May 14, 2018
- Universities face serious threats to academic freedom from outside pressure groups
- Some Donors have made demands that can undermine university provision of unbiased, high-quality research
- Accommodating ethically questionable Donor demands can undermine public confidence not only in individual researchers, but in entire institutions and even in the broader academic enterprise
- Stronger, more secure, and more stable funding for universities—without strings attached—would help insulate universities from undue pressure by outside groups
- Universities should work together to secure their financial and intellectual independence, articulate clear ethical standards, and enforce those standards
I recently documented efforts by a well-organized network of libertarian and conservative academics, advocacy groups, and media organizations to foster resentment toward universities and then gain control over them, under the pretense of supporting free speech. These efforts continue a decades-long assault on higher education, and have been remarkably effective at tarnishing universities’ reputations. This has paved the way for legislation that further undermines universities’ intellectual and financial independence.
A complementary threat to academic integrity comes from powerful outsiders exploiting universities’ financial needs to leverage relatively small donations into enduring influence over faculty, curriculum and student life. Such money-for-influence arrangements could alter what research gets produced, and by whom.
Outside funding can increase research output and impact in media and policy circles. It can fund great research that might not have been produced otherwise. But funding under inappropriate terms risks undermining the central and unique role that universities play in society as providers of high quality, reliable, and unbiased information. This could quickly destroy the goodwill and trust that universities painstakingly cultivated over decades (in some cases, for centuries).
This issue has come to a head recently with press coverage of some financial relationships and recently disclosed contracts between conservative and libertarian donors (including foundations and re-granting organizations funded by the prominent Koch family) and George Mason University. Much of the controversy relates to a libertarian / free-market embedded think tank at George Mason, The Mercatus Center, which provides supplemental compensation and resources to GMU’s economics faculty and some law faculty members, as well as opportunities to produce commissioned research on timely policy issues. Through Mercatus, the university has received tens of millions of dollars in donations.
GMU faculty members’ chances of obtaining funding and resources apparently did not depend exclusively on an unbiased assessment of their intellectual rigor and academic contributions, but rather appear to have depended at least in part on the political implications of their research. In contravention of academic ethical norms, donors had substantial influence over which faculty members would receive compensation supplements known as “chairs” or “professorships.” Donors maintained control through representation on selection committees, evaluation committees, rights to recommend removal of chair holders, gift rescission rights, and key-man clauses for senior executives, including the dean of the law school.
“The objective of the Professorship is to advance the . . . acceptance and practice of . . . free market processes and principles [as] promot[ing] individual freedom, opportunity, and prosperity . . . The occupant of the Professorship (“Professor”) shall . . . be qualified and committed to the forgoing principles.”
Rudy Fichtenbaum, president of the American Association of University Professors said “When you start getting into a study of free enterprise then you’re really, I think, stepping into a territory where you’re promoting a political agenda.” Donors may specify a topic of study or type of expertise for a holder of a chair; but they should not specify the chair-holder’s politics.
Critics say Mercatus’s ideologically based funding tips the playing field at GMU in favor of the production of economically right-wing scholarship and the retention of economically right-wing scholars and instructors. Neither Mercatus nor GMU appear to have imposed any limits on the fraction of a faculty member’s total annual compensation that could come from non-state sources such as Mercatus. This is unusual—many funders and universities worry that too much outside funding creates the appearance of impropriety. At least one prominent member of the GMU faculty with a Mercatus affiliation derived over 40 percent of his compensation in 2016 from “non-state” sources, according to public records.
Without supplemental compensation from Mercatus, GMU faculty compensation appears to be uncompetitive with comparable institutions. Thus, working at GMU may not have made sense financially for economists or law professors who were unlikely to obtain Mercatus compensation supplements—i.e., those whose scholarship might support increases in taxes, an expansion of public investment or social insurance, or more stringent regulations of business. At least one moderate economics faculty member says that she “carefully chose [her] research so it wouldn’t be objectionable” to her more conservative colleagues.
April 30, 2018
A well-organized campaign to bait, discredit, and take over universities is exploiting students and manipulating the public (Michael Simkovic)
- Many lectures about “free speech” are not really about “free speech,” but rather are intended to provoke a reaction that will discredit universities.
- When such reactions occur, many news stories about them are created, shaped, and disseminated by a well-funded network that wants to transform and take over universities.
- Students, professors, administrators should not take the bait; nor should journalists.
After a violent attack on civil rights protestors that left three dead and more than a dozen injured at the University of Virginia, students and administrators at Vassar became concerned when they learned that William Jacobson was coming to defend racism. Jacobson’s libertarian hosts advertised his lecture as “‘Hate Speech’ is Free Speech, Even After Charlottesville.” Jacobson’s previous racially charged comments and dubious assertions earned Jacobson the admiration of White-nationalist websites such as V-Dare (see also here), the John Birch Society’s New American, and Breitbart news.
But Jacobson’s much-hyped lecture turned out to be a superficial and innocuous discussion of free speech, at the level of a high school civics class. Jacobson’s prosaic lecture was not news worthy. Instead, the press focused on student and university officials’ purported over-reactions to a talk about “free speech.”
Similar stories abound. Recently, the Federalist Society invited Josh Blackman, a tenured professor at South Texas College of Law Houston’s, to lecture at CUNY law school. Professor Blackman’s sparsely attended lecture drew protestors because of Blackman’s previous criticism of an amnesty program for undocumented immigrants and his use of language the protestors interpreted as racial dog whistling.
A university official asked the students to be respectful, defended Blackman’s right to speak, and admonished the students “please don’t take the bait.” One student noticed Blackman recording himself and asked Blackman, “You chose CUNY didn't you? Because you knew what would happen if you came here." (CUNY, like Vassar, has a reputation for left-wing student activism). Blackman deflected the question. One protestor used an expletive, which Blackman repeated.
According to both Blackman and CUNY, the protestors were non-violent. Security was present to maintain order. Blackman—tall and muscular—towered over the students and appeared calm throughout the exchange.
Right-wing journalists hyped up the incident, labelling the largely minority protestors a “mob” and “hoodlums.” A law professor writing for the Volokh Conspiracy blog at Reason Magazine argued that the CUNY Dean should be fired. White Nationalist websites such as Breitbart, New American (the John Birch Society), and VDare lionized Blackman as a hero. Blackman seized the opportunities that resulted, scoring an Op Ed in the New York Daily News.
Professor Blackman’s claim that student protestors at CUNY denied him a platform is ironic. It is precisely because of Blackman’s right-wing connections and the brief protests they engendered that Blackman was given a platform at the National Review, Fox News, the New York Post, the New York Daily News, Reason, Inside Higher Ed, FIRE, Campus Reform, Cato.org, Commentary, First Amendment Watch, The College Fix, and The Global Dispatch, SeeThruEdu (The Texas Public Policy Foundation) among others. Many of these organizations are part of the Koch Brothers’ backed State Policy Network.
The purpose of media exaggeration of incidents at universities appears to be to discredit universities in the eyes of conservatives, libertarians, and moderates.
April 10, 2018
Jake Brooks in NY Times: Direct Federal Student Lending Should Provide Insurance to Students and Public Investment in Education (Michael Simkovic)
John Brooks of Georgetown's excellent Op Ed is available here.
Brooks calls to task some of the questionable and alarmist narratives that have been coming out of nominally liberal think tanks (which are funded by foundations linked to the private student loan industry and purveyors of ed-tech of dubious value), noting that Direct Lending, IBR and debt forgiveness can benefit both students and taxpayers. He also notes the dangers of the new PROSPER act and graciously linked to Friday's post about how small the direct budgetary impact of student loans is when viewed in context.
Brooks notes that some Democrats have been advancing a traditionally Republican privatization agenda. Jeff Sachs has similarly taken Obama and Clinton to task for underinvestment in basic and essential public services and infrastructure, noting that by the numbers they invest only marginally more than Republicans. Brooks argues that because of IBR, Obama deserves more credit, and that this important legacy of his presidency should be preserved.
March 28, 2018
March 27, 2018
Dangerous new bill could hurt taxpayers and make financing education more expensive (Michael Simkovic)
Higher Education could soon become substantially more expensive to finance. The federal government may reduce how much it lends to its most profitable borrowers—graduate and professional students—undermining the financial strength of the federal student lending program and reducing competition in the market for student loans. Borrowers could lose an important safety net that limits federal student loan repayments if student incomes are lower than expected. Public sector and non-profit employers could struggle to recruit and retain educated workers as a wage subsidy is eliminated and public-sector compensation becomes even less competitive with the private sector. For-profit lenders and dodgy for-profit online education programs could see huge financial benefits.
- Cap federal Graduate PLUS loans
- Scale back Income-Based Loan Forgiveness
- Eliminate Public Student Loan Forgiveness (PSLF)
- Open federal student loans to for-profit and online programs with questionable track records
Capping Graduate PLUS loans hurts taxpayers. A recent analysis by the Department of Education and the Government Accountability Office found that Graduate PLUS loans are the most profitable in the Federal government’s portfolio, even after accounting for the costs of debt forgiveness.
Figure 13 of the study shows that PLUS loans and unsubsidized Stafford loans make money for the government, after accounting for the cost of income driven repayment.
PLUS loans charge the highest interest rates in the government’s portfolio—often more than private lenders would charge similar borrowers. However, federal student loans come with a safety net that caps repayments as a fraction of a borrower’s income if the borrower’s income remains low relative to debt service payments for an extended period of time and eventually forgives the remaining balance. Risk averse borrowers may find this safety net attractive—public and private student loans are difficult to discharge in bankruptcy.
The Income Based Repayment safety net enables the federal student loan program to compete with private lenders, reducing borrowing costs even for those who opt for private sector loans. The government’s profits from graduate and professional student borrowers help defray the costs of subsidizing other borrowers more heavily.
Figure 5 of the GAO study shows Graduate Plus Loans in Income-Driven Repayment have the lowest subsidy rate of any loan program—that is, graduate and professional students repay more of their loans.
The GAO/DOE study has several limitations that overstate the costs and understate the benefits of these programs. If Graduate PLUS loans are curtailed, the federal student loan program will become less profitable and therefore more politically vulnerable to future cuts. The bill also threatens to undermine the performance of federal student loans by opening the floodgates to funding of low quality for-profit online programs.
Private lending is more volatile than federal lending. Private lending has an unfortunate tendency to become unavailable when it is most needed. During the recession of 2008-2009, private student loan origination volumes plummeted even as demand for education surged. Capping loans to graduate students could lock prospective students from poor and middle-class families out of graduate and professional school if they have the misfortune of graduating college during a recessionary credit crunch—precisely when the opportunity cost of pursuing more education is lowest because the labor market is weakest.
Limiting debt forgiveness could make federal student loans more “profitable” as a pure lending program but could have much larger costs to taxpayers if eliminating this safety net reduces investment in human capital.
The U.S. is already dramatically underinvesting in and overtaxing higher education, as demonstrated by the high public and private returns to education. The public returns to investment in higher education are greater than the expected returns to the stock market or bond market because we have a shortage of high skilled, highly educated labor. The proposed policy changes are bad for students, and they also threaten to undermine the long run economic growth and fiscal health of the United States.
March 06, 2018
...by trying to prevent Christina Hoff Sommers from speaking. There are many things one could say about Dr. Sommers, but she is not, contrary to the students, a "fascist," and she has arguments that one can argue with. That law students, in particular, should behave this way is appalling.
February 07, 2018
House Republicans propose to open floodgates to federal funding of low-quality for-profit, online degrees (Michael Simkovic)
House Republicans recently proposed to increase federal funding for the worst performing parts of higher education and reduce federal funding for the best performing parts.
For-profit ("proprietary") brick-and-mortar and online educational programs tend to have low rates of student completion, relatively poor employment outcomes, and relatively high student loan default rates compared to private non-profit and public institutions. For-profits' typically poor outcomes may be at least in part because for-profit programs typically spend far more on sales and marketing than traditional non-profit programs. This leaves fewer resources available for instruction and support services for students, or research that can help build an institutional reputation and connections with employers. Paying profits out to investors also drains cash and limits how much can be spent on instruction in any given year.* Short-term programs at for-profits are the only category of higher educational institution that have been shown by peer reviewed research to increase their prices without increasing educational quality upon gaining eligibility for federal aid.
Default rates of for-profit programs used to be even worse in relative terms, before rules were implemented to deny eligibility for federal student loans to the worst performing for-profit institutions.
A new House bill sponsored exclusively by Republicans, H.R. 4508,** threatens to open the floodgates to federal funding for for-profit and online education of dubious quality. According to the CBO, the bill would:
"Amend or repeal restrictions on institutional eligibility for federal student aid for certain types of schools, the largest of which would repeal the definition of distance education and eliminate the cap on the percentage of revenues that proprietary schools can receive from the Department of Education. . . .
Distance Education. H.R. 4508 would repeal the current-law requirement that online programs provide students with regular, substantive interaction with faculty. CBO expects that if programs do not need to meet that criterion they could more easily expand and scale up, resulting in higher enrollment. . . .
Short-Term Programs. Current law requires programs to offer at least 600 clock hours of instruction for students to be eligible for Pell grants. To be eligible for student loans, a program must offer at least 300 hours and have a student completion and placement rate of at least 70 percent. . . . H.R. 4508 would extend aid eligibility to students in short-term programs [and] there would no longer be any requirements about placement rates. . . .
Gainful Employment. In October 2014, the Department of Education published final rules related to gainful employment, setting benchmarks related to student income and federal loan debt that had to be met by programs at proprietary institutions...H.R. 4508 would repeal . . . gainful employment [rules]."
Indeed, it will be much easier to expand enrollment without the need to spend any money providing students "regular, substantive interaction with faculty," who can answer student questions, connect them with employers, or teach them.
January 18, 2018
The full document here. I may say more when I've had a chance to digest it. Signed reader comments welcome (full name required, valid e-mail address); submit comment only once, it may take awhile to appear.
January 02, 2018
Jerry Organ (St. Thomas) collects the data. The decline in the applicant pool during this time has presumably put prospective students in a stronger negotiating position, which probably explains the decline in the offers of scholarships contingent on academic performance.
September 25, 2017
It is often assumed that the only way to become a lawyer is to attend an ABA-approved law school. That is true in some states and, indeed, the ABA has at times expressed the view that it should be true in all states. But it is not the case in large jurisdictions such as New York or California, nor is it the case in the majority of jurisdictions. Claims that ABA-approved law school have a monopoly on entry into the legal profession are exaggerations. Rather, the most popular—and probably most likely—way to become a lawyer is to graduate from an ABA-approved institution.
In leading jurisdictions such as New York, California, and Virginia, an individual who wishes to become a lawyer may sit for the bar examination with between zero and 1 years of law school and between 3 and 4 years of apprenticeship and study under the supervision of a licensed attorney (this is also known as “law office study” or “reading for the bar”). In California, graduates of non-ABA-approved law schools are eligible to sit for the bar examination. This includes schools with extremely low-cost, technology-driven approaches to teaching, such as online and correspondence schools.
In fact, non-ABA law school graduates are eligible to sit for the bar examination in most jurisdictions (31 in total as of 2017) according to the National Conference of Bar Examiners.** This includes extremely large and important jurisdictions such as California, Florida, New York, Texas and Washington D.C. Graduates of online and correspondence law schools are eligible to sit for the bar examination in 4 jurisdictions.
Very few people choose the apprenticeship route, and only a minority opt for non-ABA law schools. Among those who do, relatively few successfully complete their courses of study or pass the bar examination. But those who do will have the same license to practice law as someone who graduates from an ABA-approved law school and successfully passes the bar examination.
Why then do so many prospective lawyers choose ABA-approved law schools?
The most likely explanation is that prospective lawyers choose ABA-approved law schools because those law schools provide a valuable and worthwhile service that supports a higher price point than other options.*
Many employers value legal education. That’s why they typically pay law school graduates tens of thousands of dollars more per year than they pay similar bachelor’s degree holders, even in occupations other than the practice of law. When law school graduating class sizes increase, and a lower proportion of graduates practice law, graduates don’t typically see a noticeable decline in their earnings premium.
In other words, the benefits of law school are versatile. Graduates of ABA-approved law schools also seem to be much more likely to complete their studies and pass the bar examination than students attending more lightly regulated and lower cost alternatives.