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‘Creative Destruction’ or Neo-Liberal Cost Shifting?



Authors as Published

Many legislators as well as journalists have weighed in recently concerning the rising costs of higher education at America’s public universities and colleges. Most not only lament that reality, but also blame those institutions for the current pass. No treatment has been more scathing or far reaching in its claims than The Economists’ early July cover article (June 28-July 4 issue) entitled, “Creative Destruction: Reinventing the University.” The newsweekly pronounced that, “Higher education suffers from Baumol’s disease—the tendency of costs to soar in labour intensive sectors with stagnant productivity.” While acknowledging that the “State’s willingness to pick up the slack (for higher education’s supposed lack of productivity) is declining,” the magazine argued that the reason for that stance among public leaders was universities’ inability to keep costs from soaring, even as the writers indicted the professoriate for proving woefully inadequate in increasing its productivity. The Economist embraced online learning and Massive Open Online Courses (MOOC) as the future of higher education and argued that elected leaders should not bow to likely political pressure as these trends worked their “creative destruction,” and should remember instead that “state spending should benefit society as a whole, not protect tenured professors from competition.”

Much might be said concerning the newsweekly’s various assertions. Most positively, few doubt that online education will play an important role in the future of higher education, although there is considerable debate concerning the actual impacts and future of MOOCs per se. That is, online programs will surely continue to serve a share of students, especially those already employed and seeking new skills and capacities to confront a changing labor market. Such offerings will also assist traditional undergraduate students by offering flexibility to complete certain classes and programs.

Nevertheless, these facts notwithstanding, it is not clear that public universities are uninterested in securing productivity gains, that their inefficiency and lack of productivity is responsible for the lion’s share of tuition increases in recent years or that their social function is simply to equip individuals with job skills for the current market place, a task, according to The Economist, otherwise more effectively rendered online to students in their homes. In fact, the magazine pointed to the wrong villain to “explain” the rising cost of higher education, overstated its claims for online learning and offered a sharply constricted social role for higher education, even as it failed to articulate what has happened to government support for public universities and how those choices have been linked to attendance costs.

As for rising tuition, on average, state support for higher education declined 28 percent per student in the United States between 2007 and 2013 alone. This recent trend only added to a long-term movement toward real reductions in state government aid for higher education across the nation. I know of no corporation that could withstand such sharp decreases in so short a time frame without obtaining revenue and curtailing services to offset them at least partially, to stay in business. Hoary ideological myth notwithstanding, nearly 30 percent of public university budgets is not simply “waste.” In effect, by so sharply reducing university budgets recently and by decreasing them in real terms for decades prior, state legislatures have effectively decided to shift more of a share of the burden of payment for public higher education from the commons to individuals. They have, in all of the nation’s states, and in economic terms, been moving toward redefining university education to be a private good, rather than continuing to accord it its previous status as at least a quasi-public good.

Put differently, for nearly four decades now and at a quickening pace, legislators have been shifting a growing share of the costs of public higher education from government to families (which had, in most states, always borne at least some percentage of the cost of college). Since higher education has only grown more important to the economy and to individuals during that period, and therefore more significant socially, it appears that legislators have adopted this stance as part of a broader move toward increasing the role of the market in society under the guise of neoliberal thinking, rather than as a result of any change in the character of higher education as a public asset. Indeed, to the extent that one might have imagined change would occur during these past decades of declining state aid, the growing importance of higher education to society would seem to have signaled more, not less, public support. So, lawmakers’ apparently strong backing of privatization is counter intuitive, but for the framing influence of neoliberal ideology and the fact that elected leaders could reduce state support and nonetheless blame universities politically for increased costs when those institutions raised tuition to offset a share of decreased government aid.

If The Economist and other observers have failed to acknowledge this long-term dynamic, the magazine also did not recognize the substantive role of universities in producing democratic citizens and their signal social acculturation functions. On the first, it seems clear that public higher education institutions have not in the post-World War II period simply served as technical or trade schools, providing vocational skills for their students. Instead, they have done far more and sought to equip individuals for a variety of occupational positions while also helping them develop the high order analytical capacities they need to prove prudential citizens, and the civic virtues they need to play that vital role in a socially heterogeneous society. It seems clear that this function is partially a product of curricular choices, but also of the crucible that the diverse populations at our nation’s public colleges and universities represent for most who attend them. In addition, not only do they meet and interact personally with other individuals on a campus that they surely would never meet in an online setting, students also enjoy manifold opportunities to test emergent ideas of self and of philosophy in countless conversations, large and small, intimate and public in such settings. Moreover, on campus, students can explore their talents under professional guidance in many domains, can engage in research in their interest areas with expert tutelage and can also learn what it means to become involved in local communities, even as they share their knowledge and good will and learn how others live and why.

Cumulatively, both curricular and co-curricular opportunities, organized or not, and arising from campus experience allow tens of thousands of young people annually to develop the capacities for reflection, intellectual ability, prudence and empathy that conduce to citizenship and democratic self-governance. I have seen no one argue, least of all The Economist, how online learning will expose students to so rich a palette of opportunities to develop these characteristics and capacities. It is, I suppose, arguable that the nation now allows its youth too long a period to be acculturated to maturity and to democratic virtues and that higher education ought not play the crucial role that it does in those processes for the nation’s future leaders. But critics of public universities, more interested in scolding them for their rising tuitions than in offering genuine alternatives, have said little and done less to suggest how and where this function could otherwise be served in society. Instead, as noted above, what seems to be occurring is a long-term shift away from public support of higher education, even as it rises in importance, and a companion unwillingness to acknowledge the implications of that fact. One hardly need argue that higher education is without blemish or need for improvement to contend that public universities are increasingly coming the cropper in a political conversation that blames them for the implications of choices embraced elsewhere that simultaneously seek to commodify and trivialize their social functions. Any one of these trends alone could rightly be considered pernicious for democratic self-governance. Together, they constitute a particularly poisonous brew, the antidote for which must be a far more open, honest and searching public conversation on the role of public higher education in our society.

Publication Date

August 10, 2014