Friday, August 13, 2010

The Dirty Little Secret About

Research Universities and the

Cost of Education is

Slowly Emerging

[Background on Hacker Dreifus]

From Bob Samuels:
Higher Education? Everything You Know is Wrong (about Research Universities)

As I have argued elsewhere, the problem is not that the universities have taken on many different functions; the issue is that these institutions engage in false and misleading accounting practices that result in escalating costs and decreased educational quality.

For example, most schools argue that they lose money on each student because the true cost of education is much higher than the price of admission; however, when universities make this claim, they are secretly arguing that everything a university does should be paid for by each undergraduate student.

By concentrating on the true instructional cost, I have argued that universities could easily freeze tuition and increase enrollments and still turn a nice profit, but in order to do this, schools have to be honest about how they spend their money.

I have also warned that if universities do not embrace a more transparent form of budgeting, they will suffer a public backlash that is now gaining steam. In fact, Hacker and Dreifus's book is an example of what happens when universities fail to reveal how they really spend their money.

Since schools do not want to acknowledge that undergraduate students subsidize external research, they end up secretly stealing money from instruction to pay for research and administration. For instance, the University of California currently receives $10,000 from each undergrad and $14,000 from the state for each student, but only $5,000 of this amount goes to instructional costs. This means that the majority of undergraduate funds goes to pay for research, administration, and other activities that are not directly related to undergraduate education. In other words, undergraduate students and the state are unknowingly subsidizing the research mission.

As Hacker and Dreifus rightly point out, research funded by outside sources, like the federal government and corporations, rarely covers the full cost (122). The reason for this discrepancy is that in order to perform research, universities have to build new facilities, hire more administrators, buy more equipment, and increase the staff. Unfortunately, schools rarely admit that research loses money, so they have to secretly take money from the undergraduates. Likewise, as Hacker and Dreifus highlight, most athletic programs lose money, and so students end up subsidizing these nonacademic departments.

... Hacker and Dreifus argue falsely that "the professorial class controls what happens on many a campus . . . " Yet, the same authors later point out that the number of administrators has continued to out-pace the number of professors, and that the new administrative classes has taken over the control of most administrations (30, 108).

There is much more in this article. All of it thought-provoking. It should be read by the Morrill Hall Gang, the members of the state legislature, business leaders, and the new University of Minnesota president. Turning around the University of Minnesota so that it provides a high quality, reasonably priced, undergraduate education AND fulfills its research mission should be a top priority in the next few years.

We must all hang together, or...


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