Wednesday, June 3, 2009

Is it Even Possible for State Legislatures To Keep Public University Tuitions "Low" Ever Again?

One thing economic recessions force state governments to do, especially since they have constitutionally mandated balanced budgets, unlike the federal government, is to re-examine their spending priorities and how to pay for them.

We can no longer have everything we want when we want it. And there is no such thing as a 'free lunch". We have limited resources and budgets. No matter what any politician will try to say otherwise.

Always remember this important concept: Each new session of any legislative body formed after an election can not be bound by the decisions of any previously elected legislative session. That is one of the fundamental principles of a democratically-elected republic. This important principle has allowed the United States and its individual states to adapt to new conditions, economic realities and distributions of wealth in order to survive over the past 219 years.

So far, that is.

And our Founders sought to make the legislative bodies the pre-eminent decision-making authorities at both the state and federal level. Not the executive branch nor the judicial branch. Freely-elected legislators every other year at the state and congressional level; every six years at the US Senate level.

Perhaps the most important function of any state or local government is the provision of quality primary, secondary and higher education for its citizens. Thomas Jefferson counted the founding of "The University", as it is known in Virginia, as so important in his busy life that it is one of the three items posted on his tombstone. He advocated for an extensive system of free, public education as a means to educate the populace, defend and preserve democratic values and unleash a world of creativity unlike in any other nation around the world. [1]

Think of Jefferson as the first leader in the modern world to really 'get it' when it came to educating the masses so that the United States could become the most amazing job and wealth creation machine the world has ever known. Ever.

How does providing a "free" public college education today stack up against his utopian dreams of almost 200 years ago? Have economic conditions and competing legislative options changed since then so they call for different approaches nowadays?

North Carolina is currently struggling with competing desires of providing a 'free' public college education “as far as practicable”, as stated in the state constitution, and balancing the state budget. State-ordered budget cuts of 11% are currently underway and raise the fears of harsh reductions in the number of able young professors who really are the 'seed corn' for educating our future engineers, scientists and mathematicians.

Jefferson correctly noted that it was in the best interests of the young democratic republic to educate as many of the uneducated, illiterate, poor people as possible at the time. In that spirit, North Carolina was the first state to open its doors to the public in 1789. In 1795, a young man, Hinton James, literally walked 170 miles from Wilmington, NC, presaging the enrollment of Michael Jordan from the same city by about 186 years, to Chapel Hill and became the first student to graduate from a public-funded state university in 1798 as a civil engineer.

"Practicable' is a quaint 18th century word that is hardly ever used anymore, one reason being that it is hard to pronounce. It doesn't mean "practical" either; it's more correct interpretation is what can actually be "put into practice" or "capable of being done".

The comparatively low tuitions to attend the higher institutions of education in the University of North Carolina system seem to no longer be 'practicable' in any sense of the word. Unless, of course, dramatic changes are made in spending priorities in the state budget or humongous sums of money can be saved through administrative overhead reductions and building construction projects on campus are restricted going forward.

Here are the various tuitions for neighboring states for comparison purposes in 2008: (in-state first, out-of-state following)

UNC-Chapel Hill: $5397/$23,000
U.of Virginia: $9505/$30,000
U. of South Carolina: $9000/$20,000

There are two ways to go on this issue. One would be to hold true to the 'as far as is practicable' language of the state constitution and make the tuition "free" for all in-state students. Period. Since every family in the state has 'paid for' public higher education through state taxes paid over the years, all students would 'deserve' to attend public university free-of-charge as an underlying principle. North Carolina's relatively high state contribution of 38% to the University System's annual budget basically calls for such an outcome.

"Free" higher education obviously would mean a massive reorientation of priorities in the state budget but it can be done. Remember, each new legislature can make decisions without being bound by previous legislative spending priorities. We might not be able ever again to pave as many roads or cover as many people as we want on the state medicaid budget, which is hamstringing state budgets as much as it is at the federal level. Such a decision would be true to the state constitution and the intent and spirit behind the University ideal, wouldn't it?

If North Carolina does not go the totally free in-state tuition route, at the very minimum, it should raise out-of-state tuitions to a level comparable to UVA. Out-of-state students will continue to apply to Chapel Hill in droves regardless of the tuition. In 2008, over 13,000 out-of-staters applied for only 500 available positions. This would raise close to $14 million annually at the Chapel Hill campus alone. Out-of-staters by and large have never paid any state taxes and know that they are going to be paying a higher tuition to attend as a result.

A long-term solution would be to raise the in-state tuition rate to equal that of UVA. Are the educations received at UVA and USC worth $4000 more per year to the student in either of those states versus North Carolina? Apparently that is what the market price is telling everyone. Equalizing in-state tuitions to UVA levels would raise over $53 million for the Chapel Hill campus alone. Per year. And obviate the need for draconian budget cuts as long as the University system is managed in a conservative fiscal manner.

What is not publicly stated very often is that a low tuition across-the-board benefits everyone, rich and poor alike. Does it stand to reason in this day and age that the son or daughter of the most wealthy family in the state pays the same rate as the student who comes from a much more modest income-earning family? Is it really fair that 17% of the families with students now at Chapel Hill who sent their kids to a private high school in or out-of-state can then send them to a public university like Chapel Hill for the same below-market tuition fee as any other in-state student?

An endowment could be raised that would fully offset or reduce the tuition costs for every student who comes from a family with income levels below, say, 300% of the poverty level. The Carolina First Campaign raised closed to $2.4 billion by the end of 2007. Perhaps it could be increased to $4 billion to cover the students who need this assistance. North Carolinians are more than generous when it comes to helping people when asked.

Tough economic times have a way of highlighting areas in government budgets that need to be addressed. Legislative budgets at any level are made to set priorities on a vertical, not horizontal, basis. Bringing tuition charges into line vis-a-vis our neighboring public university systems is one important area to start, barring any radical change to existing state spending priorities, so the next generation of North Carolina-based engineers, scientists and mathematicians will be educated and trained to meet the 21st century.

[1] "The object [of my education bill was] to bring into action that mass of talents which lies buried in poverty in every country for want of the means of development, and thus give activity to a mass of mind which in proportion to our population shall be the double or treble of what it is in most countries." --Thomas Jefferson to M. Correa de Serra, 1817.


  1. Fascinating article. Reading reminded me of the striking contrasts between UNC's campnus and the University of Michigan's, which I've always wondered about.

    Growing up around UNC, I always admired the size, beauty, and magnificence of its campus. I proudly believed that its buildings and facilitiest must be the finest of any state institute in the contry.

    Then I attended U of Michigan for grad school and I was really struck (and a little saddened) by how much bigger, better, more advanced, and better maintained the campus, buildings, facilities were there.

    The next time I visited UNC, these differences really stood out to me. By all appearances, it was clear to me that Michigan's funding was many times larger than UNC's. Even though I never even attended UNC (Duke in fact), I found myself wishing my home state's university was better funded.

    UofM Tuition In/Out: $11,037/$33,069

    Not exactly sure what to make of all that. Just something the article reminded me of.

    Mike M

  2. thanks for writing, Mike "Anonymous'. It seems like we either go the full free tuition route for everyone or equalize the tuitions to competitive other public universities. What happens if state revenues dry up even further next year and the next? Do we cut professorships by 30% in that case? Who will be left to teach our children at that point? Frank

  3. Higher Education is a public good, but it is being increasingly viewed as a private purchase that only benefits the recipient. Of course that is not true as Jefferson knew only two well. The baby-boomers have promised themselves public benefits, low tax rates and a world-wide army that keeps global oil flowing to our economic competitors at zero c that together are clearly unsustainable and toxic for our country. They have been systemmatically gutting the educational support that their parents gave them and giving themselves more and more. It won't end until the next generation snatches the levers of power from the self-absorbed "Me" generation.


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