Halting the Erosion of State Support for Higher Education

Colleges and universities must shift some of the pain resulting from shrinking state support to their students, argues Sheldon H. Jacobson.

September 5, 2017
 
 
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As we just celebrated the 155th anniversary of the signing of the Morrill Land-Grant Acts into law, the state-supported university model is under attack and at risk. In today’s financially challenged environment, with numerous competing interests, higher education is falling down the priority list when it comes to state investment.

In part, that’s because some state legislators think university administrations are fiscally irresponsible, with bloated budgets. The perception that universities are a public good has been supplanted by the view that they are financial drains.

Legislatures point to specific units within universities that are redundant or specific activities that are wasteful. In response to such claims, state universities have pared down the size of administrations, focusing resources on core educational and research activities. Such changes have resulted in a better alignment between what legislators expect from state universities and what those universities deliver to stakeholders.

Meanwhile, university administrators and students make impassioned speeches extolling the economic and social values that universities create. They point to the many contributions of higher education: an educated and highly trained population generates significant revenue to state coffers. People often locate and take jobs where they studied and, hence, add skills to a state work force. New businesses spawned from university research activities generate significant economic value to states.

Yet despite such efforts, many public universities have been ineffective in communicating their value to their state legislatures, and a bevy of institutions continue to struggle to secure appropriate state support. Some would call this insanity: the same approaches continue to be used, yet they yield limited or no response from state legislatures in moving funding to levels commensurate with the value that universities provide. A new strategy is needed.

A Downward Spiral

If we examine how budget cuts impact universities and their students today, it’s clear where a fundamental problem lies. During periods of reduced state support, universities protect one stakeholder from feeling the pain: the students. But that is shortsighted and destructive to the institutions and the students themselves.

Here’s why: in-state students at public institutions benefit from reduced tuition costs because of the state support provided to subsidize the cost of their education. When such support is significantly curtailed, universities work to protect students, ensuring that they can graduate on time and have access to a spectrum of educational and extracurricular opportunities and experiences. They fill the economic gaps by increasing the number of students in general, particularly out-of-state and international students (who typically pay higher tuition and fees), and reducing faculty members. That means class sizes grow, which means services are overburdened.

Admission quality standards are also gently relaxed to allow for the enrollment growth. Infrastructure and building maintenance are curtailed, and in some cases, delayed indefinitely. Salary increases for faculty and staff members are minimal or nonexistent, and sometimes furloughs are instituted as cost-saving measures. All such actions lead to high-quality faculty and staff members becoming targets of poaching by other institutions. That creates a reactive environment in which senior administrators must deal with retention matters rather than work to keep quality people and compensate them in ways that are commensurate with their value and contributions.

Such environments also tend to foster intellectual malaise, which inhibits productive creative endeavors, further depressing the efficiency and effectiveness of the intellectual talent at universities. All this results in even more faculty members seeking opportunities at other institutions or becoming disengaged -- which further underutilizes their talent and limits their contributions. Junior people may be more difficult to recruit, and those who do accept positions do not view them as long-term ones.

This downward spiral exists in numerous state institutions around the country. Even with the demands they face, private colleges and universities are fiscally more agile in meeting their own budgetary challenges, resulting in a widening gap between public and private institutions.

Shifting the Pain

This bleak picture can be tempered. Colleges and universities must shift some of the pain resulting from shrinking state support to their students. If students cannot graduate on time because of limits on course enrollments and space limitations, they will become advocates for the state universities, since such students (and their families) are voters -- a group to which state representatives respond. In addition, state-located companies will have a shrinking pool of talent to draw upon, which can discourage economic expansion within a state -- and they are yet another group to which state representatives respond.

As is, by public universities continuing to bear the preponderance of the pain inflicted by cuts in state appropriations and to deliver a product that does not upset voters and companies, state legislatures have no reason to increase their support of higher education. Indeed, one can argue that such a decision by state legislatures is justified and warranted, given how universities have responded to the shrinking financial state support provided.

Students, who are innocent bystanders in this tug-of-war between state legislators and universities, deserve better than what they are being given. Protecting students may allow universities to win short-term battles to continue to operate, but it ensures that they will lose the long-term war for their effectiveness as institutions of higher learning. To truly place students first requires colleges and universities to thrive and remain vibrant.

There are risks in shifting some of the pain resulting from shrinking state support for higher education to students. Institutional reputations can be irreparably damaged. Departments may be closed and educational opportunities reduced. The retention and hiring of staff members may increasingly become a challenge. In the extreme case, a reputable state university system may collapse, with entire campuses closed as student applications and enrollment plummet.

Yet the same risks exist if the current status quo continues -- just prolonged over a longer time period. The environment created by the current strategies and policies is detrimental to all stakeholders. By working toward a local point of safety, rather than a global solution of excellence, state institutions are guaranteeing their own demise.

The time has come for leaders of state institutions to take a position that will allow states to either appropriately support their colleges and universities, or, if this is not feasible, set them free to operate as private institutions -- where the cost of the education delivered can be appropriately recouped directly from students and indirectly through enhanced endowment support activities.

Otherwise, such systems will continue to be incrementally dismantled by reductions in state support (effectively bleeding the systems dry), which will continue to have repercussions on our nation’s ability to compete on a global scale. Our higher education system has been the envy of and model for many countries around the world. The positive trade balance that higher education services enjoys is one metric for this exalted reputation.

A decisive shift in who bears the cost of education can restore stability. Such a shift would place more responsibility on all stakeholders -- universities, state governments and citizens of the state -- to assess the investments they are willing to make in higher education and the quality of higher education they are willing to support. Recalibrating support to appropriate levels will unleash a vast amount of intellectual energy, the social and economic value of which will far exceed the cost of such investments.

As is, all the investments made over the past 155 years to build quality state-supported higher education systems in this country are at significant risk. Our students, our states and our nation deserve better.

Bio

Sheldon H. Jacobson is a professor of engineering in the department of computer science at the University of Illinois.

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