Philadelphia Inquirer, November 22, 2010
Pennsylvania State University dwarfs all the commonwealth’s other institutions of higher learning, public and private. According to the university’s own statistics, one out of every 127 American college-degree holders is a Penn State graduate!
The university has managed to thrive despite a steady decline in state funding. In the 1970s state support accounted for 60 to 70% of the total, but even before the recession hit two years ago, contributions from Harrisburg had fallen to only 11 percent of the school’s budget. Since then, the amount has dropped to 6 percent. And given the cost-cutting campaign promises made by Gov.-elect Tom Corbett, the trend seems destined to continue.
For a world-class, “state-related” institution, as Penn State is known, this raises a question: Does it make sense to be related to the state anymore? Could Penn State choose to go private, or might it happen by default?
In either case, it would be a loss. The university and the state should find a way to stick together through these rough times.
Penn State fills its current market niche so well that it’s hard to imagine a better arrangement for the state’s residents. Thousands of Penn State undergraduates benefit from a year or two, sometimes more, of course work at one of the 19 undergraduate branch campuses before they move to the main campus to complete their degrees. This arrangement effectively combines the smaller classes and focus on teaching more typical of liberal-arts colleges with the benefits of a major research university. And the system delivers this appealing package for half the price (including room and board) of the most expensive private universities.
The state money must come with strings, though it’s difficult to get anyone to say exactly what they are. Legislative control, or at least influence, over in-state tuition levels seems like an obvious possibility.
Penn State could probably afford the freedom it would gain by breaking with the state. Applications are at an all-time high, matriculating students have stronger credentials than ever, and the system continues to add degree programs and expand its facilities across the commonwealth. At a half a million strong, Penn State’s alumni network may be the largest in the country, and its members are a well-organized, enthusiastic, and loyal crowd.
On the other hand, privatization doesn’t always work to the consumer’s advantage. In its present form, Penn State exerts pressure on a fairly wide range of colleges and universities to offer clearly differentiated products of their own. As a private university, it might not be able to resist the temptation to raise prices and compete with a narrower segment of the higher-education market – specifically, other big private universities.
Penn State’s predicament (or opportunity, depending on one’s point of view) is not unique. Administrators of public university systems across the country are reassessing their positions as they watch their state subsidies dwindle and wonder what the future will bring.
The prospect of privatization certainly raises some thorny questions in any state. Would legislatures resist public university systems’ attempts to go private? Would they be happy to shed public employees and renegotiate pension obligations, assuming they could? If the states own the land on which the campuses sit, would the acreage be leased or sold? Would alumni support going private? Would they be willing to help pay for it?
The only certainty seems to be that the era of reliable state funding for public universities is past. Going private may be the logical step for some, but in Pennsylvania we should try to keep the “state” in Penn State.
Hello Grant,
Can the statistic at the beginning of your article in today’s Inquirer possibly be true?
“One out of every 127 American college degree holders is a Penn State graduate!”
I wonder how they arrived at that figure?
That’s the number they publish.
My guess is that they have a rough idea of how many living Penn State grads there are and they divide that into the number of American college degree holders. The latter figure (at least some reasonable guesses) is pretty easy to track down.
I think they have almost 70,000 students currently enrolled in undergraduate programs.
Big numbers.
Grant
Mr. Calder,
As a student involved in student governments for both University Park and the Commonwealth Campuses, I would like to point out there are actually 19 ‘branch’ campuses, all of which offer degrees, and 5 of which are full Colleges within the University (Abington, Altoona, Berks, Erie, & Harrisburg). Plus there are the special mission campuses like Hershey, Dickinson School of Law, Great Valley, and the World Campus. Just to point out how much the state really does benefit from PSU.
All the best,
Sean Goheen
You are absolutely right. My mistake.
And I didn’t even count Great Valley, Hershey and the law school.
It is an amazing system.
Thanks for straightening me out on that number.
It’s true. We tend to think of privatization as an absolute good, even when it clearly isn’t.
G
Thank you for your discussion on the idea of privatizing The Pennsylvania State University–from Monday’s Inquirer. I was aware of the general tendency of the states to reduce their support of the great land-grant universities; however, I was not aware of how far this has gone in the case of Penn State. I write as a native Philadelphian and a graduate of Penn State: B.A. in philosophy, with honors, 1970.
Two factors seem to me of significance in relation to your discussion. The first is to ask what would become of Penn State’s commitment to the “sons and daughters of the working people” of the state, if it were to become a private institution–in competition with the other large private universities. I recall the phrase, or words to that effect, as inscribed in the entrance hallway of Old Main in State College–including murals from the time of the Great Depression. There has certainly been some tendency of other “state-related” institutions to turn their attentions to the cultivation of the wealthy as they have become less “state-related.” In our present times of growing inequalities across the country, I can not see such a development as positive. We have to ask what provisions will be made for that traditional commitment, if Penn State were to become a private institution. There is some considerable danger, I believe, that even with tuition aid and loans, the sons and daughters of the working people of the state could become mere academic canon fodder.
Secondly, I think to ask about the relationship between state support for P.S.U. and state support for other institutions of higher education in the state–including the system of State Colleges, and the many Community Colleges which have developed in more recent years. Though I favor keeping the “state” in “Penn State,” I wonder what other demands are being made upon state resources to support institutions of higher education. Private universities definitely have a needed place in the general system of higher education in the state and in the country. I don’t think we want a uniform state-related system. But we would know better how to evaluate the idea of privatizing Penn State, if we knew what was happening with the financing of other, traditionally state-supported institutions. How has state financing developed in regarding these other institutions? Again, how has state aid developed in relation to private and religious institutions in the state? Has financing of Penn State diminished while aid to, say, the University of Pennsylvania or Villanova has increased?
Personally, I favor public financing of public institutions such as Penn State–and others which have a clear public commitment. But I do not know the general course of development in recent years. Can you say more?
Sincerely yours,
H.G. Callaway
H.G –
I don’t know much about the funding levels at the other state-related systems in PA. My guess is that the Commonwealth system (University of Pittsburgh and Temple University and their branch campuses) and the 14 campus University of PA system both receive substantially higher percentages of their operating budgets from the state than Penn State does. I would think that the U of PA system levels are at least 30 or 40% for state funding.
Private institutions receive very little state money. If they do, it’s a small fraction and can only be used in very prescribed ways, such as for the purchase of textbooks which students can use but remain the property of the school.
Private institutions receive very little state money. If they do, it only constitutes a small fraction of their budgets and can only be used in very prescribed ways, such as for the purchase of textbooks which students can use but remain the property of the school.
The University of Pennsylvania’s veterinary school, for example, may be eligible for some more substantial state funds because it is the only one in the state, but that’s a special case.
Grant
Dear Mr. Calder,
Doing some searching around on-line, I was unable to find much very specific regarding the state funding to the system of State universities (the old teachers’ colleges), though since they have all been upgraded to state universities in recent decades, I would guess that their funding has been substantial. I read that they are owned by the state.
I did find that as recently as the 1970’s state support to P.S.U. was in the range of 60-70%, and that Pennsylvania colleges and universities (public and private) now have high tuition costs in comparison to many other states. I would be surprised if state aid to Temple and Pitt were much above the levels that P.S.U. is now receiving. Since I am also a graduate of Temple’s graduate school, (Ph.D., philosophy, 1976), have been aware of some sentiment favoring Temple attaining the status of a private university. I do not think this would favor their commitment to the sons and daughters of the working people. Instead, I have seen some tendency toward emulation of the class favoritism in other private universities.
Regarding the private colleges and universities, including those with religious affiliations, I believe that some of these have received funding of various sorts, but I found nothing of the details of this on-line. I wonder if the notion involved in the purchase of text books for parochial schools has been extended to the point of subsidy for new buildings in the religiously affiliated colleges and universities. I would much rather that state funding for private and religiously affiliated colleges and universities be restricted to state aid for the tuition costs of their students. Otherwise, I suspect we risk politically inspired subsidies to particular denominations–verging on violation of the establishment clause of the first amendment.
60 to 70% state funding for Penn State in the 1970s sounds about right.
Amazing how much it’s fallen since then.
I see your point about using whatever state funding is now allocated to private and parochial schools to support “state-related” schools, but my sense is that the amounts aren’t substantial.
I think they get around the establishment clause problem by providing the (very limited) funding to all non-public schools, so there’s no “establishing” of a particular religion.
Grant
As an alumnus, I would generally NOT support privatizat ion, but I understand there soon may be little or no choice. I feel it incumbent on Harrisburg to realize that Penn State serves the STATE of Pennsylvan ia, especially as the second largest employer in the state. While a private Penn State would certainly still employ many people, it would have no obligation or incentive to serve the state in the way that it does now.
I graduated from a high school in Pennsylvan ia. I was (and still am) absolutely horrified at the cost of higher education for PA residents. ..even to go to a public, in-state institutio n. $16,500/ye ar for just TUITION! Even the ‘real’ public universiti es in PA (the PASSHE schools) only come in at about $4K less. A serious disservice is done to PA residents in this regard. I went out of state of my degree!
You’re right, they are expensive, but they do have some excellent programs. I’m afraid they’re not going to get any cheaper from here on in. Part of the problem is that they can get away with charging more because the private are so much more expensive. It’s ironic usually competitio n helps keep prices down. But that principle doesn’t seem to work in the world of higher ed
Kind of a surface address to the issues. Public funding of colleges has outstrippe d inflation over the past 20 years by 120% That’s a lot.It’s allowed a lot more administra tors ,some of whom have questionab le jobs. (i like VP for diversity. ) it’s allowed a lot of depts who graduate students with little scholarshi p and no job skills. I think what will happen is a culling of depts and possibly universiti es.
There is no need-that i can see-for a sociology dept at every school.And ,probably an increase in tuition for profession al schools. Med students at state schools are certainly subsidized
But,the public is under no obligation to pay high salaries /bennies for people just because they’ve received them in the past
(Heinlein is very good on this.See “Lifeline”
I didn’t know that funding for state colleges had run so far ahead of inflation. I wonder how much variation there has been among the states and among public systems. My guess is that in PA while the legislatur e steadily funded smaller and smaller portions of Penn State’s budget over the past few decades it kept the percentage it underwrote of the 14 campus University of Pennsylvan ia system fairly steady. Pennsylvan ia is a strange case because it actually has three separate “state-rel ated” university systems, not including the community colleges.
Grant
As an alumnus of Penn State, I know I am in the minority when it comes to supporting the university in going to a fully private model (if we cannot get more money from the state). It is a travesty that in-state tuition at university park is much more expensive than at public institutions that are ranked much higher. We should use the threat of going fully private to get more money from the state so we can compete with ucla, uc berkeley (both landgrant), uva, unc, and michigan to be at the pinnacle of public higher education. There is absolutely no excuse for not turning university park into a perennial top 30 undergrad institution and among the very elite public institutions.
If the state doesn’t want to play ball, prepare to do the nuclear option and go fully private. 6% budget support is pitiful and a shameful reflection of PA’s attitude towards public higher education. If I could outline a general 25-30 year plan, I would most probably have PSU go private, turn more of the sat. campuses to four year, cut the amount of students at main campus by 35-50% (university park is horrifically overcrowded, i think the ideal number if going private would be something along the size of USC), and do something about the alumni giving/participation rates. For its size, PSU’s endowment is extremely limited and this affects its ability to compete with the very top publics.
I enjoyed my time in happy valley but I do think there are a lot of issues the school and the system as a whole has which many alumni don’t like to bring up.