An illustrative story about public higher education funding

When people consider the decline of state support for public higher education, it’s commonplace to hear calls to reverse that trend.  What’s rare is to hear people describing plans for how such a fine reversal could occur.

I suspect it’s because folks realize that the political situation in most American states is so difficult to overcome.  I’m not referring to Trump, although he can make things worse on this score.  Instead, it’s clear that state legislatures generally have priorities they find more influential than sufficiently funding state universities.

Perhaps an instructive story will make that political fact more evident.

I’m drawing the following tale from a fine, story-rich 2014 Chronicle of Higher Education article by Karin Fischer and Jack Stripling.  The story I’d like you to listen to starts in the midwest:

More than a decade ago, the new governor of Michigan stood before a group of more than 1,000 business leaders and posed a simple question: Where would you make the first cut? The options were projected onto large screens in the Detroit convention hall: Health care. K-12. Prisons. Welfare. The arts. Higher education.

(The reason for this exercise was a bad economy, even for Michigan.  To continue:)

As a list of programs and government services flashed on the screen, Ms. Granholm asked members of the audience to press a button: Cut or keep?

“Where would you spend your first dollar?” she prompted. “Where would you make the first cut?”

The vote wasn’t even close. At the top of the list of cuts: the state’s universities.

Michigan State capitol_David Marvin

“The vote wasn’t even close.”

But that’s just one event, right?  It’s solely the whims of one population, surely?  No.  That vote was just the first of a series:

Over the next year, the governor would conduct a dozen similar forums around the state. Sometimes she asked participants to rank their favored programs. Other times she presented specific trade-offs: Eliminate after-school programs or scholarships for students at private colleges? Cut money for cooperative extension or prescription-drug help for senior citizens? No matter the size of the group, no matter where in the state, the results were always the same: Higher education should go on the chopping block.

Listen to that last bit again: “No matter the size of the group, no matter where in the state, the results were always the same: Higher education should go on the chopping block.”

Keep in mind that Michigan is not a deep red state.  It has a proud history of labor and civil rights activism.  It narrowly voted for Bernie Sanders over Hillary Clinton in the 2016 Democratic primary.  Yes, it went for Trump in 2016, but only by a hair, and not by a majority of votes cast.  The governor in question?  Was she an anti-tax, Tea Partier Republican?  Nope.  She’s a Democrat.

In fact, let’s hear more about her from Fischer and Stripling:

It wasn’t that Ms. Granholm was hostile to higher education. Far from it. The first in her family to go to college, at Berkeley and then Harvard Law, she knew the power of a degree. Indeed, she would make doubling the number of college graduates a priority and promote community colleges as a way to retrain the state’s blue-collar workers.

But when it came down to it, as much as she valued higher education, Ms. Granholm considered other programs more crucial.

This is a story about severe economic stress.  While it’s the kind of stress most states felt in 2008 and some still experience now, not every legislature faces such economic urgency.  Yet the priority rankings remain widespread, from what I’ve seen.  Back to Granholm’s candidates: health care, K-12, prisons.  She adds “Welfare”; I would interpret this to include the full range of transfer payments and services, including pensions. Higher education cannot outcompete these domains for budget priorities.  Legislators will “consider other programs [to be] more crucial.”

There’s much more in that article, and I commend it to you.  It has many impressive stories.  I’m particularly struck by the resonance of this line from another story, concerning higher ed in Colorado:

The state is no longer—will not likely again be—a full partner with public colleges.

Yes, that’s the state not effectively partnering with the institutions it created and used to support well.

One more Michigan sample: the University of Michigan’s long-time president James Duderstadt once described his institution’s relation to the state government thusly:

As university president I used to explain that during this period we had evolved from a state-supported to a state-assisted to a state-related to a state-located university. In fact, with Michigan campuses now located in Europe and Asia, we remain only a state-molested institution.

Even if a campus isn’t expanding abroad, that’s a fine pair of sentences.

How will this story play out in the future?  How much longer will state governments continue to be such non-partners for public colleges and universities?

My speculation is that these political forces are nearly intractable for the short and medium-term future.  The political value of public higher ed’s competitors is just too high.  Additionally, some are becoming more expensive, notably health care and pensions.  If their value remains high, they’ll draw more from a state’s funding.

It’s possible that some of these competitors will decline in importance.  K-12 costs might tick down as demographic forces produce ever-smaller class sizes.  Schools and districts can respond to that by cutting the number of classes – i.e., reducing the number of teachers and associated staff, leading ultimately to less expensive primary and secondary school programs.  (This will require educators to not succeed in arguing for the pedagogical benefits of smaller classes.) It’s also possible that a millennial change wave could persuade states to reduce mass incarceration and decriminalize some offenses, leading eventually to less expensive penal systems.  Given American culture and politics, I think this might take some time to accomplish.  Demographics could help here, too, as active criminals tend to be younger.  Furthermore, we can imagine a Bernie Sanders-style health care financial reform that finally brings down the medical cost curve at the state level.

Alternatively, American culture could experience a sea change.  We might return to a mid-20th-century attitude of valuing public education highly as a public good.  This is Chris Newfield’s vision, which he articulated in a fine book and as a splendid Future Trends Forum guest:

Short of those developments, I fear state universities will continue to end up at the top of Granholm’s cutting ballot for years to come.

(thanks to Linda Burns, who pointed me to George Siemens’ tweet; Michigan capitol photo by David Marvin)

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34 Responses to An illustrative story about public higher education funding

  1. Dahn Shaulis says:

    This problem brings out some very difficult subjects to consider. Is public higher education supposed to be a source of democracy or is it merely a social sorter? Are public universities supposed to improve the lives of its citizens or are they supposed to make enough money to continue expanding?

  2. Dahn Shaulis says:

    Forgot to mention that Suzanne Mettler discussed these competing interests in Degrees of Inequality.

    It’s a shame that our nation has chosen a society of “savage inequalities” in K-12 education, mass incarceration instead of higher education, high cost, low value medical care instead of wellness, and an economic and financial system that produces needless disruption, debauchery, and degradation at levels that destroy civilizations.

  3. Warren Blyth says:

    Has someone made a breakdown of the how these state budget decisions play out in the long term? (like a short video or animation that’s less than 20 minutes?)

    From the Michigan anecdote, I get the sense higher ed was seen as a luxury that should be ditched during an emergency. And maybe so. But I worry that most people don’t have time to chew on long term effects of their priorities. Or may be basing their decisions on how America worked before the 1980s.

    (I haven’t chewed on them. but i get the sense that defunding higher ed leads to greater student debt, due to tuition hikes. That funding k-12 to try and increase graduation rates may be hampered by the effects of poverty in the home. That prison systems are being privatized and run for profit. That the percentage of senior citizens is about to skyrocket to 25% of the population. etc. I’d love to see (or read) an in depth well researched breakdown of how all these things tend to play out in 2019 America. And if it seems legit, I’d seek to share (or make) a 5 to 20 minute “charming animation” version of it with all my friends and family who have less time to chew on these things.)

    • Dahn Shaulis says:

      Warren, yes defunding is part of the problem. It’s part if the neoliberal plan to defund, deregulate, and privatize education. Higher ed is a racket, and there are so many players getting their piece of the pie. This includes for-profit mechanisms such as endowment money managers, for-profit fees for service,for-profit marketing, enrollment services and lead generation, privatized campus services, for-profit online program managers (OPMs), privatized housing, private student loans, student loan servicers, and Human Capital Contracts, also known as income share agreements.

      • Warren Blyth says:

        I’ll try to look into what you’re saying, though i’m not very aware of neoliberal plans (or Human Capital Contracts. And I think i’ve been interfacing the other terms you mention from a different perspective. I’ll start googling). (on one hand i’m disturbed when my university talks like a profit driven corporation. on the other hand I know the state cut off a lot of money years back that was flowing to them, which led to tuition hikes and more money hunting).

        – Could you suggest any video (lecture?) or animation that breaks down how these state budget decisions play out in the long term? (maybe a link, or title?)
        I’m asking because it’s hard to share your high level comment with my network. They’re more likely to consider digging into details (and get on board) after the high level points are made with engaging media.

        • Bryan Alexander says:

          I haven’t seen such a video, but will look.
          For my upcoming podcast series, would you like an episode on this?

          • Warren Blyth says:

            Well, my core interest is in how to explain taxes and state budgets to ordinary folks. seems the core of most political arguments I see is that people don’t believe the money is going where the legislation claims it is going. So we need to find a way to be more transparent about this.
            (it’d be cool to learn more about how budgeting priorities play out in the long term. but that seems doomed to be speculation on some level. explaining where the last allocation went in a specific state seems more solid.

          • Bryan Alexander says:

            Improved transparency would be awesome, Warren.

            Would a simulation or game help?

          • Warren Blyth says:

            (looks like i can’t reply to your nested comment, so jumping up a level).
            i think it’d be ideal to make a visualizing web tool, that combed publicly posted records and made them easy to grok. but. when i looked into it for my university, i found pdf dumps without clear detail (like if someone has multiple positions, it lists max salary for both. leaves out what percentage they’re getting for each). and i expect each money hose is going to be documented differently. so you kinda need people in each org to format their public records better (or a larger team to handle scraping each).

            – I think people would watch a 3 minute high level animation about budgets in their area. but you’d have to update it every year? (and be realllly careful with bias).

            – neither of those sounds fun, so I’ve fallen back into making a game about the local situation. but it’s become kind of a wacky personal statement with irresponsible comedy (as games tend to do?).

  4. Joe Essid says:

    This story is only part of a larger one: the decline, an irreversible one in my opinion, of American power. We have overspent our means for too long on too many things.

    We will, in the words of James Howard Kunstler, “reset” somewhere. He thinks it likely to be pre-industrial. I’m thinking the UK in the 1950s: facing national bankruptcy, our trillions in debts coming due at long last, our shedding global pretensions and even our military. Remember, the UK had a carrier fleet too, right into the 1960s.

    Unlike that era and place, I’m not so sure America’s best minds will have a refuge, as UK expats did then, by going to other nations that invest in R&D and a culture of inquiry. Canada? Scandinavia? The UAE or China, a devil’s bargain at best?

    As much as I’d love universal health care and Mars colonies, I think a more likely future to be a lower-population, less polluted version of Soylent Green, until global populations stabilize at a few billon and the atmosphere begins to return to some sort of stability.

    Grim? Yes. Yet not as grim as Kunstler’s scenario of complete collapse or Atwood’s tale of an American white-male dystopia. Yet our descendants will still curse us, Left and Right, for fighting over abortion or trans rights when the entire house was on fire.

    • Dahn Shaulis says:

      Joe, the People can still try to organize for democracy and quality of life. That’s what I’m doing. And I don’t think it’s too late.

    • Bryan Alexander says:

      I wonder.
      In my work I try to consider the systems within which higher ed functions. That means technology, demographics, culture, policy, economics. It’s a tall order, in fact.
      So far I’ve only established trends from that macro field. The resulting scenarios have only been for higher ed per se.
      Should I start investigating macro scenarios? To include possible futures like yours and Kunstler’s?

  5. Kenneth M Van Horn says:

    Public universities are subject to public whim and I think academics have utterly failed to realize the environment in which they operate.

    A 2016 study published in Econ Journal Watch considered voter registration of faculty members in selected social science disciplines (and history) at 40 leading American universities. The study found a ration of 11.5 Democrats for every Republican in these departments, but with wide variation. In economics, the ratio was 4.5 to one, while in history the ratio was 33.5 to one.

    To what degree are budget cuts in higher education the result of the victor getting the spoils and punishing political adversaries?

    Short-sighted, true. But also short-sighted of the administration of the University of Alaska. If the University of Alaska was well known for producing sound conservative or libertarian policy ideas instead of being best known for its climate change research, things may well have turned out differently.

    Alaskans are a surly lot and politicians are vindictive. Has no one underscored the value of political savvy and good public relations to academia?

    The pride and presumption in academia kind of reminds me of a governor’s election in Georgia back in 1970. Carl Sanders was a former governor running again and his campaign slogan was “CARL SANDERS OUGHT TO BE GOVERNOR AGAIN,” in all caps. An upstart running against him had stickers printed that said, “WHY?” And plastered them on every Sanders campaign sign they found. Jimmy Carter won and the rest is history.

    Political savvy wins. Hubris loses.

    Public higher education should be fully funded… why? Have academics become presumptuous? Are the benefits from public higher education mostly public or mostly private? Why should public monies be used to subsidize a benefit that is mostly private?

    Obviously, education degrees benefit the public as does basic research, but to what degree does your accounting degree or MBA benefit the public? Should the public be subsidizing courses of dubious value to the public? Should the public be subsidizing students of dubious quality?

    This isn’t just an American question. Consider this article from Britain:

    The issues facing higher education are substantial. When a person with a newly minted BA enters the workforce and can scarcely put together a cohesive sentence in writing, why should businesses hire based upon a BA? Why not have the HR department just test every candidate to see who is most capable? And if they do that, what value does a BA hold from ANY academic institution?

    • Chris L says:

      What UA has tried to do, as consistently as most, is create educational experiences and programs that are suited to the population they are intended to serve based on the industries in the state, market projections, etc. This already involves a fair amount of politicization due to those industry interests and the politicians they have in their pockets.

      The kind of pandering to conservative and libertarian anti-intellectual money-grubbing and score-keeping is a failure of its own. Probably better to go down trying to do the right thing than become that kind of political monstrosity. There is, and will be, plenty of corporate training to fill the gap as the politicians and the interests supporting them extract all the value they can from the state before abandoning it.

      • Bryan Alexander says:

        Chris, where does most of the Alaskan corporate training live these days, in vo-tech schools, for-profit campuses, or within businesses?

    • Chris L says:

      It’s also fascinating to me how you appear to think this has been happening over the years. Do you really think people at UA are unaware of your basic propositions here? That they don’t work with legislators? That they don’t have reps in Juneau? That they don’t work constantly with industry reps and politicians alike (not to mention all the other stakeholders)? And that the people needed to do all that contribute to the very bottom line costs that are then used as ammo *against* them?

      You aren’t exactly outlining rocket science level concerns here…do you have any knowledge of how UA actually works or are you just lecturing from the abstract?

    • Dahn Shaulis says:


      You ought to post this on the

      • Kenneth M Van Horn says:

        Dahn, that would be pouring salt into a wound. Unfortunately, these things are not easily corrected. I buried a government agency I was once a part of that was entirely defunded (though it still exists statutorily) precisely because winners and losers are chosen when budget priorities are set and a decade of trying to change lawmaker opinion was simply not enough time to change course and change opinions.

        For good or ill, our representatives are the people they represent. They are not better than we deserve as we would hope. Their ignorance, bias, and short-sightedness are representative of “we the people.”

    • Bryan Alexander says:

      Kenneth, thank you for the rich commentary.
      A few responses:
      1) States used to provide the majority of public university support, back in the mid 20th century. Do you think our economy has changed since so that most of higher ed’s benefits are private?
      2) “To what degree are budget cuts in higher education the result of the victor getting the spoils and punishing political adversaries?” I think that happens, but usually on a small scale. Blue and red states alike have defunded public higher ed at a per-student basis.

  6. Keil Dumsch says:

    Just a few points I’d like to make:

    1) Most of the states that have made cuts to higher ed funding are cash-strapped states. Too many people are making it seem like anti-education state legislatures are thoughtlessly slashing higher ed budgets out of spite

    2) Alan Collinge, Paul Campos, and Matt Taibbi (among others) have pointed out that it is the exact opposite of the truth to claim that colleges have been forced to jack up their tuition to obscene levels because of state budget cuts. Many colleges are sitting on big cash reserves, spending huge amounts, and for the most part not practicing genuine cost containment. I suppose the universities are also “forced” to pay the adjuncts poorly and the football coach obscenely, expand the ranks of administrators, take on debt for trophy architecture, gouge students for textbooks, etc.

    3) In states like Louisiana that have cut higher ed spending, there are way too many public colleges, too many people go, and too many people go for too long to make it affordable for the state to sustain a system that huge.

    Bottom line, the post-WWII (and especially post-1965) push to have nearly everyone go off to college (with most pursuing a four-year degree) is simply not affordable any longer for states, if it ever was. It is a much bigger line item in state budgets.

    • Bryan Alexander says:

      Another Taibbi fan here!

      1) Very good point about state financial constraints. Alaska, for example, saw revenues clobbered by oil prices’ falling (responsible for about 85% of that state’s revenues).
      2) I think the picture is stranger than that.
      Broadly, we can document universities boosting tuition after 1980 when state revenues fell *and* as enrollments rose. Then, as Chris Newfield has shown, universities got into an entrepreneurial mindset and sought new revenue sources.
      Campuses buying stuff: keep in mind that a lot of this happens through debt, and debt’s been easy for schools after 2008, when interest rates plummeted. And that a lot of schools haven’t gone on the spree – again, think community colleges.

      What do you think of mergers?

      • Keil Dumsch says:


        I wrote a note to myself to respond to this a couple months ago but forgot.

        I’m reading Newfield’s book. He makes some solid points but I really think he understates some other problems, like much higher enrollments post-1980 (as you pointed out above), colleges not practicing genuine cost containment, the colleges holding the credential monopoly for employment, etc. It’s way too simplistic to blame state budget cuts for the rising costs.

        As for your question about mergers, as you know they are already happening. In fact, I think we need to get out front of the problem and start closing and consolidating colleges. Jeffrey Selingo suggests this as well.

        A piece today in the Chronicle of Higher Ed indicates a lot of college presidents are in panic mode about enrollment numbers.

        • Bryan Alexander says:

          Hello, Keil! Thank you very much for circling back!

          Agreed about the problems of rising enrollment and cost containment.

          Closures: I suspect we’re on the edge of a new wave of them.

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