By Richard Vedder
50 years ago almost to the day, I fell in love with American higher education. In early September 1958 I began my undergraduate education at a fine American university, Northwestern (the sixth highest ranked university by Forbes/CCAP). For 50 years, I have loved it. Universities impart understanding, wisdom, and learning. They help turn children into adults. They advance the frontiers of the greatest civilization our planet has ever seen. They save lives and make other lives more meaningful. Universities are where kids learn, fall in love, make lifetime friends, learn from stupid mistakes, develop lifelong intellectual interests, and prepare themselves vocationally for life. And American universities are among the best in the world, THE BEST on average by several criteria.
Rolls Royce makes wonderful cars, and I would love to own one, but the opportunity cost of owning one is too high --I have enough money for a nice house, but not enough for a nice house and a super nice car. Most of American higher education wants to be the Rolls Royce of the field, and accordingly lavishes increasing amount of resources into their product. But, unlike Rolls Royce, it is not clear the product today, as expensive as it is, is much better than in, say, 1958 when I began college. To be sure, the changing quality over time is simply unmeasurable, since colleges have no bottom line, no measures of what they add to the human experience. Improvements have come in the quality of student housing and food, in the recreational facilities available --in short, into the country club dimensions of student life. But have they come about in the quality of the learning? I am dubious.
The reasons for the rise in costs relative to the quantity and probably quality of the products offered are many, too many to be discussed much here. The non-profit nature of most providers and the prevalence of third party payments are huge factors. The massive government student loan program, for example, has enabled colleges to raise costs a lot --and much of the increase in university spending has gone for dubious things like vast new administrative bureaucracies, massive public relations offices, fancy buildings that lie fallow (to use an expression I use a lot when I teach medieval economic history) much of the year, and expensive affirmative action programs that violate the basic meritocratic nature of American society.
American colleges are largely unaccountable to anyone. The Boards of Trustees at many schools are gutless puppets to the administration of the school, their servants rather than bosses. Faculty members are excessively arrogant and unaccountable, as are university administrators. As a consequence, often things are done not in the public interest --including huge salaries and perks for university leaders, kickbacks to financial aid officers who get too cozy to private loan companies, athletic programs that violate basic ethical precepts to increase revenues and victories, etc. Universities are increasingly out of touch with the mainstream in American life, politically, culturally, and socially. Giving colleges huge amounts of institutional autonomy can lead to abuses, and the abuses are mounting.
A day of reckoning is coming to higher education. The Spellings Commission was the opening salvo in a more critical, and I think healthy, examination of the business and outcomes of higher education.