• Confessions of a Community College Dean

    In which a veteran of cultural studies seminars in the 1990s moves into academic administration and finds himself a married suburban father of two. Foucault, plus lawn care.

Title

Why Don’t We Plan for Recessions?

An easy answer and some others.

August 20, 2019
 
 

Jeff Selingo asked a great question this week on Twitter. Why don’t colleges put contingency plans for recessions in their strategic plans?

I’ll offer an easy answer, and some harder ones.

The easy one, which is true as far as it goes, is unpredictability. If I could time recessions, I’d make a fortune playing the market. But responses are unpredictable, too.  Will a given recession lead to an enrollment spike? Typically, community college enrollments are inversely related to the employment rate, so a sharp drop in employment leads to a sharp rise in enrollments.  (The economic principle behind that is opportunity cost. When we’re competing with involuntary unemployment, we do better than when we’re competing with paid work.) But that’s a general tendency, rather than an iron law.  And state and county funding often dry up at exactly the moment that enrollment increases, making the fiscal impact on the college more of a mixed bag. Given that strategic plans typically cover three to five years, rather than one, it’s unrealistic to expect them to track short-term economic indicators very closely.  I’d guess there will be a recession at some point in the next three to five years, but I don’t know at which point, how bad, for how long, or what kind of recovery would be involved. Each of those variables would change the decisions embedded in the plan in significant ways.

The harder answers have to do with the process and purpose of strategic planning.  

Strategic plans, as typically promulgated in higher ed, are deeply conflicted in purpose. They’re supposed to be visionary but also consensus-driven; typically, by the time a consensus has formed around something, it’s no longer visionary.  They’re supposed to be done inclusively, but also supposed to focus difficult decisions; that’s a tough balance on a good day, made that much harder when a culture developed over decades of growth encounters secular economic decline.  They’re supposed to be affirmations of values, but also to-do lists with deadlines and accountable parties for each measurable outcome. Nobody covered by the plan is responsible for the broader economy, so it tends to get left out. (“Jane, make sure there’s no recession, okay?”)  Sometimes plans are even used to drive fundraising, and donors don’t like what they perceive as pessimism, even if it’s hypothetical.

That doesn’t lend itself to a lot of “if-then” scenarios.  Typically, it lends itself to versions of “the same, but more,” because that’s where it’s easiest to get consensus.  That’s especially true when the “if” is something negative, like cuts. In an inclusive process, it would be shocking for somebody included to vote themselves off the island.  That’s just not what people do. So if some folks have to be laid off, don’t expect to see that in the strategic plan in any detail. At most, there might be some reference to “aligning expenses with revenues.”  And even that will probably get some folks’ backs up. 

There’s an element of magical thinking in much strategic planning.  To many people, putting something in a plan means calling it into existence.  Why waste political capital on scary layoff plans if they might not happen? To the extent that scary contingency planning puts off donors, it can even become self-fulfilling; all the more temptation not to address it.  And some politicians might actually take such plans as a form of permission.

A college could -- and, to some degree, has to -- engage in more candid fiscal discussions internally.  But to the extent that the more candid discussions reflect a different reality than the inclusive, inductively-written strategic plan, the college leadership has left itself open to charges of lacking transparency.  Sometimes that can’t be avoided, as when circumstances change much more quickly than the usual processes assume. For example, midyear budget cuts or missed enrollment targets can change the financial picture significantly and all-at-once; at that point, administrators have to do what they have to do.  Ideally, they would have prepared contingency plans for that, but again, get too deeply into those plans and charges of opacity start to fly.  

The contradictory and confused purposes of inclusive plans, combined with the inherent unpredictability both of recessions and of political responses to recessions, make it tempting for colleges generally to dodge the subject.  That’s a problem, but it’s a problem with deep roots. It could be avoided by dropping the idea of inclusive or shared governance, of course, but that would bring costs of its own. 

I hope that the next recession triggers an enrollment spike.  That would make a lot of sense both for the college and for the community.  But we’re not planning on one right now, and that’s more rational than it might seem from the outside.

Wise and worldly readers, have you seen a college do a particularly good job of simultaneously being inclusive in its planning process while also building in realistic and specific plans to deal with significant and lasting funding declines?  If so, I’d like to know how they did it.



 

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