How One University President Is Trying to Save Public Higher Ed
The plan: Get rid of the “smoke screens” that mask the funding of private colleges—then starve them out.
On the morning of June 3, Senator Lamar Alexander walks into an ornate meeting room in the Dirksen Senate Office Building and gavels open a hearing of the Senate Health, Education, Labor, and Pensions Committee to a standing-room-only crowd. At seventy-five, the gray-haired Tennessee Republican has started to hunch over and shuffle as he walks. But he retains the man-in-charge air of a twelve-year Senate veteran and a former two-term governor, president of his state’s flagship university, U.S. secretary of education, and, briefly, presidential candidate. Alexander only recently won control of this powerful committee, once headed by Ted Kennedy. He has made no secret of his desire to use the perch to put his mark on history as a capstone to his long career—by, among other things, rewriting the Higher Education Act (HEA), the federal statute that controls everything from student loans to support for minority-serving institutions.
Alexander hopes to make HEA reauthorization in part a vehicle to deregulate higher education; he believes that there is a significant amount of costly and burdensome federal red tape imposed on states and colleges and that they should have more flexibility. But as today’s hearing on college affordability proceeds, it becomes clear that things aren’t going as he might have liked. The problem is that the Democrats’ star witness, the Louisiana State University president F. King Alexander, is stealing the show. Dressed in a suit with an LSU pin and a tie of LSU purple, King Alexander not only shares a last name with the senator (though they are not related), he’s also a southerner from the Tennessee Valley who has thought deeply about the effects of federal policy on higher education. Yet King’s ideas for ensuring college affordability are the polar opposite of Lamar’s: the LSU president wants more federal regulation—including on his own state and university.
The “greatest challenge facing public universities,” King Alexander explains, is that states today spend about half as much on higher education on a per capita income basis as they did in 1981. This is a direct result, he says, of a regulatory failure built into federal law. In other areas of federal policy, such as transportation and health care, federal dollars come with strings attached—states have to pitch in a set amount of money too. That’s not the case for higher education, where money follows the student to private and public colleges alike, and states have no requirements to fund public universities at a certain (or indeed any) level. The result is that when states are under budget pressure, as they have been in the years since the financial crisis, they slash spending on higher ed. The burden of those cuts then gets shifted to students, in the form of higher tuition, and to the federal government, in greater spending on grants, tax credits, and subsidized student loans.
On the current course, King continues, within twenty years at least eight states—including Colorado, Louisiana, Massachusetts, and South Carolina—will spend no public money on their state universities, and in the rest of the country public higher education will be a shell of its former self. Lamar listens, rocking back and forth in his chair.
When it comes time for questions, the Republicans mostly ignore King, focusing on the other witnesses, but nearly every Democrat calls on him. Patty Murray and Al Franken ask King about specific ways the federal government can use regulations—they prefer the term “leverage”—to encourage states to fund public higher education. Sheldon Whitehouse argues that there’s no reason to “flood” the higher education system with federal dollars if the government doesn’t stop states from disinvesting in public higher education—a surprising statement considering that another Democratic senator from his state of Rhode Island created the modern aid system and the party has historically favored flooding it.
One committee Republican, however, does engage with King. Bill Cassidy, a freshman senator from Louisiana who was sworn in just seven months ago and obtained both his undergraduate and medical degrees from LSU, confesses to a conflicted view about King’s argument. “I’m against states being mandated to do something, but it appears unless states are mandated to do something they’re not going to do so.” King replies that if the federal government doesn’t force states to do something, then the costs will shift onto the federal government and the individual students. Lamar, appearing to grow more upset with the turn the hearing is taking, walks over as Cassidy gets up to leave the hearing room and whispers into his ear for more than a minute.
After all the senators have had their chance to ask questions, Lamar delays the conclusion of the hearing to spar specifically with King. How could he want more federal mandates when it’s federal mandates in other policy areas, like Medicaid, that force states to divert funding from higher education? King perches forward in his chair as Lamar speaks, ready to counter. Yes, it’s true, King replies, that governors very much oppose federal mandates, but they certainly respond to the incentives they create. During the recession, a federal mandate within stimulus funding prevented states from cutting higher education; only when the stimulus money ran out did states slash those budgets. That, says King, is proof that federal mandates work, whether governors like it or not. Lamar shoots back that he is completely opposed to federal mandates. “I think that if you have that you might as well just have the federal government take over all the states. Wouldn’t be anything left for governors or legislators to decide, and so I would respectfully disagree.” With that, Lamar ends the hearing.
The plate tectonics of higher education are rumbling. Fiscal and ideological pressures are pushing toward a clash over the role of the federal government in higher education. For many years, the Democrats were primarily focused on making the existing student aid program more generous. But with $1.2 trillion in outstanding federal student loan debt and continued state disinvestment in public higher education, Democrats are quickly coming around, as the hearing suggests, to King’s view that pumping ever-more resources into federal student aid is a mug’s game. The basic rules need to change. HEA reauthorization is one vehicle for that change, but given GOP resistance and the general gridlock in Congress, it’s probably not the most promising one. Instead, this is an issue that’s likely to play out in the presidential race. Democratic presidential candidates have already started to appeal to their progressive base by talking about “debt-free college,” and the emerging details of these plans all revolve around the federal government forcing states to fund public higher education. To make their case, the candidates need allies knowledgeable enough about the complicated policy architecture of federal-state higher education funding to advise them, and credible enough to be spokespeople for the needed changes. More than anyone else, that person is F. King Alexander.
The Louisiana State University and Agricultural and Mechanical College is the flagship campus of the LSU system and is located in Baton Rouge, an hour’s drive north of New Orleans. The campus, which has multiple exits off of the I-10 freeway, is a large presence in the city, both in terms of land and the number of people it employs.
Baton Rouge in early June is similar to Washington, D.C., in August—after about thirty minutes outside you resent that society requires you to wear clothes, now that they are drenched with sweat and stuck to your skin. LSU battles the heat with giant southern live oak trees (Quercus virginiana), which seem to cool the entire campus and offer a much-needed refuge from the sun. The oaks are sacred—people who park their cars near the exposed roots are heavily fined. Strolling through the quad, you encounter one of the limbs of a giant tree growing downward, sprawled on the ground like a student lying out in the sun. You might recognize LSU’s trees, grass, and understated buildings from the Pitch Perfect movies, in which LSU stars as Barden University.
LSU looks different from northeastern liberal arts campuses, where tight arrays of neo-Gothic buildings evoke a connection to European learning from before we knew the earth revolved around the sun. Since the nineteenth century, LSU’s mission has included training farmers and engineers, and that practicality is still present today. The campus has a simulated oil-drilling station to train petroleum engineers on how to prevent blowouts, such as the one that occurred on BP’s Deepwater Horizon oil rig in the Gulf of Mexico. During my tour the engineers were excited to “blow the stack”—pent-up gas was released from a 100-foot-high derrick in the form of a blazing fireball, and as we drove back toward the center of campus a cloud of black smoke crawled across the sky.
I’ve come two days after Lamar Alexander’s hearing to get a better sense of King’s thinking and worldview. We meet at “The Club,” a fine-dining facility with high ceilings and chandeliers in the center of campus. As a rule, it is impossible to sit down with any university president in America and not get an earful of boosterism about the unparalleled greatness of their institution. King is no slacker in this regard. He talks about LSU’s collection of marine life, an alumnus who was flight director for a Mars rover mission, LSU’s sold-out baseball game the next day, and their live tiger, Mike, whom they bring out to football games to intimidate the opposing team.
Soon enough, however, the discussion turns to federal policy. King is most proud of how little debt LSU students graduate with and how high their mid-career earnings are—LSU has the largest number of undergraduates studying petroleum engineering, a highly paid profession, of any college in the country. He’s quite sure that the return on investment of an LSU degree beats that of the majority of private schools. But he can’t prove it definitively, because Congress, at the behest of lobbyists for the private colleges, has specifically barred the Department of Education from extracting the necessary data.
King does not hide his distaste for private colleges or the professional associations that represent them, and reserves a special hatred for for-profits, which he refers to as “industrial park” universities. He can’t understand why the federal government gives out money to private institutions, no questions asked. Public colleges, he notes, are held accountable at least by their state legislatures for how much they spend and charge in tuition and fees. Private colleges can charge more in tuition and force their graduates to take out loans to pay for it with no repercussions from the federal government—even if their students do poorly. That’s why King wants the federal government to hold all institutions that take federal dollars, public and private alike, more accountable. In his mind, the privates thrive on misinformation, “smoke screens” like U.S. News & World Report, which rewards schools for spending excessive amounts of money per student—King calls it an “inefficiency ranking.” He thinks that if parents could see that students at public institutions graduate with relatively low amounts of debt and equal or better earnings, the majority of privates would be in trouble.
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But better information is just the first step in his crusade to save the publics and force a reckoning on the privates. The second step, as he revealed at the hearing on Capitol Hill, is for Washington to get states to stop cutting their higher education budgets as a condition for receiving federal student aid. The third step is to starve the privates. In King’s mind, privates have no right to federal dollars, and the history of their actions suggests that they do not have their students’ best interests at heart.
King finally comes up for air to tell his staff, who surround us at the table, about his day. He just showed off LSU’s brand-new NCAA Golf Championship trophy to some politicians, who wanted photographs with the players. King was doing some last-minute schmoozing with his most important funders: the Louisiana state legislature.
Drive north eight more minutes down I-10 and you hit the Louisiana state capital, once dominated by the larger-than-life Huey Long, and this year held hostage by Governor Bobby Jindal. After years of tax cutting by Jindal, along with the added pressure of decreasing oil prices in a state heavily reliant on the petroleum industry, the state began the legislative session in April with a $1.6 billion deficit. Eager to jump into the presidential race, and to do so as the most conservative candidate running, Jindal had to close the gap without running afoul of the Taxpayer Protection Pledge he’d made to the conservative activist Grover Norquist. So he proposed, among other budget measures, to reduce state funding for public higher education by 80 percent. This on top of the fact that the state’s higher education funding had already decreased by $5,000 per student in inflation-adjusted dollars since 2008, a 43 percent drop, which is the most of any state except Arizona.
Jindal’s proposed cuts are an extreme example of what public higher education institutions have faced to varying degrees in recent years. Since 1989, total state support in real dollars has actually increased by about 8 percent, but enrollment grew by 49 percent in the same period. That means that state support per student has decreased by 24 percent over the last twenty-five years.
Per student funding tends to drop during recessions both because states have less tax revenue with which to fund public higher education and because enrollment spikes, meaning that when schools most need extra funding states are least able to provide it. The last year of declining per student funding was in 2012, and is now increasing again in most states (though from a very low bottom), with a few exceptions—Louisiana being one of them.
Throughout the spring, King worked behind the scenes, talking to legislators to try to get them to not cut funding to LSU. But by late April, with no sight of a savior for his university, King made a desperate move. He told the New Orleans Times-Picayune that if the current budget went through, then LSU might have to declare “financial exigency,” which would give King the power to shut down programs and lay off tenured professors—the Times-Picayune reporter called it “academic bankruptcy.” The rare declaration made national news and rattled financial markets. LSU canceled a $114 million bond sale, and Wall Street investors cried foul that the sale had started before exigency was mentioned. “It changed everything—those two words,” says Bob Mann, a political columnist who is on the faculty at LSU’s communications school.
The move seemed to shake Louisianans into caring about the fate of their flagship school—King told me afterward that it gave the legislators the political cover they needed. Within a month of King’s declaration, the house fully restored funding for higher education by increasing sales taxes and getting rid of some tax breaks for businesses, and in the final hours of the legislative session on June 18 the legislature sent a bill to Jindal with virtually no cuts to higher education. To avoid Jindal’s veto, the legislature created a tax credit for a student fee that would never be assessed, an accounting gimmick that the Republican state treasurer called “nonsense on a stick” but that allowed Jindal to claim that he hadn’t raised taxes (according to Norquist’s peculiar definition, a fee is not a tax). Jindal signed the budget and got on a plane the next day for a prayer rally in the early primary state of South Carolina.
Not everyone was happy with King’s tactics. Scott McKay, the editor of a prominent conservative blog in Louisiana called “The Hayride,” says he doesn’t understand why King is so focused on being funded by the legislature. LSU is a great university, argues McKay, and it’s priced below the Southeastern Conference average. McKay would rather that King increase tuition to exactly what “the market” will pay for instead of “depending on the idiots in the state legislature” to secure funding for LSU every year.
King feels, however, that raising tuition to make up for Jindal’s draconian proposed cuts would put the school out of reach for many lower-income Louisianans and make LSU more like a typical private university. “So we all look like Tulane or we all look like Vanderbilt,” he explains. Furthermore, King doesn’t just represent LSU Baton Rouge. As chancellor of the entire LSU system, King also oversees LSU’s far-flung branch campuses, like LSU Eunice, a two-year college that grants associate’s degrees and prepares students to transfer to four-year schools. Places like LSU Eunice don’t have the pricing power of the flagship Baton Rouge campus, so an 80 percent decrease in funding, as Jindal was calling for, would have been devastating. Fundamentally, King is fighting on behalf of the ideology that higher education is a public good that benefits society as well as the individual.
The idea of education as a great equalizer was one that F. King Alexander imbibed as a child around the dinner table. King was born in Kentucky in October 1963 into a family of progressive education administrators. His paternal grandfather, Sam Alexander, started as a school teacher in rural Kentucky before rising through the ranks to oversee financing for Kentucky’s department of education for most of the 1960s. In 1968 Sam was promoted to deputy state superintendent for public instruction—the highest position one could hold without being elected. He was a New Deal southern Democrat and a great admirer of Franklin Roosevelt; when electricity first came to their home in Marrowbone, Kentucky, in 1946, Sam told his young son, Kern, King’s father, that it was thanks to Roosevelt and the Tennessee Valley Authority. (Lamar Alexander’s family is from nearby Maryville, Tennessee, about a three-hour drive away and also in the Tennessee Valley.) Sam was also an admirer of Lyndon Johnson’s Great Society—especially LBJ’s signing of the 1965 Elementary and Secondary School Act, the landmark federal statute that funds impoverished K-12 schools. He once marched with the teachers protesting the state legislature about their low salaries, a risk for a political appointee answerable to that same state legislature. He felt that was “the right thing to do,” according to Kern.
Kern followed in Sam’s footsteps. After earning a doctorate in educational administration and briefly working on a study for Kentucky’s department of education, he moved to Maryland for a job at the predecessor of the U.S. Department of Education in the Johnson administration before taking his family to Gainesville, Florida, where both of King’s parents became professors at the University of Florida.
As King settled into kindergarten, his mother, Ruth, was hired to run the women’s physical education program at the university. Ruth was focused on equity of funding through a different emerging fight—women’s athletics. In 1972, she successfully lobbied the University of Florida to start a women’s athletics program a few months before Congress passed Title IX in the Higher Education Act, which, among other things, mandated that universities provide equal opportunity in athletics for both sexes. Ruth’s crusading spirit and gritty determination were big influences on King, according to family members. After becoming pregnant with her fourth son, it was made clear to her that the head of her academic department might ask her to resign. She said she would not, gave birth during spring break, and was back in the lecture hall the following week when classes resumed.
Meanwhile King’s father, Kern, was becoming involved in school equity fights just as his father had been. As an academic studying K-12 financing, Kern and other like-minded experts developed a legal theory that states were often required by their own constitutions to fund all school districts at higher and more equal levels. When the Supreme Court of Kentucky determined, in a major 1989 case, that the legislature had failed the state constitutional mandate “to provide an efficient system of common schools throughout the state,” it cited Kern’s testimony and arguments. Another victory came in Tennessee, where the court ruled in 1993 that funding disparities violated the state constitution’s education and equal protection clauses. King proudly told me that while Lamar Alexander was governor, his “father sued him.” Actually, while the allegations in the case occurred in part while Lamar was governor, the suit was filed a year after he left office, and Kern Alexander was an expert witness, not the plaintiff. Still, the pride King takes in the claim—and his evident delight in the idea that his family has already bested Lamar once—is telling. “People hand down businesses,” King told me. “This is our family business.”
After growing up in Gainesville, King went to St. Lawrence University in upstate New York, then to Oxford for a master’s degree. After a stint as a professional fund-raiser for the University of North Carolina at Greensboro he went to the University of Wisconsin-Madison to earn a PhD in higher education and policy.
It was at Madison that his intellectual compass was set. At the time, the mid-1990s, a number of the faculty in the higher education administration department at Madison, including some of King’s own professors, were battle-scarred veterans of a now largely forgotten fight over educational financing and equity involving the Higher Education Act—another piece of Johnson’s Great Society and the same legislation Lamar Alexander now aims to reauthorize. The HEA supplied federal dollars to states and schools to construct academic buildings, some money to institutions for grant aid to needy students, and money to banks guaranteeing some student loans. In the years following its passage in 1965, a vigorous debate ensued over how best to give low-income students access to college. One group believed that money should continue to flow through states and public institutions in order to keep tuition at public colleges cheap or free. Another camp argued that this approach was wasteful and inequitable, since public universities disproportionately served upper-middle-class students.
The latter group, made up of economists and various public intellectuals, argued that a system of “direct aid” would be more efficient: give needy students a tuition voucher, and let them decide where to spend it, thus encouraging a market-like mechanism that would keep prices down. This approach was pioneered, in part, by the conservative economist Milton Friedman. But it was broadly endorsed by much of the intellectual and political class of that era, including both the Johnson and Nixon administrations.
King decided to write his thesis on these old debates and how they ultimately played out in Washington in 1972 in the form of influential amendments to the HEA, which greatly increased federal student aid. He focused part of his thesis on the successful efforts of private colleges to convince Congress that, without federal support, they would close. In the late 1960s, all schools, both public and private, were feeling financially squeezed due to a confluence of economic factors, but prominent private universities such as New York University and Stanford said they were facing even more serious financial strain. The private schools argued that they were at an unfair disadvantage because the publics were subsidized by the states. They hoped the federal government would even the playing field.
The plight of the privates became a major cause of concern to the influential Carnegie Foundation as well as to members of Congress, especially those representing the Northeast, home to the nation’s oldest and most elite private colleges. In part because they had been around so long, those privates were able to argue, wrote King in his dissertation, that they “had an evolutionary entitlement to survival and to governmental resources.” King thinks that lawmakers who went to private schools, like Senator Claiborne Pell of Rhode Island, who attended Princeton and Columbia, believed that elite private schools were inherently superior to flagship publics. “They felt like ‘if the poor kid can’t go to Harvard like we did, what a shame,’” says King.
By the time of the 1972 debates, as the federal government considered a massive increase in spending on higher education, the private schools had been so successful that the debate in Congress was not whether privates would be funded, but how. Privates and publics both benefited from, and therefore favored, an institutional aid formula based on enrollment. But the privates were also more amenable to direct aid as a way to compete with low-cost publics, and King suggested in his thesis that they may have quietly lobbied for it. Claiborne Pell formed a coalition of Republican and Democratic senators that allied mainly with Republican House members to push through the direct aid model—a victory for Pell, economists, the intellectual class, and the Nixon administration.
The direct aid model’s centerpiece was Pell’s Basic Educational Opportunity Grant for low-income students, later renamed the Pell Grant after the senator who championed it. The law also opened up federal aid to for-profit institutions and encouraged states to create their own direct aid programs, which virtually every state ultimately did. Thus in 1972 the federal government engineered a mass experiment in education vouchers at the college level, not unlike the kind conservatives have long argued—so far unsuccessfully—should be tried in the K-12 system.
King’s thesis attempted to determine the ultimate effects of that mass experiment. Central to his analysis was the work of M. M. Chambers, an expert in higher education finance at Illinois State University who in 1968 predicted disaster if a voucher-type model were put in place. Direct government aid to already high-cost private institutions, Chambers wrote, would fuel further increases in tuition at those schools, thus “pric[ing] out” the very low-income students the program was trying to help. Additionally, he argued that federal direct aid would create an incentive for states to reduce support for public institutions, thus depriving low-income students of the free and low-tuition education that the vast majority of them depend on. In his 1996 thesis, King marshaled an extensive amount of data to show that Chambers’s predictions have proven true, and that without a change in federal policy things will only get worse for lower-income students and the public colleges and universities supporting them.
Upon completing his PhD, King became an academic at the University of Illinois. He got his first big break in 2001 when the Economist picked up one of his journal articles, “The Silent Crisis,” which demonstrated that while professors at public and private universities used to be paid the same salaries back in the 1980s, by 1998 professors at top-tier privates were paid $20,000 more than their public counterparts. (King says the differential has now grown to $45,000.) Soon after, King took over, quite literally, the family business: he succeeded his father as president of Murray State University in western Kentucky. He spent four years there slowly raising his national profile as a thinker on higher-education funding issues, once even testifying in Congress. He was then chosen to lead California State University, Long Beach, a larger school with a significant number of low-income students that gave him a better platform to inform the world about the catastrophe of the 1972 amendments. He began writing op-eds in the higher education trade press and working the halls of Congress on behalf of an idea called “maintenance of effort”: that as a condition of federal higher education aid, states should be required to provide a minimum amount of their revenues to their public colleges and universities.
It was the same concept King would later argue with Lamar Alexander about in the hearing this summer. But in 2008, with the Democrats controlling the House and Senate, he had a bit more luck. King helped successfully lobby for the inclusion of a maintenance of effort provision tied to a small matching grant for states to encourage enrollment of low-income students in the reauthorization of the HEA, against the objections of Lamar Alexander. It was a big fight to even get that provision in at all, but funding in the program was too small to significantly affect state behavior. A few months later, during the financial crisis, Congress included maintenance of effort language in a massive stimulus package allocating $40 billion to states to, in part, support higher education. King points out that many states cut their budgets to within 1 percent of the threshold, but did not go below it: It was the closest he could get to a proof of concept for his idea, and he says he’s not sure he’ll “ever get a bigger accomplishment” than that maintenance of effort provision. After three years, when the money dried up and states were no longer subject to maintenance of effort, many states further decreased support below the floor that had been set by Congress.
The disagreement over maintenance of effort is one over the proper role of the federal government. Lamar Alexander reflected the Republican Party’s view on states’ rights when he told me that maintenance of effort “usurp[s] the prerogative of the constitutional authority of governors and legislators to decide how to spend state dollars by, in effect, being coercive.” King, for his part, describes himself as a “federalist” when it comes to education policy and says “states’ rights is George Wallace standing in front of the Alabama admissions office not letting anybody in.” To King, the debate over maintenance of effort is nothing less than a battle over whether Americans of modest birth will have anything like the same opportunities as the affluent to better themselves through higher education. Spend enough time around King, and you get the sense that he became a public university president less because he wants to run a school than because it provides him a parapet from which to fend off the hordes trying to destroy public higher education.
King has been making his arguments for twenty years, but until recently Democrats were more focused on expanding the direct student aid program to help poor and middle-class students by increasing Pell Grants and middle-class tax credits, and creating generous repayment plans for student loans. But as student loan debt has risen and governors like Bobby Jindal and Scott Walker in Wisconsin cut higher education budgets, Democrats are increasingly realizing that their unquestioning advocacy of federal direct aid has allowed states to play Washington for a sucker. That’s why they chose King Alexander as their witness.
While Congress is unlikely to reauthorize the Higher Education Act this year, the hearing served as a window on the evolution of Democratic thinking in the run-up to the 2016 presidential election. President Obama took the first step in proposing “free community college,” earlier this year, which included a maintenance of effort provision, and prominent liberal voices like Bernie Sanders and Elizabeth Warren have proposed “debt-free college.” (Hillary Clinton has also indicated that she’s interested in the idea.) Lift the hood on Sanders’s plan and you realize it could more accurately be called “free tuition at public universities,” because private colleges aren’t eligible for the $47 billion in federal money he’s proposing to offset tuition. Sanders’s plan also includes, sure enough, a provision that states maintain a set level of higher education funding.
Democrats are slowly coming around to the idea that the only way debt-free college is possible, from a cost perspective, is by limiting it to public schools and forcing the states to chip in money. In the hearing, King outlined his vision for how this could work. States have been cutting budgets and increasing tuition at public universities faster than Congress can authorize Pell Grant increases. The federal government spent $67 billion on grants and tax credits in 2014 (King also includes loans, but their cost is more complicated to estimate). King told the senators to just take $10 billion out of the direct aid program and use that money to create a matching program for states—states that fund their public institutions at high levels get a reward in federal dollars, and lose their match if they go below a certain amount.
Taking money out of the direct student aid program is still sacrilege for most Democrats—Sanders proposed paying for his plan with a “Robin Hood tax” on Wall Street while keeping the direct aid program in place. But the idea of bolstering public higher education without raising federal taxes is appealing, and as Democrats continue down the path toward debt-free college, they will find King Alexander showing them the way forward, intent on undoing the mistakes of the past.
This article appears courtesy of Washington Monthly.