The latest squeeze on higher education appears to be enrollments rising faster than operating budgets.  "Colleges can’t afford to hire enough full-time faculty to educate their growing student populations, and are increasingly turning to low paid, disposable adjuncts to make up for it."  Economists Liang Zhang, Ronald G. Ehrenberg, and Xiangmin Liu do the research.  "Colleges and universities have increasingly employed faculty whose salaries and benefits are relatively inexpensive; the slowly deteriorating financial situations at most colleges and universities have led to an increasing reliance on a contingent academic workforce."

What happens next is not pretty.
Administrator salaries go up, adjuncts face increasingly alarming economic insecurity, and the quality of education at lower-tier schools continues to be undermined even as the top colleges have access to almost unlimited resources. In other words, even the most leftwing institutions in the country can’t afford to put egalitarian, blue-model ideals into practice.  Like all decaying blue institutions, the university still serves insiders (college presidents, professors with tenure, students at Yale) quite well, even as outsiders (adjunct faculty, students who took out loans to go to lower-tiered schools) struggle.
I've been following this dynamic for years.
Surprise. What the government subsidizes, it gets more of. If it subsidizes "not charging list price," Nobody. Pays. List. Price.
Perhaps administrators have been forced to compete, something that ought to produce welfare gains.  Or perhaps, the contingent faculty are a margin along which administrators adjust, in order to pay for climbing walls and Adzillatrons.
To the extent that vouchers make potential students or their parents less price-sensitive, the administrators are free to exercise more market power. We also have to know what preferences the students are acting on. These vouchers might be subsidizing Jacuzzi U and other creature comforts -- not a new problem -- rather than additional computer connections, journals, or smaller classes.
The title of my post comes from Over the Rainbough, now a members-only weblog. I grabbed a large quote back in the day; it's prescient today.
The government has demonstrated that when the price of tuition goes up the they will give out more money, and the average financial burden on individual students will go down. Why not take this to it's logical end. First we will have every student needing and/or using some financial aid to pay for college tuition. Next the average student will only pay for half of their college tuition. Soon after this will become the case for all students. Eventually the average student will pay nothing for college, and will rely entirely on financial aid, and finally this will expand to every student. A college education will be "free" to every student in America. Meanwhile the quality will not have increased a bit and the cost per student of college tuition will be many times what it is today.

By redistributing the cost onto those not attending they create the perception that the cost of tuition hasn't really changed at all. Consequently no one notices when we do not get an increase in quality in return for the rising expense of tuition.
Meanwhile, U. S. News will continue to sell those guides, to Donald Trump and his kids, and to anyone else Hillary Clinton deems unworthy of free college.


Dr. Tufte said...

You forgot to add that having way more (list price or higher paying) foreign students will also be a result.

Stephen Karlson said...

Hey, I'm retired. You carry on the fight.