While seeking to make college more affordable and accessible, the Obama administration has launched a worrisome but largely unnoticed assault upon the nation’s publishers and the vibrant market in online learning. The U.S. House has approved a White House-backed provision to provide $500 million to develop free, and “freely available,” online college courses.
The administration is pushing forward with its trademark certitude; Secretary of Education Arne Duncan humbly suggested last week that the administration’s American Graduation Initiative is the 21st century counterpart to Abraham Lincoln’s Morrill Act and to the landmark post-World War II GI Bill.
Duncan is particularly enamored with the $500 million to develop the “Online Skills Laboratory,” in which the federal government will “invite” colleges, publishers and “other institutions” to create online courses for Uncle Sam in a variety of unspecified areas. The feds will then make the courses freely available and encourage institutions of higher education to offer credit for them.
The proposal is both short-sighted and destructive. It’s one thing to encourage providers to develop ”open source” wares and to promote measures that encourage publishers, colleges and universities to reduce costs and save students money. But it’s another thing entirely for the federal government to use taxpayer dollars to provide services that will undercut those offered by self-sustaining private enterprises.
First off, it’s not clear what problem the administration hopes to solve. Online courses already exist and are offered by an array of publishers and public and private institutions. Access to online courses is hardly an issue. Online enrollment grew from 1.6 million students in 2002 to 3.9 million in 2007, when the figure equaled more than 20 percent of total enrollment at all U.S. degree-granting institutions. U.S. News and World Report reports that nearly 1,000 higher education institutions provide distance learning. For-profit online providers reported that online enrollment was up more than 25 percent from summer 2008 to 2009.
More than half a dozen major textbook publishers, including Pearson, McGraw-Hill, Cengage, W.W. Norton & Co., and John Wiley & Sons, as well as hundreds of smaller providers, develop and distribute online educational content. To take one example, Pearson’s “MyMathLab” is a self-paced customizable online course that the University of Alabama uses to teach online math to more than 10,000 students a year. Janet Poley, president of the American Distance Education Consortium, says that new course development is not a “terribly high need,” and “I’d rather see more of the money go into scholarships for online learning than reinventing courses that have already been invented.”
Now, I’m as skeptical of big publishing as most, and make no claims for the quality of any particular product. But the point is that exactly the kinds of online courses and materials that Duncan and the House are calling for already exist. If Duncan’s claim is that somehow these same providers or new providers will deliver a better-quality product when hired by Uncle Sam, he needs to make that case.
Further, if there is such urgency to act, it is hard to understand why the administration wants to launch a federally directed effort to develop new materials rather than find ways to leverage those that exist.
What is it that federal dollars will buy that isn’t already available? As Tom Allen, CEO of the Association of American Publishers, has noted, “State-of-the-art, market tested and validated educational materials are already available and in use by millions of students at virtually every public and private college campus in America…. Why spend hundreds of millions of taxpayer dollars for the government to attempt to replicate products that already exist?” Sure, Allen is an interested party here, but that doesn’t make the observation any less true.
If the administration is concerned about cost, cost-cutting new providers like StraighterLine illustrate that the efficiencies created by new technologies and delivery systems are already allowing some providers to start offering dramatically cheaper instruction.
Today, the chokepoint is often not the lack of existing online courses or materials but the fact that colleges and universities offer them at prices that approximate those charged to students enrolled in more costly traditional instruction. Of course, this stickiness in price has been due to credentialing and regulatory practices that impede the emergence of low-cost entrants; state-funded institutions that use new e-learning students to cross-subsidize other units; and proprietary operators that have happily responded to this cozy arrangement by competing on convenience rather than price.
Rather than addressing the anti-competitive arrangements and cross-subsidies that have led colleges to profiteer at the expense of students, the administration is pushing to spend half a billion dollars to procure online courses that will be offered free of charge to all comers, both in the U.S. and overseas. The proposal would hide true program costs from both student and taxpayer.
This is sensible only if one assumes that federal contracting and oversight ensure better outcomes than market transactions. But this is the same administration that explains that the “public option” is desirable in health care precisely because it believes in market competition. Moreover, if experience with online education during the past decade is any guide, there is little reason to believe that colleges and universities would actually pass cost savings produced by taxpayer-funded courses on to students.
The measure also manages to raise concerns about academic freedom and stifling critical research and development.
Federal law has long buttressed academic freedom and intellectual pluralism by prohibiting the U.S. Department of Education from exercising control over “curriculum, program of instruction … text books, or other educational materials by any educational institution.” The administration would suddenly have the department funding the creation and dissemination of entire courses. Once the U.S. Department of Education is sponsoring a freely available course financed with taxpayer funds, it will be difficult for all but the most expensive or distinctive institutions or providers to justify paying for an alternative offering. For the huge swath of the curriculum represented by general and introductory courses, it is not a stretch to imagine that federally-sponsored courses would become a de facto national college curriculum.
As for R&D and market innovation, Duncan’s proposal is a profoundly short-term solution. If the federal government started freely offering large swaths of cell phone service, it would be difficult for providers to retain customers. The result would be the gradual erosion of the market place and reduced investment in new products or services. Short-term savings would be gained at the cost of gutting the sector’s ability to keep innovating and improving.
The administration and Congress might want to think twice about undercutting publishing and computer software when the copyright sector, which employs more than five million people, is already wrestling with intellectual piracy and declining print sales.
For those who think that the U.S. Department of Education can develop instructional programs and identify promising innovations and opportunities more effectively and efficiently than the messy market place, the “Online Skills Laboratory” must sound like a swell idea. For those who believe that functioning markets generally yield better outcomes than state-directed enterprises, it is a very troubling development.
Even as his administration has become the majority shareholder in General Motors, appointed a “pay czar” to oversee compensation at the nation’s major banks, and endorsed a “public option” to ensure “competition” in a health care market already populated by more than 2,000 insurers, President Obama has taken pains to explain that he is acting reluctantly and only under duress -- and that, as he told Fortune magazine last year, he continues to be the same “pro-market guy … I always have been.”
The president explained at the time, “I still believe that the business of America is business. But what I also think is that with all that power … comes some responsibilities -- to not game the system, to not oppose increased transparency in the market place, to not oppose fiscally prudent measures to balance our budget.” If the president meant what he said, it is hard to fathom why his administration is moving to undermine productive enterprises, obscure price mechanisms, and spending a half-billion dollars to replicate existing products.
If the president is a “pro-market guy,” this would be a good time to show it. Does he really want to add chief of the national “Online Skills Laboratory” to his list of burdens?
Frederick M. Hess
Frederick M. Hess is director of education policy studies at the American Enterprise Institute.
As someone who researches and works with distance education consortia in both the United States and Canada, I have received several inquiries over the past week about “what really happened” in the closure of the University of Texas’s TeleCampus. Just two weeks earlier, I had met with Darcy Hardy and Rob Robinson, the leaders of the TeleCampus. They were charged last May with meeting an accelerated timetable for making their organization self-sustaining. Their efforts appeared to be bearing fruit. That was the first of several wrong conclusions drawn by me and others in recent weeks.
In this article, I raise other conclusions that were offered to me.
Is distance education dead? Commenting on Inside Higher Ed’s article announcing the closure, one observer suggested that the pursuit of distance education is driven primarily by monetary motives. He added that universities “find distance education is not infinitely scalable and scramble for some reason to drop such programs.”
It is wrong to conclude that the TeleCampus closure reflects negatively on distance education as an enterprise. Distance education enrollments continually grow faster than the on-campus population. Officials at Colorado Community Colleges Online recently told me about their 49 percent enrollment increase over the spring 2009 term. Although some would like it to do so, distance education is not going away.
Are distance learning consortiums dead? Some suggest that it no longer makes sense to have separate structures, like the TeleCampus, to support distance education. That conclusion rings hollow for me, especially since I heard about two other states considering new consortiums in the last week. In my 2008 study on financing consortiums, I harshly concluded that these multi-institution entities need to evolve or dissolve.
As technology and constituent needs change, so must consortiums. They should focus on services that the institutions cannot do on their own or for which economies of scale improve quality and costs. Consortiums can also add value by conducting research on emerging technologies and teaching techniques. Successful consortiums constantly evolve their structure to assume new roles while shedding activities once they become entrenched on campus. The Connecticut Distance Learning Consortium embraces an entrepreneurial spirit by developing e-portfolio and online tutoring services that have expanded well beyond state borders. If a consortium does not meet the evolutionary challenge, it should dissolve. Failure to evolve was never a criticism of the TeleCampus.
Are services redundant? The TeleCampus was criticized for unnecessarily mirroring services offered by the UT campuses. That conclusion does not universally hold either. Not all campuses have the same level of services. Redundancy multiplies as each campus regenerates lost services once offered centrally. Efficiencies of scale evaporate and the costs shift to the campuses. Collaboration efforts struggle mightily in meeting needs that are urgent on one campus, but absent from another. Now the campuses will be struggling to fill the void in the next few months.
Can we say the TeleCampus mission is complete? The press release announcing the closure asserts that “a new organizational support structure is appropriate as the next step in maximizing distance education opportunities for our students. The UT TeleCampus has accomplished its mission of providing this capability to our campuses.”
Again, a conclusion that is tough to substantiate. As with other consortiums, the Telecampus’s mission is to “extend the reach” of its member campuses. That strikes me as an ongoing goal and not one with a defined endpoint. While I am delighted that the UT System will continue to support its program to accelerate baccalaureate degree completion, I remain very interested in seeing what else the new centralized support structure offers.
Is UT TeleCampus one of the best distance learning consortiums? I have called the UT TeleCampus one of the leaders in the field and an exemplar for other consortiums. Upon reflection, that conclusion is wrong. Given the strength of its staff and quality of its services, it is the best. Oddly enough, Darcy Hardy learned of the closure after returning from a trip on which she was one of 20 national leaders invited to meet with a prestigious foundation.
What lessons can be drawn? Many theories on the TeleCampus closure have been offered, including those around financial, leadership and organizational dynamics. My sincere hope is that others do not draw the wrong conclusions from this experience in assessing the worth of their own consortium. Consortiums are unique entities. While general principles may apply, their value can be judged only in each unique, local environment. The local landscape contains political, financial and historical barriers and opportunities that do not translate well from place to place.
Am I saying that we cannot learn anything from this experience? No. There will be much to learn. WCET’s eLearning Consortia Common Interest Group includes leaders from many consortiums in the United States and Canada. This decision renewed efforts within the group to examine consortium success factors and to identify practices that do (or do not) work. Keep watching for developments.
In the end, why is the University of Texas System closing its TeleCampus? I remain perplexed, and I hesitate to guess, as I will probably draw the wrong conclusions.
During the tech boom of the '90s, New York University and Western Governors University were among the ambitious innovators in distance education. NYU created a for-profit, online spinoff. After a few years, it tanked. Western Governors, with its emphasis on "competency based" education, predicted it would quickly enroll thousands of students -- and ended up with dozens.
This week, both institutions are turning corners in their distance programs.
DeVry University cut back faculty positions last week in a continuing effort to bolster profits amid decreasing enrollment.
The for-profit institution said Wednesday that it had eliminated the jobs of 134 faculty members, both full-time and part-time. DeVry had already carried out two voluntary buyout programs earlier in the fiscal year. This most recent reduction, in which 29 faculty members voluntarily took a buyout, followed an evaluation of DeVry’s “campus-based instructional needs.”
Once you've done real estate, casinos, an airline, and reality television, what's left? For Donald Trump, there's always higher education.
On Monday Trump unveiled his own "university," which will sell CD-ROMs and offer online courses in real estate and business. No credit or degrees will be offered, although baseball caps and shirts with the university logo may be purchased ($21.95 for a cap, $39.95 for a golf shirt).