Views: Fixing the Broken Financing Model - Inside Higher Ed - 2 views
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George Mehaffy on 28 Nov 10"Fixing the Broken Financing Model October 4, 2010 By Darryl G. Greer and Michael W. Klein In the title of a recent paper, David Breneman, a regarded higher education economist, asks: "Is the Business Model of Higher Education Broken?" While he objectively weighs the pros and cons of his question, we answer emphatically, yes! Put simply, the way in which America finances public colleges and universities, which serve over 70 percent of college students nationally, is severely and irreparably broken and needs to be changed. Without a new model, public higher education will fail its principal purpose of providing broad college opportunity, especially to low- and middle-income students and an emerging population of new Americans. Moreover, without a new funding rationale that has transparency and predictability for all funding partners, these colleges will lose the public trust - a critical element in sustaining the American democratic experience through education. Public colleges can achieve the dual goals of public and private benefits only by demonstrating equity and fairness regarding who goes to college; legitimacy for who pays and how; and responsibility for how colleges account for educational outcomes and sustaining the public trust. The solution as we see it should include a new public service corporation model that creates private partnerships; produces new revenue to replace lost public financing; protects and enhances the core educational enterprise; and, thereby, generates greater transparency, accountability and public trust that will support a sustained investment in public colleges. The Problem There is widespread evidence, in addition to opinion, that the longstanding model for financing public colleges that has seemed to work so well in many states for decades, now seems, even with an expected economic recovery, to need radical change. (See the soon-to-be-published "A New Model of Financing Public Colleges and Universities," in On the H