College Giving

So, according to this article, there's good news and bad news with regards to college/university giving. The good news is that according to The Chronicle of Philanthropy, 25% of organizations on the "Philanthropy 400" list this year were institutions of higher education. (The "Philanthropy 400" is apparently a list of the 400 organizations that raise the most money...I had to look that one up.) So, the good news is that the top 400 organizations received an increase of 3.5% overall compared to 2010...and while this is nothing compared to what they were receiving prior to the recession, at least the earnings seemed to have increased.

Unfortunately (from my perspective, at least), the organizations that top the list are institutions that likely do not have the kind of need for giving the way other many other institutions do. (At the top of the list are Stanford, Harvard, Amherst and Johns Hopkins.) While giving for these institutions may have increased (for Amherst significantly so!), I'm guessing that there are other institutions out there that were previously dependent on alumni giving that are suffering because they are not able to generate the kind of revenue they were able to generate prior to the economic downturn.

I wish I could see the full list, but I do not have a subscription to The Chronicle of Philanthropy...it would be interesting to see the types of institutions on this list. I would bet that many of them are institutions that are considered by USNWR to be "the best" institutions. Still, I'm sure if you asked any of these institutions on this list, they would all say they still need more. Institutional endowments across the nation took a hit in 2009, and I think that an article we read in class this semester is correct in that there will always be a need for more money (even in more economically prosperous times), and that will always be able to be put to use. There is no such thing for an institution to receive too much money.....

Liberal Arts Colleges in the Current Economy

I thought this was a great article, and though it may not be the most concerning topic to most people within the field of higher education, I was definitely interested in it because I graduated from a women's liberal arts college and did my budget narrative on a liberal arts college!

Basically, the article discusses Smith College and their "Future Initiative" plan that you can find here. Like Mount Holyoke College, Smith is an undergraduate liberal arts college for women, and they're located roughly 20 minutes north of MHC. Smith has a larger endowment than MHC and is more well known than MHC (at least on the western side of the country), but what concerns Smith tends to concern MHC as we are similar institutions with similar priorities.

Like one of MHC's strategic planning reports, Smith's "Future Initiative" discusses the fact that the current model (both educational and financial) are not sustainable. (Though I would argue the reason the educational model isn't sustainable is only because it is financially unsustainable.) Liberal arts colleges, even those with endowments like Smith and MHC should be concerned about their futures because large changes (such as adding programs that may be less competitive but will being in money, or adding online instruction) could change the mission of the institution, even if they can bring in money. These colleges need to think through their plans with their communities (including alumnae and students) to determine their courses of action.

I remember when I was at MHC I was concerned about the move towards centralized dining. While dining is not completely centralized, something does change about the feeling of community when you can't just roll out of bed in your pajamas and get a hot breakfast in your residence hall. Clearly, this is something one may not see as a big deal, but these are the small changes that may become large changes in the future.

Small classes taught by professors (who make good money!) are also a hallmark of the liberal arts experience, but the fact that these instructors receive only a small fraction of research grants and contracts that research institutions do is almost like a financial double-whammy. While technology plays an increasing role in college life, how should professors incorporate technology into learning? Should there be classes held online? While I can understand students at large universities taking an occasional online class, I can't even imagine taking an online class at an institution like MHC unless it were taught by a distinguished professor that is physically in a different location...and even then, I would probably argue that the students should meet together in person in a classroom while the instructor was broadcast into the classroom.

I clearly don't have the answers, but a liberal arts education means something, and I am concerned that many options to increase revenue may detract from the missions of these institutions. Of course, in this economy, I am sure we will hit a point where we no longer have a choice...and it is definitely a good idea to try to brainstorm ideas now, before it's too late.

Affordable Excellence

I thought this article was interesting, as it is about financial aid (need vs. merit) at a public liberal arts college that is competitive with both public institutions and liberal arts colleges. The main gist of this article is that St. Mary's College of Maryland will be getting a new VP and Dean of Admissions & Financial Aid, Patricia Goldsmith, and the goal of the institution is to increase both access and excellence.

While this article is specifically about this institution, I think almost every institution would say that they would like to be able to increase access and excellence, but the question is "How?" In the article, the author discusses institutions that have opted to be "need blind" as well as institutions that will give merit grants to all students that meet certain academic criteria (though critics argue this is what institutions were doing all along anyway). I have a hard time understanding how a public "honors" college that really has that private liberal arts college feel can exist and continue to be affordable. With a student:teacher ratio that rivals many private liberal arts colleges, and an almost completely residential community (90% of students live on campus), the faculty and staff salaries (especially if there is staff tenure in this state) as well as the maintenance of the campus must be very expensive!

At least tuition and fees for St. Mary's College seems to be a "good deal" (relatively, of course) at $14,400 a year for residents, though non-resident tuition is significantly higher at $26,500 a year. I think that going forward, St. Mary's needs to find a way to figure out the direction they want to head in and try to stay true to their mission. Since they are an "honors," college, academics should be their main focus, but as a public institution, their next priority should be accessibility for in-state students. Though I understand the need to use tuition discounting and that there is a benefit to having students from various geographic locations, I think this institution needs maintain its accessibility particularly for in-state students, particularly those with high levels of financial need.

"Republicans Push Pell Changes"

According to this article, House Republicans proposed to maintain the dollar amount of the maximum Pell Grant at $5,550 but make several other cuts in the program, including the following:

• Students attending at a less than half-time status will no longer be eligible for grants
• Students can receive the grant for only 12 semesters (down from 18 semesters)
• Students eligible for less than 10 percent of the maximum grant would receive nothing
• Programs for colleges serving significant numbers of black students, Asian-Americans and Pacific Islanders, Alaskan Natives, Native Hawaiians, and Native Americans (as well as tribal colleges) would be eliminated
• The budget for Hispanic serving institutions would be cut by 83%
• The budget for HBCU's would be cut by 36%

My thoughts?

Well, let me start by saying that I'm completely biased because if balancing the budget were my job, I'd do my best not to meddle with education (other than to improve it)...HOWEVER, if I were required to make cuts to Pell Grants, I would not make the above changes. Who do these proposed changes hurt the most? The students that need the aid the most, of course.

Historically underserved minorities are the students that tend to live at the lowest levels of socioeconomic spectrum. These students are also more likely to need to work while in school (and may perhaps register for fewer credits), and may take longer to graduate whether it is because they began their academic journey at a community college or because they need to work while in school. I think for many of these students, completing a degree in 6 years may be unrealistic. I can definitely see students within the UH system suffering if these changes were made.

As we have recently read in class, while the focus of early efforts to increase higher education access was for those who had the greatest need, the fact that many of these programs have expanded to include the middle-class may be (particularly in this case) hurting the students that need the aid the most.

I am not sure exactly what the income cut-off is for receiving a Pell Grant, however, perhaps this cut-off could be lowered somewhat so students in the upper middle-class would only be eligible for grants while only the lower class and lower middle-class would still be eligible for Pell Grants. --Just a thought.

The Conspiracy of the College Conspiracy

So I actually came across this video while on youtube one day and it just smelled fishy from the beginning. I watched parts of it here and there and aside from the fact that I completely disagree with the ideology it claims to represent (i.e. "College education is the largest scam in U.S. history!"), I found so many facts that were used incorrectly, as well as several phrases with a heavy emphasis on "might" and "maybe." From the beginning of the video, the writers were cramming facts and scare tactics down your throat. They used the average debt of graduating from a private school as the "average debt" overall, and tried to help us understand why tuition "needs to be increased" based on the "friend" of someone who is running a for-profit institution. Um...fishy anyone?

Throughout, the video is pushing gold stocks which is unsurprising, given that (after just a little bit of poking around), I find out that the "National Inflation Association" is just a group that is trying to scare the public to scam them into buying stocks in gold and silver. Go figure the piece was written by Jonathan Lebed, a well known stock scammer.

The Chronicle decided to dedicate a little article to the video here. I hope that people don't need to read the article to realize the video is just a scam.

Of course, given the fact that we are in a very scary economic time, people may be more likely to actually buy into the fear. While people are beginning to occupy Wall Street...with several "Occupy" events going on around the U.S. (and the world) and the whole 99% campaign, there are tales out there that are true about being college educated and unemployed. I just hope that people don't buy into the fear mongering of the NIA.

Higher Ed in South Korea

Okay, so the focus of this article is on teaching in South Korea, and the observations of an American professor in South Korea, however, there are some interesting statistics related to higher ed finance here:

A full year of tuition and living expenses for a midranked public university consumes, on average, more than 45 percent of a family's annual income. The costs are higher if the institution is private and is considered the equivalent of an Ivy League institution. Over the last three decades, tuition costs borne by South Korean families have increased by a factor of almost 30 with an especially sharp jump in the last decade. Household incomes have not increased at the same rate.

So basically, here in the U.S., I would argue that while higher education still is not a "right" the same way K-12 education is, higher education in the U.S. is seen as a "public good." In South Korea, it appears that education is still a "private good" and is primarily for those who can afford it.

The article mentions high rates of college and high school student unhappiness, as well as high rates of suicide. Interestingly enough, as I read the article, I could not help but draw parallels between these students and students at MIT (I had a friend who went there). Perhaps the combination of student competition (where professors actually pitt students against each other for grades in class) and long study hours are to blame. I also found that many of my Asian friends (particularly males) who attended the best private schools here and received the highest grades here also spent their first year of college at Harvard and MIT partying, who seemed to be (much like the Korean students) just celebrating being done with high school and the fact that they got into Harvard and MIT.

While I don't think this article can really be generalized in any particular way, the unfortunate circumstances of higher education in South Korea (and by this, I mean the constant hours of studying in primary and secondary school, as well as the fact that college is only seen as a private good) do seem to reflect the nation and the priorities of the nation. Perhaps a more efficient education system could help lead to a more efficient government??? Hrm...we may never know.

Thanks for Ruining FA for the rest of us.....

Well, I'm glad some democrats are calling for a "crackdown" on the financial aid fraud that is going on in the country. First of all, here is the article I'm commenting on, though for greater background on exactly what these looters are doing, read this. Oh, and if you're interested, here's the letter written by the democrats calling for a crackdown on these criminals.

Basically, what these "ringleaders" do is find "straw" students (fake students) to enroll in online courses at various colleges, and apply for financial aid for them, take these "fake" courses, and then receive a kickback of $500 to $1500 worth of Pell Grant money from these phony students. Since the courses are online and it's difficult to verify that those online are who they say they are, the ringleaders have been able to get away with millions of dollars worth of fraud!

I think there are several difficulties in catching these ringleaders. Rio Salado got lucky (so to speak) and was able to catch someone because a financial aid officer noticed the same handwriting on several applications...but what if he hadn't? How do you go about catching these kinds of people? According to the article, some current investigations involve up to 400 people!

While I think there can be some benefit to online courses, the fact that there is no way to know who is on the other end is a problem, and I think we are still a ways away from really doing anything to improve the process. Also, if online classes are very large and involve little involvement beyond multiple-choice quizzes and exams, it is even easier for criminals to capitalize on these opportunities.

I think the biggest question, aside from "How do we catch these criminals?" is "How can we verify that students are who they say they are in online classes?" I think we're several years away from an answer.

Socioeconomic Diversity at Top Colleges and Universities

So, in this article, the author Catharine Hill (President of Vassar College) argues that selective institutions should increase their socioeconomic diversity to have more than 10% of the student body from the bottom 40% of the income distribution. Okay, that sound good to me. How does she recommend colleges do this? By having the U.S. News and World Report include socioeconomic diversity in their rankings. My feelings about this are somewhat mixed, so let me explain why.....

First, I think that it's important to note that the colleges and universities that Hill is talking about are the top institutions in the nation that have likely suffered the least in the economic downturn. These institutions are need-blind and already provide great financial aid packages to the students that do attend, in some cases, eliminating loan aid from financial aid packages entirely.

When students from low SES groups attend these universities, I am going to bet that these students are academically prepared for these institutions, and will typically graduate within 4-years at these schools (which is common). When the culture of an institution is to prioritize academics and graduate within four years, I'm sure the students from the lowest SES groups do the same, perhaps with even more focus because they are aware of the wonderful and rare opportunity they've received.

I also agree that it would be great if more students from the lowest SES groups could attend these "elite" institutions of higher education. I've always believed that SES was a greater divider than race and ethnicity, and that "elite" institutions should recruit these students and provide better academic options for them.

Unfortunately, while changing the criteria in the USNWR may lead to the results Hill is talking about for these elite institutions, I'm not sure whether the overall result will benefit students from low-SES groups on the whole. Let me explain. Schools like Harvard, Stanford, and Amherst will always find their way to the top of the rankings one way or another, particularly because of their reputations. What about institutions that are ranked much lower but build their strategic plans around improving in the rankings? I can't remember many off the top of my head, but Baylor is an example. Their strategic plan, "Baylor 2012" included goals that directly mimic USNWR's criteria and they had spent well over $200 million by 2007! My concern is that schools that aren't in the "elite" tier may admit students from low SES groups just to move up in the rankings without considering the ramifications. Are these students actually academically qualified? Will they succeed? Does the academic culture of the institution encourage students to prioritize academics? What is the graduation rate?

I think there are already many institutions in the country that are not "elite" that already are working very hard to try to serve students from low SES backgrounds (i.e. community colleges). I think that elite colleges should work hard to recruit more qualified students from lower SES backgrounds. I am concerned, however, that institutions may end up admitting these students just to try to move up (or just to keep up) with USNWR rankings and may not have the support these students need. While admitting students from low SES backgrounds should be a priority for all schools (particularly elite institutions), I think that actually graduating these students should be a bigger priority.