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Student debt is worst at schools with the highest-paid presidents


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This report about university executive pay by Jon Wiener for The Nation is from 2014 but relevant as ever: he states clearly that student debt is worst at schools with the highest-paid presidents. This isn’t necessarily a causative correlation, i.e. students aren’t necessarily only paying for the executive’s salary, but rather high executive pay is indicative of a university’s tendency to overpay and over-hire administrators as a means of executive self-preservation. Read Wiener in partial below, in full via The Nation.

The “most unequal” public university in America, according to the report, is Ohio State. Between 2010 and 2012 it paid its president, Gordon Gee, a total of almost $6 million, while raising tuition and fees so much that student debt grew 23 percent faster than the national average.

The only people on campus worse off than students with loans are the part-time faculty members—and they too were worst off at schools with the highest paid presidents. OSU, while paying its president $5.9 million, focused its faculty hiring on low wage part-timers, hiring 498 contingent and part-time but only forty-five permanent faculty members.

At the same time that the regular faculty has been shrinking, the number of administrators has been growing. During the period when OSU hired forty-five permanent faculty members, it hired 670 new administrators. A similar pattern is found throughout American universities.

The Institute for Policy Studies report, “The One Percent at State U: How University Presidents Profit from Rising Student Debt and Low-Wage Faculty Labor,” examined the relationship between executive pay, student debt and low-wage faculty labor at the twenty-five top-paying public universities. Co-authors Andrew Erwin and Marjorie Wood reported that money spent on administration at the highest-paying universities outpaced spending on scholarships by more than two to one.

“The high executive pay obviously isn’t the direct cause of higher student debt, or cuts in labor spending,” Ms. Wood told The New York Times. “But if you think about it in terms of the allocation of resources, it does seem to be the tip of a very large iceberg, with universities that have top-heavy executive spending also having more adjuncts, more tuition increases and more administrative spending.”

Why is this happening? “The motor force behind these trends is the hiring of ‘professional administrators’ whose primary commitment is to their own careers and advancement,” says William R. Schonfeld, former dean of social sciences and emeritus professor of political science at the University of California, Irvine (where I teach history). “They take jobs as stepping stones to other positions higher on the ladder.”

“To protect themselves,” Schonfeld says, “they grow the bureaucracy. They are committed to goals which can be relatively quickly achieved—more funds raised this year from the immediate business community, as compared to building a strong foundation for long-term giving by alumni; new schools and academic units, as compared to the tedious and slow process of building true distinction.”

The focus on quick results—not so different from corporations’ focus on quarterly profits—is responsible for the increase in both the number of administrators and their growing salaries. At Ohio State, “We’ve been hiring financial VPs from Wall Street and HR heads from private corporations,” says OSU’s Harvey Graff, professor of english and history and Ohio eminent scholar in literacy studies.

*Image of Ohio State University via gradschoolhub.com