By Hans Johnson, director of research, Public Policy Institute of California
This opinion article appeared in the Sacramento Bee on January 28, 2011 and reprinted in the Merced Sun-Star on March 22, 2011
Budget crises are leading to a new model of higher education in California. This new model treats higher education as a private good by providing less and less public funding for our three-tiered system of higher education, the University of California, California State University and the California community colleges.
The new approach has been cobbled together, a response to the budget fires that now seem to rage with more frequency and intensity than ever before. It ignores the public benefits of investing in higher education and could imperil the long-term economic success of our state.
There is an argument to be made for privatizing some of the costs associated with higher education. After all, it is the individual with the college degree who enjoys most of its benefits. One of those benefits is money. College graduates with a bachelor's degree earn almost twice as much as high school graduates in California, and even in the recession have had unemployment rates less than half those of high school graduates.
But higher education is not only a private good. California's national and global competitiveness depend on highly skilled and highly educated workers. Most job creation in California occurs with the establishment of new businesses – businesses that are disproportionately started by college graduates. In addition, California's history of increasing economic well-being has occurred primarily because of improvements in educational attainment. The Public Policy Institute of California has projected that our economy will continue to demand more highly educated workers. If current trends persist, the economy will require 1 million more college graduates by 2025 than the state will be able to produce.
Today, higher education is being asked to bear a disproportionate share of the state's budget cuts. At the University of California, state support per student is less than half of what it was 20 years ago. We now spend more for corrections than for UC and CSU combined.
Gov. Jerry Brown has proposed to cut $500 million from the University of California, another $500 million from the California State University, and $400 million from the community colleges.
If cuts happen at this level, the University of California will cross a symbolic threshold: for the first time ever, the university will derive more revenue for its core instructional budget from private sources – students and their families – than from the state. California State University will serve tens of thousands fewer students, and the community colleges will serve hundreds of thousand fewer. It remains to be seen whether these cuts are reduced when a budget is ultimately passed, but it is not at all evident that there is much sentiment among legislators to lower the size of the cuts.
Certainly in these hard economic times and with no appetite for new taxes, some cuts are inevitable. So, if we have to make cuts – and we do – let's make them strategic. Changes made today will have long-term consequences. The overarching consideration in making cuts should be protecting student access and student success as much as possible. With this in mind, each branch of California's higher education system should identify strategic principles for managing through this crisis.
Community colleges should focus on their core transfer and career training missions. It is better to eliminate courses designed for personal enrichment than to sacrifice academic courses necessary for transfer to a four-year university.
California State University should persist in its efforts to increase completion rates, ensuring that students who have done everything right do indeed graduate. We have already made substantial investments in the education of those who make it to the CSU system. Improving completion rates at these campuses is one of the most cost-effective ways to increase the number of college graduates in the state.
Both California State University and the University of California will need to increase tuition yet again – rather than shrinking the size of the university by restricting enrollment. As with previous increases, students from high-income households should pay the full increase while students from low- and moderate- income families should receive grants to offset higher tuition, thereby ensuring access to the universities for all students. Even with increases in tuition over the past few years, UC and CSU have received record numbers of applications. Let's try to meet that demand rather than reduce enrollments.
Finally, the state should consider adjusting funding formulas so that colleges are rewarded for desired outcomes, such as the number of degrees and certificates earned, rather than just students in seats.
These are difficult times, but if we manage this crisis and establish new efficiencies in higher education, we will be better positioned to meet both current and future challenges. Ensuring the long-term prosperity of the state and its residents requires viewing public higher education as a necessity, not a luxury. Californians know this. In response to a PPIC survey in November, 63 percent of Californians said that a college degree was necessary for economic success. Almost 90 percent of parents want their children to earn a college degree. Making it possible for families to achieve this goal is in the best interests of all Californians.