The Pillaging of America's State Universities

The financial struggle of public research institutions may be a matter of choice—not necessity, as public leaders say.

Mike Householder / AP

America’s great public research universities, which produce path-breaking discoveries and train some of the country’s most talented young students, are under siege. The result may be a significant weakening of the nation’s preeminence in higher education. Dramatic cuts in public spending for state flagship universities seem to be at odds with widespread public sentiment. Americans say they strongly believe in exceptional educational systems; they want their kids to attend excellent and selective colleges and to get good, well-paying, prestigious jobs. They also support university research. After 15 years of surveys, Research! America found in 2015 that 70 percent of American adults supported government-sponsored basic scientific research like that produced by public universities, while a significant plurality (44 percent) supported paying higher taxes for medical research designed to cure diseases like cancer or Alzheimer’s. Nonetheless, many state legislators seem to be ignoring public opinion as they essentially starve some of the best universities—those that educate about two-thirds of American college students.

According to the American Academy of Arts and Sciences’ recently completed Lincoln Project report, between 2008 and 2013 states reduced financial support to top public research universities by close to 30 percent. At the same time, these states increased support of prisons by more than 130 percent. New York City’s budget office reported in 2013 that incarcerating a person in a state prison cost the city roughly $168,000 a year. California apparently does it on the cheap: It costs roughly $64,000 annually for each prisoner—a bit more than the cost of a year at an Ivy League university (average tuition is $50,000) and far more than at the University of California, Berkeley, ($13,000) or at CUNY ($8,000).

The withdrawal of state funds is often one of the direct causes of increased college tuition—not necessarily an increase in faculty size, spending on construction, or administrative costs. Yet, many state policymakers attribute the increased tuition to wasteful spending by the universities. To fill the financial hole, state universities are going national and international—admitting many more out-of-state and foreign students, who sometimes pay as much as three times the tuition of state residents.

Today, families pay more than half of the cost of a public-university degree. In 1970—a period during which middle-class wages stagnated—they paid about one-third. The tuition at the University of Michigan, Ann Arbor, this year is roughly $7,000 for the first two years; $9,000 for the second two, according to school officials, (not the $55,000 commonly attributed to Ivy League universities). And these figures represent the sticker price, not the discounted price after taking into account financial aid.  At the two largest public systems of higher learning (the City University of New York and the California system), the average tuition runs from about $8,000 to $13,000 a year—the price tag at UC Berkeley. For example, fully 60 percent of City University undergraduates pay no tuition after taking into account financial aid, such as Pell grants and state support.

And again, as student tuition and fees rise, the United States spends between $60 billion and $80 billion a year on its incarceration system. Meanwhile, it charges interest on student loans that yields roughly $66 billion off of six years of federal student loans, and $51 billion in 2013 alone, according to the Massachusetts Senator Elizabeth Warren. Some argue that college-student debt could be reduced dramatically if the government charged students the same interest on their loans as it charges banks to obtain money. And if the United States reduced or eliminated the unnecessary hundreds of thousands of people (predominantly minorities) who wallow in jails for multiple non-violent misdemeanors, perhaps it could invest in the higher education of a great many more of its young people—and thus create many more productive members of society.

A type of delusional thinking seems to convince American policymakers that excellent public colleges and universities can continue to be great without serious investment. As the former Secretary of State and Stanford University provost Condoleezza Rice and Joel Klein, the former New York City schools chancellor, wrote in a Council of Foreign Relations report, higher-education investments are a form of national security at least as important as direct investments in bombers, military drones, missiles, or warships. In other words, these education investments have a very high payoff for states, the nation, and the larger world.

All this amounts, arguably, to a pillaging of the country’s greatest state universities. And that pillaging is not a matter of necessity, as many elected officials would insist—it’s a matter of choice. If Wisconsin’s governor and legislature succeed in eliminating or emasculating tenure for faculty members at the University of Wisconsin, Madison, they can say goodbye to the greatness of that institution of higher learning. If Florida’s governor asks students in the humanities or arts to pay higher tuition than those who major in business or STEM subjects, Florida’s universities are apt to deteriorate in quality. And just so it doesn’t seem like I’m cherry picking, consider what North Carolina’s governor said not long ago: “If you want to take gender studies, that’s fine, go to a private school and take it. But I don’t want to subsidize that if that’s not going to get someone a job.” The consequence of such policy choices, it seems, is that tuition will go up and access for kids from poorer families will go down.

But such outcomes can be prevented. Those in the voting public who believe that they can get something for nothing or that quality will simply materialize out of the ether can revisit their assumptions. Governments can increase the marginal tax rates on substantial incomes so that those who have benefitted most from the nation’s prosperity pay a fair share of taxes that enables both access and educational opportunity for talented young people. The United States currently has one of the lowest marginal tax rates in the industrial world. Transferred resources from the very rich (less than 1 percent of nation’s population controls more than 25 percent of its wealth), corporations, and from lower-priority institutions could build a more robust educational system in our country. There are important positive consequences in economic growth from such investments at the state and local level, as has been demonstrated in studies of Silicon Valley and in the area surrounding Boston.

In short, today essentially everyone who attends Berkeley pays a maximum of around $13,500 a year—even if his or her parents are billionaires. At Stanford or at Ivy League  universities that same student would pay (and could afford to pay) the full sticker price of tuition (around $50,000 a year), but the youngster from a poorer economic background might well go free. There is not enough differentiation in tuition pricing between those who come from very wealthy background and those whose parents can barely make ends meet.

Higher education also needs more political leaders who are willing to risk their jobs by committing to ostensibly risky investments in K-12 and higher education. Every elected politician should have quitting issues—in short, be willing to resign or risk reelection when others undermine his or her core values. Take the former Connecticut Governor and Congressman Lowell Weicker, who was willing to sacrifice his leadership positions in defense of his tax policies. It’s time for the states and the federal government to step up to the need to invest creatively in education and raise public awareness about the wisdom of these investments. And it’s time for more members of the voting public to support candidates who meet this description.

Finally, it’s up to the federal government to become an even more active player in supporting the quality of and access to higher public education, just as it did in 1862 when during the Civil War it passed the great Morrill Act that established the land-grant universities—and as it did after World War II when it passed the G.I. Bill. As Benjamin Franklin, who gave a good deal of thought to higher learning and founded the University of Pennsylvania, once said: “An investment in knowledge pays the best dividend.” This investment is a choice that the country must make if the United States wants to maintain a leadership role among the community of nations in the 21st century.