The first article, from The Chronicle of Higher Education, discusses the concept of “badges” that are awarded by various websites, training companies, individuals, etc. The concept is that the badge is relatively easy to earn (to keep the learner motivated and engaged) and indicates that they have achieved a certain skill level or learning competency.  At the Khan Academy, students receive a “Great Listener” badge for sitting through 30 minutes of video lectures and can earn an “Awesome Listener” badge after completing a full hour of video lectures.  In addition, visitors and users of that site can earn badges indicating “Master of Algebra” or “Challenge Patches.”  Similarly, MITx is a newly announced venture by Massachusetts Institute of Technology (MIT), slotted to be released in an experimental prototype version in the spring of 2012 and designed to recognize people who complete MIT’s online courses and successfully pass the tests and quizzes.  MIT has an arrangement with OpenStudy to offer badges to students who are helpful in course discussions.  The John D. and Catherine T. MacArthur Foundation has a $2 million grant to test the badge platform in education.  With the Foundation’s support, The Mozilla Foundation (best known for the Firefox browser) is “building an Open Badge Infrastructure to enable the interoperability and collection of badges” which will “support badges from any issuer across the Internet.” 

Both The Chronicle of Higher Education and Inside Higher Education wrote about the tenured Stanford professor who has left to form a startup, Know Labs.  Sebastian Thrun and a colleague taught an artificial intelligence MOOC (Massively Open Online Course) this summer to more than 160,000 students and he plans to commercialize that type of course through the Udacity portal owned by his startup, Know Labs. Thrun’s venture will not only offer courses developed and taught by him but also by others.  One of the first courses that Udacity will offer is “Building a Search Engine” which will be seven weeks in length and which will be taught by David Evans, Associate Professor of Computer Science at the University of Virginia.  Thrun is betting that the word (grades/recommendation) of a highly regarded professor will win over prospective employers or current employers of students taking courses.

Richard Vedder, an economist at Ohio University, wrote an article for the Chronicle’s Innovations blog entitled “Beware: Alternative Certification is Coming.”  Most of the article talks about Straighterline’s lower priced college course offerings and the announcement last week that Straighterline is offering students the opportunity to take the Educational Testing Service (ETS) iSkills test and the Council on Aid to Education’s (CAE) Collegiate Learning Assessment (CLA) test (the one made famous by New York University Professor of Sociology and Education, Richard Arum and University of Virginia Assistant Professor of Sociology, Josipa Roksa in their book, Academically Adrift: Limited Learning on College Campuses).  Vedder also discusses the Khan Academy and MIT certification offerings.  My favorite paragraph from his article relates to his discussion of the first week of beginning economics courses when professors explain the point that:  “If the price of something rises a lot, people look for substitutes.  Resources are scarce and they [people] maximize their utility by shifting away from high priced goods or services to the lower priced good or service.”

The comments sections in the online postings of these articles range the gamut from commending the idea to ridiculing it.  I happen to think that these alternatives to traditional higher education are to be expected as part of the continuing onslaught of alternatives for a service that many can either not afford or believe is overpriced.  As Christensen states in his books about innovation (specifically Disrupting Class: How Disruptive Innovation Will Change the Way the World Learns and The Innovative University: Changing the DNA of Higher Education from the Inside Out), it’s not always the disrupter that succeeds, but sometimes the incumbent who adopts the disruptive technology and deploys it successfully.

One of the issues that I see with badges is the issue of identity verification and assuring that the person who earned the badge is actually the person who did the work.  Just like the recent SAT test taking scandal on Long Island, if I have a talent at taking a certification course and there are no checks and balances in the system, I may be able to take the course/test for others using their identity.  That problem can be solved, but some solutions are more expensive than others and the expensive solutions may overweigh the cost of the badge or the alternative certification. 

As soon as employers start accepting the badges, the value equation for higher education will lower, putting additional stress on a system that is already stressed by its high prices.  If employers value the training of a superstar professor over a university, that will be another disruptive force to the sector.  The situation reminds me of the scenarios described by Nicholas Carr in his book, The Big Switch (which I wrote about in my blog in July 2008).  Carr’s premise is that the lower cost of technology switches the power from institutions with lots of capital to the individual entrepreneur who is able to “rent” powerful servers and technology from vast farms owned by Google, Microsoft, etc.  Having accreditation and a fancy campus with many faculty and staff may not overwhelm a solo professor/instructor able to convey valuable knowledge to students and to “certify” them by awarding a badge.

The fact that “badges” and other forms of alternative certifications are surfacing daily is another example of the evidence that traditional higher education is overpriced and under siege.  According to a recent Pew Research Center survey, the primary reason that students don’t attend or complete college is financial.  In fact, 57% of adults responding in the survey said that the higher education system does not provide good value for the investment and 75% said that it is not affordable.  The trend is for U.S. employers to seek workers with at least some post-secondary education.  If our colleges and universities are unable to provide employers with graduates with these credentials, it opens opportunities to corporations, organizations, or even individuals offering the alternative credentialing.  Colleges and universities should look to some of these alternatives as viable means to providing a lower cost education as well as a way to preserve or grow their existing enrollments.

Unlike Clayton Christensen who writes about innovative companies as a Professor of Business Administration at Harvard Business School (thus making his transition to writing about innovative universities less surprising), DeMillo’s background is in engineering and computer science.  His observations, however, stem from his background as a professor at a traditional “brick and mortar” school.  From his position inside the hallowed halls of academia, he notes that the institutions in the middle, those between the elite institutions (top 75) and institutions that admit everyone, are the ones that are in trouble with a value proposition squeeze coming from above (elite) as well as below (business model to serve anyone or everyone at a lower price point).  DeMillo stresses that modern universities are businesses (contrary to some of the myopic ideologues who insist that non-profit institutions don’t have a business model) and are competitive organizations run by smart people.  Similar to Christensen, DeMillo argues that the class-oriented society and culture of higher education creates a faculty-centered model that is difficult to break out of for institutions undergoing competition for enrolled students.  (For a review of Christensen’s book, Disrupting Class: How Disruptive Innovation Will Change the Way to World Learns, see my August 2008 blog article.  To see my review of Christensen’s book, The Innovative University: Changing the DNA of Higher Education from the Inside Out, see my August 2011 blog article.)

DeMillo states that in any market, the winners are those with competitive brands, price, or value.  Brand is difficult to build for all but the elite colleges and universities, price continues to increase for almost all institutions and in most cases is becoming uncompetitive, and value is a concept seldom understood by the faculty at most institutions.  Because most college presidents are promoted from the ranks of academics, they are ill-equipped to understand the importance of strategic planning and understanding competitive threats from business disruptors like creative proprietary institutions.

DeMillo states that his book is “ultimately an essay about value.”  Most of the world does not understand the traditional American business model for higher education that is faculty-centered and resource inefficient, not to mention costly.  If American universities want to “survive” (DeMillo’s choice of words) over the next generation, they must apply the following three lessons of our global economy to their operations:

1. Focus on value and deliver a degree that is priced reasonably and that is of reasonable quality.
2. Focus on costs by controlling them in ways that are unthinkable by faculty-centric institutions to include:
a. Deskilling (greater use of adjuncts)
b. Better use of physical plants
c. Better use of materials
3. Establish an individual institutional reputation versus continuing to chase the elite institutions at the top.

DeMillo takes the time to review and report on activities of proprietary or for-profit institutions that he credits for being student-centered because students provide their main source of income.  DeMillo states that enrollment growth is a good thing at a for-profit in that it increases revenues and profits and allows the institution to reinvest those profits in additional services and programs.  Traditional institutions determine their charges from a fixed cost model designed to measure the cost of hours of instruction in the classroom with little consideration for the appropriateness of the charge or the specific relevance of matching labor delivered to competitive market costs.  Online programs run by proprietary institutions price based on services consumed or delivered and unencumbered by a high fixed cost structure; because of this, they are able to provide a competitively priced product with a value recognized by the students they serve.

Institutions in the middle are subsidized by public funds, sponsored research, endowments, or church support.  Tuition fluctuations at these institutions create revenue gaps that have to be covered by increases in one or more of the relevant subsidies.  Those subsidies are shrinking.  DeMillo states that it is not clear how much disruption institutions in the middle can tolerate, but for many, resources are stretched and stressed beyond the breaking point.  DeMillo argues that all institutions in the middle have to pay attention to price sensitive customers.

DeMillo spends some time talking about non-profit and proprietary institutions that are process centered and provides examples about efficiencies that lower the production cost for those institutions.  Another topic that he spends a little time discussing is “hacking degrees.”  Hacking is a topic that continues to be discussed by many writers including Anya Kamenentz, author of DIY U: Edupunks, Edupreneurs, and the Coming Transformation of Higher Education.  It is a controversial topic for those focused on traditional education but more strategic for those focused on the capabilities of technology and the learning that the internet and employers provide many adults.  In my opinion, it is a topic that is not covered enough in this book given its potential for impact on the higher education sector.

Like any good researcher, DeMillo provides recommendations for institutions in the middle to “survive” and thrive in the 21st century.  Broadly speaking, institutions should define their value and become “architects” for new business models.  As it applies to the definition of value, institutions should forget about who is above them, focus on what differentiates them, establish their own brand, not romanticize their weaknesses, and be open.  From an architecture perspective, institutions should balance faculty-centrism and student-centrism, use technology, cut costs in half, focus on their own measures of success, and adopt the New Wisconsin idea which is to be truthful to the community that you serve.  His recommendations are sound and grounded.  Because of the entrenched culture at many of the institutions in the middle, I doubt that few will be able to follow DeMillo’s recommended path to improving their performance and financial stability.  Those that are able to follow the path, should see improvements in reputation, enrollments, and be able to distinguish themselves from their competition.

Bailey points out that the public sector has frequently employed the expertise of private industry in various attempts to solve the nation’s problems.  For example, in March 2010, President Obama reached out to private-sector businesses, agreeing to provide some $150 billion in support of those businesses developing an alternative to foreign oil.  He said to the CEOs in attendance, “’Your country needs you to mount a historic effort to end, once and for all, our dependence on foreign oil…And in this difficult endeavor, in this pursuit on which I believe our future depends, our country will support you.’” 

In another example, Bailey points out that the Review of US Human Spaceflight Plans Committee established by the White House Office of Space and Technology Policy recommended that NASA seek private sector assistance in developing commercial spacecraft.  “The review argued that this would free NASA to focus its attention and investment on developing more advanced capabilities, particularly in deep-space exploration.”  In each of these examples, a significant problem or dilemma has been acknowledged and government has rightly recognized that private sector innovation has the business agility and market understanding to propose and execute a meaningful solution.

In the realm of education, however, the pattern of public-private cooperation has not held true.  Bailey states that “Instead of involving the private sector, education policymakers have actually created policy and funding barriers that skew support to non-profits and prevent for-profits from participating in programs aimed at improving teaching or learning.”  He uses the American Recovery and Reinvestment Act’s Investing in Innovation competition as an example of education policymakers “shutting out” private sector for-profit institutions.  He explains that Congress wrote that legislation in a way that effectively excludes the for-profit education sector. 

In explaining why government is hesitant to engage the private sector in the higher education debate, Bailey recounts some of the most pronounced criticisms of online education.  He explains that many fear that government support for for-profit universities could lead to “market distortion.”  On the other hand, systematically excluding the private sector can lead to its own variety of market distortions and fundamentally, “these concerns do not outweigh the benefits of having a thriving marketplace of private-sector entrepreneurs tackling social problems, particularly in education.”  Interestingly, there also seems to be resistance to government engagement of private sector education institutions because of a belief by some that one should not make a profit on education.  It is difficult, in my opinion, to justify this notion – especially in light of the fact that government engagement of private industry in the areas of clean energy, healthcare, and space exploration has set the precedent that it is okay to turn a profit while addressing some of the nation’s greatest challenges.  Additionally, no president of a non-profit college or university operates continuously on negative margins.  Prudent managers of non-profits are obligated to cover operating costs or explain why not.  The non-profit system actually encourages continued increases of expenditures during good economic times since the tax code questions a non-profit that continually generates a substantial surplus.  In order to reduce surpluses, additional projects are funded.  In addition, the taxpayer subsidies of non-profit entities are already very large.  In addition to allowing families of students to receive education tax credits, alumni and parents are allowed to deduct charitable gifts, and the institution does not pay income taxes on its endowment earnings, the receipt of charitable gifts, and generally, little to minimal property taxes and no income taxes are paid. 

Private enterprise plays an integral part in the fulfillment of national policy initiatives.  As Bailey points out, “Private industry routinely takes technologies pioneered by the government and turns them into cheap, reliable and robust industries.”  Why should online higher education be any different?  The federal government developed the initial product – education (via compulsory, free public K-12 education, and eventually the establishment of government subsidized institutions of higher education) – and placed significant value in obtaining that product.  In an era of considerable funding cuts and a bleak financial outlook for most institutions, it seems that now is the optimal time to engage the private sector for its opinion and ideas in order to reach President Obama’s stated education goals. 

Schneider and de Alva note that consumers are largely oblivious to the cost of an item, focusing almost solely on the price instead.  As long as the price seems reasonable (or, at least comparable to other similar products), the consumer is not likely to consider what the actual cost of the product is.  As the authors point out, nowhere can this be seen more clearly than in higher education.  Since the downturn of the economy in 2008, a deluge of articles have been published exploring the price of a college education (see the “Impact of the Economy on Higher Education” section of this blog) but little has been written for the American public about the true cost of a degree (that data is typically buried in academic policy and research reports that typically do not receive broad media coverage).  Schneider and de Alva have undertaken the daunting task of publishing the total cost of a bachelor’s degree for the American taxpayer.  Their findings are notable, assuming that those in a position to influence public policy and a broader national discussion read their paper.

The authors divided their sample into the following categories: public, private not-for-profit, and private for-profit institutions.  Beyond that,  they used a variation of the well-known rankings reported in Barron’s Profiles in American Colleges which provides six categories for schools ranging from “noncompetitive” (open admissions schools) to “most competitive” (highly selective, elite institutions).  Interestingly, American taxpayers subsidize the least competitive schools far less than they do the most competitive.  The irony is that the largest and fastest growing sector of the college population includes low-income and non-traditional students who are attending the lesser competitive schools.  These schools tend to offer greater flexibility for part-time students, working adults, and other “nontraditional” student populations.  To provide perspective on the dramatic differences in taxpayer subsidies, consider that “among not-for-profit institutions, the amount of taxpayer subsidies hovers between $1,000 and $2,000 per student per year…”  Among the most selective institutions in the nation, “the taxpayer subsidy jumps substantially to more than $13,000 per student per year.”

The amount of return (ROI) is important when considering any investment and can mean the difference between whether one makes an investment or not.  In the case of higher education and the taxpayers’ “investment,” the return is far lower than necessary to justify the current subsidy trends of the more highly subsidized institutions.  “For public institutions, taxpayers are investing more than $60,000 for each bachelor’s degree granted in the three less competitive categories, close to $75,000 in the highly competitive institutions, and more than $100,000 for each bachelor’s degree granted in the most competitive flagship institutions.”  In the less competitive schools, high dropout rates and longer time taken for completion of the degree decrease the taxpayers’ total ROI.  The highest dropout rates, however, tend to be found in the lesser competitive institutions – the same institutions receiving the least taxpayer subsidies (or none at all in the case of private for-profit institutions). 

According to their research, bachelor’s degrees earned from the private for-profit institutions offer the highest ROI for taxpayers since so little taxpayer money is invested into those schools.  The authors also consider the income taxes paid by those without and those with bachelor’s degrees.  Data shows that individuals holding a bachelor’s degree have lifetime earnings substantially higher than individuals without a college degree and therefore pay more in taxes, providing a benefit to the taxpayer. 

For example, because for-profit institutions receive no state appropriations but pay income taxes, there is a “net ‘profit’ to the taxpayer” for bachelor’s degrees earned at schools within this category.  Table 2 in the report shows that there is a benefit of approximately $6,100 to the taxpayer and over the degree holder’s lifetime, taxpayers will realize a net benefit of approximately $60,900 thanks to higher taxes paid by the graduate holding a bachelor’s degree from a for-profit institution.  By contrast, at a public school (non-/less competitive category), the taxpayer will subsidize approximately $6,000 per bachelor’s degree per year and ultimately see a total cost of $67,600 per bachelor’s degree.  Over the lifetime of the graduate’s career, the taxpayer will not see a positive ROI for subsidies provided for the benefit of the degree-holder.  The ultimate net cost to the taxpayer for a bachelor’s degree earned from a public school in the “non-/less competitive” category is $7,500.

In concluding, the authors make several recommendations that are worth re-iterating here.  First, they encourage stakeholders to focus efforts on addressing issues of college completion and retention.  This makes sense considering that the bulk of taxpayer costs associated with degrees earned at the lesser competitive schools (where the majority of students are earning degrees) is a result of high dropout and slow completion rates.  Additionally, the authors recommend that policymakers reverse “the current policies that result in providing the lowest levels of taxpayer support to the institutions that enroll the highest percentage of low-income, nontraditional, and minority students…”  Providing additional monetary incentives to these students can help boost the college completion and retention rates, ultimately benefiting the taxpayer as degree holders earn more and pay more in income taxes over the course of a lifetime.  The authors point out that if the Obama Administration’s “completion agenda” is met, taxpayer ROI at the lesser competitive schools where dropout rates are highest will increase.  The authors also recommend that policymakers take notice of the Lumina Foundation for Education’s Guide for State Policymakers which calls for  states to make strides in expanding and strengthening “’lower-cost, non-traditional education options,’” including online education.  Finally, the authors note that little data has been collected regarding the true and complete cost of a bachelor’s degree.  By understanding the real and total cost of the educational product as well as the price, policymakers can gain a better understanding of the true financial picture of higher education. 

Our military responded to a series of natural disasters this year.  In March, through Operation Tomodachi (Japanese for “friendship”) the Marines, Navy, and Air Force offered humanitarian and disaster relief assistance to the Japanese people affected by an 8.9 magnitude earthquake and tsunami that killed more than 15,000 and left millions more homeless.  Marine helicopter units delivered thousands of pounds of rice, bread, and other food items to the hardest hit areas.  In addition, a significant number of American naval ships responded including the USS McCampbell, the USS Curtis, the USS Mustin, and the USS Ronald Reagan. 

The US Army Corps of Engineers (USACE) moved into action when a series of severe storms this past Spring plagued the nation’s mid-section.  Tornadoes, floods, and other significant weather events left thousands in a desperate state.  The USACE worked diligently to ensure the safety of structures following those storms and to assist in meeting the basic needs of those impacted by the devastation. 

In the wake of devastating Hurricane Irene which pummeled the East Coast in late August,  National Guard and Coast Guard forces were deployed to the hardest hit areas on the East Coast within hours of the storm making landfall.  Select Army personnel were also involved in relief and rescue efforts.  The nation applauded the responsiveness of the military and FEMA personnel after Irene, commending the organizational structure for making necessary changes from lessons learned after Hurricane Katrina.  America’s men and women in uniform also provided assistance to “man-made” events, many that bolstered the cause of freedom and liberty around the world.

In March when the United Nations intervened to uphold a “no-fly zone” in Libya following Muammar Gaddafi’s crack down on anti-government rebels, the United States military was on hand to provide assistance.  US ships (in conjunction with British vessels) fired more than 100 Tomahawk cruise missiles at key Libyan air and ground defense systems.  With the assistance of American and other coalition forces, the people of Libya were ultimately successful in overthrowing the long-seated military dictator last month.

In May, American troops fulfilled a promise made to the American people on September 11, 2001 by capturing and killing notorious terrorist Osama bin Laden.  After months of gathering intelligence, US Special Forces infiltrated bin Laden’s compound in Abbottabad, Pakistan.  The terrorist was ultimately killed in the ensuing firefight though no US service members were lost.  In the aftermath of one of the most significant military operations in American history, President Obama applauded the diligence and commitment of the American armed forces.  In his nine minute address to the American people, President Obama told the nation that, “justice has been done.”

In the midst of these noble efforts and heroic accomplishments, however, the military suffered tremendous losses this past year.  August 6th marked the deadliest day for American forces in Afghanistan since that war began more than a decade ago.  On that day alone, thirty American troops, mostly elite Navy SEALs (some reported to have been part of the bin Laden mission), were killed when insurgents shot down a Chinook helicopter in which they were flying to aid a team of Army Rangers.  The entire month of August saw the loss of 66 US service members, making it the deadliest month for US troops since the war began. 

In total, 6,314 American troops have been killed in Afghanistan and Iraq since 2001.  438 of those troops were killed this year and, tragically, a number of whom were AMU students.  When I learn of the death of one of our students, it brings into perspective the unsung heroism of our nation’s military men and women and the veterans who served before them.  To everyone serving our country or who has served our country in the past, thank you for all that you do and have done to preserve the freedoms that we enjoy at home and abroad. We salute your dedication, commitment, and sacrifices.

The Economist presents data that may back the case that it’s not just the economy.  In examining data accumulated in their annual ranking of the top 100 MBA programs, they note that in 2010, the average cost of an MBA for the 85 schools outside of the top 15 was $81,911 while the average starting salary for the graduates of those schools was $81,178.  Five years earlier, the two year cost for the same 85 schools was $60,247 while the starting salary average was $78,442.  The attached graph shows that the disparity was greater ten years ago when the average starting salary was over $80,000 and the average cost was slightly less than $50,000.  The comparison could hardly be more dramatic; increasing costs of tuition have cut the noticeable advantage of attending a residential MBA program outside of the top 15. 

Elite schools like Harvard still have an advantage according to The Economist’s survey data.  Additionally, the article mentions a recent event at Harvard hosted by a large consulting firm where a member of that firm’s senior management noted while speaking to the faculty that the most valuable player on the Harvard Business School team was the Director of Admissions, a not so subtle reference to the elite students recruited to the school and subsequently recruited by that consulting firm.

While the purpose of the article is to compare costs of high end MBA programs, the comparison can easily be made across the entire continuum of accredited business programs.  The Association of Advance Collegiate Schools of Business (AACSB), one of the accrediting bodies for U.S. business schools, estimates that there are 13,670 institutions world wide that offer a business degree.  Being able to distinguish your program and your graduates from the masses is more than likely the only way that you can command a premier price going forward.  In more recent commentaries on the general state of global higher education, books like The Global Auction: The Broken Promises of Education, Jobs, and Incomes and The Innovative University: Changing the DNA of Higher Education from the Inside Out also stress the need for differentiation, tuition reductions, or both in order for institutions to maintain their competitive edge.  My theory is that regardless of your business program’s relative ranking, competing on price and product differentiation is the only safe way to ensure long term success.

In general, the report finds that revenues are down and spending (overall and per student) reflects that decline.  Recession-related state budget cuts meant deep cuts to educational appropriations.  As a result, schools in every sector of the industry raised tuitions (in some cases significantly) in an attempt to make up that difference.  American Recovery and Reinvestment Act (ARRA) funds may alleviate some pressure in the future but because most institutions did not begin receiving those funds until the last part of 2009, the impact of that funding source is not fully captured in the report. 

Some of the most striking statistics are related to community colleges.  In 2009 alone, community colleges were educating more than 6.5 million students, accounting for approximately one-third of all the nation’s college students.  Though shouldering a large portion of the burden of educating the nation’s college students, community colleges also saw the largest funding declines during the decade.   

The authors point out that “nationwide public appropriations for higher education never completely rebounded from the 2001 recession, and the 2008 recession is proving to be more serious and longer lasting.”  This decline in appropriations has trickled down to have a direct impact on the student.  In an attempt to make up the lost appropriations, most colleges and universities increased tuition consistently over the decade.  Unfortunately for the student, however, most such increases failed to make up the entire difference in lost appropriations and did not equate to an increase in spending per student.  On average, increases in tuition revenues made up for only about half of lost appropriations except for at public community colleges where tuition increases accounted for less than half of the difference. 

The findings outlined in Trends in College Spending are particularly salient in the current economic environment.  As the report’s authors note, when compared to the 2001 recession, “…the 2008 recession is proving to be more serious and longer lasting.”  Even though the recession was identified as “over” in mid-2009, the economy has clearly not rebounded and unemployment remains significant (9.1% as of last month).  According to Mark Kantrowitz, publisher of FinAid.org, “the average increase in annual college enrollment during a recession is 567,400 (4.5% of total college enrollment), compared with 150,800 (1.2% of total college enrollment) between recessions.”  Between 2008 and 2009, as reported in the Trends in College Spending report, enrollments in US colleges and universities increased by more than 860,000 students, “nearly a 5 percent increase since 2008 and the single largest one-year increase since the mid-1970s.” 

One of the only positive trends found in the data is related to educational productivity.  In 2002, colleges and universities began providing data on undergraduate credit hours per degree.  The analysis done for the Delta Cost Project report show that colleges and universities are using credits earned more effectively, reducing total credits to be taken to earn a degree.  The authors note that more effective use of credit hours earned has “translat[ed] into a ‘savings’ of nearly a half a semester’s worth of credits.”  This is a very positive finding especially when one considers the increase in tuition rates across the board and decrease in spending per student. 

As the authors point out, the ramifications of the “Great Recession” of 2008 are still being felt and will continue to reverberate through the industry for at least the next several years.  President Obama, however, has stated that it is his hope and intention that America regains its standing as number one in the world for number of college graduates.  In considering the policy implications of the study’s findings, the authors note that even with the improvements in instructional efficiency, much more needs to be done if the nation is to achieve the President’s goals.  The report notes that reaching such an ambitious goal (the United States currently ranks 12th in the world), “will require improvements in educational performance at every level of the educational pipeline, from high school graduation to college completion, averaging 4 percent per year.  The gains in degree/certificate completion reported here are close to 1 percent per year, and by themselves are not enough to meet the attainment goals…” 

NCLB, at the time of its passage, was intended to provide “increased accountability for States, school districts, and schools; greater choice for parents and students, particularly those attending low-performing schools; more flexibility for States and local educational agencies (LEAs) in the use of Federal education dollars; and a stronger emphasis on reading…” The Act ties federal education dollars to performance on standardized testing.  In large part, this stipulation has been the foundation for continued criticisms of the program. 

With federal funds tied to the performance outcomes of standardized testing measurements, many claim that teachers began “teaching to the test.”  Rather than explore the entirety of the curriculum, many teachers and school districts have been accused of focusing solely on the materials that they know will be on “the test.”  This summer, NCLB took a significant hit to its already shaky reputation when more than 100 teachers, principals, and public school officials in Atlanta were allegedly involved in altering students’ answers on the state’s Criterion Reference Competency Test (CRCT) to make it appear as if students were scoring higher on that standardized test than was actually the case. 

Other critics of NCLB claim that the federal government is requiring significant expenditures of the states in order to meet the various requirements of the Act.  For example, by requiring schools to provide “highly qualified” teachers to every student, some school districts may have to increase their teacher salaries.  The federal government has never fully funded NCLB and many states bemoan the various costs associated with the Act that the federal government does not cover.  Some consider the situation a Catch-22: many states are failing because of inadequate and less-than-qualified teachers.  Requiring them to employ more qualified teachers and staff will also require them to spend money, money that many states are having difficulties finding.

Dan Lips, education analyst at The Heritage Foundation, reported in November 2006 that during the Bush Administration, federal spending on public education increased significantly.  The organization states, “Annual U.S. Department of Education spending on elementary and secondary education has increased from $27.3 billion in 2001 to $38 billion in 2006, up by nearly 40 percent.”   Lips noted in his report that this increase in funding had done little to improve the quality of American public schools and many were facing the same challenges that were in front of them at the inception of NCLB.  Beginning in 2006, however, federal education spending dropped significantly until 2010 when it jumped again to levels even higher than federal education spending in 2006. 

Last week, President Obama announced that he would allow states to liberate themselves from the burdens of some of the elements associated with No Child Left Behind.  Obama stated that he was providing greater flexibility to states because “’We can’t let another generation of young people fall behind.’”  Specifically, States will have an opportunity to apply for a waiver which would allow them greater autonomy in dealing with troubled or failing schools.  In order to expect the waiver to be granted, however, states would be required to show that they have been raising standards. 

Perhaps not surprisingly, President Obama tied the imperative of improving educational standards in the United States to the current economic situation.  He stated to an audience of education leaders attending a meeting on the topic at the White House that, “’We are in the midst of an enormous economic challenge…the most important thing we can do is make sure that our kids are prepared for this new economy.’”  This sentiment aligns with the President’s consistently-stated goal of increasing the nation’s college graduation rates so that America is once again the preeminent nation in that ranking. 

President Obama’s announcement about his waiver program coincides with Congress’ reconsideration of the Elementary and Secondary Education Act (ESEA).  Passed in the mid-1960s as part of President Lyndon B. Johnson’s “War on Poverty,” the ESEA has been the overarching policy guiding elementary and secondary education in the United States since its passage.  President Bush’s No Child Left Behind Act was the reauthorization of the ESEA in 2001.  By mid-October Congress is expected to begin an intense review of ESEA.  Given the current political situation, it will be interesting to see if any significant changes are proposed and, if so, how closely the final ESEA reauthorization bill lines up with President Obama’s latest initiative offering NCLB waivers for individual states. 
 

A 2006 report from the Commission of the European Communities titled “Delivering on the Modernisation Agenda for Universities: Education, Research, and Innovation,” noted that the “modernization of Europe’s universities, involving their interlinked roles of education, research and innovation” is a “core condition” for the success of the Lisbon Agenda.  In that same year, the Spring European Council agreed upon the establishment of the European Institute of Innovation & Technology (EIT) which would “contribute to improving Europe’s capacity for scientific education, research and innovation, while providing an innovative model to inspire and drive change in existing universities, in particular by encouraging multi-disciplinarity and developing the strong partnerships with business that will ensure its relevance.”  Additionally, the Commission called on member nations to create national systems that allowed for geographic mobility of degrees between various EU member states, greater autonomy with strengthened accountability for universities, incentives for partnerships between universities and the business community, and an increased “employability” of graduates. 

To this end, EU member nations set forth their own individual agendas geared to meet the goals of the Lisbon Agenda, although few developed comprehensive national strategies in a timely manner.  In 2005, for example, Ireland introduced its “National Reform Programme” which called on the government to double R&D investments, increase participation in higher education by currently underrepresented groups, and decrease the number of students who prematurely leave their educations.  Spain committed significant funding to “growth and employment priorities” including building up access to higher education as a means to fulfilling the goals associated with the Lisbon Agenda.  In France, the government used the Lisbon Agenda as justification for educational reforms that increased spending on science and research and development by 3 percent.  After joining the EU in 2004, Slovenia attempted to catch up with its colleagues in regards to the Lisbon Agenda.  By June 2005, the government of Slovenia published its “Development Strategy” which included some “interventions in the field of higher education and research.” 

Today, more than 11 years since the signing of the Lisbon Agenda, it is clear that these efforts were not enough.  Many heads of state of EU nations have admitted the failure of the Lisbon Agenda.  In the summer of 2009, Swedish Prime Minister Frederik Reinfeldt wrote in an article published in the Swedish daily paper, Dagens Nyheter, that “even if progress has been made it must be said that the Lisbon Agenda, with only a year remaining before it is to be evaluated, has been a failure.”  Many decry the nonbinding nature of the Lisbon Agenda as one of its greatest failures.  Despite its shortcomings, many EU heads of state have called for the program to be re-launched.  Spanish Prime Minister, Jose Luis Rodriguez Zapatero, has encouraged member states to analyze and understand the failures of the Lisbon Agenda when moving forward with another ten-year program with similar goals.

Recent news stories from around EU member nations, however, leave many questioning how much attention heads of state will give to Prime Minister Zapatero’s advice.  Nearly every EU nation is facing a financial crisis similar to that of the United States and like their counterparts in the US, publicly funded European universities are suffering.  In Latvia, for example, significant cuts to the nation’s education budgets have left many students uncertain about their academic futures.  Each of the nation’s 34 universities is facing deep budget cuts with one estimate noting a “threatened 50 percent cutback to the planned higher education budget…”  Universities in Italy, Ireland, Iceland, Estonia, Romania, Lithuania, the Czech Republic, Croatia, Serbia, and the Former Yugoslav Republic of Macedonia are also experiencing significant higher education budget cuts. Germany is a notable exception.  Most German universities are fully state-funded and require little to no tuition for attendance and the federal government continues to make significant investments in German higher education.

While the Germans continue to make significant investments in their higher education system, other EU member states are struggling with how to actualize the recommendations of the Lisbon Agenda.  As early as 2005, many were already realizing that the Lisbon Agenda was doomed.  European Commission President Jose Manuel Barroso of Portugal told a gathering in Brussels in early 2005 that “’The overall Lisbon goals were right, but the implementation was poor.  The lesson from the last five years is that we must refocus this agenda to deliver results.’”  Since its expiration in 2010, many have called for the revitalization of the agreement, either in its original form or in a somewhat altered form.  In the face of the “Great Recession” of 2009, very few European economies were left unscathed leading many to reiterate the importance of the ideals of the Lisbon Agenda.  As a result, the Europe 2020 Strategy has been put forth as the “new and improved” Lisbon Agenda.  With so many heads of state acknowledging the importance of education and innovation as a driver of economic development and experiencing the failures of the Lisbon Agenda, it will be interesting to see what alterations are made to the new Europe 2020 Strategy and how that program will impact the higher education systems and ultimately the economies of the EU member states.  The European higher education model is not significantly different than the U.S. higher education model.  Given the significant cuts to higher education support that we’ve seen in states like California and the resulting increases in tuition costs to students, a similar outcome of limiting access to higher education is likely at a time when neither states (U.S.) nor countries (Europe) can afford to decrease the number of their college graduates.

To see headlines regarding the financial state of international higher education, see the “International” section of the “Impact of the Economy on Higher Education” portion of my blog. 

Aerial view of the planned 9/11 memorial on the site of the World Trade Center. (photo from 9/11 Memorial website)

It has been a decade since the unprecedented terrorist attacks of September 11, 2001.  Despite the time that has passed, our memories of that day remain fresh and raw.  More than 3,000 lives were lost in the attacks at New York City and the Pentagon as terrorist hijackers flew two planes into the World Trade Center and one into the Pentagon.  More than 400 firefighters, police officers, and other first responders lost their lives responding to the tragedies in New York and Washington.  Thanks to the brave actions of the passengers of United Flight 93, countless more lives were saved.  All 45 people aboard that flight were killed as a brave few attacked the hijackers, forcing the plane down in a field in rural Pennsylvania.  Had the hijackers completed their mission with an attack from Flight 93 on any strategic location in Washington, the total death toll would have been higher.

Less than a month later, the US military mobilized to Afghanistan to rout out the Taliban regime which had provided safe harbor to the terrorist mastermind behind the 9/11 attacks, Osama bin Laden.  Within a few years of entering Afghanistan, the US military also began mobilizing to remove Saddam Hussein from power in Iraq. 

Approximately three-quarters of APUS’ student body have served as active military personnel and have been directly involved in these missions.  Some of them made the ultimate sacrifice in these two theaters of action.  To date, more than 6,000 American military personnel have lost their lives in Iraq or Afghanistan since those wars began.  Each of us owes a tremendous debt of gratitude to the first responders who risked their lives to assist those trapped in the rubble in New York City and at the Pentagon, to our men and women in uniform, and to the many people who work diligently to identify and avert future attacks.  I encourage everyone to take a moment to reflect on the lives lost on that fateful September day and to commemorate and honor those who have continued to risk their lives to protect our nation and its citizens. 

Two months to the day after the attacks, President Bush said, “’Time is passing.  Yet, for the United States of America, there will be no forgetting September the 11th.  We will remember every rescuer who died in honor.  We will remember every family that lives in grief.  We will remember the fire and ash, the last phone calls, the funerals of the children.’”  These words are as accurate today as they were ten years ago.  Even as we near completion of an official memorial to victims in New York, celebrate the toppling of the Taliban in Afghanistan, the capture and execution of Saddam Hussein, and the death of Osama bin Laden earlier this year at the hands of US special forces, we will always remember that day, the tragedy it brought to our entire nation, and those who have given their lives since to ensure that the freedoms on which this nation was established remain intact for future generations. 

In honor of this weekend, Story Corps preserves some of the voices of those affected by 9/11.