What Can We Do about Higher Ed?

HOW ABOUT A LITTLE GOVERNANCE?

Here’s an interesting exercise: Go to the Budget and Control Board’s website and download an Excel file containing the names, positions, and salaries of all state employees making more than $50,000 per year. The database is arranged according to salary, with the highest paid employees at the top. Now go down the list and note which agencies the employees work for.

So – out of the first 300 names, how many work for one of the state’s public colleges and universities?

Answer: 297.

Sure, there are lots of different ways of explaining why all the state’s highest-paid public employees just happen to work in higher education: Our schools’ salaries have to stay competitive or we won’t attract the best! Look how much investment our universities attract to the state! And so on. Yet there is something deeply troubling about the fact that tuition at taxpayer-supported universities has gone through the roof even as university administrators have become – overwhelmingly – the best paid bureaucrats in the land.

This trend isn’t limited to South Carolina, of course. As Glenn Reynolds points out in his short but excellent book The Higher Education Bubble, “For the past several decades, higher education has been living high on the hog. Faculty salaries have grown significantly, administrative salaries have grown dramatically – seven-figure pay for university presidents isn’t even news anymore – and at most schools, there are scores of lower-level officials who still make more money than anyone else on campus except coaches.”

South Carolina’s public colleges are far from exempt from these criticisms. Indeed, as The Nerve’s Amit Kumar showed in a piece last fall, the compensation packages for our state universities’ top brass has reached astronomical levels – in many cases rising substantially during the Great Recession, when universities were raising tuition and complaining of state budget cuts. Nor is it just the universities’ army of vice presidents who earn ever-growing six-figure salaries: the Legislative Audit Council handed down a sharp rebuke to Clemson for doling out massive pay raises – 107 percent, 57 percent, 47 percent – to administrators already making six-figure incomes without even bothering to subject them to performance reviews.

As administrator pay goes through the roof along with tuition, funding for classroom instruction is going down. A study released last fall by the Policy Council and the American Council of Trustees and Alumni revealed that administrative funding has grown at an alarming rate relative to general and educational expenditures (or G&R – that is, classroom-related spending). USC-Columbia, for instance, increased it proportion of administrative spending by 41 percent over six years. (See chapter five of the report.)

It’s one thing to point out higher education’s failings. But what, realistically, can be done?

To answer that question, it’s necessary to identify the root cause, or at least one major root cause, of the problem. And that is this: South Carolina’s public higher education system really isn’t a “system” in any meaningful sense at all. Each college is governed by a board of trustees; each board of trustees consists of members appointed by the legislature and governor; and no one has any practical power to tell those boards what is and isn’t in the best interests of the state.

The result? Each board looks after the interests of the school, not of the taxpayer. Administrative (and, increasingly, faculty) salaries go up in order for the school to remain competitive with other schools – in many case, with other state-funded schools. Departments and programs are added, not because it would benefit the taxpayers of South Carolina to have access to these departments and programs, but in order to enhance the prestige of the institution. Tuition hikes go unchecked because that’s what the college needs to fund its various new initiatives: the fact that they’re squeezing South Carolina taxpayers out of the higher education market is, too often, irrelevant to boards of trustees.

Here’s what’s too often forgotten: State colleges are state agencies. And just as we don’t allow other state agencies to do and spend whatever they want without any accountability, so we shouldn’t allow state colleges almost total license to operate in any way they see fit. As long as these are in effect state agencies, they should be governed accordingly.

That’s why we’ve promoted the idea of a statewide Board of Regents. What we have, in effect, is a situation in which the taxpayers fund a large number of quasi-agencies operate with near total autonomy. A Board of Regents would change that. It would have the power to say “No” to unnecessary tuition hikes and capital projects, to force colleges to keep administrative hiring and salaries in check, and to ensure that programs aren’t started and expanded merely for the sake of institutional prestige.

Legislation to create a Board of Regents has been introduced many times in the General Assembly fore (see here for the most recent bill, introduced in 2010). But most lawmakers haven’t been enthusiastic about the idea.

Why not? It’s hard to say, but surely one reason is that the universities’ high-paid lobbyists tell them it’s a bad idea. What, you didn’t know taxpayer-funded universities could lobby the legislature? Oh yes, and they use tuition money to do it.

A Board of Regents could stop that, too.

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