March 31, 2009

Not closing up shop just yet

Kevin Carey's Chronicle column this week, What Colleges Should Learn From Newspapers' Decline reminds me too much of Willard Daggett's slipshod prognostication: oh, yes, there will be surgery-by-wire where you can stay in Podunk while a surgeon in New York City opens up your heart (something close to what Daggett claimed in one speech I witnessed). And because some colleges on the margin of financial survival will close in the Great Unraveling (as Krugman has termed it), that means there are huge segments of higher ed doomed in the next five years!

Pardon me for the historian's skepticism here, but if that were true, then the quick closure of Atlantic University in 1932 should have presaged disaster for higher education later in the 1930s. Didn't happen. The Depression caused lots of trouble for both K-12 schools and colleges, certainly, but I don't see what Carey sees. The newspaper business is imploding because of a combination of several things:

  • Owners began to expect absolutely unreasonable profit margins
  • The revenue model for newspapers depended not on readers but on selling advertisers the valuable access to readers that eroded in the internet era.
  • Newspapers have been unable to replace that revenue model.

We may see similar levels of idiocy in some institutions, but that's true no matter what the era. Peabody College for Teachers was an independent private institution having financial difficulties in the early 1970s, but what put it over the edge and forced the merger with Vanderbilt several years later was the amazingly inane decision of administrators to eliminate non-education programs, thereby swiping the financial legs out from under the place. (Retaining the non-education programs may not have saved Peabody in the end, but eliminating them ensured its demise as an independent college.) That type of misjudgment is possible anywhere at any time.

One significant difference between newspapers and colleges and universities (and the relevant one here given Carey's argument) is that colleges and universities have already responded more successfully than newspapers to dropping support from the constituency that used to pay for access to readers ... er, students, or more properly, graduates. The decline of state support for public higher education began several decades ago, and while Carey and I may not like the shape of the response, no one can claim that it has fallen on its face in the same way as (or even in a remotely similar way to) newspapers trying to gain money from online readers. Because businesses have paid for access to graduates (i.e., they pay more to adults with baccalaureates than to high school graduates or high school dropouts), that has been enough not only to sustain higher education but given it substantial growth over the past 30 years.

In other words, higher education already had its newspaper-circulation problem, and it's on the other side. Update: Brad DeLong embarrasses me by coming up with the ultimate "already had its problem and went past it" example: books didn't kill universities. Current score counting macroeconomic analysis: DeLong, 501; Dorn, 3.

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Tags: Atlantic University, Kevin Carey, Peabody College for Teachers, Vanderbilt University, Willard Daggett
Posted in Higher education on March 31, 2009 8:34 AM |