Public universities have gotten sandbagged by frustrating and confusing debates about financial resources, administrative bloat, tuition bubbles, and cheaper, better high-tech alternatives. What are people supposed to make of all this? The question is especially critical as the economy goes from bad to worse and public universities teeter on the verge of a new wave of cuts to their public funds.
POLITICS AND THE UNIVERSITY: ▶ Views From Experts on Six Campuses
Many people would also like to know: Why all the fuss about declines in public support? Public universities still look like a good deal—the University of California's tuition, at something over $12,000 a year for in-state students, is less than a third the price of a major private college. So why all the drama about saving public universities from cuts in public support?
Public-university officials have made it harder to answer this question by emphasizing their institutions' similarity to leading private counterparts and expressing their resolve to replace lost public funds with private funds. This has, unfortunately, minimized the distinctive mission of public universities and the unique role public financial support plays within them. Although public-university leaders have denounced the cuts in support, they left themselves open to the states' most effective rebuttal: Public universities can always make up for those cuts by charging more tuition.
The root problem of public universities is not that they keep losing public funds, although this is a destructive symptom. The root problem is that voters don't know why public universities need public money. Legislators, business executives, and most public-university officials, too, either don't know or aren't saying.
Why are public universities resting on public funds? Because only this combination supports the mass creativity on which a successful "innovation economy" depends. Although nearly all policy makers say they want an innovation economy, they are trying to get it in the wrong way—by overconcentrating resources on small, highly selected, unrepresentative elites, and at a moment in world history when this concentration is rightly unpopular and blatantly dysfunctional.
Rather than countering concentration, higher education has long been increasing its own version of it. The educational results discredit the strategy. In the 30-year period that American private universities have gotten richer and publics poorer, the country has completely lost its international advantage in higher-education attainment. According to the Organisation for Economic Co-operation and Development, the United States is now 12th in B.A.-degree attainment and 20th in college continuation. The problem is that the country's very high overall level of financial support for higher education is spoiled by the inefficiency of concentration at the top.
How do we know that mass rather than elite creativity leads to the best overall results? By looking at just about any contemporary field of research. Innovation economics stresses the benefits of "spillovers," in which the value that one firm can obtain from an innovation is a fraction of its overall benefit in the wider economy. Innovation by "end users" greatly increases a product's value via an unmanaged collaborative process involving thousands or millions of people. Historians have shown that most innovation happens far downstream from laboratories, long after the initial invention has been dispersed into society. Urbanists have identified high innovation rates with densely interconnected regions like Silicon Valley, and social theorists and marketing experts jointly emphasize "network effects" in which the impact of an innovation is proportional to its distribution.
Similarly, education researchers have shown how learning is accelerated by intensive interaction within diverse groups. The field of cultural studies has demonstrated the power of cultural production that crosses racial, national, linguistic, and every other kind of boundary, while business professors are trying to get corporate clients to convert to "open innovation" systems because they need the ideas of other companies and not just their own. Even Microsoft, which has risen by virtue of its intellectual-property monopoly, is trying to convert its patent portfolio into a permeable Microsoft ecosystem. Although these efforts need to be shaped by politics and civil society, they are all on the right track toward creating a breadth and inclusiveness of human creativity that is scaled to the size of the problems we must solve.
More relevantly, those experiments in mass creativity will fail when they rest on private investment. Private funds seek not to maximize spillovers and generalize network effects, but to minimize them. For example, investors in start-up companies look to strong intellectual-property portfolios to maximize future returns to their company by denying them to other companies or to the public directly, and yet those portfolios can block innovation by preventing the circulation of knowledge.
The same issue faces public universities. In contrast to their private counterparts, they are already set up to produce creative people and new ideas on the scale required. They are often very large, have a three-quarters share of total enrollments, are rooted in their regions, and are connected to local populations and needs. They are low-barrier institutions, and nearly all accept most students who apply—even the University of California, as a whole, accepts over two-thirds of its applicants. Public universities are much more diverse than their private counterparts: Two of the most selective public universities in the country, UC-Berkeley and UCLA, have proportions of low-income students, as measured by Pell Grant recipients, that are more than twice that of highest Pell-level Ivy League school (Columbia), and four times the level of the more aggressively privatized, elite public flagship University of Virginia. Similarly, state-supported UC-Riverside has nearly four times the rate of Pell Grant recipients (42 percent) as the "state-located" University of Michigan (13 percent).
And the shift to private funds threatens those virtues. In terms of capacity, the scale of private money is far too small. The California community-college system, for example, turned away 400,000 students in the budget-cut year of 2009 to 2010, which means they turned away more students that year than the entire enrollments of the 16 most prestigious U.S. private universities (in the Times Higher Education rankings) plus the Annapolis Group of superb liberal-arts colleges. The cut in the community-college system was $520-million; only Harvard and Stanford raised more than that sum in that year, for facilities and activities meant to last years or decades. In a world in which increasing educational attainment means advancing the poorer three-quarters of the population whose results have not improved in 30 years, educational gains cannot be supported by private funds.
In addition, since private investment wants to retain rather than distribute returns, it favors selectivity over breadth. This is the underlying reason that the global leadership of Harvard and Stanford is cemented by the fact that they each reject more than 90 percent of their applicants. They have made no effort to reverse this trend by increasing the size of their student populations. If public universities depend increasingly on high tuition, differential tuition, and private gifts, they will increasingly replicate the inefficient stratification of the higher-education sector as a whole.
The implication of all this is that public universities should emphasize their differences with private universities, and openly align themselves with mass creativity and the broad development of human capability. We should support a version of the innovation economy that is egalitarian and democratic—that develops craft and skill widely in the population, then puts it to use via mass employment. We need to side with the broad majority that has been damaged by economic concentration, and help solve, rather than perpetuate, the problems of our current plutocratic version of the innovation economy. Finally, we must explain clearly and constantly why only broad public financial support can create such broad public educational benefits.