Chapter 6: Education Finance in Our New Context: Is Financial Decision-Making Headed in the Wrong Direction?

We have been president of two research universities, chief financial officer (CFO) and deputy CFO of a Big Ten university, vice chancellor and associate vice provost of a flagship research campus, faculty members at three R1 research universities, and currently serve as CFO of an R2 research university. As we reflect on our combined 75+ year careers, it strikes us how much of what we experience and observe today differs from what either of us has lived through.

As we began our careers in higher education in the 1970s and 1980s, there seemed a societal consensus that public universities were a core component of the American dream—the notion that Americans might succeed regardless of the economic circumstances in which they were born (Economic Mobility Project, 2009). The research findings undergirding this consensus remain little changed. Americans who earn college degrees are better off than those who do not graduate from college and the difference has been growing over the past few decades (Akers & Chingos, 2016). They have higher earnings (Oreopoulos & Petronijevic, 2013), better health (Hout, 2011), and higher job satisfaction (Oreopoulos & Salvanes, 2011). Of the 11.6 million jobs created in the last 10 years, 95% went to people with at least some college education (New America, 2017)—persuasive statistics. Or at least one would think they would be.