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Higher education in America has reached a tumultuous crossroads. Our state colleges have long been considered the jewels in America’s educational crown, but these colleges are receiving significantly less state funding when compared to past decades. This drastic decrease has led institutions to search for new funding avenues. Foremost in the funding conversation is privatization.
“The state share of academically-related university spending (excluding revenue items such as food, lodging, hospitals and intercollegiate athletics) is now less than 10 percent,” The Center for College Affordability and Productivity’s Richard Vedder stated in an article on Bloomberg’s website.
The argument for privatization is often met with scoffing, but when faced with minimal state support, the switch is both feasible and attractive.
Privatizing state colleges will not adversely affect institutional operation. The lines between state and privately-funded universities is constantly blurred by the large endowments public colleges receive. For instance, according to The National Association of College and University Business Officers, the University of Virginia is in the top 20 endowed schools. This report goes on to explain that endowments at schools such as University of Virginia rivals state funding.
“With a multibillion-dollar endowment and large out-of-state enrollments, schools like the University of Michigan and UVA are more like private universities already than the public’s perception of a state university,” Vedder stated in The Chronicle of Higher Education.
Many colleges see removal from public funding as an opportunity to be self-sufficient, setting their own agendas and progressing diverse ideas. For instance, the University of California’s Anderson School of Management moved to privatize their MBA program in 2012, seeking more breathing room economically and creatively from the state-funding plan. While many administrators fear the donors will have too much say in the school’s operation, it is simply exchanging one system of funds and standards for another.
Privatization also benefits the state. As America’s economy continues to climb uphill from our economic spiral, states do not have unlimited funds to offer colleges. Given that the State Budget Solutions announced that the cumulative state debt is more than $4 trillion for fiscal year 2011, relieving the burden of funding state colleges would be an economic boon to struggling state budgets.
Students may fear rising tuition costs, but privatization benefits abound. Peterson’s, an online higher education research provider, explains that private universities excel in reducing class sizes and offering personal contact with professors. Furthermore, Vedder noted in The Chronicle of Higher Education that the number of public universities in the U.S. News and World Report top colleges and universities list has decreased overtime, revealing the differences in educational quality.
Regardless of the growing pains associated with privatization, the time for change is now.
“We are at a moment when organizational innovation is necessary if we are going to maintain academic excellence,” William G. Tierney, director of the Pullias Center for Higher Education to The Chronicle of Higher Education, said.
Colleges should let state funding continue to fall away and move to replace the lost state funding with private donors and renewed initiatives to attract paying students. It is time for the state college to become its own entity.