HIGHER EDUCATION'S SHERLOCK HOLMES MOMENT. I sometimes use Sherlock Holmes to reinforce an important but unintuitive point of economics. "When you have eliminated the impossible, whatever remains, however improbable, must be the truth." The observation continues, "It is stupidity rather than courage to refuse to recognize danger when it is close upon you." Where higher education is concerned, the danger is close, and according to the dean at Anonymous Community, it has been closing in for some time. He summarizes a conversation with a graduate school friend.

As we caught up and I regaled him with stories of the repeated, and accelerating, cycles of cuts with which I'm dealing, he mentioned that it seemed like in bad years, higher ed gets killed, and in good years, it only treads water. It never actually gains.

While there are exceptions here and there, it struck me as essentially accurate. The cycle is decline-plateau-decline-plateau-decline, with the plateaus getting progressively shorter. With each 'recovery,' only a fraction of the previous decline's loss is restored, and then another (and worse) decline starts.

That cycle is contemporaneous with the expansion of access-assessment-remediation-retention, beer and circus sports programs, and higher education as summer camp. In some subset of higher education, there has been a proliferation of administrators. The post does not provide background on which universities were surveyed (there being gaps in the bar chart) or which individuals were classified as "professional and executive staff."

Higher education's response, however, appears to be more of the same. Here's University Diaries, elaborating on a student response to an Arizona State strategic plan.

Presidents of universities are not, as you say, “simply” trying to keep their schools from sinking. Some of them are doing things with money that help their schools sink. They’re giving too much money, time, and attention to sports. They’re giving themselves and other administrators excessive compensation. They’re paying professors and graduate students too little.

They're also taking advantage of the willingness of professor wannabes to cobble together a full time job out of five or six temporary assignments at two to four colleges. Although many administrators indulge themselves like Brezhnevite apparatchiks, the system requires the sanction of the victim.

The issue, however, is not one of students being denied access. It is one of poor performance stemming from too much access.

Some observers of the American campus might call today “The Age of the Slacker.” Higher numbers of young people than ever before attend four-year colleges, but graduation rates are low. Disengaged students seem to be everywhere: they are the ones who reject active learning, disrupt classrooms with rude behavior, and try to get the curriculum “dumbed down” by their refusal to perform to their abilities.

These disengaged students seem to care little for their education, other than to accumulate enough paper credits to receive a diploma that will permit them to gain better employment. The reasons are myriad: low expectations and a focus on self-esteem in K-12, technological distractions, and so on. And many university officials avoid dealing with them, in order to maintain high enrollments.

Go read the full article. There are several observations from economists that capture the challenges of teaching economics, a technical subject that is often a required course for people whose focus may be on the credential.

My focus, however, is on the market test as the credit crunch and the wealth effect cut into that excess demand for prestige degrees. (I have written a lot about that.) Perhaps, to continue that Sherlock Holmes metaphor, the substitution behavior of prestige seekers is the object Holmes found because he looked for it. The editorial writers at USA Today deputise for Watson.

The recession has triggered a quiet panic in higher education. Some parents are insisting that their children apply, or transfer, to less expensive public colleges. Those public schools, meanwhile, face sharp drops in funding from state legislatures.

The editorial proposes the usual remedies. The situation offers the public universities the opportunity to tighten admission standards, encourage professors to raise the bar in class, and raise tuitions to encourage selection out by individuals who disengage because the current price structure induces indifference between participating and not participating.