The Public Interest and University Governance (Part 1)

Tom Wood

In “Three Cheers for the Dons,” my latest posting, I argued that the governing bodies of colleges and universities should be controlled by the faculty rather than by members external to the university, which is now the almost universally prevailing arrangement. I argued that, despite all the failings of the professoriate these days, things are far worse with academic deans and administrators, and with boards of trustees that aid and abet them. Faculty control of governing bodies would not be ideal, I argued, but it would clearly be better than governance structures that place control of the college or university in the hands of external majorities.

I expected that many NAS members would agree with this view. I was aware, however, that it was also controversial, since most university reform efforts have been directed towards changing the university from the outside. I had hoped that “Three Cheers” would provoke an interesting and productive exchange of views by commentators. I was disappointed when it didn't. I do not intend to drop the thesis, however, and intend to return to it from time to time. This is one of those occasions.
 
The Palaima-Sandefer controversy at UT-Austin
 
Thomas Palaima is a professor of classics at the University of Texas at Austin. Jeff Sandefer is a member of the Texas Public Policy Foundation, a graduate of Harvard Business School, and a longtime teacher at the graduate level, first at the University of Texas and now at the Acton School of Business in Austin, which he co-founded.
 
There was an exchange between Thomas Palaima and Jeff Sandefer recently over the issue of tenure. It was kicked off by an op-ed piece by Palaima that appeared in the Austin American-Statesman on May 1 of this year (“Why we should value the tenure system”). Palaima's piece was itself a response to a Newsweek column by Francis Fukuyama, who had argued that the tenure system is outmoded and should be abolished. While expressing his agreement and appreciation for some of the recent political positions Fukuyama has taken (mostly notably his rejection of neo-conservatism), Palaima wrote to criticize Fukuyama's position on tenure.
 
Towards the end of the piece, Palaima praised the tenured faculty at UT for its seven-year process of curricular reform for undergraduate studies. Palaima attributed the success of this curricular reform to tenure:
Moreover, the career-long security at a particular institution offered by tenure has several unacknowledged positive ramifications. It makes tenured faculty willing to put long hours into improving for the long haul what they rightly come to view as ‘their’ colleges and universities. This runs counter to what political economists like Fukuyama see as the harmful emphasis on short-term gains in American corporations and other institutions.
Palaima concluded his article as follows:
Like many other long-term changes, these improvements would have been unthinkable at an institution made of untenured careerist faculty members ready to spring off to the best job offers elsewhere and therefore unwilling to do hard work whose only reward is making the educational experience better for tens of thousands of young men and women of the state of Texas year after year.
 
The next time you run into tenured faculty members anywhere, thank them for their dedication to the future of our country.
 
Palaima’s op-ed piece incited a reply (“Public Universities Belong to the Public, Not the Faculty”) by Jeff Sandefer, who lives and works in Austin and has taught at UT. Sandefer’s reply was published by the Texas Public Policy Foundation. Sandefer did not respond to Palaima’s claim that the curricular reform process was a success and that it had happened through the hard work and dedication of tenured faculty. Instead, Sandefer chose to attack the tenure system in general and on his own terms. He was particularly indignant over Palaima's claim that tenured faculty have “rightly” come to view institutions of higher education as “their” colleges and universities.
 
Sandefer, apparently, finds this view offensive and perhaps even absurd on its face. He would undoubtedly regard the thesis that I advanced in my “Three Cheers for the Dons” in the same way. Sandefer’s argument against tenure and even shared governance, however, is not clear, and to the extent that it is clear, it is unsound (which is not to say that the conclusion is necessarily false). So far as I understand it, his argument goes like this: The public supports public colleges and universities only because it deems them to be in the public interest. All state higher education funding should be redirected to scholarships, so that “universities once again will have to answer to the people who pay the bills.” That’s the only way, he says, “students, parents, and taxpayers will ever regain control of our universities.” Since public colleges and universities belong to the public, faculty (tenured or otherwise) should have no say in their governance. The faculty is the problem, not the solution, for the problems facing higher education.
 
Like most bad arguments, this one simply needs to be stated clearly to see that it is unsound. Clearly there is a non-sequitur here. How universities are to be governed is an empirical question. There is no public interest represented by a public college or university other than it should teach well and produce good research—because that is essentially what colleges and universities do. What governance structures serve those purposes best is a purely empirical question. The best governance structure certainly can’t be deduced by arguing that since universities exist to serve the public interest, they should be controlled by public (i.e., external) members rather than the faculty.
 
Furthermore, Sandefer apparently overlooked the fact that the University of Texas is already fully controlled, as all public colleges in the U.S. are, by external members rather than by the faculty. (The Board of Regents, the governing body for The University of Texas System, is composed of nine members who are appointed by the Governor and confirmed by the Senate.) These external members are ultimately responsible for any ills that Sandefer finds there. The Regents not only have plenary control over the university. As is the case with virtually all other public and private institutions of higher education in the U.S. they actually own it. Indeed, legally these governing bodies actually are the university, as I pointed out in my “Three Cheers” posting.
 
Sandefer’s piece consisted almost entirely of unsubstantiated allegations and impressions from his own experience teaching, which makes it difficult to assess or rebut his claims. This statement, for example, is typical: “As a successful entrepreneur and a longtime university teacher, my years inside academia have taken me to places where parents, donors, and taxpayers aren’t welcome. I have seen firsthand what happens when tenured faculties act as if the universities belong to them.”
 
However, Sandefer also made several empirical claims in his Texas Public Policy Foundation piece that can be evaluated. One of these concerned the extent to which faculty members in the U.S. are devoted to research, at the expense of their teaching responsibilities. Sandefer specifically claimed the following: “Academic research, properly accounted for, consumes two-thirds of every dollar we spend in American universities.”
 
This claim is, I believe, demonstrably false.
 
As was typical of his whole Texas Public Policy Foundation piece, Sandefer has provided no evidence that supported this claim, either in the column in question or elsewhere on the Web (at least that I could find). However, the issue need not be relegated to the realm of idle fancy or speculation. All the institutions in the U.S. that receive funding from the federal government are required to submit annual reports to the U.S. Department of Education. These reports, which include breakdowns of revenues and expenditures, become part of the IPEDS (Integrated Postsecondary Education Data System) database, which is publicly available. It took only five minutes for me to determine that Sandefer’s estimate of expenditures on research is widely off the mark, even for the University of Texas at Austin, which has a Carnegie classification of “Research University/Very High” (RU/VH).
 
I used IPEDS’ peer analysis tool, which gives the breakdowns for the selected institution as well as some peer or comparison institutions, which the researcher is free to select. The peer institutions I selected for the analysis were UC Berkeley, U Michigan-Ann Arbor, and UNC-Chapel Hill. The results, which are given in bar graph format, show quite clearly that the percentages spent on research activities at UT-Austin and related institutions are vastly different from the one speculated by Sandefer.
 
One must keep in mind as well that Sandefer’s claim was not limited to UT-Austin, or even to research universities. His claim was that “[a]cademic research, properly accounted for, consumes two-thirds of every dollar we spend in American universities.” [Emphasis mine.] This makes Sandefer’s claim even more preposterous, since research universities are only a relatively small fraction of universities in the United States. I have not shown the work here, but a cursory use of the IPEDS database for a wider range of universities showed an even wider divergence between Sandefer’s estimate and reality than that shown in the bar graph above.
 
The best way of getting a sense of reality for all institutions in the IPEDS database is to consult the tables provided by IPEDS itself, rather than by using the Peer tools, which are useful mainly for studying selected institutions. (Some of the IPEDS tables also give limited breakdowns for different types of institutions.) This IPEDS data makes Sandefer’s claim about the percentage of expenditures consumed by research at universities generally look almost laughably off the mark.
 
The following data is taken from Table 348 of the IPEDS postsecondary database for 2003-2004. The selected data gives the relevant expenses for the present discussion of public degree-granting institutions. The expenses are given in thousands of current dollars for 4-year institutions. The third column gives the percentage of total revenues for each kind of expense:
 
Operating expenses
161,575,599
96.4%
Instruction
42,287,792
25.2%
Salaries & wages
29,290,396
17.5%
Research
21,394,125
12.8%
 
The following data is taken from Table 351, which gives the total expenditures of private not-for-profit degree-granting institutions for 2004-05. This table gives the data for four different kinds of institutions:
 
 
Total
Instruction
Percentage
Research
Percentage
Doctoral, extensive
55,467,664
17,112,252
0.308509
10,426,440
0.187973
Doctoral, intensive
8,150,711
3,120,735
0.382879
718,364
0.088135
Master’s
17,762,348
6,891,718
0.387996
275,517
0.015511
Baccalaureate
16,028,633
5,649,242
0.352447
152,300
0.009502

Other categories of expenditures not given here for Table 351 are: Public service, Academic support, Student services, Institutional support, Auxiliary enterprises, Net grant aid to students, Hospitals, Independent operations, and Other.

Note that with one exception, the percentage of total revenues consumed by instruction in Table 351 increases—as expected—from Doctoral (extensive) to Baccalaureate, and that the percentage of total revenues consumed by research declines from Doctoral (extensive) to Baccalaureate institutions. Note also that the percentage of expenditures consumed by research is a fraction of the percentage consumed by instruction for all types of institutions, including Doctoral (extensive). Even at Doctoral (intensive) universities, the percentage of total revenues consumed by research is only 9 percent. At Master’s institutions, the percentage of total revenues consumed by research is very small (2 percent), and at Baccalaureate institutions that percentage is almost vanishingly small.
 
Oddly, Sandefer himself also insists that most teaching is conducted by non-tenured faculty. As he said in his Texas Public Policy Foundation article, “So who teaches our children, if not the tenured faculty? An underclass of teaching assistants, adjuncts, and other non-tenured faculty – many of whom are paid $10 per hour or less. According to the New York Times, 70 percent of the faculties at American universities are made up of non-tenured, non-tenure track faculty.” Yet it is widely recognized that adjuncts and other non-tenured faculty have less time for research than tenured faculty. All this makes Sandefer’s claim that 2/3 of academic expenditures are consumed by research at American universities in general even more incomprehensible.
 
Another useful check on Sandefer’s wildly inflated estimate can be found in the HERI national survey of American faculty, “The American College Teacher: National Norms for the 2007-2008 HERI Faculty Survey.” In the section “Teach and Research Practice and Perspectives” on p. 9, HERI reports that “Faculty spend significantly more time preparing for their teaching responsibilities and actually teaching than they spend on research and committee work…”. The overall breakdown was as follows:
 
 
Hours per week spent on preparing for teaching
 
 
8 hours or less
34.5
 
13 hours or more
41.1
 
 
 
Hours per week spent on scheduled teaching
 
 
8 hours or less
45.2
 
13 or more
19.6
 
 
 
Hours per week spent on research and scholarly writing
 
 
8 hours or less
68.0
 
13 hours or more
19.4
 
The HERI survey also gives a breakdown of reported hours per week spent by full-time undergraduate faculty (p. 29). The category that applies best to UT-Austin is “Public university.” (There is no category for research university in the HERI survey; and the survey findings were not much different for the category of “Private university.”) That breakdown is as follows:
 
 
 
 
 
 
 
Hours
 
During the present term, how many hours per week on average do you actually spend on scheduled teaching (actual, not credit hours)
During the present term, how many hours per week on average do you actually spend preparing for teaching (including reading student papers and grading)
 
During the present term, how many hours per week on average do you actually spend on research and scholarly writing
None
0.9
0.4
13.0
1 to 4
20.8
13.7
23.9
5 to 8
41.0
26.3
17.2
9 to 12
24.7
25.3
14.7
13 to 16
6.3
15.1
9.9
17 to 20
3.5
11.8
9.8
21 to 34
2.2
5.8
7.4
35 to 44
0.4
1.1
2.7
45+
0.2
0.4
1.4

[NOTE: Important and interesting data from the survey about time spent advising and counseling students, committee work and meetings, other administration, other creative products/performances, consultation with clients/patients, community or public service, and outside consulting/freelance work, have not been included here.]

 
Finally, the same HERI survey has a breakdown for full time undergraduate faculty at baccalaureate institutions. I give below the survey findings (pp. 149-50) for full professors, 95% of whom reported that they had tenure.
 
 
 
 
 
 
 
Hours
 
During the present term, how many hours per week on average do you actually spend on scheduled teaching (actual, not credit hours)
During the present term, how many hours per week on average do you actually spend preparing for teaching (including reading student papers and grading)
 
During the present term, how many hours per week on average do you actually spend on research and scholarly writing
None
0.6
0.4
8.7
1 to 4
18.4
15.1
27.9
5 to 8
36.3
28.1
21.1
9 to 12
30.5
25.5
14.9
13 to 16
9.0
14.1
7.9
17 to 20
3.3
9.8
9.3
21 to 34
1.6
5.8
8.6
35 to 44
0.2
1.0
2.4
45+
0.2
0.4
1.2

Sandefer’s wildly inflated estimate of the amount of time spent by faculty on research has already elicited a response from the NAS. The present posting simply provides more dispositive data. Peter Wood, in his “Sandefer Exaggerates,” reached similar conclusions to mine, and in his comment to Peter’s article, NAS member Michael Kellman said:

Could it really be that two-thirds of the budget at my university -- oops, my place of employment under contract to the State of Oregon -- could it really be that two-thirds of the budget goes to research? I dug up the budget, brushed up on my business math, subtracted out the stuff that I know isn't being spent on research, e.g. the athletic budget, -- and using the two-thirds figure, deduced that “we” are spending about $500 per year per to educate each student -- less if you take out graduate students, costs of administration, buildings and grounds, campus police, etc. etc.

I knew “we” were efficient but I had no idea! They must know some pretty creative, or at least arcane accounting techniques at the Texas Public Policy Institute and maybe at the Acton MBA program. But then, at $51,500 per year tuition, they must be able to hire some pretty fancy perfessers. Not even counting the great return on patents!

Of course, Sandefer has a right to be skeptical, and it is possible that he really does think that his 2/3 estimate can be validated. His language might even be taken as suggesting this. Where Kellman speaks of “creative, or at least arcane accounting techniques,” Sandefer says “Academic research, properly accounted for [emphasis mine], consumes two-thirds of every dollar we spend in American universities.” But what Sandefer cannot do is simply impugn the data that UT and other institutions have provided under law to the federal government. If he thinks that “proper accounting methods” have not been used, the onus is on him to say why, and what those “proper” accounting methods are.
 
Sandefer, in fact, appears to be a good example of what is inherently wrong with external governance of universities. He might love to be on the Board of Regents of UT, and it could probably be arranged easily enough, given Texas politics. On May 4 of this year, the Houston Chronicle carried an article entitled “Records show appointees gave Perry $5 million.” It was subtitled: “But governor’s office says donations are not considered in job assignments.” The article then led off with the following paragraphs:
Gov. Rick Perry has accepted nearly $5 million in political campaign donations from people he appointed to state boards and commissions, including some in plum jobs that set policy for state universities, parks and roads, records show.
 
Nearly half the appointee donations came from people serving as higher education regents, including more than $840,000 from those at the University of Texas System, according to a Houston Chronicle review of campaign-finance records.
 
Political patronage is nothing new for Texas governors in both political parties. The contributions are a legal and common practice, though it has been fodder for critics over the years.
Andrew Wheat of the watchdog group Texans for Public Justice probably got it right when he pointed out that this arrangement is “one of the big perks that come with the office of the governor.” “You get to dole out this stuff to reward your donors,” Wheat said.
 
The Chronicle article also mentioned that many of the donations, including some of the largest, were made within weeks of the individual's appointment. Jeff Sandefer himself was appointed to the Interstate Oil and Gas Compact Commission after having made a total contribution of $270,000 to Perry.
 
The Chronicle was certainly right to raise the issue of campaign contributions to Perry in connection with Perry’s appointments to important boards and commissions. With respect to Sandefer’s appointment to the Interstate Oil and Gas Compact Commission, however, it is relevant to note that Sandefer is an oilman, and a highly successful one at that. This in itself makes me think that he is qualified to serve on that commission. Of course, it is now widely recognized that the national financial crisis we are experiencing was due, in large part, to the excessive and unwise deregulation of the financial industry, and that this deregulation occurred largely as a result of the financial industry’s own lobbying, and political pressure on the agencies that had been set up to regulate them. Appointments like Sandefer’s could conceivably raise similar concerns and issues in Texas. Nevertheless, while there might be a case that Sandefer is not the right person for the post for such reasons, the evidence is that he is qualified for it.
 
It is quite otherwise with most appointments to the governing bodies of public and private universities in the U.S. Apparently, it is widely regarded as quite natural and even good policy to have appointments made to university governing bodies as they are to the Board of Regents of the University of Texas (where Regents are appointed by the Governor and confirmed by the Senate). It actually might be the way appointments should be made, if universities could be run just like any other business. But there is no evidence that they are or should be run in this way.
 
Sandefer’s apparently baseless and facially absurd claim that 2/3 of the nation’s expenditures on higher education are consumed by faculty research does not inspire confidence that Sandefer would be a good appointment to the governing body of the University of Texas. But given the prevailing arrangements, his appointment is a real possibility. In his eagerness to malign faculty at UT with whom he clearly feels no affinity, Sandefer clearly prepared to shoot from the hip in his criticisms. This does not inspire confidence in his management skills at running a large university, however successful he might be as an administrator at his own small, private Acton School of Business.
 
It is also significant that did Sandefer did not attempt to meet Prof. Palaima’s principal argument in defense of tenure, which was that tenure creates a commitment to a university that non-tenured members do not and cannot have, and that faculty members are able and willing, when tenured, to put in long hours improving the institution with an eye to its long-term future. This is in fact an important argument for tenure that is often overlooked. Palaima’s point will be taken up again in future installments of this series of postings on the public interest and university governance.
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