Veteran Univ. Administrator Discusses 'Cost Disease' in Higher Ed

American colleges and universities will have to tighten their belts in coming years to survive shortfalls in government funding, according to Mark G. Yudof, a law professor and veteran university administrator who spoke at the Graduate School of Education Monday.

Yudof, who has served as the chancellor of the University of Texas System and the president of both the University of Minnesota and the University of California, focused his talk on the economic phenomenon of “cost disease” in higher education due to decreasing government subsidies.

“If you want a deeper understanding of the cost disease, think about a symphony orchestra that wants to reduce the cost of putting on a concert,” Yudof said. Comparing a decreased government subsidy for the arts to a cutback in a state budget for higher education, Yudof likened universities’ fear of raising tuition to an orchestra manager’s reluctance to increase ticket prices. Not only would there be public outcry, he said, but also the steeper prices might disadvantage middle- or low-income earners.

State governments are spending less on higher education in order to meet the needs of an aging population and spending more on medical care and social security, according to Yudof. In addition, increasing diversity in America’s population has cultivated a tendency to “eschew responsibility to educate other people’s children," he said.

Yudof added that declining support for public goods and booming privatization in industries contribute to the reduced interest in financing higher education. “We now spend more in America on potato chips than on research,” he said.

Still, Yudof said that universities can take concrete steps to make higher education efficient and affordable. Reducing faculty size and replacing tenured professors with teaching staff who are less expensive to employ could help lower costs without necessarily reducing teaching quality, he said. In particular, he added, the shift from a traditional classroom to an online learning environment for certain courses would dramatically aid with reducing expenditures on faculty salaries.

Noting that such adjustments would require “immense collaboration and cooperation and [that the] internal politics of a university can be gruesome,” Yudof said in an interview after the event that current college students must recognize the value of tuition and embrace the idea of online learning for necessary reform to occur.