).

    I also don't think anyone disagrees that higher ed, both non-profit and for-profit, is heading for more "flexible" delivery, which may create some cost savings. But beyond delivery, why should not-for-profits be more like for-profits? Is Dr. Vedder willing to apply to same accountability rhetoric to the for-profits as he and his colleagues seem to think the not-for-profit sector should be obliged to accept? It's interesting that the sector with the proven results is being asked to show more, while the sector with the spottiest record is being promoted as the golden child.

  • "Tough Love"
  • Posted by Greg Smith on May 23, 2006 at 8:50am EDT
  • Professor Vedder, like so many economists, seems to know the "cost" of everything, but the VALUE of little.

  • Dr. Vedder - Part time faculty member
  • Posted by CP on May 23, 2006 at 9:20am EDT
  • If Ohio U learned from the for-profit sector as Dr. Vedder suggests, he would be a part-time faculty member makiing his living with another job and would most likely only have a virtual office. Hmm, there's productivity.

  • The lucrative accountability business
  • Posted by H. E. Baber , Professor at University of San Diego on May 23, 2006 at 9:40am EDT
  • I wonder how much the Center for Higher Education Accountability costs--how much the director is getting paid, how many staff will be employed and where the funding for their salaries, facilities and junkets to conferences of accountability experts is going to come from.

    Has anyone ever figured the costs of monitoring, supervision and regulation, both at the national level and within universities, what we're paying in time and money to support committees, agencies and bureaucrats promoting "accountability"?

  • For another perspective on Professor Vedder's research. . .
  • Posted by Don Heller on May 23, 2006 at 9:40am EDT
  • . . .see my testimony to the House Education and Workforce Committee last year in response to his:

    http://edworkforce.house.gov/hearings/109th/fc/collegeaccess041905/heller.htm

  • Points of order
  • Posted by R.A. Shaw on May 23, 2006 at 10:30am EDT
  • "The Congressionally-mandated report from the 1998 Higher Education Act .."

    Got the title? ID number? URL?

    " .. extremely limited access .."

    Suggest you read Greene (U-Ark.) on this. His position: just about every student capable -- and more -- are attending college. So, what do you mean, extremely limited access?"

    "Is Dr. Vedder willing to apply to same accountability rhetoric to the for-profits as he .. (seems) to think the not-for-profit sector should be obliged to accept?

    IMHO, that is absurd. The public is outraged that no one -- staffs, executives, boards -- at public (and, often, private) universities are held accountable, for anything, viz. Larry Summers, N.J. med-school scandal. The teachers' unions love to kick University of Phoenix (and never offer workable solutions themselves), but at least Dr. John Sperling took responsibility, during crises.

    As for these --

    " .. to know the “cost” of everything .."

    That's also the definition of a cynic. Dr. Vedder's CV says he served on the Athens, OH, Board of Education. I've yet to meet a cynic on a board of education. Most serve "for the benefit of the children."

    And this --

    "If Ohio U learned from the for-profit sector as Dr. Vedder suggests, he would be a part-time faculty member .."

    That might be true, if Dr. Vedder's PhD was in English, education, the humanities, psychology, sociology, or other high-unemployment area. It is not.

  • Define "Value"
  • Posted by Neal McCluskey , Education Policy Analyst at Cato Institute on May 23, 2006 at 10:30am EDT
  • Here's what's troubling about people in higher education who despise "the market": They cry out about "values" and "the public good" to trash the market, but ultimately invoke those hopelessly nebulous terms to force taxpayers to subsidize the ivory tower in which they reside. In other words, they invoke the "public good" in order to accumulate more private goods for themselves.

    But if higher education is as important as its defenders so often say it is, they really ought not to fear being left to the dreaded market; individuals on their own will choose to spend money on colleges and universities because the value they get from doing so would be worth their expenditures. But politically, that's the problem: Too many students, professors, administrators, and other residents of the ivory tower want more money lavished on them then individual Americans would collectively be willing provide. In the face of that, college and student lobbyists use government to take taxpayers' money, and because government is doing it call it the "public good."

    Of course, were anyone else to do such a thing we'd call it something entirely different: "robbery," plain and simple.

  • moe points of order
  • Posted by policy wonk on May 23, 2006 at 12:00pm EDT
  • Here's a brief history of the Cost Commission that I believe Adonis was referring to:

    http://www.highereducation.org/crosstalk/ct0598/voices0598-history.shtml

    Unfortunately, despite that it was indeed a Congressionally mandated report, it isn't easily available for free on-line, though Greenwood Press has it up for sale.

    Regarding this comment from HE Baber:
    "I wonder how much the Center for Higher Education Accountability costs—how much the director is getting paid, how many staff will be employed and where the funding for their salaries, facilities and junkets to conferences of accountability experts is going to come from."
    *****

    The article clearly states that there's funding from the Searle Freedom Trust. Host institutions generally support centers, and for good reason.

    ****
    "Has anyone ever figured the costs of monitoring, supervision and regulation, both at the national level and within universities, what we’re paying in time and money to support committees, agencies and bureaucrats promoting “accountability"?"
    ****

    What relevance does this have?

    And Mr. Carter, it's take "roll", not "role". Anyway, what does this have to do with the discussion?

  • Richard Vedder should talk!
  • Posted by Michael Kellman , Professor at University of Oregon on May 23, 2006 at 12:10pm EDT
  • A guy near retirement, with a named chair, spends taxpayer and student money discovering how inefficient higher education is. And writing a book about his "discovery". Is this a parody or what?

  • Depends
  • Posted by R.A. Shaw on May 23, 2006 at 12:50pm EDT
  • ".. Is this a parody or what?"

    Common reply by those who have left academia, when asked about returning: "never -- too chaotic."

    As for more parody, search Google with keywords "Ward Churchill."

  • Thank you, Mr. Wonk
  • Posted by R.A. Shaw on May 23, 2006 at 12:50pm EDT
  • The summary was helpful.

    Briefly: in perfect world, everything would be funded, unemployment would be zero, resources would be limitless, and every child would be above-average.

    News-flash: the world's not perfect. There can't be unlimited spending on medical care, education, human services -- demand is almost unlimited. No country in the world has unlimited spending on such services.

    The current public debt is around $4,300,000,000,000.00 and the current budget deficit is around $350,000,000,000.00. On 9/11/2001, the U.S. mainland was attacked by suicide terrorists. Ten percent of Mexico's population lives in the U.S. and are demanding services. China and India are fierce economic competitors.

    Higher education is a good thing. We only have so much money, for higher ed. And anything, including higher ed, can always be made to be more productive, to benefit as many as possible. Those are unifying messages in both reports.

  • Vedder's critics
  • Posted by Richard J. Bishirjian , President at Yorktown University on May 23, 2006 at 2:05pm EDT
  • Reading some of these comments tells me that Vedder has hit a nerve. What would some of these commentators do for a living if they're institutions were not supported by $90 billon in annual federal aid? Vedder argues that colleges and universities are simply not held accountable for practices that have driven the cost of higher eduation out of the reach of those who do not want to indenture themselves to lifelong indebtedness. That drives the middle class into the hands of education bureaucrats for whom character education is not a high priority. Nor for that matter are specific required courses much esteemed. That is higher education?

  • Economiccs is God
  • Posted by mike on May 23, 2006 at 2:05pm EDT
  • Studying at the altar of reagonomics in 1980, I honestly didn't know that economics would become our new theology. My young professors at UW-Madison think it is the most amazing thing-----college is about jobs, studnets are mere instruments of state economic policy. Remember when education was about a life---what you did after you earned a living.

  • Market Idolatry
  • Posted by Anonymous on May 23, 2006 at 3:15pm EDT
  • There are so many factual errors and unsubstantiated generalizations in the responses to this essay (and, for that matter, in Vedder's remarks) that responding would be, for the most part, pointless. But I'm struck in reading these posts at how what it means to be a conservative has changed over the years. Now, it seems, even the notion of the "public good," of some things being more important than the transitory whims of the market, is seen as some kind of Socialist ploy.

    It used to be that some conservative social critics complained that students weren't being sufficiently acquainted with their culture's past; they railed against the removal of Homer, Vergil and Plato from humanities curricula. Now we're told that we should get rid of "classic[s] departments that don't make money." No one stops to wonder if maybe Classics departments were never intended to generate profits--if their purpose might in fact have been to impart knowledge of our remote ancestors so that their accumulated wisdom wouldn't vanish, since the natural tendency of young people is, as one might expect, to ignore Vergil in favor of MTV. So much for all that. Now everything should be sacrificed to the market. It's done such wonders for the quality of television programming, after all.

    Look, "conservatives," I don't like Ward Churchill either. I don't know when you'll understand that he's a *symptom* of higher education having *already* been more or less handed over to market forces. (Faculty already have to let their students fill out customer satisfactions surveys. The people who should be taught are already very much in the driver's seat.) Ward Churchill is the equivalent of those women eating horse manure on reality television--outrageous content that will bring an audience.

    Responding to every problem in higher education with the slogan "make them compete" has already led to its vulgarization. This obsession with the market as a solution to every problem in the world has less in common with classical conservatism than what passes for thought in a cult.

  • Cheers to Anonymous!
  • Posted by monkey on May 23, 2006 at 7:15pm EDT
  • And to Mr. McCluskey, free market forces are not necessarily the answers to all questions. Value is not necessarily monetary in nature. A higher education degree is not necessarily tied to monetary value, either. Is a business degree worth more than a liberal arts degree? I would say not!

    The privatizing of education has not worked very well in K-12 and would be disastrous in higher education.

  • Posted by Marvin McConoughey on May 23, 2006 at 9:30pm EDT
  • "Tough Love" for education spending generally, not just higher education as discussed here, will attract growing emphasis. The reason is that our trillion dollar annual education system cost, combined with intractable rises in Social Security and Medicare costs come as we face permanent petroleum price increases. We don't have the national income that would be needed to pay for all of our national wants. Even now, we suffer from immense internal and external indebtedness.

    Higher education might start with a new look at the true costs and national benefits of sports.

  • When only 31% can read
  • Posted by JBM on May 24, 2006 at 7:40am EDT
  • When only 31% of college graduates possess proficient literacy skills (and come out with in excess of $100,000 in student loan debt), it is openly irrational to pretend that continued forced funding of any such debacle by taxpayers is proper. Even academics can bury their heads in the sand for only so long: Decades of doing so have led to nothing but wholesale destruction of higher education. No one is properly forced to underwrite an incompetent business that fiercely (and selfishly) resists all essential reform.

    http://nces.ed.gov/naal/

  • Point in fact
  • Posted by R.A. Shaw on May 24, 2006 at 8:00am EDT
  • " .. Is a business degree worth more than a liberal arts degree?"

    Daniel Patrick Moynihan often cited need for facts. Fact is, there are several surveys that show, on average, BBAs make more $$$ than BA-LibArts, in their first position after graduation. Further, one only has to read the high-volume, anti-business screeds in IHE to sense that economic divide.

  • Reply to Previous Postings
  • Posted by Adonis Metriotitas on May 24, 2006 at 9:10am EDT
  • OK, folks. The Congressional report can be downloaded for *free* at the NCES Web site...it is not hard to obtain:

    http://nces.ed.gov/pubsearch/pubsinfo.asp?pubid=2002157

    As for R.A. Shaw's posting:

    Saying something is "absurd" doesn't make it so. I happen to disagree. Non-profit institutions are accountable to a thousand bosses...student reviews, departmental reviews by administrators, legislative and administrative oversight, oversight from boards of trustees, governors, or visitors, alumni...you name it, everyone has a piece of higher ed. Not to mention that ultimate market accountability tool: not enrolling in institutions that don't fit your needs.

    As for Professor Greene's assertion...there is directly contradicting evidence from the federal Advisory Committee on Student Financial Assistance that *half a million* college-qualified students each year are unable to enroll in higher ed due to lack of finances. Here's the documentation:

    http://www.ed.gov/about/bdscomm/list/acsfa/emptypromises.pdf

    So "extremely limited access" means compounding this situation by excluding more students with astronomically high prices once state funding is zeroed out. Not a terribly enticing solution to the already-rising prices in higher ed.

  • Put Down the John Stossel
  • Posted by Anonymous on May 24, 2006 at 9:35am EDT
  • JBM, you're ignoring the fact that public universities have already been compelled to operate within the corporate model, and already depend heavily on corporate funding. I'm sorry that you don't like the results.

  • Heller's Rebuttal to Vedder...worth the read
  • Posted by Wilbur Beauregard on May 24, 2006 at 10:25am EDT
  • All this has been fascinating to read as a budding scholar in finance of higher education.... I read Heller's testimony in contrast to Vedder, and found it to be so lucid and concise and to the point. This is an educator/researcher that Secretary Spellings should have on the commission.

    "In his book, Professor Vedder calls for the elimination of the subsidies that states provide for public colleges and universities, and for Congress to abolish the Title IV grant programs as well. He justifies this radical proposal by presuming that state and federal support for higher education has little impact other than to enable colleges and universities to increase their prices. Remove the public subsidy, he argues, and these institutions would have little capacity to continue to raise prices."

    The testimony continues with more eloquence. Check Heller's link above for the complete testimony.

    Asa novice, perhaps I view things withan innocent's eye but remember the emperors clothes? So.... I've read Vedder's stuff before and it does seem he gets highly placed more for entertainment value to break monotony. Even I can tell with finite dollars available to states for budgeting; and with medicare and prison costs skyrocketing the item that gets the short straw is going to be higher education.
    As with the federal budget trend under the current administration, there is a "pass it on to the next generation" mentality to let the next generation worry about all the debt-both federal and their own education.

    WB

  • Anonymous
  • Posted by JBM on May 24, 2006 at 11:20am EDT
  • John Stossel? He did not carry out that study. If you are disputing its results, state the grounds on which you are disputing then,

    No, I do not like the fact that universities have so abdicated the responsibility of educating students that only 31% of them possess proficient literacy skills on graduation.

  • re: Point in Fact
  • Posted by Monkey on June 1, 2006 at 3:15pm EDT
  • ” .. Is a business degree worth more than a liberal arts degree?”

    "Daniel Patrick Moynihan often cited need for facts. Fact is, there are several surveys that show, on average, BBAs make more $$$ than BA-LibArts, in their first position after graduation. Further, one only has to read the high-volume, anti-business screeds in IHE to sense that economic divide.

    R.A. Shaw"

    Good to know that money is the only "value" of a higher education as evidenced by BBA's making more $$ than BA-Lib Arts. Maybe we should just make a value ranking system of degrees based on the potential for making $.

    1. Engineering
    2. Business
    3. Everything else that doesn't make lots of money, i.e. education, social science, liberal arts, hard sciences (except if you make a discovery and patent it and get huge grants),etc.

    You are missing the whole point. A college degree is not a guarantee for anything. I've worked with so many students and their parents, who want to know how much will my kid be able to make and what kind of job will they be able to get. It completely depends. There is no easy answer. There are averages, but they do not apply to everyone. An education is an investment, to which $$ cannot always be assigned as a "value".