The media, universities, and Higher Ed Cabinets: Or, why doesn’t Harvard buy the New York Times?

A potentially symbiotic relationship between the ‘quality’ media in the USA, and institutions of higher education, has been discussed from time to time in a variety of fora. Fiscal stress in the print media, for example, has led some to suggest that the well endowed (e.g., Harvard, with nearly $40 billion in interest generating capital) should rescue outlets like the New York Times, or actually facilitate the creation of a quality newspaper in Chicago (the Chicago Tribune is shockingly bad for a city of eight million). Instead, we see a significant component of the New York Times being sold off to Mexican billionaire Carlos Slim Helú last week, or the Washington Post dependent upon the profits being generated by Kaplan.

Yet quality newspapers play a critically important role in the higher education process, let along the broader socio-economic development process. Many professors (including myself) use newspaper articles in courses, and we require term-length newspaper subscriptions to complement more traditional readings. Newspapers are also important outlets for the circulation of knowledge that is produced in universities, and they help observers of the world of higher ed (including global higher ed) keep up on what is happening.

In this context, it is worth noting that the New York Times teamed up with the Chronicle of Higher Education today to host the USA’s:

first Higher Education Cabinet, comprising presidents, trustees and leaders from 76 colleges, universities and higher-education associations. The goal of the cabinet is to identify trends and direct discussions about the most pressing issues facing higher education today.

The first meeting of the cabinet will be held today at The New York Times Building. The welcome address will be given by Janet L. Robinson, president and chief executive officer of The New York Times Company, followed by remarks from Jeffrey Selingo, editor of The Chronicle of Higher Education. Topics to be discussed at the cabinet meeting included e-learning, internationalization [“Internationalization” – How will you compete globally?], financing models, assessment and accountability.

“The New York Times is committed to fostering discussion about the changing landscape of higher education,” said Felice Nudelman, executive director, education, The New York Times. “We are delighted to be hosting the inaugural Chronicle of Higher Education/New York Times Higher Education Cabinet meeting and look forward to continued opportunities to facilitate creative and collective discussions about the key topics in higher education.”

Today’s ‘Cabinet meeting’ is apparently the first of many (to be held on an annual basis), and will be supplemented by quarterly online meetings “conducted via the EpsilenTM environment, an e-learning and meeting platform”, which is:

the result of six years of research and development within the Purdue School of Engineering and Technology at IUPUI.  Epsilen Products and Services are commercially available through BehNeem LLC, the holding company created in Indiana to commercialize, market and further develop the Epsilen Environment. The New York Times is an equity and strategic partner in the company.

The bringing together of institutions of higher education and the quality general and higher ed media cannot help but generate positive benefits. Yet, I cannot help but wonder if the leaders of the many well resourced universities participating in this scheme – people focused on generating maximum annual returns off of endowments, or selling their innovative learning technologies like Epsilen to the media (or to universities and colleges) – reflected much, if at all, about the structural problems facing media companies like the New York Times Company.

Autonomy of university foundation offices and administrators aside, imagine if just a few of these universities decided to pool parts of their endowments, and preserve if not enhance the quality media in the USA, a country desperately in need of better news and analysis. So, instead of Columbia’s Bollinger working for the Washington Post Company, imagine if the Washington Post worked for Bollinger, or the Chicago Tribune worked for Penn’s Guttman, or the New York Times worked for Harvard’s Gilpin Faust. Not ideal, perhaps, but better than watching these important media firms get ravaged by the forces of socio-economic and technological change. But, might this be expecting too much of inward looking universities in the era of the marketplace?

Kris Olds

The “new global wealth machine” and its universities

Further to our most recent entry on the King Abdullah University of Science & Technology (KAUST), the Financial Times notes, today, that KAUST’s endowment could swell to a level that would make it the world’s second largest endowment (after Harvard), and it has not even finished building its first building!

As the FT suggests, this is setting off a scramble in the fund management world:

The King Abdullah University of Science & Technology will not open until 2009 but it is already holding talks on its endowment with fund managers such as BlackRock and private equity firms including Bain Capital, people familiar with the matter say.

The university has received $10bn for its endowment from King Abdullah, which would make it the sixth biggest university endowment in the world, said a university spokesman based in Washington.

People familiar with the endowment negotiations say they have been told the fund could grow to as much as $25bn, which would make it the world’s second biggest university endowment after Harvard’s $35bn nest egg.

The endowment would be one of several significant Saudi investment bodies. So far, the Saudi approach has been to refrain from giving any one arm too much money in the hope of maintaining a low profile and preventing a foreign backlash, bankers say.

“The Saudis under-represent both the amount of their reserves and the investments they make overseas,” said the head of the Dubai branch of one large Wall Street firm. “The last thing the Saudis want is to attract attention.”

Noteworthy, of course, was the visit by US President George W. Bush to Saudi Arabia last week, where he pleaded with the same King Abdullah to open the spigots a little wider.

News items like this are reminders that some of the so-called ‘hotspots‘ in the global higher ed world are linked, in quite fascinating ways, to the people controlling political regimes in countries like Saudi Arabia, the UAE, and Singapore.

On this note, the New York Times graphic below, which was recently profiled by the Center for Graphic Facilitation, hints at the fact that several of the key people behind Singapore’s Global Schoolhouse development initiative (which we will be writing about in the next 1-2 weeks) are also managing the Government of Singapore’s Government Investment Corporation (GIC), a sovereign wealth fund worth at least $330 billion.

As the same FT article notes:

Money from endowments is considered particularly desirable by fund managers because universities have such a long-term investment focus. Some sovereign funds in the Gulf, such as the Kuwait Investment Authority, have adopted the endowments of leading universities such as Harvard and Yale as their role models.

The new political economy of such development initiatives is complicated in nature, yet prising key elements of them apart is a challenging and entirely worthwhile task.

Kris Olds

Has higher education become a victim of its own propaganda?

eh.jpgEditor’s note: today’s guest entry was kindly written by Ellen Hazelkorn, Director, and Dean of the Faculty of Applied Arts, and Director, Higher Education Policy Research Unit (HEPRU), Dublin Institute of Technology, Ireland. She also works with the OECD’s Programme for Institutional Management of Higher Education (IMHE). Her entry should be read in conjunction with some of our recent entries on the linkages and tensions between the Bologna Process and the Lisbon Strategy, the role of foundations and endowments in facilitating innovative research yet also heightening resource inequities, as well as the ever present benchmarking and ranking debates.

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councilpr.jpgThe recent Council of the European Union’s statement on the role of higher education is another in a long list of statements from the EU, national governments, the OECD, UNESCO, etc., proclaiming the importance of higher education (HE) to/for economic development. While HE has long yearned for the time in which it would head the policy agenda, and be rewarded with vast sums of public investment, it may not have realised that increased funding would be accompanied with calls for greater accountability and scrutiny, pressure for value-for-money, and organisational and governance reform. Many critics cite these developments as changing the fundamentals of higher education. Has higher education become the victim of its own propaganda?

At a recent conference in Brussels a representative from the EU reflected on this paradox. The Lisbon Strategy identified a future in which Europe would be a/the leader of the global knowledge economy. But when the statistics were reviewed, there was a wide gap between vision and reality. The Shanghai Academic Ranking of World Universities, which has become the gold standard of worldwide HE rankings, has identified too few European universities among the top 100. This was, he said, a serious problem and blow to the European strategy. Change is required, urgently.

sciencespo.jpgUniversity rankings are, whether we like it or not, beginning to influence the behaviour of higher education institutions and higher education policy because they arguably provide a snap-shot of competition within the global knowledge industrial sector (see E. Hazelkorn, Higher Education Management and Policy, 19:2, and forthcoming Higher Education Policy, 2008). Denmark and France have introduced new legislation to encourage mergers or the formation of ‘pôles’ to enhance critical mass and visibility, while Germany and the UK are using national research rankings or teaching/learning evaluations as a ‘market’ mechanism to effect change. Others, like Germany, Denmark and Ireland, are enforcing changes in institutional governance, replacing elected rectors with corporate CEO-type leadership. Performance funding is a feature everywhere. Even the European Research Council’s method of ‘empowering’ (funding) the researcher rather than the institution is likely to fuel institutional competition.

In response, universities and other HEIs are having to look more strategically at the way they conduct their business, organise their affairs, and the quality of their various ‘products’, e.g., educational programming and research. In return for increased autonomy, governments want more accountability; in return for more funding, governments want more income-generation; in return for greater support for research, governments want to identify ‘winners’; and in return for valuing HE’s contribution to society, governments want measurable outputs (see, for example, this call for an “ombudsman” for higher education in Ireland).

European governments are moving from an egalitarian approach – where all institutions are broadly equal in status and quality – to one in which excellence is promoted through elite institutions, differentiation is encouraged through competitive funding, public accountability is driven by performance measurements or institutional contacts, and student fees are a reflection of consumer buoyancy.

But neither the financial costs nor implications of this strategy – for both governments and institutions – have been thought through. The German government has invested €1.9b over five years in the Excellence Initiative but this sum pales into insignificance compared with claims that a single ‘world class’ university is a $1b – $1.5b annual operation, plus $500m with a medical school, or with other national investment strategies, e.g., China’s $20b ‘211 Project’ or Korea’s $1.2b ‘Brain 21’ programme, or with the fund-raising capabilities of US universities (‘Updates on Billion-Dollar Campaigns at 31 Universities’; ‘Foundations, endowments and higher education: Europe ruminates while the USA stratifies‘).

Given public and policy disdain for increased taxation, if European governments wish to compete in this environment, which policy objectives will be sacrificed? Is the rush to establish ‘world-class’ European universities hiding a growing gap between private and public, research and teaching, elite and mass education? Evidence from Ireland suggests that despite efforts to retain a ‘binary’ system, students are fleeing from less endowed, less prestigious institutes of technology in favour of ‘universities’. At one stage, the UK government promoted the idea of concentrating research activity in a few select institutions/centres until critics, notably the Lambert report and more recently the OECD, argued that regionality does matter.

Europeans are keen to establish a ‘world class’ HE system which can compete with the best US universities. But it is clear that such efforts are being undertaken without a full understanding of the implications, intended and unintended.

Ellen Hazelkorn

Foundations, endowments and higher education: Europe ruminates while the USA stratifies

The role of university endowment funds in supporting higher education institutions varies significantly across space and time. Some higher education systems make no use of them, nor do they plan on doing so, while others are grappling with the socio-cultural, legal and political hurdles preventing their emergence as tangible material forces.

uwfound.jpgOver the course of the last six years, following a move to the United States (I’m based at the University of Wisconsin-Madison, est., 1848) I’ve had a crash course on the socio-cultural foundations of endowment funds. It is this dimension that is amongst the most significant yet intangible force facilitating the development of endowments. I’ve acquired insights on this issue via guiding some visitors from Europe (including people involved in the Bologna Process, as well as from the European Commission) to the University of Wisconsin-Madison’s Foundation (pictured above), and simply by living and working in this context (an unplanned ethnography, if you will). The UW Foundation, which is the 46th largest in the US, has an endowment worth $1,645,250,000 (at the end of 2007). Note, though, that it is a separate endowment from the University’s autonomous technology transfer office (WARF) which has its own $1.5 billion endowment, and the UW Trust Funds (worth $450 million) that support all 26 campuses in the UW System.

During tours through the UW Foundation offices at 1848 University Avenue, which employs approximately 130 people, we witnessed a veritable machine in motion: counselors guiding dialogue between prospective donors and options for targeted initiatives; strategists working out the aggregate demographics of alumni base transformations; analysts working with integrated data bases that can identify thousands of data points including the occupations (including employers) of individual alumni, the value of their houses, and the ideal time (in terms of career and generational transition) to court them for large-scale donations; and a large room with computers and headsets where an additional 110 students (paid on an hourly basis, with free pizza on Friday nights) work from approximately 3:00 pm on so as to call alumni spread across the country while they are home at the end of the working day, but before they start winding down for bedtime.

Institutionalization aside, I’ve also witnessed the construction of a family-like university-alumni relationship such that the university, via the provision of a high quality (usually) education, generates a lasting social relationship with individuals. Apart from in the classroom, this also occurs via the establishment and maintenance of carefully crafted places where lasting memories of a positive nature can be created (such as the lake-side student union and Bascom Hill), events (including sporting events) which are often associated with planned spectacles (e.g., see the 49 second video clip below) that spark memorable experiences,

and the saturation of students’ senses with visual icons – in Madison’s case numerous trademarked logos, and the beloved starburst chairs that are placed on the lake-side student union. These places, events, and icons are seared into the memories of all alumni, with subtle but equally effective reinforcement provided by their inclusion in the free alumni magazines that get mailed out on a regular basis.

uwchair.jpgUpon reflection, the Canadians on campus, and visiting Europeans, view the construction of such a propulsive system with both fascination and a touch of unease. The brazenness of the effort to construct ‘family’, and then the application of advanced data bases to mine these relations to acquire financial gifts, can seem a touch too strategic and material in orientation. But when I meet alumni while parking cars at my son’s school playing field (a fundraiser that takes advantage of the fact that the 82,000 seat university football stadium is a mere three blocks away), I engage in direct conversations regarding, and observations of, that intangible alumni feeling. To be sure it is overtly strategic in some ways, but these people also feel like they are ‘giving back’: they are, in their minds, honouring the institution that played such a fundamental role in reshaping their lives, in connecting them to lasting friends (and often romantic partners), and marking their transition to adulthood. Of course they are also, via their donations, supporting subsequent cohorts of students. And the effects on the university are striking, with the John and Tashia Morgridge-funded Institutes of Discovery but one of the more striking examples. Indeed one group of alumni even donated $85 million in 2007 to ensure that the Business School is not named after any one person for the next 20 years; a surreal donation, in some ways, given the present logic of the system. In short, while the structural context is clearly a factor, it is the intangible socio-cultural dimensions that play a fundamentally important role in facilitating this development process.

nytendowment.jpgWhile universities in many parts of the world begin to grapple with socio-cultural, legal, and ideological dimensions of foundations, and endowment bases, it is also worth taking into account the emerging effects these endowments have in aggregate. Recently released data by the National Association of College and Business Officers (NACUBO) in the US identifies a clear private/public schism, and it is this schism that is the topic of discussion in today’s New York Times. As the NYT article notes:

The result is that America’s already stratified system of higher education is becoming ever more so, and the chasm is creating all sorts of tensions as the less wealthy colleges try to compete. Even state universities are going into fund-raising overdrive and trying to increase endowments to catch up.

The wealthiest colleges can tap their endowments to give substantial financial aid to families earning $180,000 or more. They can lure star professors with high salaries and hard-to-get apartments. They are starting sophisticated new research laboratories, expanding their campuses and putting up architecturally notable buildings….

Higher education has always been stratified, but the disparities were never as large as today. In the early 1990s, endowment income represented a small part of revenues at most colleges and universities. In 1990 Harvard’s endowment was $4.4 billion.

The last decade brought a sea change, as sophisticated money managers hired by the universities moved their portfolios into hedge funds, private equities and other high-performing investments, and endowments skyrocketed.

Some of the effects of the hastening stratification are evident even in my own relatively well-endowed university, where high quality departments (e.g., Political Science) have been raided by private Ivy League universities, leading to the departure of about ¼ of all of the professors in the last three years. Business Week also has two related stories (‘The dangerous wealth of the Ivy League‘ and ‘Educational excellence, without Ivy‘) regarding the effects of this stratification process.

Many European universities are in the early stages of establishing foundations and building up endowments, though most really have no idea how to do so. This said one emerging trend is to acquire gifts via firms (i.e., not high ‘net worth’ individuals), which will inevitably fuel the relative growth of business schools (unless these monies are taxed for the benefit of all assuming the business school is not stand-alone). Yet the development process is fraught with unresolved debates: is this a good idea?; is this a workable idea?; how does one overcome the socio-cultural barriers to the idea of donating money when ‘already’ paying via the tax system?; how can the European Higher Education Area (EHEA) compete (assuming it wants to) with the US without endowments, or at least substantially enhanced and concentrated funding of select universities?; etc. It is also noteworthy that key institutions, including the European University Association (EUA) and the European Commission, have yet to acquire accurate and systematic data about what endowments (if any) exist within individual European universities (though not for lack of trying). And at a broader scale the OECD has not conducted any serious research on this issue; a somewhat surprising fact given the policy relevance of the phenomenon.

So as Europe ruminates (or perhaps equivocates), it does make me wonder if this not too significant of an issue, and a debate, to be left to individual European countries (with the UK the most active), European universities, and European politicians, to grapple with. In short, why is there no systematic analysis and coordinated discussion?

Kris Olds

Autonomous foundations and the reduction of barriers to innovation in higher education

Over the last decade some noteworthy initiatives have emerged within the US to remake science and engineering degree structures and offerings, often with a focus on speeding up the time to graduation, enhancing and broadening the skill make-up of graduates, and building deeper information channels between academia and industry. Yesterday’s Washington Post had an insightful article on just these themes – the emerging professional science master’s degree (PSM). As the Washington Post notes:

The PSM program is designed to provide more advanced training in science or mathematics — with a dose of business skills — and entice more students who receive bachelor of science degrees to stay in the field without having to pursue a doctorate. Most college graduates with four-year science degrees leave the field and don’t return.

The PSM degree, sometimes described as a science version of the MBA degree, is being hailed as one of the most promising innovations in graduate education in years.

The Washington Post article profiles PSM-related initiatives created to date at Washington DC-based universities including George Washington University, Towson University, American University, the University of Maryland, Georgetown University, Virginia Tech, and Virginia Commonwealth University in Richmond. The article notes that “about 1,300 students are enrolled in PSM programs at more than 50 schools nationwide”, with the Washington area base region for “the most programs”.

sloanlogo.jpgFrom a non-US or international comparative perspective, one dimension of the development process that is worth noting is the critically important role of independent non-profit foundations to spurring on initiatives and innovation in higher education. As hinted at above, the PSM is largely an outgrowth of the effort of the Alfred P. Sloan Foundation to enhance and broaden the skill make-up of science and engineering graduates (especially at the below PhD level), and build deeper information channels between academia and industry. As Michael S. Teitelbaum, Vice President, Alfred P. Sloan Foundation, stated in a 6 November 2007 testimony before the Subcommittee on Technology and Innovation, Committee on Science and Technology, U.S. House of Representatives, the US needs to do a better job of improving the:

“signals” about such careers that are publicly available to prospective students. In particular, doctoral programs in many U.S. universities provide far less information to prospective and entering students about the career experiences of their recent graduates than do the law schools and business schools on the very same campuses. This should certainly change; students need to be provided with far better if they are to have realistic expectations as they embark upon a course of graduate study and postdoc research that often can stretch out over most of their 20s.

Universities and disciplines are, despite their reputations in conservative political circles, notoriously risk averse and slow to innovate with respect to course and degree offerings. The Alfred P. Sloan Foundation, which was established in 1893, created the PSM program in 1997 during a period of considerable debate about America’s perceived knowledge deficit (which eventually fueled the creation of the polemical study Rising Above The Gathering Storm: Energizing and Employing America for a Brighter Economic Future Committee on Prospering in the Global Economy of the 21st Century: An Agenda for American Science and Technology). The ultimate impetus for the PSM, however, seems to be Sloan’s considerably more nuanced concern about the quality of science and engineering education versus the number of science and engineering doctoral graduates. See Teitelbaum’s informative testimony for further information on this issue.

Further information on the background to the PSM is available here, while a PSM locations map (with links to specific programs) is available here. A screen capture of the map below clearly highlights the geography of the PSM.

psmmap.jpg

Ten years on since its establishment the PSM has taken off. Indeed primary responsibility for institutionalizing the PSM is now in the hands of the Council of Graduate Schools (CGS). It is worth noting, however, that the Washington Post article states that “[l]ast year, Congress provided funding for schools to establish or improve PSM programs through the America Competes Act”. This is in fact incorrect for the America Competes Act only authorized the creation of a Professional Science Master’s program at the National Science Foundation (NSF), and it did not provide any funding. Supporters of the PSM degree are hoping for action via the Fiscal Year (FY) ’09 appropriations, but the US omnibus bill approach (which provides for a number of miscellaneous enactments) makes establishing specific program appropriations particularly difficult.

In any case the uplift in PSM support and associated offerings, while not seamless, reflects the capacity of institutions like Sloan to push and facilitate the construction of new knowledge/spaces such that they eventually become institutionalized. As with the entry on stem cell research advances that we published on 21 November 2007 we see, yet again, how foundations can use their resources, linkages to universities, and autonomy, to strategically pursue goals that might get blocked within universities. As the Washington Post article notes:

That it took a foundation, and not a school, to get the ball rolling is not entirely surprising, educators said, despite a broad agreement that the country needs more trained scientists.

PSM supporters expected — and met — resistance from some educators, who thought the science course requirements were too limited or who did not want PSM students in their classrooms because they didn’t think the students had done the prerequisite courses.

In addition, universities are tradition-bound institutions. It can be difficult for schools, especially state-run systems, to get approval to start something new. Schools don’t like to force experts in one field to change their focus or unwillingly collaborate outside their discipline.

“In general, institutions of higher ed pay lip service to interdisciplinary studies,” said Ali Eskandarian, an associate dean at GWU who oversees its PSM program.

In the end universities, especially public universities, need to be pushed, embedded as they are in complex legal foundations and held back by large and complex bureaucracies. We’ll return to a related issue soon: the organizational barriers preventing the development of international double and joint degrees in public universities, though sadly no foundation in North America has stepped in (yet) to spur on developments on this front. And if you want an interesting contrast on this issue compare the North American situation to the European one; a context that has experienced substantial change via the European Commission’s Erasmus Mundus program. In short, the reduction to barriers to innovation in higher education, and the construction of new knowledge/spaces, is increasingly associated with an emerging constellation of socio-economic imaginaries, many of which are derived from non-university quarters. We thus need to focus more attention on the nature of these imaginaries, and the modes of engagement that lead them to become noteworthy forces of governance.

Kris Olds