Wednesday, August 01, 2018
I attended a liberal arts college as an undergrad, and, as someone with a Ph.D. in political philosophy, have a soft spot for folks who think there’s still a point in reading Plato. As an academic, I hate to hear of students being stranded, and faculty and staff losing their jobs.
That said, some alarms ring a bit more off-key than others. That was my response to the recent IHE story about Earlham College, a respected private liberal arts college in Indiana.
The short-term provocation for the story was the unexplained resignation of its president after a single year in office. That’s certainly weird, and newsworthy, in itself. The story goes on to explain the fiscal challenges facing Earlham.
Apparently, for a student population that hovers around 1,000, it has slashed its budget to $42 million per year. Its endowment has been drained to slightly under half a billion dollars.
For comparison, Brookdale has over 12,000 students -- not even counting non-credit programs -- and a budget of $84 million. That means that even after cuts so drastic that a president skipped town rather than endure their effects, Earlham is still spending about six times more per student than we are. The savings it’s drawing down are over $480 million. Ours are under $3 million. And we have five unions on campus, which I think is about five more than Earlham has; that makes cost control more complicated.
Yes, Earlham has dorms and Brookdale doesn’t. But even remove dorms from the equation, and the spending imbalance remains staggering. Yes, Earlham is technically “private,” but between tax exemptions and financial aid, so much of its funding is public that the distinction is weakening. (For that matter, even as a “public” community college, Brookdale gets far more of its budget from tuition than from state and local aid combined.) Besides, simply calling an institution “private” doesn’t automatically make it better. DeVry is “private” and the University of Michigan is “public,” but most of us consider the latter more impressive. Tax status is not an excuse.
The tax exemption on Earlham’s endowment, by itself, is a larger public subsidy than our state and local subsidies combined. That’s before counting work-study, Title IV, or anything else.
Why is Earlham’s austerity newsworthy, while ours is simply accepted as part of the natural order of things?
Again, I don’t mean to pick on Earlham specifically. It’s a symptom of a much larger issue.
Are Earlham’s students six times more worthy than Brookdale’s? If so, I’d like someone to explain to me why. In writing, preferably.
Ivy Tech, Indiana’s community college system, serves far more people than Earlham, and at far lower cost. Yet it goes unmentioned in the story.
We get worried about year-to-year cuts, and rightly so, but we accept catastrophic differences of resources as normal and natural.
It isn’t. It’s a political choice that could be made differently.
For example, what if public support in all of its forms -- subsidies, tax exemptions, and the rest -- were allocated equally on a per-student basis across sectors? More to the point, why aren’t they? There’s a strong argument to be made that they should actually be allocated in inverse proportion to the wealth of the students there, but in the spirit of comity, I’d settle for parity. Earlham is spending $42,000 per FTE; we’re spending 7. What if we each had 25?
If you’re attached to Earlham, substitute any other national “private” liberal arts college you want; the outlines will be the same. In some cases, the multiples will be much higher.
I don’t wish Earlham ill. There are far worse uses of money than supporting liberal arts colleges. I would just like to know what makes its students worthy of six times more spending each than ours. RIght now I suspect the argument is circular: it has more money because it’s elite, and it’s elite because it has more money.
I’m thinking there’s an easy test of whether that’s true. Add up all of the tax expenditures on students -- including exemptions on endowments and real property -- and divide by the number of college students in America. Then, allocate on a per-student basis equally. Try that for a decade or two, and see what happens.
Without that, the double standard for austerity amounts to little more than punishing the struggling for struggling. A half-billion dollar endowment allows plenty of room for error. Our students don’t have room for error. They should. They’re worth it.