Bankrupt State University|
November 29, 2012
Many of my friends and readers are disheartened by recent cultural and political
trends. Many blame our universities and wonder whether we can ever restore
sanity in our nation, given that the enemy seems to control the modern
university. They see no chance to win in the war of ideas as long as they are
forced to support the public university and, therefore, forced to fund a war
against their own cherished values.
But I know something they don't know. The public university that has declined so
steadily in recent years will cease to exist in just a few short decades. The
moral bankruptcy we have seen over the last twenty years is about to be followed
by another sort of bankruptcy. Before long, many of the universities that have
betrayed taxpayers and alumni will be forced out of business. It will happen for
the following reasons:
1. Federal funding reductions. LBJ got us deeply entrenched in the
business of federal funding for institutions of higher education. When he did,
tuition began to skyrocket. More recently, the federal government has gotten us
deeply entrenched in the business of individual student loans. This has had the
same effect. When a lot of people are able to borrow a lot of money to purchase
goods or services, the effect on the price of those goods and services is
dramatic. Supply and demand is not a rule; it is a law.
State university administrators seized upon the increased demand for higher
education by raising tuition. This was done for three reasons: a) because they
could, b) because they wanted to give themselves raises, and c) because they
wanted to hire associate and assistant administrators to do their work for them.
Now, the federal deficit is spinning out of control. As a result, the federal
government will soon have to cut aid to state universities. This will confront
administrators with this important decision: will they a) cut administrative
spending, or b) raise tuition? The answer will be "b."
2. Student loan bubble. People are easily enticed into taking the bait
when offered unlimited funds to pursue education. This applies to those who are
not qualified to attend college at all. (Think about the housing bubble for just
a moment). As tuition continues to rise, many more students who enroll will
figure out that they have been duped long before they graduate. The universities
have lied to them during recruitment. Departments in the social sciences and
other disciplines have betrayed them by exaggerating the pay scale and
availability of jobs they could likely expect upon graduation. These
realizations will result in a massive upswing in the dropout rate over the next
few years. These dropouts are many times more likely to default on their college
loans than students who graduate.
When the whole college loan industry collapses, people will actually have to pay
for school as they go. That will result in many empty seats in many college
classrooms. Universities will have to make up the difference by turning to
3. Declining donations. Consider the following scenario: just two weeks
ago, a fraternity of 80 men was ejected from a public university campus. They
were investigated for hazing but then exonerated. They were also investigated
for an alcohol violation that was so minor that police declined to arrest
anyone. They were found to be guilty of only one offense, which was dubbed
"failure to cooperate with the investigation." This was another way of saying
the university thought but could not prove they were guilty because they refused
to confess. At the end of the day, the 80-man fraternity was banned from campus
for three years.
This real life incident will have two real life repercussions: a) the
administrator who led the investigation will be promoted for expelling a
politically incorrect fraternity (one of their flags has a Confederate symbol
embedded within it). b) 80 future alumni will respond to the administrative
overreach by refusing to donate for the rest of their adult lives.
This issue is serious. As the university administration has grown, it has
assumed more control over the lives of students. In recent years, students have
been prosecuted with increasing frequency for increasingly petty offenses with
drastically decreasing respect for their due process rights. This includes petty
prosecutions for speech code violations that amount to stripping students of the
right to participate in the free exchange of ideas - the very reason many came
to college in the first place. Is anyone foolish enough to believe this will
have no effect on their willingness to donate?
The army of administrators that grew in the 1990s as a result of generous
federal funding and the explosion in student loans will soon have to beg in
order to retain their positions. Alumni will wisely apply the norm of
reciprocity by exercising their power over these overpaid and underworked
administrators who once practiced authoritarianism on them. They will wisely
withhold donations and instead focus on paying their entirely-too-high student
For all of these reasons, the public universities will eventually go bankrupt.
And that is good news for a nation that is going morally bankrupt in the shadow
of the ivory tower. They had a good thing going but the party is close to being
over. The hangover will soon begin.
Mike Adams is a criminology professor at the University of North Carolina
Wilmington and author of
Feminists Say the Darndest Things: A Politically Incorrect Professor Confronts
"Womyn" On Campus