Tag Archive for: tuition

Yes, Students Are Customers, but the Customer Isn’t Always Right by Kevin Currie-Knight & Steven Horwitz

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“College students are not customers. That analogy needs to die. It needs to be drowned in the world’s largest bathtub. It needs a George R.R. Martin–esque bloodbath of a demise.”

These are the strong words of education writer Rebecca Schuman in response to Iowa’s recent attempt to pass a law tying professors’ job security to their teaching evaluations. Such laws, Schuman and others think, are based on the misguided idea that students are akin to customers.

OK, So College Isn’t Like a Restaurant

To an extent, we agree with Schuman, but we think she vastly oversimplifies. In one way, it is hard to deny that students are customers. They (or someone acting on their behalf) pay for a service and, like customers in any other market, students can take their tuition money elsewhere if they aren’t satisfied.

Whether the educational experience was to the student’s “liking” may not be a good measure of the quality of the university’s educational services. 

On the other hand, as Schuman points out, college education looks quite different from many other businesses. Unlike restaurant patrons, for example, students are buying a service (education) that isn’t geared toward customer enjoyment. A good college education may even push students in ways they don’t enjoy.

Whether the tilapia was prepared to the patron’s liking is a good measure of the restaurant’s food. Whether the educational experience was to the student’s “liking” may not be a good measure of the quality of the university’s educational services.

Rather than this distinction being evidence for Schuman’s claim, however, it actually points out one of its flaws. She overlooks the fact that not all customers have the same sort of relationship with a business as we see in the restaurant industry, which serves as the only basis of her customer analogy.

Yes, colleges certainly have a different relationship with students than restaurants have with patrons. Patrons are there to get what tastes good and satisfies them for that specific visit. Students are (presumably) there to receive a good education, which may not instantly please them and may sometimes have to “taste bad” to be effective. (Most people who go to the dentist don’t find it immediately pleasurable, either, but, in the long run, they are certainly glad they went.)

No Pain, No Gain

We can think of three alternative business analogies for the university-student relationship.

First is personal training or physical therapy. Like university education, they involve services that aren’t geared toward immediate consumer happiness. To help a client achieve good results, a trainer often has to make the workout difficult when the client might have wanted to go easier. And good physical therapy often involves putting the client through painful motions the client would rather not undergo.

Yet, these businesses see their clients as customers and probably take customer feedback quite seriously. Trainers need to push customers past where they want to go, but this doesn’t mean trainers dismiss negative feedback.

Credible Credentials

Second are certification services, firms that provide quality assurance for other firms. Such providers may find themselves at odds with their customers when they withhold certification, but if the firm asking for certification really wants an assurance of quality for its customers, that firm will understand why its unhappiness at being denied isn’t a reason for the certifying organization to just cave to whatever its customers want.

Schuman suggests that if students are customers, the university must be a profit-grubbing business.

For example, a manufacturer of commercial refrigerators might seek certification from Underwriters Laboratories to prove to restaurant owners that its appliances have been independently tested and proven to hold food at safe temperatures that won’t sicken customers. If tests reveal that the fridges aren’t getting cooler than 50 degrees — far above food safety guidelines — the fridges won’t get certified.

Any certifying bodies that give in to pressure to certify all paying customers will end up being punished by the market when someone (a competitor? a journalist?) reveals that the company’s certification doesn’t really certify anything. Protecting the quality of the certification process is in everyone’s interest, even if it makes some of a certifier’s customers unhappy with particular outcomes.

College students may well be like the firms seeking a certification of quality, with employers and graduate schools being the analogue of their customers, who will only hire or admit “certified” students.

The Cheapest Product at the Highest Price?

A third analogy is the nonprofit organization. Schuman suggests that if students are customers, the university must be a profit-grubbing business, and since a “business’s only goal is to succeed,” a customer-focused university will “purvey… the cheapest product it can at the highest price customers will pay.”

But does viewing the people one serves as customers necessarily turn one into a business whose concern is to sell poor products at a high price rather than to provide a good service? Credit unions, art museums, area transportation services, and, yes, private K–12 schools are often organizations that don’t operate for profit and yet provide services directly to paying customers.

Nonprofit museums charge admissions and nonprofit ride services charge for rides; therefore, they serve paying customers. But this does not mean they aim to make the maximum profit possible, or in fact any sort of profit, by providing the lowest quality at the highest price. (Of course, we would take issue with Schuman’s characterization of even more traditional profit-seeking firms as aiming to sell junk at high prices, but we can leave that to the side for our purposes here.)

Schuman is wrong to think that if universities see students as customers, this must turn them into profit-driven businesses in this narrow sense.

Is the Customer Always Right?

For all that, we sympathize with some of the basics of Schuman’s argument. As college professors, we understand her concern over putting too much stock in student evaluations of teacher performance. Even if students are customers, they surely aren’t customers in the same way the restaurant patron is a customer. And a restaurant will not automatically treat every customer comment card as equally influential in changing how it does business. Some restaurant customers have unrealistic expectations or don’t understand the food service business, and restaurants often have to decipher what feedback to take seriously and what to disregard.

We suspect that Schuman’s confusion may result from universities and professors thinking that they are selling something different from what students may think they are buying. Students generally want the degrees that come from education, with education being the process to get the degree. Universities (and professors) sell knowledge and skills, and the degree is simply the acknowledgement that students have obtained that knowledge.

Professors may think that they are selling something different from what students think they are buying.

Good learning may be difficult and, in the short run, unpleasant. But for students aiming for a degree, it would be better to go through classes that are agreeable and aren’t too difficult. If this is right, you can see why there’d be a mismatch between how students think their education is going and how it may actually be going, and why the former may not be the best gauge of the latter.

With a restaurant, the customer and the seller both agree on what the product is: a good meal (and good restaurateurs will generally defer to what the customer wants). With personal training, it may be that the trainer’s job involves pushing customers past where they’d go on their own, but the trainer and customer do still generally agree on the service: the trainer helps customers achieve their goal of fitness.

We appreciate and share Schuman’s concern that universities not over-rely on student evaluations and the degree to which students find their educations pleasurable in a narrow sense. But the issue isn’t as simple as saying that, because professors’ job security shouldn’t come down entirely to student evaluations, students aren’t customers.

Yes, there is a danger in treating students the way restaurateurs treat patrons. But there is also danger in the other extreme: if we stop viewing students as customers in some sense of the term, then instead of treating them with the respect we generally see in the personal training and certification industries and among nonprofits, we risk turning universities into something more like the DMV.

Kevin Currie-KnightKevin Currie-Knight

Kevin Currie-Knight teaches in East Carolina University’s Department of Special Education, Foundations, and Research. His website is KevinCK.net. He is a member of the FEE Faculty Network.

 

Steven HorwitzSteven Horwitz

Steven Horwitz is the Charles A. Dana Professor of Economics at St. Lawrence University and the author of Hayek’s Modern Family: Classical Liberalism and the Evolution of Social Institutions.

He is a member of the FEE Faculty Network.

RELATED ARTICLE: This State Offered Free College Education. Here’s What Happened.

The Legacy of Arne Duncan, Common Core and So Much More: College (Part 2)

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As noted in my last post, outgoing Secretary of Education Arne Duncan has done his part to transform America through K-12 education.  This has happened through Common Core and by expanding the Department’s reach into younger and older cohorts.  Duncan got the promise for an additional $1 billion for preschool education.  As the Chronicle of Higher Education noted, Duncan is also leaving a “big imprint” on higher education.  His legacy is one of “innovation and regulation.”  College is put into a seamless web of K-16, or P-20, with an unprecedented federal role in admissions, placement, assessment, and financing.

The Chronicle notes that Duncan has deviated from the standard practice of Democratic secretaries who have just doled out money.  He has been “personally upbraid[ing] colleges over rising prices and low graduation rates, their handling of cases of sexual assault, their lax academic standards for athletes . . . , and their resistance to greater oversight.” Patricia McGuire, president of Trinity Washington University, has become disillusioned with Duncan’s “top-down approach.” Institutions, like Yale University, get nervous about the Department’s investigations of “sexually hostile environments.”

The nonprofits, like the Lumina Foundation, that have been funding Common Core, however, give a positive assessment. Jamie Merisotis, President and Chief Executive, praises Duncan’s “strong leadership” in putting our higher-education system “a step closer to reflecting the needs of today’s increasingly diverse college students — and the changing meaning of ‘college’ to include all types of postsecondary learning.”  Competency-based programs that “measure learning” through demonstration of a skill set are among his many “innovations.”  Inside Higher Education calls it “new delivery model with the potential to improve degree completion, reduce costs to students, and improve transparency and alignment of learning outcomes to the needs of employers and society.”

Currently, over 600 colleges are designing, creating, or already have competency-based education programs. This number has grown from 52 last year. As with Common Core, it is being funded by the Bill and Melinda Gates Foundation, with “guidance” from the U.S. Department of Education.

The notion of “competency” changes the fundamental notion of education, taking it from learning for its own sake, with a knowledgeable, independent citizenry as an outcome, to producing workers with skill sets.  Colleges that have agreed to align financial aid to such tests have ceded their own power.

Funny, Arne Duncan, when he spoke at the 2013 meeting of the American Education Research Association (AERA) and promised a “sea-change” in assessments for K-12 students, included “competency-based education,” as well as “non-cognitive skills.”  Others at that AERA meeting of academics and researchers working at universities, federal and state agencies, school systems, test companies, and non-profit agencies were Linda Darling-Hammond, who oversaw the development of the SBAC (Smarter Balanced Assessment Consortium) tests, one of the two Common Core tests, and her close colleague, Bill Ayers.

Many colleges are following the Department of Education in emphasizing non-cognitive, “social and emotional learning” skills.  Seventeen colleges have received funds from the Department’s “First in the World” grants to identify and help at-risk students through the aid of a tool called Diagnostic Assessment and Achievement of College Skills to measure such emotional attributes as “grit.”

Colleges have been targeted strategically.  Jacqueline King, director of Higher Collaboration at SBAC, has been working to “create greater academic alignment between K-12 and higher education.”  Common Core tests are determining placement in college courses.  In 2014, college faculty in Tennessee attended workshops to learn how to “synch up with Common Core,” in effect to teach grade 13.

I reported that the Department of Education had funded the 2013 working paper, “The Common Core State Standards: Implications for Community Colleges and Student Preparedness for College.”   It described the “Core to College” program in ten states: Colorado, Florida, Hawaii, Indiana, Kentucky, Louisiana, Massachusetts, North Carolina, Oregon, and Washington.  Core to College is funded by the Lumina, the William and Flora Hewlett, the Bill and Melinda Gates, and other foundations.  Their report, “Making Good on the College-Ready Promise and Higher Education Engagement Core to College Alignment Director Convening, August 1-2, 2012,” provides a record of discussions by “alignment directors” and guest speakers on teaching “a new type of student, more prepared for college-level, discipline-specific work.”  (As a former college instructor I am skeptical: having “more prepared” students meant an easier time in teaching them—not the need for special workshops.)

The ten states are to serve as “bellwethers and models for the rest of the country.”  Among the strategies, directors suggested more data, outreach to other “stakeholders” and private colleges, and more meetings.  They are also looking beyond “the English and Math Departments” that receive Common Core-certified students.  Speakers proposed “engaging faculty in other disciplines that could be touched by Common Core implementation, such as history or the social sciences.”

WestEd, a major Common Core funder, is evaluating the initiative.

The push for new assessments (especially at community colleges) has been quickly followed by calls for free community college.  In his 2014 State of the Union address, President Obama cited Tennessee’s still-developing program as a model.  The American Association of Community Colleges welcomed the proposal.  This year, on September 9, Obama announced that the “College Promise Campaign” would be chaired by Second Lady Jill Biden.  AACC President Walter Bumphus and Trustee President J. Noah Brown will serve on the National Advisory Board.

Democratic front-runners, Hillary Clinton and Bernie Sanders, pushed free college in their first presidential debate on October 13, 2015.

To top it off, the federal government is providing a college “scorecard.”  Of course, those who continue to refuse federal aid, like Grove City College and Hillsdale College, will continue to be left off.

Students at these colleges will also find themselves at an increasing financial disadvantage. One of Obama’s first orders of business was to make the federal government the bank for student loans.  This “bank” practices “loan forgiveness,” by graduating payment to income and providing complete forgiveness through work in government jobs, such as in public schools or at Americorps, the federal agency.  Indiana University law professor Sheila Seuss Kennedy and Indianapolis Chamber of Commerce manager Matt Impink enthused about such a “tour of duty” that sounds like the “civilian corps” Obama put forth at the beginning of his presidency.

We are well on our way.  With schools producing graduates with competencies “align[ed] to the needs of employers and society,” and with Common Core spitting out high school graduates “college and career ready,” we will no longer worry about higher learning.

EDITORS NOTE: This column originally appeared on the Selous Foundation for Public Policy Research website. The featured image is of President Obama announcing free community college with Vice President Joe Biden and Second Lady Jill Biden.

Bernie Sanders’s Plan to Fix College Is Worse than Nothing by Ariel Deschapell

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Bernie Sanders has tapped into a frenzied millennial base by proposing “free” college tuition (that is, tuition paid for by the government). Bachelor degrees are pitched as the primary means by which individuals can gain skills and increase their incomes, so skyrocketing tuition is becoming a hot election topic. But are more subsidies to the university system a legitimate solution to the problem, or simply a stunt to capitalize on youthful outrage?

There’s no denying that the price of higher education is unrealistically high, and a fix is needed. But Sanders’ plan doesn’t even purport to be a solution. It does nothing to address the root problem of rising costs. It merely spreads those costs to society as a whole by socializing them.

Proponents of this idea don’t ever seem to explore the more fundamental question of why the cost of college continues to increase, let alone how socializing those costs stops the inflationary trend.

The assumption seems to be that rising costs are simply a law of nature that we have to deal with. Fortunately, this isn’t the case. If we look at the wider economy, the cost of higher education is clearly an anomaly. Products across the economic spectrum, from smartphones to automobiles, decrease in cost and increase in quality year after year, despite heavy demand. Indeed, consumer demand is what drives continuous innovation in these industries.

Could the problem be something as simple as decreased public funding? Even if that were true, it still wouldn’t explain why universities seem incapable of cutting costs and maximizing performance. Apple, Samsung, and most any other firms seem perfectly able to do so without any regular source of taxpayer funding.

Higher education possess no unique characteristic that prevents it from improving and adapting as every other industry regularly does. But incentives matter, and the market incentives that drive competitive innovation in other industries are heavily distorted in the college and university system.

For starters, under the Higher Education Act signed into law by Lyndon B. Johnson in 1965, universities and colleges gained a de facto monopoly on higher education.

As Senator Mike Lee explains,

Under the federal Higher Education Act, students are eligible for Title IV student loans and grants only if they attend formally accredited institutions. That makes some sense, for purposes of quality control.

Except that under the law, only degree-issuing academic institutions are allowed to be accredited. And only the U.S. Department of Education gets to say who can be an accreditor.

That is, the federal government today operates a kind of higher-education cartel, with federally approved accreditors using their gatekeeper power to keep out unwanted competition.

Can this explain why higher education seems perpetually stagnant and inefficient? Since 1965, computers have gone from being the size of a small building to vastly more powerful, more common, and more affordable pocket-sized devices. Whole other industries have been continuously disrupted again and again, giving way to newer and better models for doing business.

Yet despite a relentlessly increasing price tag, a college education is largely the same beast it was decades ago. In 21st century America, our higher education system is still governed by rules written in 1965.

Because of these rules (and a flood of taxpayer-backed loans), more students are funneled into accredited higher education every year, while the supply remains artificially restricted. Even the smallest regional colleges turn away more students than they could hope to take in.

Is it any surprise then that tuition continues to climb when there exists so little competitive pressure to keep it in check? Without the risk of losing potential students to superior alternatives, universities lack the basic incentives to maximize the value they provide while minimizing the cost.

With this in mind, what does Sanders’s proposal do to address the underlying structural problem in higher education? As it turns out, worse than nothing.

Instead of seeking to weaken the cartel and drive down prices by increasing competition, free tuition goes the exact opposite way. Like decades worth of failed higher education programs, Sanders seeks to continue stimulating demand while doing nothing to address the artificially limited supply and dearth of innovation. Unchecked by any last remnant of market forces college costs will continue to run away at an even faster rate than before.

Were it still 1965, the Senator might suggest we deal with the AT&T telephone monopoly by demanding free landlines for all Americans forever. Thankfully, this isn’t what happened, and instead of a sprawling federally subsidized landline monopoly, we have a cheap, competitive nationwide market for cellular and mobile internet providers.

But this is exactly what Sanders proposes for higher education: a stagnant, expensive, uncompetitive industry, stuck in the past and eating up billions in subsidies. In doing so, he threatens to deny us the creative destruction sorely needed to bring higher education into the 21st century.

Socialized college tuition may provide a popular and illusory respite for students, but only the competition present in free markets can actually reduce costs and spur sustainable innovation.

Ariel Deschapell
Ariel Deschapell

Ariel holds the Henry Hazlitt Fellowship for Digital Development at FEE. He is a student of Florida International University with a focus in finance and economics.

Save Money with Adjunct Professors, Spend It on Bureaucrats

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Jordan Schneider, like many part-time college instructors, teaches on two community college campuses in order to cobble together a living. He earns a paltry $21,000 per year with no benefits for teaching a larger-than-normal load of four courses per semester. Non-tenure track full-time professors earn $47,000. Established professors’ salaries have remained flat, at between $60,000 and $100,000. As a former instructor of English at Georgia Perimeter College and elsewhere, these figures, from the 2014 Delta Cost Project, sound right.

In “Letter to Full-Time Faculty Members,” in the Chronicle of Higher Education, Schneider deviates from the typical call for redress through unionization, and appeals to full-time colleagues’ self-interests by arguing that a class of “super adjuncts,” paid more than regular adjuncts but less than full-time faculty ($20,000 to $25,000 per term with benefits), with some of the duties and voting privileges of full-time faculty, would take away administrators’ “trump cards”: the threat of replacing full-timers with cheap adjuncts, who, along with teaching assistants, now account for half of instructional staff (up from one-third in 1987).

But the number of full-time professors on short-term contracts (like “super adjuncts”) has already increased, by 30 to 50 percent between 2004 and 2012.

Goodbye, Full-Time Faculty

In spite of increasing reliance on contingent faculty, higher education costs tripled between 1975 and 2005. Tuition at public four-year colleges and universities increased nearly 160 percent between 1990 and 2012. At private bachelor’s institutions it has almost doubled since 1987. Yet, the proportion of all employees who were full-time faculty has declined 5 to 7 percent at four-year colleges and 16 percent at community colleges between 2000 and 2012.

While students have less access to faculty members, especially full-time faculty members, they are paying for the services of administrators and their professional staffs. Since 1987, this number has more than doubled and increased at a rate twice as fast as the growth in the number of students.

The Delta report states that there is “no single smoking gun” to explain such growth in administration.

Why So Many Administrators?

Huffington Post’s Jon Marcus cannot pin down the reasons either, claiming more resources are being devoted to such things as marketing, diversity, sustainability, security, athletic programs, and conference centers. He quotes Dan King, president of the American Association of University Administrators, who claims that government regulations and demands for such services as remedial help and counseling are responsible. Yet, graduation rates of students at four-year bachelor’s institutions have barely inched up, from 55 percent to 58 percent since 2002.

Political science professor Benjamin Ginsberg seems to have a good diagnosis. In his 2011 Washington Monthly article, “Administrators Ate My Tuition” he noted that well-paid professional bureaucrats have taken over duties once handled by faculty members on a temporary, part-time basis. Unlike faculty members, their motivation is not academic improvement, but growing the bureaucracy, with make-work projects developed at far-away conferences and retreats.

Goodbye to Real Instruction

This is evidenced by the questionable academic value of many of the initiatives coming out of their offices. In fact, many of the programs substitute for real academic instruction. More and more money is spent on diversity, social justice, and sustainability initiatives at the expense of real teaching.

The students who can least afford such diversions, those attending community colleges, are seeing the largest shift from funding for teaching to administrative programs.

I saw this happening at Georgia Perimeter College where I was a part-time instructor from 2007 to 2010. As we were being asked to squeeze several more students into our classes (that were maxed out at 22) for the same $2100 per class, college president Anthony Tricoli was rallying faculty to embrace civic learning.

Around the same time, 2009, the federal government put out the 136-page report, A Crucible Moment: College Learning and Democracy’s Future, for which Tricoli served as a roundtable member. The college’s Atlanta Center for Civic Engagement & Learning was one of about 100 participating organizations that included campuses, non-profits, and government agencies. However, real “civic learning” is the farthest from the report’s objectives.

Model centers, such as at the University of Maryland and Salt Lake Community College, show students working in soup kitchens, reading to school children, and cleaning up nature trails. Organizations such as Campus Compact (which GPC joined) and the Association of American Colleges & Universities (the lead writer of A Crucible Moment) provide direction. One instructional ASC&U video shows a statistics professor “collaborating” with an “anti-poverty” representative on a lesson publicizing free tax preparation services in target zip codes for Earned Income Tax Credits. (If there is any doubt about the agenda, a “social justice” sign appears prominently.) Instead of formal essays or research papers, students write “reflection papers.”

At my college, the associate vice president for civic engagement and service learning, attorney Deborah Gonzalez, made $104,000 for offering “infrastructure and resources, to share best practices and technical assistance . . . , to [help faculty] implement initiatives to help their students engage in their communities, both locally and globally”—all while presumably helping students strengthen their “academic goals and objectives.” In response to her call for courses with a “Civic-engagement or Service-learning component,” a colleague shared having students serve as docents at the Margaret Mitchell House. I failed to see how such activities, whether “global” or ushering at a local historic site, would help students struggling with grammar.

The grand new Center for Civic Engagement and Service-Learning opened in 2010 with much fanfare and a keynote address by former President Jimmy Carter. The program listed a good number of individuals drawing salaries or partial salaries for their efforts: the Associate Vice President for Academic Affairs, the Executive Director, the Service-Learning Coordinator, the Administrative Secretary, and eleven faculty members.

In 2012, however, Tricoli was forced to resign over a $25 million budget deficit; he is now suing, charging conspiracy to ruin his reputation. I don’t know what percentage the civic engagement initiative represented, but such programs are not cheap.

Rather than pleading for part of the increasingly smaller portion of budgets allocated to academic instruction, it seems that Schneider and others ought to be demanding the ouster of bureaucrats and the restoration of higher education to its rightful purpose.