Lowering the Cost BarrierWhy access to higher education is more important than ever
President Lawrence S. Bacow grew up in the Rust Belt in the 1950s and ’60s, before it was rusty. His hometown of Pontiac, Michigan, boasted three General Motors plants: GM Truck and Coach, Fisher Body, and Pontiac. Oddly enough, life in a manufacturing boomtown gave Bacow a unique perspective on the value of higher education. “If you graduated from Pontiac Central or Pontiac Northern High School,” he says, “you aspired to get a good job in the automobile industry, which gave you job security and tremendous benefits. You could lead a very good middle-class life without a college degree.”
Today, of course, those plants have vanished, and with them the idea that a high school diploma is sufficient to achieve the American Dream. As manufacturing jobs have moved to lower-wage countries, Bacow says, “what remains are higher-value-added jobs that require higher skills to perform. This has increased the demand for education.”
Statistics bear him out. Between 1960 and 2009, the Bureau of Labor reports, college enrollment rates among sixteen- to twenty-four-year-olds rose from 45 percent to 70 percent.
But as the demand has soared, so has the price of a degree. A few more figures, if you please: Bloomberg News reports that state funding for public colleges and universities has dropped from 50 percent of those institutions’ revenues two decades ago to 30 percent today. The amount charged to students for tuition, room, and board at public institutions jumped 32 percent in real dollars between 1998 and 2008, according to the National Center for Education Statistics; the increase at private institutions was 24 percent. As always, poorer families are taking it on the chin—especially because the federal Pell grants on which 9 million lower-income college students rely cover a dwindling share of costs (the maximum grant covers 32 percent of average tuition and fees, down from 50 percent in 1980).
All of this has Larry Bacow convinced of one thing: the United States must find ways to make higher education more accessible and more affordable. After stepping down from the presidency of Tufts on August 1, he will spend much of his time working toward solutions. Besides serving on nonprofit boards and on the visiting committee for Harvard’s Kennedy School of Government, Bacow will spend the 2011–12 academic year as president-in-residence in the Higher Education Program at the Harvard Graduate School of Education. He will join the Harvard Corporation on July 1, and will remain a member of the President’s Board of Advisers on Historically Black Colleges and Universities. And he will collaborate with other education leaders to study how information technology can open up entirely new avenues to higher learning.
In an interview with Tufts Magazine, Bacow made it clear that economic competitiveness is not the only reason to improve access to a college education. But it’s a darned important one.
TUFTS MAGAZINE: You’ve said that access to higher education is one of the biggest challenges to American competitiveness. How do you mean?
PRESIDENT BACOW: We used to have the most highly educated workforce in the world—with a higher proportion of college degrees than any other nation. But between 1997 and 2008, the U.S. educational attainment rate went from third to tenth worldwide, and Korea is now the global leader. President Obama has set a goal of reclaiming our number one position by 2020. To do that, we’re going to have to substantially increase the percentage of people in our population with college degrees. And that means increasing access to college.
Where does one begin?
And it’s not.
Tuitions at private institutions have risen, too, of course.
What has happened—which I think is a cause for concern—is that institutions like ours are becoming affordable only to those families who can pay the full price, without financial aid, or to those families who qualify for financial aid. What’s being left out is the middle. Over time we’re going to wind up with a bimodal distribution of income at these institutions, and that’s fundamentally unhealthy.
Why does tuition always rise? Can’t institutions cut costs instead?
Even our so-called variable costs are essentially fixed. Colleges and universities tend to be collegial enterprises. It’s very, very difficult to lay people off in collegial enterprises, even when tenure is not a consideration. So to balance their budgets with diminished resources, the only thing institutions can do is increase tuition. That in turn affects access.
But surely there are frivolous expenditures that could be cut. Aren’t some institutions competing on amenities instead of academics?
The problem is, that’s not what the market demands. In ten years as president of Tufts, I’ve never had a student or family come to me and say, “President Bacow, increase my class size, reduce my course offerings, give me simpler food offerings in the cafeteria. It would really be OK if we had triple and quad dorm rooms”—and by the way, I lived in a quad my freshman year in college—“and as a result lower my tuition.” I’ve never heard it once. Everybody wants more, and they want us to do it for less.
How do you respond?
You won’t find climbing walls at Tufts. You won’t find the equivalent of fancy health clubs. You won’t find concierge services in the dormitories. But at the same time, we need to understand that we are subject to the pressures of the marketplace. And all the pressure is to do more, not less.
Then what’s the solution? If tuitions keep rising, how will people who aren’t wealthy afford higher education?
Over the last few decades in the United States, tax rates have continually fallen. During the Eisenhower years, the highest U.S. marginal tax rate—the amount owed on income exceeding $300,000—was above ninety percent. Even under the Reagan administration, marginal tax rates were as high as fifty percent. Today, the highest marginal tax rate is around thirty-five percent. So we have reduced the tax burden quite substantially, but we have not reduced our aspirations.
How do we bridge that gap between resources and aspirations?
Do we need some kind of “Sputnik moment” to galvanize public support for education?
And the competition might do us good?
This will require not just investment, but also brain power and a willingness to do things differently than we’ve done before.
What kind of changes do you envision?
We’re still in the embryonic stage of understanding how to use these new tools. Initially, people thought educational technology meant that we were going to teach courses the same way we always taught them—we were just going to broadcast them to the rest of the world. And now people understand that technology gives us the opportunity to rethink how students learn, to provide real-time feedback. We can ask questions along the way in the learning process, and based upon the responses to those questions, we can provide the student with additional layers of understanding to supplement material the student has not quite comprehended yet. Or we can accelerate their path through the material if they’re understanding it more rapidly than might be the case with a one-size-fits-all approach.
What’s holding us back, then?
How do we know there is a market for that kind of learning?
So technology might make higher education more affordable, but at the same time render it unrecognizable.