financing higher education

Who owns the future? Those who invest in it!

A while back, the NY Times reported that China’s government is making an investment of $250 billion/year in the development of human capital. The Times likens this to the GI Bill in the US in the 1940s that contributed to the longest period of sustained economic growth in the US during the last century. There is a wealth of additional information in the article. Definitely worth reading.

Since reading the article I have continued to observe many other countries making extremely large investments in higher education. I am just home from Saudi Arabia where massive investments in higher education are being made as well. There has been much written about Brazil’s investment in higher education. There are many countries participating in this trend. That is, except my own country.

Of course I recognize that investment alone does not produce quality higher education and that the Chinese government’s determination to control knowledge and ideas that circulate nationally is an enormous problem. And that building an effective academic culture will be an enormous and ongoing problem. Whether China is truly prepared to provide appropriate facilities and adequately remunerated faculty to support growing enrollments remains unclear. That said, the infusion of capital will certainly lead to a lot more Chinese citizens with a university degree. The Times tells us that during the last decade alone, China has quadrupled their number of university graduates. Just as the GI Bill supported a diverse population at different kinds of institutions of varying quality in the US following the Second World War, the Chinese investment will undoubtedly do the same. This it will likely lead to the improvement of the median level of education in China while building a much better educated work force. According to the Times, multinationals from Intel to General Motors have taken not and are hiring, writing: “China’s growing supply of university graduates is a talent pool that global corporations are eager to tap. ‘If they went to China for brawn, now they are going to China for brains,’ said Denis F. Simon, one of the best-known management consultants specializing in Chinese business.”

Of course I believe passionately that more education should be accessible to more people and that this kind of investment and expanded access is a good thing. But the path China is on does imply a call to action for the rest of us. We live in a competitive world and we need to consider the implications of massive infusions of capital in higher education by other governments. Compare the Chinese\ investment in higher education with a few illustrative examples in the US. State funding to the University of California in 2011/12 represented a 21.3% cut from the previous year. State funding to UC has dropped steadily over the past five years (although the trend has reversed some this year). State appropriations to the University of Michigan in Ann Arbor represent less than 24% of the operating budget. In the 2012/13 budget of the University of Virginia, the state’s contribution is under 6%.

These are only a few examples, but in a political environment hostile to taxes, many public universities are desperately short of the funding needed to sustain their goals of providing equitable access to all who are qualified as well as to continue to lead the world with the best opportunities for advanced education. Like private universities, public institutions have little alternative other than raising fees, which increases the cynicism of conservative politicians towards higher education and puts a degree out of reach of ever more young Americans. In other words, we are passing China, but going in opposite directions.

So despite our presumption that the US hosts the world’s best universities, we do not (or very soon will not) have the world’s best educated population. And that has serious implications for the future.

Read more:
Inside Higher Ed