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*Cc:*Hymore, Diane
*Subject:*October 14, 2010

Below is a clipping describing a provocative new book by Mark Turner, a
professor at Columbia University.  We have invited Mark Turner to visit UT
on October 14, 2010.  Please let me know if you would be interested in
meeting him or spending time with him.  I believe that will be time well
spent.

lj


The New York Times

Academic Bankruptcy

By MARK C. TAYLOR

Published: August 14, 2010

WITH the academic year about to begin, colleges and universities, as well as
students and their parents, are facing an unprecedented financial crisis.
What we've seen with California's distinguished state university system -
huge cutbacks in spending and a 32 percent rise in tuition - is likely to
become the norm at public and private colleges. Government support is being
slashed, endowments and charitable giving are down, debts are piling up,
expenses are rising and some schools are selling their product for
two-thirds of what it costs to produce it. You don't need an M.B.A. to know
this situation is unsustainable.

Related


Times Topics: New York University | Columbia University

With unemployment soaring, higher education has never been more important to
society or more widely desired. But the collapse of our public education
system and the skyrocketing cost of private education threaten to make
college unaffordable for millions of young people. If recent trends
continue, four years at a top-tier school will cost $330,000 in 2020,
$525,000 in 2028 and $785,000 in 2035.

Yet most faculty and administrators refuse to acknowledge this crisis.
Consider what is taking place here in New York City. Rather than learning to
live within their means, Columbia University, where I teach, and New York
University are engaged in a fierce competition to expand as widely and
quickly as possible. Last spring, N.Y.U. announced plans to increase its
physical plant by 40 percent over the next 20 years; this summer Columbia
secured approval for its $6.3 billion expansion in Upper Manhattan. N.Y.U.
is also opening a new campus in Abu Dhabi this fall.


The financial arrangements for these projects remain obscure, but it is
clear that they will not be completed without increasing the universities'
already significant and perhaps unsustainable levels of debt. Last year
Columbia reported $1.4 billion in outstanding debt against a $5.89 billion
endowment. N.Y.U. had a staggering $2.22 billion debt with a relatively
modest $2.2 billion endowment - one that had shrunk by more than 11 percent
over the previous fiscal year. For universities, as for banks, the question
is not only the value of current and projected assets but also the
availability of liquidity so they can pay off interim debt obligations
during a time of financial instability.


There is a similarity between the debt crisis on Wall Street and what
threatens higher education. Just as investors borrowed more and increased
their leverage in volatile markets, many colleges and universities are
borrowing more and betting on an expanding market in higher education at the
precise moment their product is becoming affordable for fewer people.


Financial aid is drying up and government support is not keeping pace with
the rising cost of college, so students and parents are being forced to
borrow more heavily. For decades, admissions offices have marketed
themselves by promising a significant return on the investment in the form
of higher lifetime income. But with the cost of an undergraduate degree well
into the hundreds of thousands of dollars, this argument is no longer
persuasive. Students and their parents are carrying unsustainable levels of
debt, which is likely to lead to a crisis that will mirror the collapse of
the subprime mortgage market. To make matters worse, student debt is even
more toxic than a soured mortgage, because it is nearly impossible for a
person to legally walk away from student loans the way a homeowner can walk
away from a mortgage.


The competition between Columbia and N.Y.U. is an example of what
educational institutions should not be doing. Universities should be looking
for new ways to provide high-quality education to more students at a lower
price. In today's world, it no longer makes sense for every school to cover
every subject.


For example, it is absurd for Columbia and N.Y.U. to be have competing
philosophy departments at a time when there are few jobs for philosophy
academics. Instead, they could cooperate by forming a joint graduate and
undergraduate program, which would reduce costs by requiring fewer faculty
members and a more modest physical presence, while at the same time
increasing course choices for students. And in our wired world, universities
on opposite sides of the globe could find similar ways to collaborate.


American higher education has long been the envy of the world, but today our
institutions are eroding from within and are facing growing competition from
countries like China and India, which are developing ambitious plans to
enter the global higher education market. Capital can be intellectual and
cultural as well as financial; it is vital that American higher education
remains the reserve currency of the global educational system. No less than
Wall Street, our colleges and universities are in dire need of reform.


Mark C. Taylor, the chairman of the religion department at Columbia
University, is the author of the forthcoming "Crisis on Campus: A Bold Plan
for Reforming Our Colleges and Universities."