Sunday, May 01, 2016

Zero-Sum Performance

I hate getting up at dark o’clock to go to the gym.  It’s an act of will, and it doesn’t always happen.  Even when it does, it’s grudging on a good day.  But I do it relatively consistently because I know that it’s good for my health.  And because the more I do it, within the confines I’d realistically observe, the more it helps.  (I’m told there are eventual limits at the extremes, but I’m far enough from those not to worry about them.)  There’s some discernible connection between my efforts and my health, so I power through impertinent alarm clocks.

The theory behind performance funding for community colleges is similar.  Improvement is hard and requires some strength of will, the argument goes, but the results will be worth it.

But there’s a crucial difference that often goes unnoticed.

My own fitness, or lack thereof, is independent of anyone else’s.  If I ramp up my efforts, I get (somewhat) better results, regardless of what anyone else does.  Yes, there are limits -- the forties are not the twenties, no matter how hard you try, and frankly I have other things to do -- but in a general sense, if my neighbor takes up jogging, my ratio of effort to payoff doesn’t change.  Nobody else’s fitness comes at my expense, and nobody else’s lethargy makes my workouts any easier.  I don’t benefit from anyone’s failure, and my success isn’t at anyone’s expense.

That means I don’t face the prospect of futility.  Yes, I may be literally running in place, but I’m still making progress.

The same can’t be said of most performance funding systems.

In most states or systems with performance funding, the overall level of funding -- the pie to be sliced, if you prefer -- is either flat or declining.  Which means that if everyone improves by the same five percent, then everyone gets the same zero percent increase.  You may be making progress, but you’re still essentially running in place.  Worse, if you improve by three percent but the statewide average is five, you actually lose ground.  

Improvements generally cost money.  Having your funding cut for not improving enough can become self-fulfilling, or even a death spiral.  You struggle because you’re underfunded; you get funding cut more because you’re struggling; that makes you struggle even more, which leads to more cuts...

Anyone in the public sector for any length of time has seen this logic play out repeatedly.  And that’s before even mentioning the increasing layers of unfunded mandates that legislatures don’t hesitate to pile on, even as they preach performance and austerity.

Zero-sum performance funding are doubly senseless when colleges’ service areas are defined geographically, whether by county or by “district.”  Cutting funding to a college in Buffalo to fund a reward for one in Brooklyn doesn’t help the student who lives in Buffalo.  If your local college gets hurt by a formula, but it’s the only game in town, well, sorry.  

Redesigning America’s Community Colleges, the excellent book from Tom Bailey, Shanna Smith Jaggars, and Davis Jenkins, makes the often-lost distinction between institutional cost per student and institutional cost per graduate.  It’s possible to reduce the cost per graduate, but doing so nearly always increases the cost per student.  Our funding, including tuition, is mostly per-student.  Getting better results costs more.  

Obviously, it’s possible to waste money; simply spending more is no guarantee of results.  But that’s why it’s important to get performance funding right.  For it to make sense, it has to be both independent of what other places do, and positive-sum.  It has to enable the interventions that work.  If all it does is slow the decline, it won’t get the results we want.

Aging may be inevitable, but poorly-designed funding systems aren’t.  If I want to get more fit, I have to put in more effort; simply reallocating existing effort won’t do it.  Colleges are no different.  The goal of greater success is worthy; we just have to stop pretending that it won’t cost anything.