How universities turned into corporations

Business, Education, Politics

For the last 35 years, public universities in the US have undergone a transformation into a new breed of institution, one that is characterized by byzantine bureaucratic structures and boards of trustees composed of business elites. Our nominally “non-profit” public colleges are starting to look and behave like corporations.

How did we get to the point where our students are treated as customers and their educations are treated like a commodity?

Universities used to serve the “public good”

From the end of World War II to the mid-seventies, the stated mission of public universities was to serve the public good by providing students with broad cultural and human development. Furthermore, access to higher education was for the first time guaranteed to any qualified student regardless of socio-economic status, race, age, or any other category. Education was more of a meritocracy.

Prior to World War II, a university education was the opposite of a meritocracy; instead, it was almost exclusively reserved for students who hailed from a small upper class made up of the wealthy and elite. For example, in 1937, only 15% of 18–20 year olds attended college in the United States.

After the war, the GI Bill radically altered both the size and social character of the student body by bringing eight million middle-class and working-class men into the academy. In addition, the federal government created the Federal Perkins Loan program, which opened up the possibility of college for the first time for many children of civilian working class and poor families. These changes were made possible by a booming postwar economy that allowed states to subsidize this large influx of students while simultaneously keeping tuition costs down.

Economic downturn in 1970s

But things started changing during the 1970s. As the United States experienced double-digit inflation, an oil embargo, and a sputtering economy, public investment in higher education dropped, along with family incomes. Private loans began to replace federal grants as the primary means by which families could pay for college tuitions and other costs, all of which were rising much faster than the rate of inflation. This led to a substantial uptick in student debt.

Since 1980, overall college enrollment has increased from 26% to 41%. With more than 90% of projected job growth in the next ten years requiring at least some postsecondary education, a college degree has turned into what amounts to an economic necessity. Yet, at the same time, the cost of tuition and fees has tripled in the last 35 years, rising four times faster than the consumer price index. Total student debt now totals an astonishing $1.3 trillion, making it the largest sector of household debt, second only to mortgages.

This is not good news for entering students. For many working-class (and even many middle-class) students, it’s no longer feasible to pay for college as they go. They are then faced with a very difficult choice. Either they go to school and rack up a debt load that could take decades to pay off, while having no guarantee of high paying (or really any) employment upon graduation; or, they take their chances competing in a job market without a college degree.

Where is all this money going?

So, what are universities doing with all this money? For one, they are paying for an army of bureaucrats, with those at the top making six- and seven-figure salaries. In fact, the ratio of administrators to faculty is now nearly equal. Other major expenditures include construction of luxury dorms, gyms, and gourmet dining halls, and funding athletics departments that are consistently operating in the red.

What is the motivation behind these seemingly wasteful expenditures? Like corporations competing for market share, universities are engaged in a relentless battle for rankings. As the New York Times reported, “For universities reputation is money: more applications, more tuition dollars, greater levels of alumni giving.”

What’s even more disconcerting is that so little of this money is going towards a quality education. In 2013, just 20% of the teaching workforce was permanent or tenure track, and a shocking 22% of part-time and adjunct professors live below the poverty line (the national average is 14.5%). This translates to faculty who are in a precarious position as they are increasingly subject to deprofessionalization, “the process by which highly educated and skilled professionals are first displaced then replaced with individuals of inferior training and compensation.”

Students, then, are not only getting taught by lower quality faculty, but are also corralled into massive classes and increasingly taught via online courses that lack individualized instruction.

Refocusing on education as a human right

Clearly this isn’t a sustainable model for an education system, and it violates the idea that education is part of the public good and a human right. A burgeoning movement is attempting to usher in a paradigm shift—from seeing education as a profitable commodity to instead following the Universal Declaration of Human Rights dictum that “everyone has the right to education” and higher education “shall be equally accessible to all on the basis of merit.”

The effects of this shift are already being felt. In just the past year, President Obama has proposed a program that includes two years of free community college, and presidential candidate Bernie Sanders stated, “It’s time to make college tuition free and debt free.”

But there’s a long way to go before the upcoming generation can experience a future in which they can afford to go to college and get a high-quality education without bearing decades of debt.

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