Vikram David Amar (UC-Davis), Is Higher Education Spending Excessive? In Some Ways Maybe Yes, in Others Perhaps Not:
Two months ago, I wrapped up an eight-year stint as the Dean of the University of Illinois College of Law at Urbana-Champaign and returned to “civilian” life as “just” a law professor. Prior to my service as dean at Illinois, I had for seven years been the Senior Associate Dean of Academic Affairs at the UC Davis Law School (where I have returned this summer.) I hope that being away (for now, at least) from higher education administration after 15 years of toiling in the trenches will help me gain some dispassionate perspective on the directions in which higher ed has been moving, and on the perceptions non-academics seem to have about American research universities these days.
It was thus with particular interest that I read a long article earlier this month in the Wall Street Journal entitled Colleges Spend Like There’s No Tomorrow. ‘These Places Are Just Devouring Money.’ The deck below the headline was equally disparaging: “The Students foot the bill for flagship state universities that pour money into new buildings and programs with little pushback.”
The article goes on to analyze spending data at the nation’s flagship public universities. The University of California and University of Illinois systems, where I have worked, are examples of prominent flagships, but I should point out that neither was analyzed or mentioned in the WSJ article. Yet many other well-known public institutions, such as Connecticut, Kentucky, and Penn State, were featured as places where higher ed spending per student has ballooned in the last few decades. Perhaps the most wide-ranging and notable numerical takeaway from the WSJ’s elaborate analysis of all 50 public flagship universities is this: for the median public flagship, while student headcount increased 21% between 2002 and 2022, spending (in inflation-adjusted dollars) rose by almost twice that amount, or 38%. Moreover, the article suggests, the increased spending comes not primarily from increased fundraising and grant monies, but instead from the imposition of higher tuition and fees. …
That higher education is significantly more expensive (in inflation-adjusted terms) today than it was two decades ago is undeniable, and is also quite troubling in many respects. But one can’t responsibly assess how troubling this reality is—and who, precisely, is to blame—without also appreciating that higher education today is a very different institution, in what students demand and what schools provide, than was higher ed at the turn of the century. …
[H]igher education; it is a qualitatively different product than it used to be. Consider law schools, institutions with which I am most familiar. Compared to two decades ago, the career planning and advising services, the alumni relations activities, the mental health and student wellness services, the clinical educational and externship offerings, the diversity and inclusion programming, the IT support and security (against hacks the likes of which never existed before), the resources to facilitate scholarly productivity of the faculty, and the attention to compliance with Title IX and other regulatory mandates are all much greater than they were two decades ago.
Another part of rising costs has to do with professorial salaries that have increased (in inflation-adjusted terms) in many disciplines for reasons having nothing to do with university waste. Take, again, law professors. People who are competitive for tenure-track law teaching jobs almost always would also be sought after by innumerable high-paying law firms and other business entities. And the compensation enjoyed by private-practice lawyers has skyrocketed in recent decades. Average law-firm equity-partner compensation at many large law firms is well into the seven figures, and even entry-level associate attorney pay has outpaced inflation. For example, the starting salary for first-year associates at the nation’s large law firms essentially doubled from 1999 to 2019, even though inflation increased aggregate prices by about 50% during that period. If law schools are trying to hire the best and brightest faculty members (something that is necessary but increasingly challenging), the legal academy simply cannot be oblivious to how much money law professors could be making doing other things, especially as they reach the senior ranks of private practice. To be sure, people have never gone into law teaching for the money, but the disparity between professorial and practitioner pay over the course of one’s career has grown to levels that may be more seriously harming the talent flow into law school faculties. …
[T]he point is not that we shouldn’t be scrutinizing and debating the resource allocation decision that universities—especially public universities—make. We should. The point is that we should be doing so in a much more finely grained, thoughtful fashion, rather than a blunderbuss “look at how much money is being spent” gotcha kind of way. Some reasons for increased university expenditures may actually be cause for celebration, even as others are likely cause for concern. But we need to parse each cost component separately to evaluate whether the public is getting good value for its investment.
