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Saving State U: Fixing Public Higher Education Hardcover – February 23, 2010
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Nancy Folbre (2010) accurately summarized the purpose of her book, Saving State U, on the very last page: "Think of this book as Saving State U 101, an introductory course . . . in applied history and social sciences" (p. 168). Folbre opened the book with her description of public higher education as it currently exists. Folbre called the existing structure an "inefficient and unfair" "patchwork, make-do, halfhearted system" (p. iii) and advocated for free public higher education in the United States of America. She began her argument by contrasting the cost of the bailout of failing financial institutions ($12.2 trillion) to the collective amount spent by all states on higher education in 2008 ($85 billion or .7% of the bailout total p. v). She then presented one of the primary premises of the book: we are failing to meet the obligations set in The Big Deal.
The Big Deal is Folbre's depiction of a social contract that consists of intergenerational transfers to others with the understanding that it will be repaid in the future. An example is the funding of K-12 education and the partial subsidization of higher education with the expectation that educated younger members entering the workforce will then contribute to the public good. For example, the tax revenues collected are then used to support Social Security and Medicare. These are programs in which the benefits received generally exceed the amount that had been paid into. She also suggested that the term family state was a better description of the commonly used expression, welfare state, because public support, generally focuses on children and the elderly, and that much of the taxes that we pay go to education (as a payback) or toward programs to support us in our old age (in which we pay forward). The Big Deal, both overtly and covertly, played an important role throughout the book.
Folbre then discussed the history of educational expansion impasse and noted that there were four historical reasons why expansion of public education stalled: ignorance, discrimination, cost-to-benefit ratios, and how benefits are distributed and captured (p. 17). Folbre also provided a short historical overview of the development of public higher education in the United States of America. She discussed the first and second Morrill acts, the land-grant institutions, and expansion of public higher education as a result of The New Deal and the G.I. Bill. Parallel to the discussion regarding the development of state colleges and universities, Folbre also discussed the history of public spending and taxation. Folbre concluded chapter 2 by discussing the implications of the Civil Rights movement, The Civil Rights Act of 1964, The Higher Education Act of 1965, and The Education Amendments of 1972 and their respective effects on higher education (providing and encouraging access resulting in the expansion and growth of state colleges and universities). She called this period The Sweet Boom.
Folbre then discussed the state of public higher education from 1980 until today--a period she termed The Slow Fizzle. Changes in tax laws (both personal and corporate) resulted in economic gains for the wealthiest of Americans. However, as tax revenue decreased, state appropriations also decreased, forcing state colleges and universities to increase tuition and fees. A political force gained traction--one that insisted that cutting both taxes and social spending would benefit ordinary Americans. Folbre cited research showing just the opposite.
Folbre then outlined some of the issues that have made understanding and access to higher education difficult (e.g., actual cost versus sticker price, the complexity of applying for financial aid (both federal and institutional), the realities of the Expected Family Contribution (EFC)). Folbre then shared an observation about selectivity at colleges and universities with a perspective that I had not considered before. She stated selectivity itself becomes a plus. Those who enroll are promised the best possible "peer effects": surrounded by excellence, they hope to become more excellent themselves" (p. 69). She also cited research that showed a correlation between the percentage of the faculty that were adjuncts and student graduation rates. This coupled with nearly no selectivity (as well as students' intended goals and demographic profile) helps explain why community colleges retain and graduate so few students. Folbre also described how endowments play a role in providing aid revenue at private institutions.
Folbre then took a brief detour and discussed class-based differences in the outcomes of having earned a college degree. She stated that "The income of the average college graduate has failed to keep up with gains in overall productivity" (p. 83). However, the wealthiest Americans are able to send their children to elite institutions, and upon graduation, their income levels start well beyond the average college graduate. She noted that although some elite institutions had developed programs and instituted measures by which academically qualified students from low-income households could attend, tuition-free, the number of low-income students who might qualify and take advantage of this opportunity was so low as to not make any difference concerning national access to higher education. This served as a reminder about the role that public education plays.
Folbre then discussed the application of the business model to higher education. Can we increase productivity and efficiency? Incentivization may result in the wrong outcomes. The "inputs" in higher education (i.e. students) are not a standardized raw material. Each student has unique needs, obstacles, and goals. Standardized testing to ensure that certain outcomes are met may result in teaching students information that is test-specific. This would detract from the development of life-long learners, which over time, is a much more valuable human resource. Folbre also cited recent attempts to more strictly regulate the for-profit schools and diploma mills with the premise that reducing the amount of aid that goes to corrupt institutions will make that aid available for use at bone fide institutions of higher education. However, recent history has taught us that reallocation is rare. Other components of business models that were discussed include increasing productivity through increases in quantity, the use of more adjunct faculty, marketing and branding, enticing more out-of-state students who pay an additional premium, increases in rankings, seeking corporate partnerships, and entering the online market. As Folbre pointed out, none of these are really a solution, and many create new problems.
In chapter 7, Folbre began to outline her proposed solution. She started with a primer on the recent tax revolt, which began with a fundamental change in the calculation of property taxes. The sudden increases that resulted became the basis for new legislation that limited property taxes. This then became the basis for an examination of income, estate, and capital gains taxes. During economically prosperous times, tax revenue was steady despite the decreases in nearly all of the different personal taxes. However, a combination of new, unsupported, federal mandates and an economic recession resulted in budget shortfalls. The shortfalls forced states to reduce their appropriations. Folbre discussed how state lotteries (some of which were created to support education) have served as an added sales tax on mostly the poor, and have been used to fund gaps instead of providing additional funds to enhance education.
In the following three sentences, Folbre stated the bases for the tax revolt, which has now become the reason why states cannot meet societal needs, and why state appropriations have been reduced or even eliminated:
Most people have no idea what their taxes actually pay for, or what percentage actually lands back in their own pockets. (p. 141)
Why can't most Americans accurately compare their real standard of living with that of people in other affluent countries? (p. 141)
When they promised that tax cuts would deliver prosperity to all, they told us something that we wanted to believe. (p. 144)
Folbre noted that federal programs and initiatives such as the American Opportunity Tax Credit, The 2009 American Recovery and Reinvestment Act, and proposals to simplify the Free Application for Student Aid (FAFSA) are helpful. However, only a "renewed commitment to the common good" (p. 163) can save public education. The common good can only be supported if people pay their fair share for taxes; additional tax revenues are the key to changing the paradigm.
Observations and Comments
Folbre's writing style is easily accessible to the general public. There are moments when her arguments shine as beacons through a fog of ignorance. Unfortunately, this is a short book, and perhaps there are not as many gems as one might hope for. In all fairness, Folbre asked the reader to "Think of this book as Saving State U 101, an introductory course . . . in applied history and social sciences" (p. 168). She provided a good overview of the public higher education crisis and how we arrived here, but after a lengthy build up, the quick and simple answer (i.e., increasing taxes) was slightly disappointing. Although this is a critical part of saving public education, she did not devote enough time to how we might change American thought and culture. How do we change the hearts and minds of society? How do we convince politicians to embrace tax increases during a time in which any mention of an increase would be considered political suicide? Folbre provided a solution without any suggestion as to how to implement it. The simple solution to raise taxes (assuming that the additional revenues would go to funding higher education) would result in an increase in state appropriations for higher education. This benefits the bottom lines of institutions of higher education. However, that does not guarantee improvements in the quality of education. It won't convince society of the benefits of the liberal arts. It does not assure increased access and improved success among low-income and under-represented populations. It does not necessarily reduce the cost for all students. It does not reverse the trend of using more part-time and non-tenure stream faculty. It does not help institutions with burdensome federal mandates and compliance regulations. I believe that it would simply encourage institutions to make some of the same mistakes that were made prior to and after reductions in state allocations.
I also believe that Folbre dismissed, too quickly, a few ways in which institutions might be able to reduce costs and be more efficient. I clearly believe that business and education are two very different things. However, redundancy and waste are not exclusively associated with business (or government).