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How Did We Ever Get Higher Ed Backwards?

Research & Commentary
May 21, 2011

by Sam Pizzigati

Back in the mid 20th century, colleges and universities helped America beat down economic inequality. Now they reinforce it.

The American Dream isn’t quite unfolding the way Richard Silva expected. The 20-year-old Silva is currently studying at Cerritos College, a two-year school south of Los Angeles. He graduated from high school in 2009 and anticipated, back then, that he’d be transferring to a four-year school this coming fall.

No way. Cerritos is not offering the courses students like Silva need to graduate. In 2008, the college’s summer session offered 1,352 courses. This summer’s course roster totals about 200. A two-year course of study, protesting Cerritos students charged last week, now takes three to five, even six, years.

“At this rate,” Silva said last week, “I won’t be able to transfer to a four year university until 2013.”

Richard Silva hardly stands alone. Less than half U.S. high school grads today who go on to postsecondary education receive any degree within six years.

American higher ed clearly isn’t working particularly well for students — and it’s not working for faculty either. Colleges and universities, over recent years, have been steadily replacing regular full-time professors with cheaper part-timers, grad students, and full-timers not eligible for tenure.

Part-timers now represent nearly half the nation’s higher ed faculty.

Meanwhile, top college officials are pulling in pay packages that can trip into the seven digits. According to the most recent Chronicle of Higher Education stats, 30 private college presidents are now making over $1 million a year, and 59 presidents at public institutions are collecting at least $500,000.

In effect, observes former Yale faculty member William Deresiewicz in a powerful new Nation analysis, we’ve replicated inside higher ed “a microcosm of the American economy as a whole: a self-enriching aristocracy, a swelling and increasingly immiserated proletariat, and a shrinking middle class.”

We have more than mirror images here. We have interactive images. Inequality in society at large has nurtured the gaping inequality we now see in higher ed — and this inequality in higher ed is driving society at large ever more unequal.

American higher education, in effect, is essentially working only for the rich.

Media coverage of higher ed, ironically, treats the concentration of income and wealth at America’s summit as the answer to the woes that afflict our colleges and universities, not their cause. We read regularly about America’s generous deep pockets and the mega millions they contribute to their dear alma maters.

The University of Pennsylvania, for instance, has been crowing about a $225 million gift — the “largest single contribution in the institution’s 246-year history” — just in from the parents of billionaire private equity kingpin Ronald Perelman.

Overall, six colleges so far this year have received an individual donation of at least $100 million. Yale, in March alone, collected $270 million from its elite alumni, another all-time school record.

All these donations help define our deeply unequal higher ed status quo: Our elite institutions of higher education — the alma maters of America’s economic and political elite — have become fantastically richer. Harvard ended 2010 sitting on a $27.6 billion endowment, Yale on $16.7 billion, Princeton on $14.4 billion.

By contrast, the median American college endowment stands at just $72.9 million. To put these numbers in a sharper perspective: Harvard holds nearly $380 for every $1 that belongs to the typical American college.

In 2007, just before the 2008 financial industry meltdown, the 22 richest U.S. higher ed institutions held more wealth than the entire rest of the 785 institutions the national college business officer association spends time tracking.

No surprise why: The more that wealth in the United States concentrates in elite pockets, the more the wealthy contribute to the nation’s elite universities.

Decades ago, in the mid 20th century, dollars from elite pockets helped bankroll America’s public universities. In those years, states and the federal government taxed the nation’s wealthiest at near triple the tax rate those wealthy face today.

Those tax dollars from the rich made possible an enormous expansion of public higher education in the 1950s and 1960s. For the first time in world history, attending college became a viable option for students from working families.

Now that viable option is disappearing — at Cerritos College and across the United States — as lower tax revenues from wealthy taxpayers translate into state and federal budget cutbacks for two- and four-year public colleges.

Particularly hard hit: Student aid. Thirty years ago, notes analyst Bryce Covert, two-thirds of college student aid came from government grants. Two-thirds currently come from loans, and that means ever greater debt burdens.

This spring’s graduating seniors will march off into the world with $22,900 in average debt. Total student debt hit $530 billion this past December, one reason, Bryce Covert adds, why one-third of all adults under age 33 have no savings.

A half century ago, the United States literally “invented” higher education as a mass phenomenon. For years, the United States sported more college grads than any other nation. The United States, on college grads, now ranks ninth.

Americans who’ve devoted their careers to higher ed have always sought to create an educated nation. To reach that goal, we’re first going to have to have a much more equal one.

Sam Pizzigati, the co-editor of Inequality.Org, also edits Too Much, the online weekly on excess and inequality published by the Washington, D.C.-based Institute for Policy Studies. Read the current issue or sign up to receive Too Much in your email inbox.

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