Higher Education Strategy Associates

March 13

The Alternative to the End of College (Part 3)

So, if Kevin Carey is pretty much dead on about the weaknesses of current universities, and mostly wrong about where things go from here, how else might universities change over the next couple of decades?

Let’s start with the key points:

  • Money pressures aren’t going to ease up.  The cost disease will always be with us;
  • Professors want to research, and they don’t want to do it in soviet-style academies, divorced from teaching.  They’ll fight hard for present system;
  • Higher education is, to a significant extent, a Veblen Good.  It is thus, to a considerable degree, impervious to disruption;
  • Students don’t go to school just for the teaching.  They go for the experience.  And the networks.  And the personal contact.  And occasional piece of praise.  Some of this can be had online; but it tends to be more meaningful and lasting if accompanied by something face-to-face;
  • The value of an established credential is that it relieves employers of the need to think too hard about the worth of an applicant.  For this reason, it’s really hard for a new credential to displace an established credential;
  • Employers are looking for universities to produce graduates who have more soft skills – mainly relating to teamwork and customer-facing skills.  Students know this – and they want an education that will help provide this.

Any future one can imagine will need to meet these parameters.  So, let’s extrapolate a little bit from here.

  • Students will pay more for university if asked.  They may not like it, but they will do it.  This will eventually ease some of the cost pressure.  As a result, the status quo re: day-to-day practices will be easier to maintain.  A blow-out event;
  • That said, absent a frontal assault by government (which I think unlikely), tenured research track faculty are likely to hang around and get more expensive.  So there will still be cost-pressure for change;
  • Professional pressures around research output means professors by and large will abandon lower-year courses (to the extent they already haven’t).  Something has to replace them;
  • MOOCs – or something like them – are an obvious way to cut costs here.  Carey notes that although there are hundreds of thousands of different courses offered across the United States, the majority of credits actually awarded come from just 5,000 or so courses, which are pretty standard across institutions (e.g. American History 100, Accounting 200, etc.).  To some significant degree, these can be standardized.  That’s not to say there need only be a single course in each of these 5,000 areas: monocultures are bad.  But in the words of one Harvard professor Carey interviewed, there probably doesn’t need to be more than half a dozen, either.  Delivered at sufficient volume, these future-MOOCs will not just feature top lecturers, but also will have massively better support packages and learning design.  Institutions could still localize and personalize them by offering their own tutorial support and testing of the material covered in these future-MOOCs, and then award their own credit for them.  It’s not obvious the outcomes of this kind of arrangements would be worse than they are now: the lectures will likely be better, the scope for improvements for inter-institutional mobility and credit transfer are enormous, and the more nightmarish scenarios around MOOCS could be avoided;
  • Pressure from students and employers is going to lead to significant re-designs of programs around learning outcomes – and specifically around issues of teamwork and problem-solving.  The key change is going to come around how to integrate credible assessments of these qualities into existing structures of courses and degrees.  There will likely be a lot of experimentation; certainly, I think we’re on the verge of the most serious re-think of the structure of credits and degrees since the 1960s;
  • In tandem, various forms of work-based learning are going to keep expanding.  Co-ops and internships will grow.  Practical upper-year courses where students get to tackle real-world problems will become much more common.  Some new types of validation – maybe not badges but something different from a simple diploma – will arise to help document achievement in these areas.

In other words, there will likely some big changes in undergraduate programming, some due to technology, some due to cost pressures, and some due to demands from students and employers.   These changes will weaken the importance of the credit hour and reduce the centrality of academic discipline in academic life.  It will make university-based learning less reliant on classroom teaching as we currently know it.

But it will not be the End of College.

*Note: I’ll be in South Africa next week, and to keep myself sane, I’ll be taking a one-week hiatus from the blog.  See you all again on March 23rd.

March 12

The End of College? (Part 2)

As discussed yesterday, Kevin Carey’s The End of College pinpoints higher education’s key ills in its inability (or unwillingness) to provide students with any real signal about the quality of their work.  This serves students badly in a number of ways.  First, it makes finding job matches harder, and second, it means institutions can mis-sell themselves by investing in the accoutrements of excellence (ivy, quads, expensive residences) without its substance.

Essentially, Carey believes that technology will solve these problems.  He’s not a blind MOOC-hypester; in fact, his chapter on Coursera is reasonably astute as to the reasons the current generation of MOOCs have yet to set the world alight.  But he is utterly certain that the forces of technology will eventually provide high-quality, low-price solutions, which will overwhelm the current model.  The ability to learn without the need for physical classrooms or libraries, the ability to get tutorial and peer assistance online, and the ability to test and certify at a distance will largely do away with the need for current (expensive) physical universities, and usher in the age of “The University of Everywhere”.  Cue the usual stuff about “disruption”.

Carey provides readers with a useful overview of some of the ed tech companies whose products are trying to provide the basis of this revolution, with a particular emphasis on technologies that can capture and measure learning progress, and use that information both to immediately improve student performance, and to provide feedback to instructors and institutions to improve courses.  He also spends a chapter looking at the issue of credentials.  He correctly recognizes that the main reason universities have been able to maintain their position for so long is the strength of the Bachelor’s degree, a credential over which they maintain a near-monopoly.  And yet, he notes, credentials don’t actually tell much about what a graduate’s capabilities are.  And so he spends an entire chapter talking about alternatives to Bachelor’s degrees, such as Digital “badges” – open-sourced, machine-readable competency-based credentials which, in theory at least, are better at communicating actual skills to potential employers.

The problem is that this argument misses the mark, somewhat.  To measure learning in the way techno-optimists wish, the “learning” has to be machine-readable.  That is to say, student capabilities at a point in time have to be captured via clicks or keystrokes, and those keystrokes have to be interpretable as capabilities.  The first is trivially easy (although implementing into a classroom setting in a disciplined way may end up being a form of torture); the second will vary from easy to unimaginably difficult depending on the discipline.

A lot of the promise people see in machine learning is based on things like Sebastian Thrun’s early MOOCs, which were in some ways quite intriguing.  But these were in computer science, where answering a question rightly or wrongly is a pretty good indication of a mastery of underlying concepts, which in turn is probably a reasonable measure of “competence” in a field.  But extrapolating from computer science is less helpful; most disciplines – and indeed, all of business and the social sciences – are not susceptible to capture this way.  The fact that a history student might not know a “correct” answer to a question (e.g. “in what year was the Magna Carta signed”?) doesn’t tell you how well that student has mastered skills like how to interpret sources.  In the humanities and social sciences (here including Law, Education, and Business), you can capture information, but it tells you very little about underlying skills.

With badges, the problem is roughly the same.  Provided you are in a field of study where discrete skills are what matters, badges make sense.  But by and large, those fields of study aren’t where the problem is in higher education.  What problems do badges solve in humanities and social sciences?  If the skills you want to signal to employers are integrative thinking or teamwork (i.e. skills the majority of employers say they most desperately need), how do badges solve any of the problems associated with the current Bachelor’s degree?

Two final points.  First, I think Carey is too optimistic about learners, and insufficiently mindful that universities have roles beyond teaching.  One justified criticism of much of the “disruption” crowd is that their alternative vision implies a high degree of autodidacticism among learners: if you put all these resources online for people, they will take advantage of them on their own.  But in fact, that’s likely the case only for a minority of learners: a University of Everywhere will – in the early years at least, and quite possibly much longer – likely impose significant penalties on learners who need a bit more assistance.  They need a level of human contact and interaction higher than that which can be provided over the internet.

Finally, one of the main reasons people go to universities is the social aspect.  They meet people who will remain friends, and with whom they’ll associate for the rest of their lives.  They learn many skills from each other via extra-curricular activities.  Basically, they learn to become adults – and that’s a hugely important function.  And sure, most universities do a half-assed job (at best) of communicating and executing this function, but Carey’s alternative is not an improvement on this.  It is why I’m fairly sure that even if most students could go to the University of Everywhere, they would still choose not to.  Even if it were practical, I’m not sure it passes the market test.

So if Carey’s diagnosis about universities’ weaknesses are accurate but his predictions incorrect, what are the real alternatives?  I’ll tackle that tomorrow.

March 11

The End of College? (Part 1)

Over the next couple of days, I want to talk a bit about a new book called The End of College, written by the New America Foundation’s Kevin Carey.  It’s an important book not just because it’s been excerpted repeatedly in some major publications, or because the conclusions are correct (in my view: they’re not), but because it has an unerringly precise diagnosis of how higher education came to its present malaise, and the nature of the economic and institutional reasons that impede change in higher education.

Carey’s narrative starts by tracing the origins of universities’ current problems back to the 19the century, when America had three competing types of universities.  First were the small liberal arts colleges devoted either to Cardinal Newman’s ideals, or training clergy, or both; second were the Land Grant institutions, created by the Morrill Act and devoted to the “practical arts”; and a third was a group that wanted to emulate German universities and become what we now call “research universities”.  Faced with three different types of institutions from which to choose, America chose not choose at all – in effect, it asked universities to embody all three ideals at once.

On top of that, American universities made another fateful decision, which was to adopt what is known as the Elective model (I prefer the term “Smorgasbord model”, and wrote about it back here).  Starting at Harvard under President Charles Eliot, this move did away with programs consisting of a standardized set of courses in a standard curriculum, and replaced it with professors teaching more or less what they felt like, and students getting to choose the courses they liked.  This mix of specialization and scholarly freedom was one of the things that allowed institutions to accommodate both liberal and practical arts within the same faculties.  In Carey’s words: “the American university emerged as an institution that was designed like a research university, charged with practical training and immersed in the spirit of liberal education”.

The problem is that this hybrid university simply didn’t work very well as far as teaching was concerned.  The research end of the university began demanding PhDs – research degrees – as minimum criteria for hiring.  So hiring came to center on research expertise even though this was no guarantee of either teaching quality or ability in practical arts. And over time, universities largely abandoned responsibility for teaching to those people who were experts in research but amateurs at teaching.  No one checked up on teaching effectiveness or learning outcomes.  Degrees came to be a function of time spent in seats rather than actual measures of competence, proficiency, or mastery of a subject.

Because no one could check up on actual outputs or outcomes – not only are our research-crazy institutions remarkably incurious about applying their talents to the actual process of learning, they actively resist outsiders attempts to measure, too (see: AHELO) – competition between universities was fought solely on prestige.  Older universities had a head start on prestige; unless lavishly funded by the public (as the University of California was, for a time), the only way to complete with age was with money – often students’ money.  Hence, George Washington University, New York University, the University of Southern California, and (to a lesser extent) Washington U St. Louis all rose in the rankings by charging students exorbitant fees and ploughing that money into the areas that bring prestige: research, ivy, nicer quads, etc.  (Similarly, Canadian institutions devoted an unholy percentage of all the extra billions they got in tuition and government grants since the late 90s into becoming more research-intensive; in Australia, G-8 universities are shameless in saying that the proceeds of deregulated tuition are going to be ploughed into research.)  The idea that all those student dollars might actually be used to – you know – improve instruction rarely gets much of a look-in.

Maybe if we were cruising along at full employment, no one would care much about all this.  But the last six years have seen slow growth and (in the US at least) unprecedented declines in disposable middle-class incomes, as well as graduates’ post-school incomes.  So now you’ve got a system that is increasingly expensive (again, more so in the US than Canada), doesn’t attempt to set outcomes standards or impose standards on its professors, or do much in terms of working out “what works”.

Carey – rightly, I think – sees this as unsustainable: something has to give.  The question is, what? Tomorrow, I’ll discuss Carey’s views on the subject, and on Friday I’ll provide some thoughts of my own.

March 10

Maritime Problems

A couple of weeks ago, Leo Charbonneau over at University Affairs wrote a nice little piece on Maritime universities and the trouble they’re having.  The basic message is that universities out there aren’t doomed – part of the “Don’t Panic” line that AUCC seems to be putting out these days.  The argument was essentially: hey, just nudge the participation rate a point or two, and improve retention a little bit, and those plucky little eastern universities will do just fine.

Allow me to demur a bit.  Once you break down the numbers to the provincial or institutional level, you realize that the picture out east is, in fact, by no means uniform; while the system as a whole is mostly holding steady, there are a few institutions that are in real trouble.

Let’s start by looking at the numbers by province.  In Prince Edward Island, UPEI has done a good job growing its enrolments.  Numbers are off slightly in the last couple of years, but overall they remain about 10% (or about 350 students) higher than they were a decade ago.  Nova Scotia and New Brunswick, on the other hand, both saw falling enrolments from roughly 2004 to 2008.  What’s interesting since that time is the divergence in fortunes between those two provinces.

Figure 1: Total Enrolments by Province, 2004/05-2013/14, Indexed to 2004

In Nova Scotia, the fall during the 04-08 period was concentrated at four universities: Acadia, Cape Breton, Mount Saint Vincent, and Saint Mary’s, all of which lost about 12% of their student body in those four years.  However, during the subsequent rebound, only Acadia actually recovered to any significant extent: most of the growth happened at Dalhousie, which was never hurting for students in the first place.  Nova Scotia as a whole has stayed constant, but what’s actually happened over the last decade is that Dal has grown from being 34% of the provincial system to being over 40%. Meanwhile, Cape Breton, the Mount, and SMU are all a lot more precarious than they used to be.

In New Brunswick, the biggest absolute loser has been the University of New Brunswick’s Fredericton campus, which now has roughly 16% fewer students than it did a decade ago (to all those folks who wonder along with AUNBT why UNB keeps getting rid of tenure lines: that’s why).  But in percentage terms, the real disasters are Moncton’s satellite campuses in Shippagan and Edmundston, where enrolments are down 37 and 49%, respectively, over a decade.

Figure 2: Total Enrolments at Universite de Moncton Satellite Campuses, 2004/05 to 2013/14

Some of you may have noticed last week that Sweet Briar College, a small women’s college in Virginia with an endowment of $100 million, and annual fees of $34,000 US, announced it would be closing because its enrolments and finances were unsustainable.  How many students did it have?  550 – about the same as Edmundston, and 100 more than Shippagan. Somehow, neither campus is losing too much money yet – both are losing about $150K on budgets in the $12 million range – but we’re getting close to the point where the viability of both has to come into question.  That will be hugely traumatic for both communities: having a post-secondary institution in town is a major part of both their survival plans.  But it’s hard to see how the provincial government and the Acadian community as a whole can avoid this discussion.

So, is post-secondary education as a whole in trouble in the Maritimes?  No.   But I count four institutions whose enrolments are already down over 10% from where they were a decade ago, plus the two catastrophic cases of Shippagan and Edmundston.  And there are further youth population declines to come.  Yeah, some of this can be offset by international students (though in the case of Saint Mary’s, they’re already at 30% international students, and *still* their overall numbers are down 10%), but I wouldn’t bet they all can.

In other words, don’t be distracted by the aggregate numbers.  There are some very tough decisions to be made at some of these schools.  My guess is one or two of them won’t be here a decade from now.

March 09

Sessionals, Nursing Degrees, and the Meaning of University

Be forewarned: I am going to be very mean about universities today. 

One thing the labour disputes in Ontario highlight is the amount of undergraduate teaching done by non-tenure track professors.  Numbers on this are hard to come by, and poorly defined when they are.  York sessionals claim to be teaching 42% of all undergraduate classes – but how do you define a class?  But from what I’ve gathered from talking to people across the province who are in a position to know, it is not uncommon at larger universities to at least see between 40 and 50% of all undergraduate credit hours (which is the correct unit of analysis) taught by sessionals.

Think about that for a minute: half of all credit hours in major Ontario universities are taught by staff  who are off the tenure track.  People with no research profile to speak of.  Yet aren’t we always told that the combination of research and teaching is essential in universities?  Aren’t we told that without research, universities would be nothing more than – God forbid – community colleges?  So what does it mean when half of all undergraduate credit hours are taught by these sessionals?  Are students are only getting the essential university experience half the time?  And the other half of the time they are at community colleges?  If so, why are student and taxpayers paying so much more per credit hour?

These are important questions at any time, but I think their importance is underlined by the stramash currently going on between Ontario universities and colleges over the possibility of colleges offering stand-alone nursing programs.  You see, Ontario has none of these.  Universities can have stand-alone nursing programs; colleges can have nursing programs, but require a university partner to oversee the curriculum.  This partnership has nothing to do with sharing of physical resources or anything – Humber College’s partner is the University of New Brunswick (which is how UNB became Ontario’s third/fourth-largest supplier of nurses a few years ago).  No, it’s just a purely protectionist measure, which Ontario universities justify on the grounds that “patient care [has] become so complex that nurses needed research, theory, critical thinking, and practice in order to be prepared [for work]”.  Subtext being: obviously you can’t get that just from a community college.

But why is this obvious?  Clearly, universities themselves don’t believe that theory and critical thinking are related to research, because they’re allowing non-research staff to provide half the instruction.  Indeed, maybe – horror upon horrors – nearly all undergraduate instruction in nursing can be delivered by halfway competent practitioners who are reasonably familiar with developments in nursing research, and that actually having one’s own research practice is neither here nor there.   In which case, the argument for stand-alone nursing schools – with appropriate quality oversight from professional bodies – is pretty much unanswerable.

Too much of universities’ power and authority rests on their near-monopoly on degree-granting.  And too much of that monopoly on degree-granting rests on hand-waving about “but research and teaching!”  Yet, as sessionals’ strikes always remind us, Ontario universities are nowhere close to living up to this in practice.  I wonder how long it will be before some government decides to impose some costs on them for this failure.

March 06

Some Thoughts on TA Strikes

At the time of writing (Thursday PM), Teaching Assistant Unions at both the University of Toronto and York University are on strike, as is the union representing sessionals at York.  Since Toronto is indeed “The Centre of the Universe”, I’m sure everyone across the country is just riveted by this news.  At the risk of irritating those readers still further, I thought I’d jot down a few thoughts on the matter.

1)      A lot of people seem to be wondering “why are we relying so much on adjunct labour these days?”  The quick answer is “because profs are spending more time researching and less time teaching than they used to”; sessionals are an emergent property of a system that gets paid to teach, but prefers to spend money on research.  See also this recent piece on the economics of sessionals.

2)      It’s for this reason that I’m finding the OCUFA campaign on sessionals – “WeTeachOntario” – mindbogglingly un-self-aware.  It’s great to support sessionals, of course, but the utter lack of any kind of recognition that full-time faculty’s well-above-inflation pay settlements, and their perennial push to research more and teach less are significant contributing factors to the problem is simply amazing.

3)      The University of Waterloo’s Emmett Macfarlane wrote a very good piece on the TA strike on the Policy Options blog, which summed up a lot of my feelings about the strikes.  The issue pretty clearly isn’t about what students get paid for their labour as TAs (which at over $40/hr is pretty good), but what they receive overall (i.e. labour plus scholarship), which they feel is inadequate.  And yet it’s the labour tool they are using to address the problem, which is… problematic.

4)      On the issue of whether U of T grad students are, as they frequently claim, “living below the poverty level”:  The union keeps using a figure of $23,000 as the Toronto poverty level, which is in fact the pre-tax low-income cut off for large cities.  The post-tax figure – which is the more accurate comparison, since TA labour income is below the level at which income gets taxed and scholarships are tax-free up to $10K – is $19,000.  Or $1,583/month.  The base TA/grad package is $15K for 8 months or $1,875/month.  So the veracity of the claim seems to rest on the assumption that grad students get no outside income in those other 4 months.  My guess is that’s not for the most part true – they’ll either take on extra work or have an outside scholarship.

5)      What doctoral students are really asking for is that they be treated as employees, not just for their teaching duties but also for the entirety of their academic labour.  And that’s not crazy: in much of Europe, doctoral students are in fact university employees, and reasonably well paid.  There’s nothing to stop a university doing that here: in fact, some might argue that it would substantially improve a university’s ability to recruit graduate students.

The problem – as always – is money: universities don’t want to make the sacrifices to other aspects of the university budget (including, obviously, academic and staff pay) to make this work.  One possible compromise would be to turn PhD students into employees, but accept far fewer of them; but here you’d run into the problem of Arts professors having to backfill by doing more teaching themselves, and Science professors going bananas because now who’s going to run the labs?

To which, with some justification, doctoral students might simply say: Exactly. We’re worth more than you think.   And I’d have a fair bit of sympathy with that.

Have a good weekend.

March 05

CAUT on Foreign Professors

Canadian Association of University Teachers (CAUT) Executive Director, David Robinson, made some interesting statements recently about the way universities hire foreign professors.  He made them in response to an announcement that the Association of Universities and Colleges of Canada (AUCC) had negotiated an agreement to be exempted from certain rules of the new Temporary Foreign Worker program.  To quote in full from CAUT’s press release:

The national organization representing Canada’s professors says that special exemptions from the temporary foreign worker program for universities are unjustified.

“The program is intended to fill temporary labour market shortages and not to be a recruitment tool for permanent posts” said David Robinson, executive director of the Canadian Association of University Teachers (CAUT). “Universities are using the program to side-step proper procedures for recruiting.”

Universities and the federal government agreed this week to exempt institutions from a rule in the program requiring employers to submit plans ensuring Canadian citizens can move into positions held by temporary foreign workers.  Under the new rules, universities and colleges will self-regulate by reporting to their national organization only.

Robinson says there may be a lack of qualified Canadian candidates for some specialized positions, but that the temporary foreign worker program is not the way to fill these posts and that universities should have to “make the case and provide the evidence to the government like every other employer.”

“The reality is there are scores of qualified Canadian academics who are employed on temporary and part-time contracts who should be considered for full-time openings,” Robinson said. “There is simply no evidence of a generalized labour shortage of professors in Canada. It seems that universities want to play fast and loose with the rules, at the expense of qualified Canadians.”

Two points here:

First, over the last few years, some universities have indeed been using the TFW program to get new full-time professors into the country.  The main reason they have done so is the backlog in the regular work permits application system; it was simply faster and easier to use the TFW system instead.  Because these were permanent hires, universities would subsequently go through the regular process; TFW was never more than a temporary means of expediting the process of getting new professors into the county.  When the TFW system was effectively suspended a few months ago, this procedure was no longer possible.  But since the regular work permit system is still a mess, it became difficult for universities to hire the foreign professors they wanted – hence, the need for a deal to get the pipeline moving again.  Thus, use of TFW is not evidence of university chicanery, as Robinson insinuates, but rather of a deep uselessness at Citizenship and Immigration Canada.

Second, the last two paragraphs in that excerpt from the CAUT press release are intriguingly ambiguous.  Is Robinson suggesting that Canadian universities are deliberately excluding Canadians employed as sessional lecturers, and that there is some sort of connection between this and the TFW rules?   If so, he should provide some evidence.  And specifically, it should be evidence that university administrations are doing this rather than, say, his own faculty members who usually form a majority on hiring committees.

Or is Robinson perhaps suggesting something more aggressive: that because there is “no generalized labour shortage of professors” that we should be actively excluding foreign candidates?  The phrasing of that last paragraph is convoluted, but it can be read this way (or possibly he just wanted to dog-whistle this solution – letting people infer it without actually saying it outright).  This might seem an odd position for a union with as many foreign-born members as CAUT, but our academic left has always had a strong nationalist streak going back to the days of the Canadianization movement of the late-60s.

The argument that we should be giving jobs to “qualified” Canadians over foreigners is not a crazy one: after all, it’s what employers in pretty much every other industry must do.  But universities typically don’t view their job as finding someone “good enough” for the job description; they view their job as finding the person who is the best for the job (or, in practice, the person they think will be the best in about 5-7 years’ time).  Basically, academia doesn’t think of “the job” as being a set of defined tasks that could be filled by many different people as it is in most other industries.  Rather, hiring in academia is more akin to professional sports: it’s looking for the best talent to fill some pretty vaguely defined roles (e.g. “defender”).  And at the moment, Canadian employment rules back the academy on this issue.

An honest, open discussion about how and why we hire professors, and whether or not they deserve such a large exemption from the rules that govern other professions, would be interesting and useful.  It would be even better, though, if it were not begun by faculty associations hurling what are basically groundless accusations of bad faith at universities.  We can do better than that.

March 04

Stop Saying Higher Education is a Public Good

Few things drive me crazier than when people claim higher education is a public good, and then claim that, on that basis, it deserves either: a) more public funding, or b) needs to be funded exclusively on a public basis.  This argument represents a fundamental misunderstanding of what the term “public good” actually means.

When most people hear the phrase “public good”, they’re probably thinking something like, “it’s good, it’s publicly funded; therefore, it’s a public good”.  But  that rationale is tautological.  In fact, claims for public funding on the basis of a good being “public” rests on a much narrower definition.  Here, I’d urge everyone to read Frances Wooley’s excellent summary of this issue entitled, “Why public goods are a pedagogical bad”.  To qualify as a public good, the good has to be both non-rival (that is, one person using it does not diminish others’ ability to use it), and non-excludable (that is, once provided it is difficult to prevent people from using – e.g. lighthouses).  The number of goods to which that might actually apply is very, very small, and higher education certainly isn’t one of them.  Classroom space is very definitely rival, and it is trivially easy to exclude people from education – no money, no degree.  Higher education is thus a private good.  One with many public benefits, for sure, but private nonetheless.

Why does it matter if people call it a public good?  Because in all your basic economic textbooks, public goods are the goods that all (or nearly all) think should be publicly funded.  When people say something is a pubic good, they’re actually launching an (erroneous) appeal to economic authority as a basis for public funding.

Now, just because something isn’t a public good doesn’t mean there’s no case for a subsidy: it just means there’s no automatic case for it.  Health care, welfare, and employment insurance are not public goods, but there’s still a very good case to be made for all of them in terms of a public insurance function – that is, it’s cheaper to collectively insure against ill health, job loss, and poverty than it is to make people do it themselves.

Sometimes there’s a case for government subvention due to obvious market failure – most student loans come under this category (markets have a hard time funding human capital), as does public funding of research (some types of research won’t be undertaken by the private sector because of the size of the externalities).

So it’s fine to say there is a public purpose to higher education.  And it’s fine to say higher education has many public benefits.  But saying higher education is a public good, and therefore deserves full public financing, is simply wrong.  If we’re going to have sensible conversations about higher education financing, the least we can do is get the terminology right.

March 03

Lowering Tuition in the UK

So, the UK Labour Party has decided that if it gets elected this spring (odds: probably just less than even), it will bring tuition fees down from their current maximum of £9,000/year to a maximum of £6,000/year.

Progressive, right?  Not in a million years.

As I pointed out back here, the weirdness of the UK system of fees and income contingent loans is that fees have risen so high that very few people – about one in five – are expected to pay it back given how the repayment system is set up (no payments on income below £21,000 [C$40,300], and 9% on the everything above it).  The rest – 80% or so – are expected to see at least some of their loan forgiven.  So if/when tuition gets reduced, those who were not expected to repay more than two-thirds of their loans will not see any benefit.  All that happens is that the debt they wouldn’t ever repay gets paid to institutions in advance, rather than lent to students and later forgiven.  Neither will universities be any better off: all that’s going to happen is that public funding will replace government funding pound for pound.

The benefit, in fact, would only accrue to those who were expected to pay more than two-thirds, and the largest benefit would go to that 20% who was expected to pay off their loans in full – i.e. the very best-off graduates (they don’t quite get off 100% scot-free; some part of this gain will be clawed back through higher interest rates on wealthy graduates).  This is why the BBC ended its Sunday interview with Labour higher education spokesman Liam Byrne, by asking the pointed question: “why propose something that benefits the Goldman Sachs graduate more than the social work graduate?”

Fair question – and so it was no surprise that Byrne ducked it, and stuck instead to his talking point that “the present system is unsustainable”.  I think by this he meant that the exchequer will spend ever greater amounts in future on forgiving loans – but if that’s the rationale, it’s hard to understand how bringing those payments forward makes it any more sustainable. And indeed, it’s worth remembering that the cause of the unsustainability (i.e. all that loan forgiveness for lower-earning graduates) is the thing that makes it at least somewhat tolerable and lightly progressive.

Now, one shouldn’t give the ruling Tory party too much – or indeed any – credit here.  The current fee/loan system was more or less designed by mistake; the Tories were under the delusion that very few universities would jack up fees to the maximum £9,000, and so the size of student debts (and hence loan forgiveness) came as a complete surprise to them.  If they could do it again, they’d undoubtedly make it far less generous to lower earners – and indeed, now seem intent on doing so by stealth, by freezing the repayment threshold and allowing inflation to erode its value.

None of this, of course, is to say that more public funds wouldn’t be welcome in the UK.  The question is, if you had a couple of billion to spend, as Labour now seems to want to do, would you: a) give it to institutions so they can improve the education they provide?  b) give it to students from lower-income backgrounds by reducing their tuition upfront (as the UK did between 1998 and 2006)? or c) hand it over to the richest tranche of graduates?

For some reason, Labour’s answer is c).  And on the politics of it, it’s hard to say they are wrong – in a poll taken over the weekend, 60% of UK voters say they back Labour’s policy.  And of course it’s easy to understand why; if you’re not paying attention (and let’s be honest, most people aren’t), you might think the tuition fee policy was actually going to make life easier for all students.  And who wouldn’t vote for that?

Apparently UK politicians – like Canadian ones – seem to think it’s better to play populist games with tuition rather than to actually do things that help low-income students.  That’s deeply unfortunate, but unfortunately not surprising.

March 02

Government Relations

So, the BC Government is telling BC universities that they shouldn’t hire lobbyists to lobby the provincial government.  What should we think of this?

On the one hand, it’s easy to spout slogans on this subject: “Governments give money to universities to teach, not to lobby”; “That money should be in the classroom”, etc., etc.  But look a little deeper and the answer is not as obvious.  I mean, if it’s wrong for universities to “spend money lobbying governments”, why stop at paying outside consultants?  Why not force institutions to layoff their entire government relations staff?  After all, they’re doing the same thing, just at lower rates of remuneration and more oversight from the boss.  But no one’s suggesting that.  Why not?  That money, too, could go to classrooms, couldn’t it?

Or, conversely: if institutions are not allowed to pay consulting fees to lobbyists, would it be OK if they put them on payroll?  Sure, they’d be getting paid a little more on an hourly basis than your average GR person, but if we think GR employees are good but GR consultants are bad, who cares?

From the university’s perspective, the sloganeering makes no sense unless you take the lobbyists effectiveness into account.  If the lobbyist achieves nothing, then yes, that money would be better spent in the classroom.  But if by spending 50K on a lobbyist an institution ends up receiving another 500K in money, then that’s money extremely well spent.  Obviously, it’s not always simple to determine cause and effect when it comes to an individual’s work, but that’s how universities need to look at the problem; is there a return on investment?

Admittedly, from the public’s point of view it’s not so simple.  There is an unseemliness to institutions who receive public money to lobby government for more money.  I get that.  But if “receipt of public funds” is the dividing line between who does and does not get to have lobbyists, we ought to be consistent.  Bombardier lives on public sector funds; does anyone question Bombardier’s lobbying activities?  If not, why not?

As you can tell, I’m pretty sanguine about universities and lobbying (which shouldn’t surprise anyone – lobbying for students and universities is how I got into this business); but that doesn’t mean there are no red lines.   One obvious one that shouldn’t be crossed is universities directly or indirectly paying money to political parties, as Athabasca did when it bought a table at a Conservative fundraiser a few years ago.  That’s just dumb – and can lead to serious corruption (not to mention reprisals if/when an opposition party comes to power – a fairly remote possibility in Alberta, but still).

But here’s the basic point: we shouldn’t pretend all government decisions regarding universities are made on the basis of pure unadulterated reason.  Lots of things still get settled by grace and favour, and who knows who.  That story I linked to up top notes that UBC doesn’t pay any lobbyists.  That of course is because they don’t have to: UBC is connected up the wazoo, and it shows in any number of funding decisions the provincial government has made over the years.  For other universities, paying lobbyists is just a way of trying to equalize the playing field.  And what’s wrong with that?

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