The Erosion of American Higher Education

In America, the cost of higher education has been rising faster than inflation and health care costs for more than two decades. Money Magazine calculated that college tuition rose by 439 percent from 1982-2007.

According to Mark C. Taylor, author of Crisis on Campus: A Bold Plan for Reforming Our Colleges and Universities, four years at a top-tier school will increase from $330,000 in 2020 to $785,000 in 2035 if recent trends continue.

What are colleges and universities spending all that money on? If you think it's on initiatives that improve the quality of education for students, you're wrong.

Andrew Hacker and Claudia Dreifus, authors of Higher Education?: How Colleges are Wasting Our Money and Failing Our Kids -- and What We Can Do About It, write, "The chief reason why costs keep rising is that education has become a minor player in higher education. At public universities, only 28% of spending goes for instruction; private colleges do a bit better at 33%."

Hacker and Dreifus found that the majority of spending goes for costly athletic programs, faculty sabbaticals, research financing, college presidents' salaries, and excessive amenities.

Moreover, administrative bloat has been rising. A new report by the Goldwater Institute found that

[e]nrollment at America’s leading universities has been increasing dramatically, rising nearly 15 percent between 1993 and 2007. But unlike almost every other growing industry, higher education has not become more efficient. Instead, universities now have more administrative employees and spend more on administration to educate each student. In short, universities are suffering from 'administrative bloat,' expanding the resources devoted to administration significantly faster than spending on instruction, research and service.

Between 1993 and 2007, the number of full-time administrators per 100 students at America's leading universities grew by 39 percent, while the number of employees engaged in teaching, research or service only grew by 18 percent. Inflation-adjusted spending on administration per student increased by 61 percent during the same period, while instructional spending per student rose 39 percent.

At the same time the cost of higher education has been rising, the quality of education offered by colleges and universities has been falling.

A study conducted by the nonprofit American Council of Trustees and Alumni (ACTA) found that both public and private universities are failing to require students to learn important subjects.

Furthermore, most college graduates are below proficiency in verbal and quantitative literacy according to the National Center for Education Statistics.

Since 2004, the world's top two hundred universities have been ranked annually by the Times Higher Education-QS World University Rankings. Recently, Asian universities have been making significant gains on America, long considered to have the world's best universities.

In 2008, America had 37 universities in the top one hundred and 58 in the top two hundred. In 2009, that dropped to 32 and 54, respectively -- although twelve of the top sixteen universities in the world are still in America. Between 2008 and 2009, Japan went from ten universities in the top two hundred to eleven, Hong Kong went from four to five, South Korea went from three to four, and mainland China maintained its position with six.

The goal of Asian nations is to create world-class universities that surpass American universities. They have "every prospect of success," argued Yale University President Richard C. Levin in a recent lecture titled "The Rise of Asia's Universities."

To research the higher education revolution occurring in Asia, I visited many of the top universities in Cambodia, mainland China, Hong Kong, Indonesia, Japan, Malaysia, Singapore, South Korea, Taiwan, and Vietnam. The growth rate I witnessed was astonishing.

For example, here's what's happening in China: China now has the largest higher education system in the world. Five of its universities are in the world's top one hundred. University enrollment has more than tripled since 2000. More university degrees are awarded in China than in America and India combined. Over the last decade, annual awards of doctoral degrees in China have risen sevenfold. China recently surpassed the U.K. to become the world's second-largest producer of academic research papers, and the nation is on course to surpass America by 2020.

All of this has been accomplished in just three decades. There were only 205 universities in China when Mao Zedong came to power in 1949. They closed down during the turbulent era of the Cultural Revolution from 1966 to 1977. Under Deng Xiaoping, they began to reopen in 1978.

That China could reform its higher education institutions so rapidly suggests that America could do the same.

If American higher education institutions do not find ways to improve resource allocation, lower tuition prices, and provide a higher quality of education, then there will be a series of negative consequences for the nation and its citizens.

First, fewer Americans will earn higher education degrees. With tuition costs rising and the quality of education falling, increasing numbers of Americans will question whether or not they would receive a significant return on their investment.

Second, many higher education institutions will collapse from a shrinking pool of customers, dwindling government support, and increasing levels of debt.

Third, fewer Americans will be prepared to succeed in the increasingly global economy. In America, this will ultimately lead to growing unemployment rates, a decline in Gross Domestic Product, unsustainable levels of national debt, and reduced military capability.

That is truly a high price to pay.

Bill Costello, M.Ed., is the president of U.S.-based Making Minds Matter, LLC and the author of Awaken Your Birdbrain: Using Creativity to Get What You Want. He can be reached at