The opinion piece below by Nicholas Van Hoffman at first glance gives the impression that states have retreated from funding their public universities. Indeed, the percentage of tax dollars going to higher education in most states is shrinking. Those who read further will discover that Van Hoffman also cites the process by which public schools receive state and federal dollars as problematic -- relatively more tuition grants and loans through the student than direct funds to the institution, a process that Van Hoffman claims serves private institutions well and, perhaps, favors them over public institutions. Van Hoffman ends his article by citing the deleterious effect of current public funding models on poor and middle class students, who must burden themselves with debt or their parents with an inadequate financial base for retirement.
In my opinion, however, the story shouldn't end there. The missing part of the story was captured by Larry Faulkner, President of the University of Texas at Austin, when he keynoted the annual 2005 meeting of the American Council on Education. Connecting price (tuition) to cost, Faulkner said, “We must address costs. More specifically, we must mount serious, effective efforts to limit the rate of growth in the educational cost per student. It is in the range of 4.5 percent per year, a substantially inflationary figure, but more important, a figure significantly larger than the long-term growth rate of the economy.”
As long as they can avoid putting relatively wealthy parents and students at financial risk, many private institutions have little incentive to limit costs. In contrast, public institutions arguably have an obligation to reduce or stabilize unit costs -- costs per student -- and that is the untold story in Van Hoffman's article below. The trend toward privatization of public institutions reflects, in part, a rejection by public institutions of the obligation to mitigate the spiraling cost of educating a student, which the wise use of information technology would permit.
The Increasingly Private Public School
by Nicholas Van Hoffman for The Nation, October 25, 2005
They call it a public institution and it sounds like one from its name, but 92 percent of the money to run the University of Virginia comes from private sources. At the University of Michigan the figure is 82 percent; at the University of Illinois a mere 75 percent. The privatization of the nation's greatest, once-public institutions of higher learning is well under way. "America is rapidly privatizing its public colleges and universities, whose mission used to be to serve the public good," Katharine Lyall, president emeritus of the University of Wisconsin, told the New York Times. "Public control is slipping away." Graham Spanier, president of Pennsylvania State University, blames never-ending tuition increases on "public higher education's slow slide toward privatization." (Eighty-seven percent of his budget now comes from private sources.) Read more ...