On College Costs, Be Careful What You Wish For

If in the name of accountability, higher education is forced to focus obsessively on reducing expenses, the results won't yield the kind of institutions Americans want and need, writes William G. Durden.

December 10, 2007

The latest blood sport in American public policy appears to be the unmasking of the purported link between containing the cost of higher education and rigorous fiscal accountability. Stringent accountability is forwarded by critics of American higher education not only to know better "precisely what they are getting" (the assumption being that the public isn’t getting much for its investment), but also to contain escalating college costs and the price passed on to students, their families and the American taxpayer.

Extravagant spending once revealed, so goes the argument, will cause universities on the basis of public outcry to lower costs and pass less of the financial burden on to students, state legislatures and the federal government. All well and good in theory. But this causal connection has yet to be proven. This expectation assumes there is a viable business model in higher education that restrains costs, advances minimal tuition increases and continues to produce all of the components of an undergraduate educational experience to which American society has become accustomed -- and, in fact, demands. Such is not the case.

Current higher education business models are grounded in students’ and the public’s expectations of a comprehensive educational experience and the continual generation of new knowledge—both of which depend on rising revenues. There are, however, two existing business models that could be more widely introduced to appease those critics who perceive rising tuitions as arbitrary and a poor return on investment.

Nonprofit colleges and universities could adopt, for example, the business model of the rapidly proliferating for-profit universities. Colleges and universities could go totally online -- no buildings or accompanying campuses. Athletics would be eliminated as would student life. Gone would be those pesky sources of purported extravagance in American higher education.

There would also be no expectation of original research by faculty or students -- ironically the essential source of content for the for-profits to use in instruction. The course of study would be narrowed to include only those subjects that are more applied than those in a liberal arts curriculum and match more closely specific occupational needs -- business, nursing, social work, health technology, information technology, and so on. The curriculum would eliminate those courses without immediate applicability to the workforce -- English literature, poetry, art and art history, music, dance and theater. There would be no need to engage in "silly" research that deviates from what "someone" has determined a priori as essential topics of inquiry for a productive life. There would be no reason to invest in costly scientific equipment or the laboratories in which to house it.

Numerous for-profit universities have taken these steps. This model is most appealing to busy adults who are both working and trying to advance themselves through education in the most convenient way possible. It fulfills an important "in-time" professional need. For-profits compete with other for-profits and non-profits solely on the competitive basis of tuition and still accomplish their mission fully. Their business model works because they forgo all the "extras" delineated above that non-profits must support through a combination of tuition, public support, private fundraising and cost efficiencies.

But can American higher education -- indeed, can America as an enterprising, entrepreneurial nation -- afford to have all its colleges and universities so defined? Is the for-profit business model more widely acceptable to the American public -- especially for the undergraduate education of its 18-21 year olds? Wouldn’t some valuable defining elements of a distinctively American higher education -- a global market asset -- be lost in this brutal confrontation between cost and accountability?

Would we as a nation accept no college sports? Would we accept the total absence of our effort, albeit sometimes frustrating (and understandably highly inefficient) to advance students in the practice of citizenship within a 24/7 residential community? Would we accept the total absence of student life -- fraternities and sororities, club life and other extracurricular activities? Would our "consumer-students" accept residence halls, student centers and science complexes that were lacking in contemporary amenities and instrumentation?

Would we as a nation accept a curriculum that offered only those courses that translated directly to current workforce needs and neglected the arts and humanities -- defiantly unaccountable courses of study? Would we accept a college or university that restricted its faculty from engaging in research, thereby keeping them one step removed from what they teach in the classroom?

I think not. To do so would completely undermine the global market distinction that has come to define American higher education. It is no coincidence that countries such as Germany and Britain are currently seeking ways to "Americanize" their universities. As central governments cut their considerable subsidies, they are finding it necessary to increase tuition -- and along with it, the types of "amenities" that 21st century students demand. They are coming to rapidly understand that the American college experience in its totality creates an emotional identity among the student body, an identity that translates into a lifelong sense of ownership and a willingness to "give back" to their alma mater. This is an extremely powerful source of support for American higher education and it is necessary component of our business model. Why would we jeopardize this?

If higher education institutions wanted to contain escalating costs and price, they could also look to a second business model that would, in essence, put a "cap" on new knowledge. When American universities were first founded, the course of study was an unchanging corpus of knowledge that was judged finite and comprehensible in its totality. This position was inherited from our European predecessors and practiced there for centuries. In the words of Anthony T. Kronman in his recent book, Education’s End, "The classicist view of antiquity was essentially static. It paid little or no attention to its historical development ….[M]eaning and value of that world …[ resided] … in a set of timeless forms, transparent to the intellect and permanently available as standards of judgment…." Indeed, such a static view of knowledge and its the accompanying "business model" kept cost -- and tuition -- down by ignoring that pesky cost driver, new knowledge.

Some of America’s colonial colleges did manage to survive on tuition alone. After the American Revolution, however, the likes of Dr. Benjamin Rush and Thomas Jefferson introduced "new" knowledge into the curriculum -- contemporary foreign languages and the natural sciences -- and with that, the demand for constantly evolving discovery of knowledge in all fields as a defining characteristic of excellence and distinction in American higher education. This demand only accelerated as the connection between new knowledge and economic competitiveness became increasingly apparent. As the value of exploration and discovery rose, the cost of higher education increased proportionately. And this defining characteristic of an American higher education became even more pronounced with the founding of research universities such as Johns Hopkins and Stanford after the Civil War.

New knowledge -- or "progress" -- costs money, especially in an economy that is driven largely by technology and science. New knowledge, moreover, does not develop in a constricted environment, but rather in one that values wide intellectual exploration and does not a priori assume clarity about what remains to be discovered and learned. Academic effort that produces new knowledge is conducted in the context of limitless parameters and, thus, seeming inefficiency.

Excellence in American higher education rests squarely on the unending and inestimable pursuit of new knowledge. Our graduates’ creativity, flexibility and spirit of innovation are widely acknowledged as the wellspring of our nation’s global competitive advantage. Mediocrity -- defined as killing the pursuit of new knowledge -- is a far cheaper path for American higher education to pursue. But is this a viable alternative? If accountability pushes us to impose, in essence, a "cap" on new knowledge, we could well forfeit American higher education’s historic global advantage and our nation’s competitive edge.

Accountability -- and its twin, transparency -- can, and should, play a major role in this public dialogue. Holding higher education institutions to a high standard of accountability and demanding transparency can, and should, reveal how these enterprises expend their funding and why they are a sound investment. Rigorous accountability may result in some cost efficiencies. But I would argue that these savings will be minimal in the larger scheme of things. Higher education costs will only be seriously curtailed if we adopt radically different business models, such as the two suggested above.

If I am correct that Americans would not accept these two extreme, but proven, methods of containing college cost and price -- the trade-off is too steep -- we must return to the premise that fiscal accountability will somehow accomplish the task. But accountability in and of itself does not restrain cost. Indeed, there exists no business model that can adequately contain cost and price and still accommodate the public’s ever-increasing demand for athletics, residential and recreational facilities, a wide range of extra- and co-curricular activities for students, the emotional bond between student and institution, and the relentless pursuit of new knowledge.

We must, in sum, engage in the discussion about heightened accountability for higher education with extreme caution. Accountability certainly has its place. But if pervasive quantitative accountability reduces the vibrancy and expanse of the curriculum, inhibits the pursuit of new knowledge, and limits access to the arts, humanities, and student life activities that advance citizenship, then we as a nation and as a people will be profoundly diminished.


William G. Durden is president of Dickinson College.


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