Monday, November 30, 2015

Four tough things universities should do to rein in costs

image from

Universities in the United States are the best in the world, but the cost of attending them is rising faster than the cost of almost anything else. Professors blame administrative bloat, administrators blame a decline in state funding, politicians blame unproductive faculties who’ve become too set in their ways.

Yet while students are paying more, they are getting less, at least as measured by learning outcomes, intellectual engagement, time with professors and graduation rates. And although students are working more hours at outside jobs and receiving more tuition assistance, student debt now exceeds credit card debt and has become something of a national obsession.
So you would expect universities to have embarked on the fundamental restructuring that nearly every other sector has done to reduce costs and improve quality. They haven’t. Oh, yes, pay and hiring have been frozen, travel budgets cut, secretaries eliminated and class sizes increased, even as cheaper graduate students and adjunct professors have been hired to teach more. Everything has been done that can be done — except changing the traditions, rhythms and prerogatives of academic life.  
“There is a cultural aversion to thinking about cost,” explains Carol Twigg, president of the National Center for Academic Transformation, who for more than 15 years has run successful pilot projects in course redesign that have significantly cut instructional costs while improving student outcomes at scores of universities.
Among faculty members, there remains a deeply held view that equates spending with quality, considers “accountability” an assault on academic freedom and sees “productivity” as merely code for charlatan anti-intellectualism. For their part, administrators cling to hopes of boosting enrollment and fundraising while waiting for the current budget cycle to pass.
“The American university is a grand political accommodation,” says Richard Vedder, an Ohio University economist and founder of the Center for College Productivity and Affordability. College presidents, he argues, appease faculty members by giving them control over what and how they teach. They appease students and parents with high grades and good facilities. They appease alumni with expensive sports teams. They appease politicians with shiny new research centers. “The idea is to buy off any group that might upset the political equilibrium,” Vedder said.
Nothing I have observed during four years as a professor at George Mason University, seen in the data or heard from higher-education experts is fundamentally at odds with Vedder’s assessment. Even when states have set out to bend the higher-education cost curve, universities have found ways to avoid fundamental change.
What would that change look like? Here are four ideas that seem obvious and reasonable. If a college or university is not moving to embrace them, that’s a pretty good indication that cost-cutting is not a priority.
Cap administrative costs
The best data on college costs comes from the Delta Cost Project, a nonprofit that analyzes data reported to the government. It shows that in the decade prior to 2011, the biggest increase in cost per student at large research universities — the ones that set the competitive norms and that are the focus of this essay — was not in instruction but in administration: student services, institutional support, research and academic support.
While faculty critics have made sport of pointing out the proliferation of assistant provosts or the soaring salaries of college presidents, these don’t represent most new spending. What does is the growth in the number and pay of non-teaching professionals in areas such as academic and psychological counseling, security, information technology, fundraising, accreditation and government compliance.
Administrators cite government regulations, along with increasingly demanding students and parents, as the causes; no doubt those pressures are real. But judging from the amount of time these professionals spend meeting with each other, I’d wager there is plenty of savings to be had by setting priorities and streamlining structure and decision-making. As management consultants from Bain and Co. wrote in a recent report, “In no other industry would overhead costs be allowed to grow at this rate — executives would lose their jobs.”
Here’s a simple rule of thumb: A university should spend more on instruction than it spends on anything else, besides research. 
Operate year-round, five days a week
What are the three best things about being a college professor? June, July and August. It’s a tired old joke, but it’s true.
In 2002, George Washington University President Stephen Trachtenberg noticed that the school owned roughly $1 billion worth of facilities that sat idle for at least a third of the year. If he could reconfigure the academic calendar for year-round operation, he reasoned, he could enroll thousands more students without having to build new classrooms, labs, dorms or athletic facilities.
Doing so, however, would have required some professors to periodically teach during the summer, which didn’t sit well with the Faculty Senate. Its report on the matter reads like a parody of self-interested whining by coddled academics dressed up as concern for the pedagogical and psychological well-being of their students. The report never acknowledged any potential financial benefit; indeed, it declared such calculations illegitimate when the “academic environment” was at stake. The report also noted the severe hardship that a summer term would impose on professors with school-age children, oblivious to the fact that working parents in every other sector face that challenge.
It’s not just in summers, however, that facilities sit idle. Friday has become the new Saturday on college campuses as many students shun classes, and professors have been all too willing to accommodate them. At Mason, utilization of classroom space during prime daytime hours on Thursdays is 68 percent; on Fridays, it is 38 percent. That’s a bit above the national average, according to estimates from Sightlines, a facilities consulting firm.
A few universities have taken a shot at running on a 12-month calendar or returning Friday to the workweek, but nationally such ideas have gained little traction. Trachtenberg isn’t surprised: “Presidents who spend time fighting with faculty over things like this don’t last long.” 
More teaching, less (mediocre) research
Few students or parents realize that tuition doesn’t just pay for faculty members to teach. It also pays for their research. 
I’m not talking about research supported by grants. I’m referring to the research by tenure-track faculty members that is made possible because they teach only two courses per semester, rather than the three or more that was once the norm.
Teaching loads at research universities have declined almost 50 percent in the past 30 years, according to data compiled for the American Council of Trustees and Alumni. This doesn’t necessarily mean professors aren’t working as hard — surveys show they’re working harder and under more pressure than ever. Rather, says former Mason provost Peter Stearns, it reflects a deliberate shift in focus as universities compete for big-name professors by promising lighter teaching loads and more time for research. In the egalitarian culture of higher education, once some professors won the right to teach less, their colleagues demanded the same. Before long, “two-and-two” teaching loads — two classes in each of two semesters — became the norm.
Today, research is the dominant criterion by which faculty members are evaluated. In deciding which professors get tenure, assessment of teaching tends to be perfunctory (few members of tenure committees ever bother to visit a classroom), and all that is required is competence. It is nearly impossible, however, for a professor to win tenure without publishing at least one book and three or four articles in top academic journals.
Unfortunately, much of that work has little intellectual or social impact.
“The vast majority of the so-called research turned out in the modern university is essentially worthless,” wrote Page Smith, a longtime professor of history at the University of California and an award-winning historian. “It does not result in any measurable benefit to anything or anybody. . . . It is busywork on a vast, almost incomprehensible scale.”
The number of journal articles published has climbed from 13,000 50 years ago to 72,000 today, even as overall readership has declined. In his new book “Higher Education in America,” former Harvard president Derek Bok notes that 98 percent of articles published in the arts and humanities are never cited by another researcher. In social sciences, it is 75 percent. Even in the hard sciences, where 25 percent of articles are never cited, the average number of citations is between one and two. 
“For someone just to write a paper that nobody is going to read — we can’t afford that anymore,” says Brit Kirwan, a former chancellor of the University of Maryland.
To accommodate all this research, universities have shifted much more of the teaching load to graduate students with little training or experience in teaching, or to part-time adjuncts who — at $3,000 per course — have become the academic equivalent of day laborers. These strategies have degraded the undergraduate experience and given cost-cutting a bad name.
A better approach would be to offer comparable pay and status to professors who spend most of their time teaching, reserving reduced teaching loads for professors whose research continues to have significance and impact. Some departments at some schools have embraced “differentiated teaching loads,” but most tenured faculty members resist and resent the idea that they need to continually defend the value of their research. And administrators are wary of doing anything that might diminish their universities’ research reputation. 
Cheaper, better general education
Roughly a third of the courses undergraduates take fulfill general-education requirements meant to ensure that all students receive a well-rounded education. Universities have gotten more serious about requiring a minimum proficiency in writing and quantitative reasoning, but the rest of general education tends to be an intellectual cop-out. Students are presented with dozens of courses in four or five broad categories and are told to choose two or three from each. Many are large introductory lecture courses (Everything 101) that were designed primarily to provide foundational knowledge for students majoring in that subject, rather than an intellectually stimulating exploration of a discipline. Most of the rest reflect the specific research interests of professors.
This approach to general education, Bok writes, “is more noteworthy for the interests it serves than for the academic purposes it achieves.” According to Hunter Rawlings, the president of the Association of American Universities, it also reflects reluctance on the part of professors to risk offending colleagues by standing up at a faculty meeting and declaring what they think is, and is not, vital for an educated person to know.
A university concerned about cost and quality would restructure general education around a limited number of courses designed specifically for that purpose — classes that tackle big, interesting questions from a variety of disciplines. Harvard, with its Humanities 10 seminars, and the University of Maryland, with its I-Series, have recently taken steps in that direction. But this approach will achieve significant savings only if the courses are designed to use new technology that allows large numbers of students to take them at the same time.
I’m not talking about simply videotaping lectures. I’m talking about combining great talks by one or more professors and outside experts with video clips, animation, quizzes, games and interactive exercises — then supplementing that online material with weekly in-person sessions for discussions, problem solving or other forms of “active learning.” And having “labs” open day and night that use tutors and interactive software to provide individualized instruction in math and writing until the desired competency is achieved.
There is plenty of evidence that using technology in this way boosts course completion rates, improves learning retention and increases student engagement, while reducing per-student costs by an average of 30 to 40 percent, according to Carol Twigg, who has helped design many such pilot courses. Yet despite these successes, Twigg said that almost none of these models have been rolled out campus-wide. At this point, more than three-quarters of students at four-year colleges and universities have never taken an online or hybrid course, the government reports.
Not all college courses are suitable for technologically driven redesign. But to pay for labor-intensive seminars and tutorials, other courses must be made cheaper. The obvious place to start is with general education and foundational classes that offer the best possibility of realizing significant economies of scale.
So why aren’t such cost-cutting ideas on the agenda?
“Institutional isomorphism,” explained Mason President Ángel Cabrera, a former business school dean. That refers to the tendency of any enterprise to affirm its legitimacy by adopting the same structure and culture and output as its peers, even when there may be a competitive advantage to doing things differently.
Jane Wellman, who for many years headed the Delta Cost Project, thinks it’s a governance problem. University presidents and trustees, she said, think about cost in terms of one- or two-year operating budgets, and through that lens, there really isn’t any way to do more with less. Big structural change makes sense only when it’s considered in terms of investment and long-term payoff.
Maryland’s Brit Kirwan thinks the answer may be simpler than that: “Until the public demands it, it won’t happen.” And right now, the public seems to be of two minds about college costs. Parents and students say tuition and student debt are unaffordable. But when push comes to shove, so many are still willing to pay that university trustees and administrators have no incentive to upset the political equilibrium to do something about it.


Daniel W. Drezner is a professor of international politics at the Fletcher School of Law and Diplomacy at Tufts University and a regular contributor to PostEverything.
As an ongoing observer of the bipartisan War on College, I read a recent column on cost containment in higher education by The Washington Post’s Steven Pearlstein with great interest. Pearlstein is a smart guy, and he stresses four “tough things” that universities must do to contain costs. Some of the recommendations he makes based on what he “observed during four years as a professor at George Mason University” are worth considering.
On the other hand — and you knew there was an other hand — his op-ed was also mildly infuriating, because it’s conceptually muddy and relies on outdated notions. In fact, as I was reading it, I realized that there are four tough tasks a columnist should acknowledge before writing this kind of essay. Which are:
1) Define what you mean by “universities.” Pearlstein opens up by talking about “universities in the United States” and citing all kinds of stuff involving poor graduation rates and rising student debt. But almost the entire rest of the essay implicitly talks about research universities, such as George Mason or Tufts.
This distinction matters great deal, because many of higher education’s negative financial externalities have nothing to do with research universities. Exploding levels of student debt and default, for example, have a lot to do with for-profit colleges. As Adam Looney and Constantine Yannelis argued in a September 2015 Brookings paper:
Most of the increase in default is associated with the rise in the number of borrowers at for-profit schools and, to a lesser extent, 2-year institutions and certain other non-selective institutions, whose students historically composed only a small share of borrowers. These non-traditional borrowers were drawn from lower income families, attended institutions with relatively weak educational outcomes, and experienced poor labor market outcomes after leaving school. In contrast, default rates among borrowers attending most 4-year public and non-profit private institutions and graduate borrowers—borrowers who represent the vast majority of the federal loan portfolio—have remained low, despite the severe recession and their relatively high loan balances.
The amount of debt owed by those attending for-profit colleges has grown from $39 billion in 2000 to $229 billion in 2014 — which is more attributable to increases in the rate of borrowing at those schools than to increases in enrollment.
Similarly, low levels of graduation have a lot to do with for-profit schools and two-year colleges and not much at all to do with four-year research universities, as Pearlstein’s link demonstrates. Indeed, the National Center for Education Statistics’ data on graduation rates at four-year colleges shows that those rates have increased across the board between 1996 and 2007.
If Pearlstein wants to talk about what ails for-profit schools and community colleges, that’s fine. But the entire rest of his op-ed suggests that he’s not talking about those schools. And if you look at four-year universities, the situation is not nearly as grave as Pearlstein suggests.
2) Don’t exaggerate the problems that actually exist. Railing against administrative bloat and the explosion of student services in higher ed, Pearlstein clucks that “a university should spend more on instruction than it spends on anything else, besides research.”
Fair enough. Helpfully, he links to a Bain study on higher education that puts the problem in perspective:
So, based on that chart, are administrative costs and student services increasing as a percentage of total expenditures? Yes, absolutely. But after 15 years, they haven’t increased by that much, particularly at state schools. Instruction is still responsible for more than half of all spending at research universities.
Is administrative bloat a problem? Yeahprobably, but I’d make two cautionary notes. First, I’ve heard enough rants about how to eliminate the federal budget deficit through cutting administrative fat to be leery of the validity of these claims no matter what. Second, Pearlstein lists “academic and psychological counseling, security, information technology, fundraising, accreditation and government compliance” as problem areas. I’d suggest that given recent events, maybe counseling and security might not be areas worth trimming right now.
3) Don’t rely on outdated data. Pearlstein recommends year-round teaching to exploit underutilized facilities, which makes me wonder if he has been to a college campus during the summer. A significant money-maker for colleges is the leasing out of facilities in the summer to executive education programs, summer camps and other enterprises. Pearlstein also urges a greater use of online or hybrid courses, apparently unaware that this bubble popped, like, three years ago.
More significantly, Pearlstein recommends scaling back on research because no one reads it:
“The vast majority of the so-called research turned out in the modern university is essentially worthless,” wrote Page Smith, a longtime professor of history at the University of California and an award-winning historian. “It does not result in any measurable benefit to anything or anybody. . . . It is busywork on a vast, almost incomprehensible scale.”
The number of journal articles published has climbed from 13,000 50 years ago to 72,000 today, even as overall readership has declined. In his new book, “Higher Education in America,”former Harvard president Derek Bok notes that 98 percent of articles published in the arts and humanities are never cited by another researcher. In social sciences, it is 75 percent. Even in the hard sciences, where 25 percent of articles are never cited, the average number of citations is between one and two.
These paragraphs got quite a bit of attention on social media. They’re also badly outdated, relying on a study that first appeared in 1990 and compares apples and orangesThe Atlantic’s Yoni Appelbaum dissected the numbers — you can read his tweetstorm for more.
4) Be honest that you’re using higher ed reform as an implicit industrial policy. An implicit theme of Pearlstein’s essay is that too much money is being thrown at the humanities and not enough at the STEM fields. This theme is hardly unique to him. President Obama has scorned art history majors in the past and GOP presidential candidates have been bashing philosophers in the present. 
The obvious implication of all these insults is that the United States needs to produce more college graduates with real-world skills that add value to the economy. Which is indeed a fine idea. But can we just note that it’s a little hypocritical for politicians to praise the virtues of the free market as a source of U.S. economic dynamism and then act all-knowing in arguing for STEM majors over the liberal arts?
Virginia Postrel has been poking at this intellectually barren pinata for years now, and as she notes, the majors that politicians love to bash are hardly lacking in generating useful skills:
[A]rt history isn’t a major naive kids fall into because they’ve heard a college degree — any college degree — will get you a good job. It’s an intellectually demanding major, requiring the memorization and mastery of a large body of visual material, a facility for foreign languages, and the ability to write clearly and persuasively.
When politicians and pundits argue in favor of reallocating resources from one college major to another, they’re trying to say that they can pick disciplinary winners and losers better than universities, foundations, or the students themselves. There are big risks in making that assumption, especially if you base these selections on “facts” such as welders outearning philosophers that turn out not to be true. And usually such suggestions ignore the simple fact that U.S. research universities outperform every other country in the world. Or as that Bain report acknowledged at the outset:
Few industries in the United States have achieved unquestioned global leadership as consistently and effectively as our higher education system. U.S. colleges and universities are the cornerstone of our economic prosperity and the key to realizing the American dream. Thirty years of growth have confirmed the sector’s leadership and vibrancy — the result of demographic and economic factors combining to lift higher education even higher.
I get that higher education is a ripe target in an election year. And I get that blasting the “higher ed bubble” is popular even if it is not necessarily true. But for once, I’d like critics to concede that this is a far more complex topic than just “costs are out of control.”
It shouldn’t be that tough a thing to admit.

No comments: