Dec 03 2009

Students Shouldn’t Pay for Crisis

Category: Book Reviews,University FinanceBob Hanke @ 3:13 pm

Underfunding shortchanges students
by Mark Langer, President of the Ontario Confederation of University Faculty Associations

(excerpted from the Toronto Star, Wednesday, December 2, 2009)

In the recently published book, Academic Transformation: The Forces Shaping Higher Education in Ontario, co-authored by Ian D. Clark, Greg Moran, Michael L. Skolnik and David Trick, the authors argue that the current model of university education in Ontario is “unsustainable.”

They conclude that our university system can only be sustained if we create a new model, with new universities that offer just undergraduate degrees and employ faculty who spend the majority of their time teaching, performing little or no original research. The book is thoughtful and well-written. But the conclusion it reaches, simply put, is wrong.

It’s not our university model that’s the problem in Ontario. It’s the funding, or more accurately, the lack of funding. For more than a century-and-a-half, Ontario has been a world leader in providing affordable public education to all, but it is abandoning that commitment.

The Ontario government’s per-student funding to universities has fallen since the 1970s from $6,500 to $4,200 (in current, inflation adjusted dollars), a full 35 per cent, more than a third. California, by way of comparison, invests twice as much as Ontario per student: $9,500.

The results are stark. Skyrocketing tuition, enormous classes, fewer courses, impoverished libraries, outdated labs and equipment, shabby facilities – and most troubling of all – the underpaying, undervaluing and sheer exploitation of a generation of new faculty who work on short-term contracts for poverty wages, with no benefits and no job security.

Faculty share the authors’ concerns about the state of higher education in Ontario and have been warning about its deteriorating quality for years. But the authors’ proposal is not about offering a better education, or even the same quality of education. They want us to offer a cheaper education by way of lower-paid, teaching-only faculty.

The authors assert that university teaching is not enriched by university professors conducting original research in addition to teaching. But their assertion is belied by another publication from the Higher Education Quality Council of Ontario, the same body that commissioned Academic Transformation. This publication points to a number of empirical studies demonstrating that university teaching and university research are related. It also points out that there are a number of studies which demonstrate that students support this view.

University research and university teaching depend on one another. Mutually supportive, together they enrich the students’ classroom experience while enlivening faculty research. So, contrary to the authors’ assertions, their model is not going to offer our students a better quality education. It will not even provide the same quality of education. It will give students only a lower-cost education, a degree on the cheap.

We can’t do university education on the cheap and do it properly.

Where will the necessary funding come from? There are really only two sources of base funding for Ontario universities: tax dollars from the province or student fees. Consequently, there are only so many policy options available to the government.

It can continue to underfund universities and force students to make up university budget shortfalls. (Today’s students are paying 43 per cent of university operating budgets, up from 15 per cent in the 1980s.) Or it can provide lower-quality education by creating universities whose lower-paid faculty are not robustly engaged in original, teaching-enhancing, research.

Or it can increase public investment in our university system.

Ontario’s gross provincial product grew at almost twice the rate of inflation between 1983 and 2008, meaning our wealth almost doubled. But we have not invested in our public services. Quite the opposite: the Mike Harris government’s tax cuts – mostly favouring the well-off – are costing Ontario’s fiscal capacity $11 billion a year.

Ontario needs to offer our students – not to mention our families, our society, our communities and our economy – a high-quality, world-class, university education. We don’t need to make our university system “sustainable” by sacrificing the next generation of students and the next generation of faculty. We just need to invest in higher education in a way that recognizes its importance to our future. We can afford it.

In fact, given the uncertain times we live in and the challenges ahead, we can ill afford not to.

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May 04 2009

University Finance and the Financial Meltdown

Category: Book Reviews,University FinanceBob Hanke @ 10:05 am

The Universities in Trouble (Or, Why we Need A User’s Guide to the Budget Crisis at York University like A User’s Guide to the Budget Crisis at UNC-CH)

by Andrew Delbanco (excerpted from the New York Review of Books, 56(8), May 14, 2009)


Since the financial meltdown began to accelerate last summer, the world has changed utterly for colleges and universities just as it has for everyone who had not been stashing cash under the mattress. Along with failing banks, auto manufacturers, and insurance companies, universities have been making headlines—especially those whose gigantic endowments (Harvard’s was approaching $40 billion before the crash) have sharply declined. Last year, politicians and pundits were complaining about the unseemly wealth of such institutions. This year, alumni are getting e-mails from beleaguered presidents assuring them that Alma Mater will somehow ride out the storm.

The headlines tend to focus on the collapse of institutional investments, which, indeed, has been spectacular. No one quite knows how much has been lost. Led by the example of Yale’s chief investment officer, David Swensen, whose Pioneering Portfolio Management is described by the chair of the Yale investment committee as “the best book ever written on managing institutional investment portfolios,” endowment managers had been shifting large sums toward illiquid assets such as private equity partnerships, which typically require periodic infusions of fresh capital, and whose current market value is virtually impossible to assess. This and other versions of “an unconventional approach to institutional investment” (the subtitle of Swensen’s book, first published in 2000 and recently reissued in revised form) worked very well during the boom years, bringing home double-digit returns.

Today, leading universities are reporting endowment losses of 20 percent or more, but some informed observers think that the true figure, at least in some cases, may be closer to 50 percent. Actions that would never have been contemplated a year ago, such as selling severely depreciated assets in order to meet cash obligations or issuing bonds at punitive interest rates, are no longer unheard of. And in the current market, would-be sellers and borrowers are finding few buyers or lenders.[1]

To read the rest of this review, click here.


Jan 04 2009

Can We See The Future of York University in the U.S?

Category: Book ReviewsBob Hanke @ 2:20 pm

Of possible interest:

How the University Works: Higher Education and the Low-Wage Nation

by Marc Bousquet. New York: New York University Press, 2008.

Reviewed by Doug Lorimer (excerpted from the CAUT Bulletin, December 2008)

Those of us who work and study in a contemporary North American university or college are aware of the growing divergence between the idealized past of the academy and present-day realities of the working lives of students and faculty. In his study, How the University Works, Marc Bousquet forces us to lay aside our illusions and come face-to-face with the realities of the regressive changes that have occurred in post-secondary education over the last three decades.

To read the rest of this review, click here.