Thursday, April 04, 2013
Credit and Credibility
Anyway, I’m happy to see that some very smart people are starting to ask some of the right questions. Why hasn’t the upscale proprietary caught on yet? What’s stopping it, exactly? In the meantime, if you have the chance, I strongly recommend checking out McMillan Cottom’s paper and offering constructive thoughts. There’s something here, and I suspect it may shed light on more than just the next investment opportunity.
A bunch of us here at Proprietary Art School were sitting around commiserating about our declining enrollment, our cutbacks in just about everything, and the sorry state of higher ed in general. And one of us came up with the following idea: why don’t we turn ourselves into an upscale institution, a sort of for-profit version of Harvard University?
How could we do this? Perhaps we could start by establishing a medical school. Maybe would also establish a law school, and start offering advanced degrees in all sorts of exotic disciplines. Perhaps we should bring in snooty and exclusive fraternities and sororities, and maybe even encourage secret societies like Skull and Bones. Maybe we could create a football team and start offering athletic scholarships. Or we could try to turn ourselves into an R1 university, and introduce a publish-or-perish regime for our faculty and start hiring a bunch of research superstars. Maybe we could establish a new advertising campaign that could build up a media buzz about this school--telling the world how elite we are and how hard it is for students to get into this place. We would imply that the only real chance for a student to be accepted here is for them to have IQs in the genius range or to have straight A’s in high school and to have a fistful of extracurricular activities under their belts. We would imply in the ads that a degree from this school will be a virtually assured entry into a high-paying, prestigious full time job in just about any field. If a prospective student is rash enough to think that they are good enough to get in, they should go ahead and apply, but they will be competing with superstars from all over the world for the few slots that are available at our school. Harvard, Yale, Princeton, and the University of Chicago: Look out!
We were of course just joking, but Dean Dad’s post got me to thinking. How would one actually go about establishing an upscale proprietary for-profit school, when the public image of most proprietary schools has been definitely low-scale, appealing primarily to students who have such weak backgrounds that they can’t get into any sort of “real” school? This would require a lot of money up front. Maybe this startup money could be provided by a foundation like the Bill and Melinda Gates Foundation, or even the Koch Brothers. Armed with this pot of money, the ambitious school could then pursue an agenda not unlike what is described in the previous paragraph. They could introduce advance degree programs, open up medical and law schools, and then go on a hiring binge, seeking out research superstars , offering them obscenely-high salaries to lure them away. Then the school could go on an advertising blitz, telling the world how great they are going to be and how elite the school will be.
I suspect that the most serious problem will be in changing people’s perception of proprietary for-profit educational institutions as being at the very low end of the educational pecking order. For-profit schools are primarily oriented toward training their students for job opportunities in the current market, whereas the elite universities and SLACs are supposedly oriented toward the life of the mind. As Dead Dad says, it will be difficult to marry a pursuit of knowledge for its own sake with the need to make a profit.
Also, most prestigious non-profits got that way over literally hundreds of years of development. I am unclear how one could start-up an elite institution today, profit or non-profit. And, if you could develop an institution that catered to high-performing students, why would they attend, instead of all the 1st-tier and top-of-2nd-tier colleges out there?
Why would they do this instead of concentrating their power at a school they can pretty much own, or just starting up their own school they can control from the ground up? Well, to get the answer to that, you need to ask why the Koch brothers give to schools at all. They use the schools to spread their ideology. And I think that's the key word. Spread.
The Koch brothers know that if you set up a Koch U., only folks already sympathetic to their ideology will attend and work there, and people can (and will) always brush their students and faculty off as a fringe element. But if you have one or two Koch-funded "centers" in a handful of schools, and faculty paid from your coffers in institutions that dot the country, you can peddle your influence without being directly identified as a fringe element. The Charles Koch Foundation sponsors programs at 129schools. You reach a lot of people that way, people who eventually have degrees from known names like Harvard and MIT and Virginia Tech -the Koch brothers purchase prestige as part of the package already; why would they start their own school?
And if they don't, who will? Because this project is going to COST.
Prestige takes time to build and tends to require eminent, highly paid professors, ivy and an endowment. I don't see a niche for the for-profits. It's not what they're good at.