The remedy for student loan debt? Higher tuition and fees, of course!

I now truly appreciate why we go on vacations.  The Costa Rica trip was only for a week.  But, even for the week before and the one after, I was pretty much disconnected from the news. From the kind of topics that I would otherwise read up about, fret and fume, and then blog about some.  Three weeks of blissful ignorance about so many issues!  It was one awesome affair with my love.

Now, it is all over. Back to reality.  Which means that there is now so much to catch up on.

Like the financial aspects in the university system where I work.

The agenda materials for the June board meeting had an item on student debt management.  So, of course, I had to read through that.  Bad call!

The Board agenda notes:

The various impacts of the recession, including more students taking on debt as their parents’ ability to help pay for college declined, the difficult job market producing unemployment and underemployment at higher than normal rates, and lower earnings, have all made it more difficult for some students to repay their student loans.

Indeed!  So far, so good.  Let's first get some data on the situation:

A system-weighted average of almost $24,000 in student loan debt. Holy macaroni!  Given the spread between the median and the average, it means there are some high debt students, whose numbers might just about numb our senses.

The policy response includes all those things that anybody would like to hear.  Including about strategies to slow down increases in tuition and fees.

But, that is the talk.  How is the walk? Like so:

Yes, tuition and fees will go up. The system-average of 4.5 percent increase will be pretty much double the rate of inflation. Correction: 4.5 is nearly four times the current inflation rate!

Which means, we can confidently project that the student loan debt of future graduating classes will be higher than the current average of $24,000.

We are locked into this mode for various reasons.  Yes, rock climbing walls and fancy dorms are wasteful expenditures.  The phenomenal increase in student-life bureaucracy is another.

And one more: the cost of personnel and the guaranteed wage increases from year to year.  Ramesh makes a similar point when noting about garbage collectors in New York City. Whether it is teaching or non-teaching personnel, contracts guarantee wage increase over the years.  (With the non-teaching unionized employees, there has been a salary freeze, with furloughs as well, for a couple of years now.)

We faculty offer courses and majors depending on the whims and fancies of the faculty.  Not only at WOU but all over the country.  It is one thing to offer specialized courses at graduate levels--that is exactly what one would expect.  But, at the undergraduate level?  Seriously?  As I noted in a recent op-ed,

My favorite, of the ones I have come across in the news, is a course on Lady Gaga. It will require quite some effort on a student's part to use that course as a vehicle to understand what it means to be human. 

 A similar point is made in this WSJ op-ed.  While I disagree with its ideological framework, I concur with this statement there:

Meanwhile, courses proliferate on highly specialized topics—Muslims in movies, gay and lesbian gardeners, the mathematical formalization of political decision making, for example—that closely correspond to professors' niche research interests

In contrast, the courses I teach have dull and boring titles.  Nothing fancy.  No sex in the titles. Nothing about popular culture or sports. No Lady Gaga.  And then I wonder why students do not want to enroll in my classes!  Maybe I should rename the course on "The Indian Subcontinent," for instance, to "Lovemaking according to the Kamasutra."

The entire exercise of higher education increasingly seems to be no different from digging holes and filling them back again--plenty of work going on, but nothing to show for it.

Well, other than the student loan debt, that is.

The national data, as in this chart from Pew Research, will depress you:

A reminder on how that debt matters when one is about to begin an economically productive life:

debt held by millions of Millennials may be forcing this generation to:

• Put off home ownership

• Divert money from retirement accounts

• Impede the ability to take small-business loans

• Forgo securing car loans

Though hard data linking student-loan debt to a delay in these financial commitments are elusive, personal finance experts say that when one is saddled with any kind of debt, economic lives can grind to a halt. The consequences of massive student-loan debt — a trillion dollars and counting — could threaten the standard of living for this generation and harm the country's economic competitiveness.

Maybe I should have simply stayed back in Costa Rica.  Except a couple of them, my colleagues also would have been happier that way!

"College for all" confirms an old truth: there is no free lunch!

The old Soviet Union operated outside of the idea of supply and demand; instead of the marketplace deciding the appropriate levels of supply, bureaucrats and the party apparatchik decided on the quantity, whether it was about tractors or bread.  Such matters are impossible for even the most intelligent human to divine, and it is no surprise that there were long lines for practically everything, prompting various jokes like this one:

After a long wait in the queue, it is now Ivan's turn at the window to buy the television set that he was set on.
"There is a waiting list" he was told.  "Come back in three months."
Ivan is unhappy.  "Three months?" he asks
Then, slowly gathering himself, Ivan says,  "so, can I make an appointment?"
"Of course, comrade" the woman at the window replies with sarcasm in her tone.. "How about exactly three months from now?"
Ivan nods. He asks "morning or afternoon?"
"Afternoon. Why do you need to know?"
"The plumber is coming in the morning." 

Ah, it was fun in graduate school to talk and read about the USSR.  It is a good thing I did because I can relate them all even to contemporary life, here in the US!

Here in Oregon, our elected officials have divined that forty percent of the adults should have four-year college degrees; another forty percent should have two-year college degrees; and the rest will be high school graduates.

Now, why 40-40-20?  Why not 35-35-30?  Or 30-60-10?  Aha, you are beginning to see the craziness!

When we--as the government--decide as that we ought to have a certain number of college graduates, then we are also compelled to follow-up on that by allocating public resources.  Higher education is merely one of the line items in the government's budget.  A forty percent versus thirty percent requires many more millions of dollars, which have to be re-allocated from some other line item.  After all, the  constitution requires us to balance the budget.

Thus far, the drive towards producing college graduates has been accompanied by diminishing allocations from the state, which have then triggered dramatic increases in tuition and fees that students have to pay out of their pockets. Well, most do not have deep pockets, which is why we have an alarming trend of ever increasing student debt, even before they graduate.

Against, such a background of scarce tax dollars, pushing for a 40-40-20 means the budget numbers will not add up.  One option might be to weaken the degree requirements and somehow graduate more students faster and more efficiently.  After all, how hard can it be to transform a university into some kind of a Fordist conveyor belt system, right?

In case you, the enlightened reader, think that I am exaggerating, rest assured that public universities have been asked to develop a degree called the "Applied Baccalaureate" that will provide an easier path for a four-year degree compared to the existing BA and BS.  I shall avoid this "inside baseball" discussion.

But, of course, even the AB won't be enough to help us reach that 40-40-20 goal.  Finances are tight.  Therefore, it is no surprise that the system is now engaged in discussions.  But, as in the case of those old Soviet apparatchik, these meetings are held in secret:

Oregon’s top higher education officials are engaged in a hypothetical analysis of financial pressures that the state’s public universities, including the University of Oregon, face over the next few years.
But they want to keep the projections secret.

Ah, yes, revealing them might harm the country's national security and al-Qaeda might infiltrate the college campuses and make biological weapons that will then be used against the American people.  Surely it is such worries triggering the secrecy, right?

Separate the leadership of different universities

(Op-ed published in the Statesman Journal, December 4th)

The firing of Richard Lariviere from his job as the president of the University of Oregon will be discussed for a long time.

As we engage in debates, there is one fundamental issue that we Oregonians have to resolve well before hiring a successor: Should UO, and perhaps Portland State and Oregon State too, be spun off the Oregon University System (OUS) with a separate governance system?

From the day I was hired to teach at Western Oregon University back in 2002, I have wondered at the logic (or lack thereof) in having an OUS that governs both UO and WOU. After all, WOU is what one would refer to as a "teaching university" while UO is a "research university" and the missions of these two institutions are very different.

It is not that UO faculty do not engage in teaching — they do. But, at research universities, the expectation is that faculty will devote significant effort into systematically creating new ways in which we understand the world.

The metaphorical earth-shattering scholarship in the sciences and the arts happen at research universities, and that is the yardstick with which we would then measure the "worth" of a research university like UO. Thus, it is no surprise that faculty who gain membership into prestigious bodies like the National Academy of Sciences are from research universities, and not from teaching universities.

In the American higher education system, the typical expectation is that teaching universities like WOU have a markedly different role. Pretty much all of our work is about teaching at the undergraduate level. Nobel Prize winners are, therefore, not to be found in teaching universities, even when they are phenomenal teachers, as many of them are.

When there is such a wide gulf between what is expected at UO versus WOU, I am always surprised that both these institutions are governed by the same board.

When I joined WOU, the OUS had a new chancellor in Richard Jarvis. He was a geographer and taught an introductory physical geography class for us — for free, as I recall. But even before his second-year anniversary on the job, Jarvis was fired rather abruptly because the then-governor, Ted Kulongoski, wanted to set a new direction for higher education.

Unfortunately, all I have witnessed in these 10 years is more hirings and firings and the creation of more and more committees, without any directional clarity whatsoever. This decade-long experience makes me conclude that the current crisis is not anything new that Lariviere created, but is the cumulative effect of dilly-dallying.

I can only hope that the termination of Lariviere's contract will compel the governor and the Legislature to settle the issues once and for all.

In working out a plan, they ought to recognize that WOU and its sister regional universities, Eastern Oregon and Southern Oregon universities, are alike in their missions, while UO, PSU and OSU have very different institutional missions. Forcing these institutions to coexist within the same OUS structure will merely prolong the agony, and is the worst possible deal for taxpayers and students.

On the firing of Larivere. Let their people go!

The firing of Richard Larivere from his job as the president of the University of Oregon will be discussed for a long time.  As we engage in debates, there is one fundamental issue that we Oregonians have to resolve well before hiring a successor—should UO, and perhaps Portland State and Oregon State too, be spun off the Oregon University System (OUS,) with a separate governance system?

From the day I was hired to teach at Western Oregon University (WOU) back in 2002, I have wondered at the logic, or lack thereof, in having an OUS that governs both UO and WOU.  After all, WOU is what one would refer to as a “teaching university” while UO is a “research university” and the missions of these two institutions are very different. 

It is not that UO faculty do not engage in teaching—they do.  But, at research universities, the expectation is that faculty will devote significant effort into systematically creating new ways in which we understand the world.  The metaphorical earth-shattering scholarship in the sciences and the arts happen at research universities, and that is the yardstick with which we would then measure the “worth” of a research university like UO.  Thus, it is no surprise that faculty who gain membership into prestigious bodies like the National Academy of Sciences are from research universities—and not from teaching universities.

In the American higher education system, the typical expectation is that teaching universities like WOU have a markedly different role.  Pretty much all of our work is about teaching at the undergraduate level.  Nobel Prize winners are, therefore, not to be found in teaching universities, even when they are phenomenal teachers, as many of them are.

When there is such a wide gulf between what is expected at UO versus WOU, I am always surprised that both these institutions are governed by the same board. 

When I joined WOU, the OUS had a new chancellor in Richard Jarvis.  Jarvis was a geographer, and taught an introductory physical geography class for us--for free, as I recall.  But, even before his second year anniversary on the job, Jarvis was fired rather abruptly because the then governor, Ted Kulongoski, wanted to set a new direction for higher education. 

Unfortunately, all I have witnessed in these ten years is more hirings and firings, and the creation of more and more committees, without any directional clarity whatsoever.  This decade-long experience makes me conclude that the current crisis is not anything new that Larivere created, but is the cumulative effect of dilly-dallying.

I can only hope that the termination of Larivere’s contract will compel the governor and the legislature to settle the issues once and for all.  In working out a plan, they ought to recognize that WOU and its sister regional universities, EOU and SOU, are alike in their missions, while UO, PSU and OSU have very different institutional missions.  Forcing these institutions to coexist within the same OUS structure will merely prolong the agony, and is the worst possible deal for taxpayers and students.

The (atrocious) business of higher education

The Great Recession is causing quite a havoc, and the unemployed millions begin to wonder whether there will be daylight anytime soon. Angry and frustrated people are beginning to protest.  Homes are in foreclosure.  Things are awfully sucky, right?

Against such a background, one would think that university faculty and staff will be happy to simply hold on to their jobs.  Particularly at the public universities.

Not so fast.

As University of Oregon tenured professors pocket an average $4,800 pay increase this year, faculty at other Oregon campuses want fat raises, too....
The UO pay raises have complicated salary negotiations on some of the seven state campuses, giving faculty leverage to demand more money and putting pressure on administrators to deliver it. ...
WOU's faculty union settled earlier this month for a 6 percent salary increase over the next two years with another 2 percent kicking in as the biennium ends. The faculty recognized Western did not have the tuition reserves to grant pay increases on the scale of UO's and were largely satisfied, Plec said.

So, is there any overflowing coffer from where money will miraculously appear?

Nope.

The state government has been drastically reducing its allocations for years now.  WOU, where faculty (that includes me) "settled" for a six percent salary increase is now forced to abandon its tuition promisebecause it won't be able to balance books otherwise:

declining state appropriations for higher education make continuing it a risk, WOU Interim President Mark Weiss said.
"The Promise was premised on sustained and constant state funding," Weiss said. "In a down economy, it serves as a recipe for financial instability."

Let us recap the situation, shall we?

1. State allocations are decreasing
2. But, salary raises of six percent over two years
3. However, such a raise isn't enough, because over at UO the raises were larger

So, we know how this story will develop, right?  The budget will have to be balanced on the backs of students:

OUS schools may increase tuition rates every year -- and have hiked rates accordingly to compensate. Tuition on other campuses grew between 6.5 percent and 9 percent for 2011-12. Western's increased by 5 percent. And that's only for freshmen or new transfer students.

Meanwhile, WOU is hiring a Director of Athletic Compliance, so that we can make sure that NCAA protocols are being followed.  You want to understand how this came through?  For years, WOU wasn't in Division II.  But, you know the formula--sports are the most important aspects of a college.  So, to Division II we went.
However, playing at Division II level meant WOU is required to provide more scholarships and have better facilities.  Which is how we also ended up constructing the multimillion dollar Taj Mahal.  The university president offered reasons for why such an investment is needed:

Since moving from NAIA to NCAA Division II in 2000, Western Oregon University has been adjusting to the economic realities of competing at a higher level.More money was needed for scholarships, travel and increased investment in facilities, such as the new Health and Wellness Center opening this year, that will relocate the football team from the Old PE Building on campus.

Well, wouldn't it have made economic sense then to have stayed in NAIA and, therefore, not have incurred all these additional expenses?  Taxpayer and tuition monies could have been put to better use if we had stayed back in NAIA, right?

This is simply terrible how students are being screwed.   I feel awful when I see them in the classroom--most of them are there, as one student put it, "to game the system."  They see this as the only way to that promised land of a successful middle class American life. 


Little do they realize that the higher education system, which includes me, is out to suck their blood.

A focus on enrollment quickly leads to cooking up the numbers!

Only a couple of days back I posted here my concerns over public colleges and universities being keen on enrollment growth.

And, what do I read today?  The president of a public university has been fired for errors in the enrollment numbers reported:

An internal audit by the university system that was made public last week blamed Mr. McCallum for inflated enrollment numbers, which were posted not only in university documents but also in official reports to the U.S. Department of Education

Seriously, even a drunk monkey could have predicted such developments!  (editor: are you drunk now?)

It is like the old Soviet system--keep reporting good numbers all the time.  Often this led to awards and honors.  In the worst case, you get caught, which is better than not having a job because you are reporting bad numbers!

Universities, which one might think are the arbiters of truth, are now increasingly in the business of self-promotion, which often leads to bullshit, lies, and criminal acts like the North Dakota incident.

Running a university as a business with a focus on enrollment and financial bottom-line also means that we end up in situations like this: neither the university president nor the system's chancellor has any professional academic background, which one would think is fundamental requirement to lead in higher education.  Oh well, ... can't do a damn thing about these, eh!

So, what exactly does a university system chancellor do?

What does the chancellor do anyway?

The following comment (with the typo!) at Jack Bog's Blog sets it up well:

Does he have the power to hire and fire the presidents of the universities, or people that report to the presidents? Does he have authority over the budgets of the universities? Does he have authority to establish levels of tuition and fees? Does he have authority to approve capital projects? How about cirriculum? If he does these things, he's probably paid fairly. If he doesn't, then what exactly does he do?

To which this follow-up comment is hilarious:

A lot of chancelling is involved

Is it a big deal at all?  Yes, it is.

To begin with, a few years ago, then chancellor, Richard Jarvis, was sent off packing because the governor in his infinite wisdom decided to try a different approach in managing higher education in the state.  Jarvis, who grew up in the faculty ranks, was replaced by George Pernsteiner, who is the current chancellor (via this comment):

Pernsteiner was an inside appointment by Neil Goldschmidt, just before the sex scandal broke. George Pernsteiner is pretty much unique among university chancellors in not having a PhD. The RG editorial board wrote:
Pernsteiner was chosen without any of the hallmarks of a chancellor's hiring - no nationwide search, no interviews, no public process.
Then in 2005, the new OUS Board President made it permanent - again, no search or public process.

The chancellor, in this new arrangement, has become a highly paid liaison between the legislative and executive branches of Oregon.  Or perhaps even like a lobbyist for the Oregon University System!

Oh well ...

BTW, one term Jarvis taught an introductory freshman course in geography here at my university.  A funny incident he told us--when the geography faculty got together with him for coffee--was this: the first day of classes, apparently a student walked up to him and complained about the large class size (may have been about 45 students) which was a contrast to the "low average class size" the university's brochure had advertised.  Jarvis response was something like this: "I am just an adjunct faculty here.  It is the administrators who make these decisions."