If Your University Shuts Down, Are you Still Tenured?

In an earlier commentary, we discussed -

Tenure-track is Seven Year Post-doc, but What Exactly is Tenure Today?

While on the topic, let us take another look at the money flow within the University system.

Here is a rough model of how a university runs. It has four sources of money - (i) Federal grants, (ii) state grants, (iii) tuition from students and (iv) donations from wealthy individuals. The students are paying the organization to get trained so that they find employment. Federal and state government are also paying the organization so that students get trained to get jobs. Do you get the role colleges and universities serve in the society? Leaving aside private donors, here is a cartoon diagram showing the model. You can click on the images to see in bigger window.

Next, let us take a look at the actual money flow. Anyone, who does not jump out of his chair after seeing the following chart should possibly get his head checked. It is borrowed from Thoughts on Student Debt: Update - By Doug Short.

The above chart can be better understood in the context of the following second chart.

Pause for a moment and think about what is going on.

1. The university system is raising prices enormously. Not only the rate of change is higher than inflation, but the trend remains unbroken since 2002. Therefore, university professors never realized that 2007-2008 happened, even though the rest of country are suffering from it.

2. Despite such increase in prices, tenure-track professors are complaining about how much life sucks.

3. They do have a point, because all money raised is being eaten up by the parasites and is barely ‘tricking down’ to junior players. Check “Bureaucrats Paid $250,000 Feed Outcry Over College Costs”.

4. Since 2008, the entire system has been supported by massive rise in student debt. The above chart shows only half of the rise in student debt and does not show the private part.

5. Student unemployment rate has been rising since 2008 and here is the chart of US youth unemployment.

So, despite raising prices by very high rate, the universities are unable to do what they are supposed to do.

Think about that for a second. You were a customer of a pizza store between 2002-2008, because it properly delivered your pizza even though it raised prices quite a bit. Then, after 2008, the store continued to hike prices, but stopped delivering pizza to you. How long would that business survive?

It is a miracle that the universities are still surviving, and bigger miracle that college professor have no clue about how unsustainable the organizations are. We will see thousands of colleges and universities close in this country over the coming years. US currently has ~4,200 colleges and universities, and we will be surprised if even 1/4th of them last a decade. The process has already started in California, where the largest community college with 100K students is being shut down. The state cut the funding of City College of San Francisco to save the UCs. Then, the accreditation agency pulled the plug claiming that the college does not have enough money to continue operation. Poof, it will be gone.

City College of San Francisco Enrollment Plunges After Threatened Accreditation Loss

Maybe the above discussion will give the 42-year old young Harvard professors some real issues to write about instead of inane commentaries on how ‘tenure-track is seven year post-doc’.