Government Intrusion in Higher Education Is Sowing the Next Debt Crisis

It was one of those moments whose significance only became apparent years later. It was part of the pro forma interview process for a faculty position. I was to be interviewed by the university’s bursar.

He was an elderly gentleman, tall, erect, and rather dapper in his black pinstriped, three-piece suit complete with pocket watch.  If central casting had called for a Germanic-looking bureaucrat for a WWII war movie, this would have been the guy.

His formality and dress seemed out of place in an era where suits and ties came off, and faculty dress was almost indistinguishable from that of the students.

Being young and arrogant, I mentally dismissed him as a relic of another era. He was more than pleasant, and we both knew we were engaged in an academic ritual of another time.

He called me to the window and asked me what I saw. I said a parking lot, sort of wondering what the exercise was about. How many reserved spaces do you see? Three, I responded. When it gets to twelve, the place will have gone to hell, he said, and you should find another career.

I didn’t know how prophetic he was. Some years later, the parking lot had over two hundred reserved places, and by the meaningful standards of another time, the place had gone to hell.

Faculty, with very rare exceptions, do not get reserved parking places. Reserved parking places are for administrators and their staff.

The parking lot was symptomatic of the dramatic change across the nation in administrative bloat and the corresponding decline in tenure track faculty positions.  Universities hire more part-time and adjunct faculty and have even created a new designation, “contract faculty.” These are faculty who have no research demands and are hired solely to teach, usually at substandard salaries with no prospect of permanency.

Across America there are nearly four administrative staff positions for every faculty position. At the University of California, Berkeley the ratio is an incredible 9.42 to one in favor of administrators and staff.

How did we get to this point? Government.

The results of government intervention are counterintuitive. Student loan programs did not make a college education more affordable; they made it more expensive. Administrators quickly figured out that if they raised tuition, students would simply borrow more.

In addition, government financial aid required its own mini-university bureaucracy to administer such programs.

In addition, promulgation of government rules to deal with affirmative action and the rights of “oppressed” groups created a need for deans of diversity and inclusion as well as separate student unions and housing facilities.

Diversity and inclusion also meant the establishment of a shadow university in student housing to provide sensitivity sessions and compulsory forums indoctrinating the values of political correctness.

A whole series of required multicultural courses surfaced, which were little more than propaganda sessions masquerading as education requirements, or as the students referred to them, “bull***t requirements.”

All of this required people to teach them and bureaucrats to administer them. Each bureaucrat required office space and a staff, usually a multicultural staff because a multicultural bureaucracy must look like the people it serves. If there is a straight, white male out there employed as a dean of diversity and inclusion, I haven’t met him.

As one university administrator whose tongue became too loose at the annual Christmas (now holiday) party said, “If we could get rid of all this diversity crap, we could reduce the university budget by at least 5%.”

The University of California, Berkeley, budget, for example is two and a quarter billion dollars, probably somewhat higher than most. If you took 5% of it, you would end up with over 100 million dollars.

Just think how many scholarships could be granted with that money.

Government regulations have transformed universities, especially public universities, into top-heavy dysfunctional bureaucracies, which are sustained by students carrying financial debt.

The debt now exceeds consumer debt and threatens the financial system.  The current default rate is over 11%.

We need a massive reconfiguration of the higher educational system so that it is less a public works project and more focused on delivering a meaningful education to those who can benefit by it. Universities were designed for the top 7.5 to 15%, but it is not uncommon for universities to reach down to the top 50%. Less qualified students drop out, but their debt remains.

 Many college requirements are merely high school redux, and the diversity and oppression-studies requirements are totally unnecessary. College could be reduced from four to three years by eliminating meaningless requirements.  Dismembering the diversity bureaucracy would further reduce the cost of an education.

Since colleges and universities are big advocates of socialism, why not put a cap -- like rent control -- on college tuition, limiting increases to some metric based on inflation? Why should the insane rise in tuition be exempt?

But none of this is going to happen. There are too many vested interests in exploiting the system for group benefit.

Ultimately, however, the system will collapse because it cannot continue. Student debt threatens the financial system, and graduates in the liberal arts are unlikely to find careers that will generate the kinds of incomes to pay off those debts.  Eventually, there will be a large number of defaults, and we will revisit the equivalent of the housing crisis of 2008.

Universities were far better institutions and far more affordable before the government got involved and nurtured the bureaucracy. The old guy in the pin-stripped suit knew what he was talking about.

Abraham H. Miller is an emeritus professor of political science and a distinguished scholar with the Haym Salomon Center.

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