{"id":16623,"date":"2024-11-18T04:30:00","date_gmt":"2024-11-18T09:30:00","guid":{"rendered":"https:\/\/christoverall.com\/?p=16623"},"modified":"2024-11-17T22:02:40","modified_gmt":"2024-11-18T03:02:40","slug":"encore-big-ed-too-big-to-fail","status":"publish","type":"post","link":"https:\/\/christoverall.com\/article\/longform\/encore-big-ed-too-big-to-fail\/","title":{"rendered":"Encore: Big Ed, Too Big to Fail"},"content":{"rendered":"\n
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[Editor’s Note: Christ Over All<\/em> examines a different theme each month from a robust biblical and theological perspective. And occasionally we come back to themes that we’ve already covered in an “encore” piece.\u00a0 In this essay,\u00a0we revisit the month of October 2024<\/a>\u00a0and add one more “Ism” to the mix of ideologies and movements that Christ reigns over.]<\/p>\n\n\n\n

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\u00a0<\/p>\n

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I received my first glimpse of the impending higher ed crisis shortly after I was appointed president of New Saint Andrews College.[1]<\/a><\/sup><\/sup> Like previous academics suddenly thrust into administration, I was eager to get a better handle on the business side of things. So I attended a conference to hear from the president of a small, historic liberal arts college who walked a group of other presidents through the higher ed business model. He plotted out the basic financial strategy, broke down how the funding works, and described where the money comes from. The more he talked, the more it became evident that the model he was describing was broken and unsustainable. He pulled no punches on its flaws. The talk was made even more odd and disheartening by the fact that he provided no alternatives or solutions. Instead, he humorously concluded with something along the lines of, \u201cSo you can see from this that we are all driving straight off of a cliff, and there is no way to turn.\u201d With that, the room erupted into laughter, and the talk ended. Having acknowledged impending doom, we retreated into the hall for casual conversation and snacks.<\/p>\n

1. This essay originally appeared as a series of blog posts on the New Saint Andrews blog.<\/h6>\n

In a report from Bain and Company<\/a>, the authors point out that nearly 33% of all schools are struggling and that 49% of public universities are on an unsustainable financial path. More and more people are pointing out the flawed model, like in this piece<\/a> by Jason Wingard, president of Temple University. That said, many in higher ed leadership\u2014and too many of the institutions they run\u2014are on autopilot, hurdling toward an inevitable economic failure with no plans to change course or do anything to prepare for what\u2019s coming. Much of this might be because the current higher ed leadership team will just bail when things get bad. With pensions and retirement plans in hand, they can sail into the sunset and leave the problem to someone else. And perhaps more importantly, change doesn\u2019t happen because American higher ed is so heavily subsidized by federal student loans that nobody really sees a way out of the mess.<\/p>\n

Consider one of the major lessons from the financial collapse of 2008\u20132010 (the Great Recession). The meltdown was largely driven by the subprime mortgage crisis when banks pursued terrible lending practices and the feds essentially encouraged it. Banks would lend huge sums of money to people who had no business buying houses, countless people defaulted on those loans, and, eventually, the system came crashing down, taking the entire economy with it. Many of the financial institutions involved knew that what they were doing was wrong and unsustainable, but they were making money, and everyone seemed happy to keep going along with the scheme, willfully ignorant of how bad the entire deal was. One could imagine that a fair number of college boardrooms must have felt a little bit like the Lehman Brothers Bank before the collapse.<\/p>\n

Here, we find one of the darker sides of higher ed. The entire system is feeding at the trough of federal taxpayer dollars. The business model behind this lending is highly flawed and has cost taxpayers billions more than we were told it would<\/a>. This would explain why a group of college leaders can be in a room, laughing about how poor their financial models are, without any real sense of impending doom. Yes, they understand that what they\u2019re doing doesn\u2019t really work. But they also get that they\u2019re backed by the same sort of too-big-to-fail hubris that poisoned the financial sector. Such corrupt, bureaucratic, handout thinking has become all too common in our culture. We\u2019ve even named these types of industries accordingly: Big Tech, Big Finance, Big Pharma, and Big Eva. <\/p>\n

To this list I’d like to add one more: Big Education, or Big Ed for short.<\/p>\n

Big Ed is that quintessential institution of higher education. Big Ed is convinced that America cannot exist without it, and\u2014no matter what level of irresponsible spending it indulges in\u2014that the American government will swoop in to supplement revenues and make sure that the checks never bounce. The disaster looming on the horizon doesn\u2019t scare Big Ed because it doesn\u2019t believe America would ever let Big Ed actually go over that cliff. Just look at the countless checks cut to American colleges and universities throughout the COVID crisis to make sure that the collapse of the economy wouldn\u2019t touch Big Ed.<\/p>\n

The Higher Ed Landscape<\/h2>\n

There are just over 17 million students<\/a> enrolled in U.S. postsecondary institutions. A majority of those students (12.4 million, or 73%) attend public universities. Another 4.5 million (27%) attend private institutions. Total postsecondary enrollment peaked in 2010 and has been in a steady decline ever since. From the fall of 2019 to the fall of 2021<\/a>, over one million students left American colleges and universities\u2014a 6.6% enrollment decline in just two years.<\/p>\n

Lockdowns, school closures, forced masking and vaccinations, online learning, and labor shortages have all caused this precipitous decline. And this is all happening as the U.S. population has peaked and will start to fall dramatically<\/a> over the next 100 years. The implications for Big Ed are massive. The nation has hit a well-reported demographic cliff<\/a>, which means that the demand for higher ed will decrease significantly over the next few decades. These looming population and enrollment declines are already causing people to wonder if we really need so many schools. There are over 4,000 colleges in the United States, and all of them should be standing up and taking note of this shift. But oddly enough, the issue keeps getting swept under the rug. Big Ed doesn\u2019t like to be noticed, questioned, or changed when it comes to its model.<\/p>\n

Today, American colleges and universities aren\u2019t tightening their belt, reducing staff, or having frank conversations about scaling back. If anything, they\u2019re as committed as ever to building, staffing up (especially when it comes to administrative roles<\/a>), and pushing tuition up to record highs. And this defies basic economics. With a dwindling supply, how can the system sustain more demand? I can guarantee that when things start to hit the fan, these same schools will be clamoring for a federal bailout and takeover to ensure that \u201cAmerica\u2019s youth\u201d can get access to higher ed.<\/p>\n

American higher ed, public and private, is a highly decentralized, scattered, complex, and confusing federal program. To illustrate, we\u2019ll take a closer look at how public university systems generally work.<\/p>\n

The Public University Business Model<\/h2>\n

Large public universities receive a significant amount of their financial support from their respective states. Many of them were founded by state governments at the end of the eighteenth century and throughout the nineteenth century. The first public universities were the University of Georgia (1785), UNC Chapel Hill (1789), and the University of Tennessee (1794). These state schools were established in order to compete with the private college system, which was well-established in the North and generally originated with churches or church-affiliated organizations.<\/p>\n

Land grant universities like the University of Idaho (1889), Washington State University (1890), and Oregon State University (1868) came much later when the federal government passed the Morrill Act (in 1862 and 1890). The Morrill Act<\/a> promoted the study of agriculture and engineering to support the infrastructure of the young, growing nation. It also transferred parcels of federal land to state governments (hence the phrase \u201cland grant universities\u201d), which the state governments could use to fund the establishment of their own state universities.<\/p>\n

State universities have become, by far, the most popular choice for college-bound students. One of the main reasons for this is the cost. State governments significantly underwrite the costs of studying at these schools. For instance, according to SHEEO<\/a>, a typical state university (in 2018) received $7,853 per attending student from their state and local governments. This explains why state universities have two rates for tuition and fees: one for in-state residents and another for out-of-state residents. The out-of-state residents get a higher price because their families haven\u2019t been giving tax revenue to that state. However, the actual amount of funding can vary quite a bit as you go from state to state. Vermont and New Hampshire give less than $3,000 per student since so many of their students end up at private colleges. But Wyoming, where oil revenue has been overflowing the state coffers, gives the state colleges a luxurious $18,000 per student.<\/p>\n

The second important ingredient to the state university budget is tuition revenue. In 2018, the average student at a public university paid $6,788. This number has been steadily climbing over the last decade. For instance, in 2008, the average tuition payment was $4,898 (in constant adjusted 2018 dollars). Of course, this figure also varies significantly from state to state. In Vermont, where state contributions were minimal, the average 2018 student tuition payment was $14,907. In Wyoming, where that state is carrying $18,000 per student, the average tuition payment was only $3,801.<\/p>\n

So, if the average state contribution is $7,853, and the average individual student pays $6,788, it would appear that, even at our public colleges, the individual student is still picking up 46% of the tuition. However, the tuition payment from the student is actually a little more complicated than that. Included within the tuition number are all the various forms of federal financial aid, the primary components being Pell Grants<\/a> and federally subsidized student loans.<\/p>\n

A Pell Grant is awarded to the individual student as a need-based grant. From the university\u2019s perspective, this money comes as a tuition payment from the student, but in actuality, this is money coming from the federal government. In the 2017\u201318 school year, the average Pell award was $4,010<\/a> (the maximum allowed was $5,920). On top of Pell Grants are student loans, which are also subsidized by the federal government. Around 65% of graduates leave college with student loan debt, with the average balance per student being over $37,000<\/a>. In 2022, student loan debt has ballooned to $1.76 trillion<\/a>, which is just staggering. These dollars are, of course, spread out across all U.S. colleges, not just the public universities. What is most notable is that once you add up all the money that the federal government gives directly to postsecondary institutions each year (both public and private), the total is actually greater than what all the state governments collectively give. The cash payments from students or their parents, from their own pockets rather than from grants and loans, are the least significant contribution to the public university\u2019s revenue stream when compared to the state and federal contributions. In fact, according to NCES, tuition and fees only make up 20% of public universities\u2019 total revenue.<\/p>\n

This is why so many colleges are not too worried about declining enrollment, shrinking demographics, and the overall trajectory of demand for higher ed. They\u2019re funded by the federal government and feel almost no pressure to change that. It\u2019s easy money, and it keeps flowing. To counteract enrollment declines, they merely have to boost tuition, encourage students to get loans, and let the federal government continue to pay for it all.<\/p>\n

With the Shekels Come the Shackles<\/h2>\n

You\u2019ve heard the saying \u2013 \u201cIf you take the king\u2019s coin, you become the king\u2019s man.\u201d While we have always understood that the cost of state universities was somewhat underwritten by the government, I don\u2019t think many people realize how extensively these colleges depend on government money. And this has significant implications for how these schools are run. For one thing, this is not a system that is tuned into the price signals of the free market. Rather, state universities are far more responsive to state and federal government budget allocations. Most concerning is the way that Title IV money, the Pell Grants, and student loans that the federal government offers have made American colleges and universities ideologically subservient to the passing political trends in Washington, DC. When the Fed says \u201cJump,\u201d we say \u201cHow high?\u201d<\/p>\n

This became particularly clear in Nixon\u2019s 1972 amendments to the Higher Education Act. Nixon added Title IX, which declared that no school taking the federal money described under Title IV, could discriminate on the basis of gender. You probably know of Title IX because of its impact on college athletics. Because Title IX prohibits discrimination on college campuses based on gender, college athletic programs must spend equal money on both men’s and women\u2019s sports in order to be in compliance with Title IX and to keep their federal money coming. In the wake of Title IX\u2019s implementation, scores of men\u2019s sports were cut, and new women\u2019s programs were launched in an effort to rebalance athletic spending. Title IX has been especially cumbersome for college football, the most popular college sport by far since college football requires a disproportionate number of male athletes on the field. Now, because of Title IX, in order to launch a men\u2019s football team, a college must usually also launch two women\u2019s teams to compensate for the number of scholarships offered to the men\u2019s football team. Women\u2019s soccer, lacrosse, tennis, etc. all have to be launched in order to maintain balance with the football team. College athletic programs must spend equal money on both men’s and women\u2019s sports in order to be in compliance with Title IX and to keep their federal money coming.<\/p>\n

But Title IX has subsequently been interpreted to address sexual harassment as well. The reasoning goes that if a woman experiences sexual harassment on a college campus, that harassment places an impediment between her and her education. And since she experienced that harassment because of her gender, this sexual harassment violates her Title IX rights. This makes sexual harassment on the college campus, quite literally, a federal issue. And so, through Title IX, the federal government has been able to step onto the campuses of colleges that take Title IV money to dictate how sexual harassment issues must be handled. In 2011, President Obama sent a \u201cDear Colleague\u201d letter to all presidents of colleges accepting Title IV money. In this letter, Obama established a whole new set of procedures for handling sexual harassment and assault on the college campus. The burden of proof was set at the lowest possible bar of \u201cpreponderance of evidence,\u201d meaning at least 51% of the evidence. Cross-examination of the accuser was discouraged, but double jeopardy for the accused was allowed. And schools needed to hire a full-time Title IV coordinator to ensure that their campus was in compliance. This created another necessary category of administrators in order to receive federal money<\/a>.[2]<\/a><\/sup><\/sup><\/p>\n

2. For the ways in which this approach to sexual harassment has shaped evangelical institutions see, Megan Basham, Shepherds for Sale: How Evangelical Leaders Traded the Truth for a Leftist Agenda <\/em>(New York: Broadside, 2024), 160\u201393.<\/h6>\n

And, in an episode that would be comic if it weren\u2019t so tragic, college administrations across the nation, equipped with their great skill in policy creation and assessment, all threw themselves at the task of educating their students on how to correctly establish consent for sexual activity in order to establish clear lines for what was and what wasn\u2019t sexual harassment. You might remember this moment when everyone was trying to establish a policy for establishing clear permission to engage in a sexual relationship. The results became laughable fodder for late-night television as college bureaucrats turned old-fashioned fornication into a very tedious game of sexual-mother-may-I? To be clear, I\u2019m all for clarifying consent. But I think that we do much better by going with permission from her dad, a ring on her finger, and vows of \u201cwith all my worldly goods I thee endow,\u201d as well as \u201ctill death do we part,\u201d spoken in front of a room of witnesses. But this wasn\u2019t what our college administrators had in mind. Our common sense has a way of getting the better of political sensibilities.<\/p>\n

In 2016, President Obama issued another \u201cDear Colleague\u201d letter, right at the end of his time in office. This letter took Title IX\u2019s prohibition of discrimination according to gender and extended this to cover gender identity. This meant that a college taking Title IV money must accommodate transgender students by respecting their chosen names and pronouns, as well as allowing them access to the bathrooms, locker rooms, and other accommodations that corresponded to their gender of choice. This launched a barrage of spending on facilities as universities across the country attempted to remodel their bathrooms to accommodate these new requirements. It is worth noting that most campuses have opted to create bathrooms and showers that are gender-neutral and accommodate one person at a time, rather than attempt to just send biological males into a multi-person women\u2019s restroom. Again, our common sense has a way of getting the better of political sensibilities.<\/p>\n

Shortly after President Trump took office, his Secretary of Education Betsy DeVos rescinded Obama\u2019s Dear Colleague letters. However, in the spring of 2024, President Biden reinstated<\/a> Obama\u2019s same policies. Colleges and universities once again had to bow to a twisted ideology just to keep the federal money flowing.<\/p>\n

Should College Be Free?<\/h2>\n

In the end, despite the good things that programs like the G.I. Bill initially accomplished, the funding of our nation\u2019s colleges from the federal coffers has increased the cost of our college education<\/a>, has distracted colleges from their true mission, and has entangled colleges in the passing political fads of the federal government. And now we are hearing from many of our nation\u2019s politicians that college education should not just be subsidized by the government, but that it should actually be completely funded by the federal government. College should be free.<\/p>\n

Note that word free<\/em>. What does it mean to be free? There are profound implications for how you answer this question. As an American, and particularly as a Christian, that word free <\/em>has a profoundly deep meaning. It describes your independence, your ability to stand unbound by the chains of another. One thinks of the words offered by Revolutionary War General John Stark, \u201cLive free or die: Death is not the worst of evils.\u201d The first half of that quote is memorialized as the gutsy motto on the New Hampshire license plate. Or perhaps you think of Christ\u2019s words in the Gospel of John: \u201cIf the Son sets you free, you will be free indeed\u201d (John 8:36). To be free is, in this sense, a truly noble purpose. And to have a college that set you on this path, a college that taught you to live free in this deepest sense, would be a profound blessing.<\/p>\n

But there is another definition to the word free<\/em>. It can simply mean that you may have the service without having to pay the normal charge, like when you get a free pizza. Of course, it goes without saying that nothing is truly free in this sense. Somebody, somewhere is still paying for that pizza. But for whatever reason, that person is motivated to carry the cost and let you slip out the door without paying the bill. That\u2019s a nice gesture when it comes from the overflow of an individual, generous heart. But it is a financial debacle when that free meal is instituted as a national policy and considered to be an inherent right of every eighteen-year-old.<\/p>\n

Unfortunately, all the current conversations about the possibility of free<\/em> college are using this second definition of free<\/em>, rather than the first. College is being offered like a free pizza, a complimentary education served up piping hot by the federal government. But I want to argue that to the extent that we avail ourselves of this second kind of free<\/em>, we will lose that first\u2014and far more profound\u2014kind of freedom. You cannot take the money and expect to maintain ideological integrity. As federal funding increases, so does the federal government\u2019s estimation of its own authority over the various elements of college life. We may get a free<\/em> college education. But, in the end, we will find that we have gotten what we paid for.<\/p>\n

Another Way<\/h2>\n

Given that the critique that I have outlined seems to describe virtually the entirety of our higher education system, if I have convinced any readers of my concerns, I may have also left them utterly hopeless. I think this is why we are experiencing a new trend of high school graduates opting to skip college entirely. They simply don\u2019t see the point in wasting four years going into debt in order to be indoctrinated into a worldview to which they don\u2019t subscribe, all to get a piece of paper that appears to be devalued every year.<\/p>\n

But there are actually other options. I am the president of one example of a college committed to recovering a college education that understands that deeper, more profound sense of what it means to be free. At New Saint Andrews (NSA) we have said no to all government money from the very beginning. We don\u2019t take Pell Grants. We don\u2019t take federally subsidized student loans. In fact, we said no to all government money throughout the Covid crisis. Refusing to take the government money has resulted in two blessings. First, it means that we have to keep our tuition responsive to the price signals of the free market rather than the bloated numbers that Pell Grants and subsidized student loans make possible. And second, it means that we are not subject to whatever the latest Title IX requirements might be, meaning we are free to maintain that old-fashioned distinction between men and women.<\/p>\n

The good news is that New Saint Andrews is not the only college offering a legitimate alternative to the rest of higher ed.[3]<\/a><\/sup><\/sup> A number of new colleges have recently launched or are about to be launched, colleges like Patrick Henry, New College Franklin, Bethlehem College & Seminary, and several others. These are colleges that refuse federal money, that are committed to mentoring their students into a robust biblical worldview, and that seek to serve their students not by giving them vocational credentials, but by giving them a true education. There is hope for the Christian liberal arts college. But I don\u2019t think it will be a hope that is realized until we fully understand the brokenness of what is currently masquerading as a college education.<\/p>\n

3. We are not the only alternative. We are, in my opinion, simply the best alternative.<\/h6>","protected":false},"excerpt":{"rendered":"

Propped up by state and federal grants\u2014and beholden to whomever holds the strings\u2014big education will one day face a reckoning. <\/p>\n","protected":false},"author":2,"featured_media":16625,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_seopress_robots_primary_cat":"none","_seopress_titles_title":"","_seopress_titles_desc":"Propped up by state and federal grants\u2014and beholden to whomever holds the strings\u2014big education will one day face a reckoning. ","_seopress_robots_index":"","inline_featured_image":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","_links_to":"","_links_to_target":""},"categories":[32,8,1813,38],"tags":[422,856,467,1556,1913,1944,803,1945,498],"scripture-reference":[],"post_folder":[],"ppma_author":[1946],"class_list":["post-16623","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-article","category-longform","category-november-2024","category-theme","tag-barak-obama","tag-education","tag-government","tag-higher-education","tag-limited-government","tag-private-school","tag-public-school","tag-title-iv","tag-title-ix"],"acf":[],"jetpack_featured_media_url":"https:\/\/christoverall.com\/wp-content\/uploads\/2024\/11\/Avalanche-Merkle-scaled.jpeg","jetpack_sharing_enabled":true,"publishpress_future_action":{"enabled":false,"date":"2026-01-13 11:55:36","action":"change-status","newStatus":"draft","terms":[],"taxonomy":"category","extraData":[]},"publishpress_future_workflow_manual_trigger":{"enabledWorkflows":[]},"authors":[{"term_id":1946,"user_id":0,"is_guest":1,"slug":"benjamin-r-merkle","display_name":"Benjamin R. Merkle","avatar_url":{"url":"https:\/\/christoverall.com\/wp-content\/uploads\/2024\/11\/Benjamin-R.-Merkle-scaled.jpg","url2x":"https:\/\/christoverall.com\/wp-content\/uploads\/2024\/11\/Benjamin-R.-Merkle-scaled.jpg"},"author_category":"","job_title":"","church_city_state":"","last_name":"","first_name":"","church_site":"","user_url":"","description":"Dr. Ben Merkle<\/b> is the president of New Saint Andrews College, as well as a Senior Fellow of Theology. He holds a DPhil in Oriental Studies and an MSt in Jewish Studies from Oxford University, England; an MA degree in English Literature, a Greyfriars Letter, and a BS in Education (Secondary Education-Chemistry, with a minor in History) both from the University of Idaho. He is a teaching elder at Christ Church, Moscow, and regularly preaches at their downtown service. Dr. Merkle is the author of The White Horse King<\/I> (Thomas Nelson Publishers, 2009) and Defending the Trinity in the Reformed Palatinate<\/I> (Oxford University Press, 2015). He and his wife Rebekah have five children and a growing generation of grandchildren."}],"_links":{"self":[{"href":"https:\/\/christoverall.com\/wp-json\/wp\/v2\/posts\/16623","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/christoverall.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/christoverall.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/christoverall.com\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/christoverall.com\/wp-json\/wp\/v2\/comments?post=16623"}],"version-history":[{"count":9,"href":"https:\/\/christoverall.com\/wp-json\/wp\/v2\/posts\/16623\/revisions"}],"predecessor-version":[{"id":16639,"href":"https:\/\/christoverall.com\/wp-json\/wp\/v2\/posts\/16623\/revisions\/16639"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/christoverall.com\/wp-json\/wp\/v2\/media\/16625"}],"wp:attachment":[{"href":"https:\/\/christoverall.com\/wp-json\/wp\/v2\/media?parent=16623"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/christoverall.com\/wp-json\/wp\/v2\/categories?post=16623"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/christoverall.com\/wp-json\/wp\/v2\/tags?post=16623"},{"taxonomy":"scripture-reference","embeddable":true,"href":"https:\/\/christoverall.com\/wp-json\/wp\/v2\/scripture-reference?post=16623"},{"taxonomy":"post_folder","embeddable":true,"href":"https:\/\/christoverall.com\/wp-json\/wp\/v2\/post_folder?post=16623"},{"taxonomy":"author","embeddable":true,"href":"https:\/\/christoverall.com\/wp-json\/wp\/v2\/ppma_author?post=16623"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}