Higher Education University Inc. Campus Commercialization and The CEO Salary
The Commodification of the
University As Product
leaves them without Moral Authority.
2016 Universities Are Becoming Billion-Dollar Hedge Funds With Schools Attached. free-market fundamentalism that thinks all institutions in society exist to enrich the bankers Universities raking in a record $40 billion in 2015, Wall Street stacked boards of directors approving self-dealing investments, all while tuition continues to rise, student debt continues to mount, and value of a college degree declines. Over $100 billion of educational endowment money nationwide is invested in hedge funds, costing them approximately $2.5 billion in fees in 2015 alone. force universities to stop doing business with hedge funds The problems with hedge funds managing college endowments are manifold, going well beyond the exorbitant—some would say extortionate—fees they charge for their services. Yale’s comparatively modest $26 billion endowment, for example, made hedge fund managers $480 million in 2014, while only $170 million was spent on things like tuition assistance and fellowships for students. tax-exempt educational institutions doing business with companies notorious for dodging taxes in offshore havens. More generally, tax exemption is a giant government subsidy that disproportionately benefits elite schools (the ones that attract the biggest donations and earn the largest investment returns), thus further polarizing an educational system already separated into haves and have-nots. And it gets worse. Kick Wall Street
Off Campus Endowments were not just innocent victims of the 2008 financial crisis, but actually helped enable it.
The passage of Bayh-Dole, effectively put universities into the patent business. By allowing them to own patents for federally funded research, there was suddenly an incentive to the universities for research that would pay off during the life of a patent. In the early 80s, you never heard discussion from faculty of wanting to take a sabbatical and start a company. Now, of course, there are enough stories of faculty members becoming rich, that that seems to at least be a fantasy for many faculty members. So where the incentive used to be to do groundbreaking research and establish a reputation, now there is a competing incentive to do something that VCs will find interesting, in 5 years.
The National Science Foundation and the Defense Department makes investments which spawn graduates and ideas that get funded by VC's. Generally, these are new ideas based on existing technologies. With a good shot of producing returns within five years, they are magnets for talent and venture capital— and eventually for big companies that often buy the start-ups whole. Anything that takes 10 years.
Finally, per trends in federal R&D federal research funding as a percentage of GDP saw a heavy move from non-defense to defense in the early 80s and has overall had a declining trend. I think that reduction in non-defense spending has also funded immediate priorities at the expense of a long-term research as an overall trend.
Billionaire Steve Jobs
Steve Jobs was adopted by a working-class couple. He dropped out of Reed College when he couldn't afford tuition. Jobs started Apple computer in his parent's garage in 1976. This is the text of the Commencement address by Steve Jobs, CEO of Apple Computer and of Pixar Animation Studios, delivered on June 12, 2005.
NYU Eats World - An alumna laments the rise of an imperial university
Empire Building - Mega Universtity Scandals - Report after report after report show colleges became more concerned with institutional growth than with education. Pre$tige: The university pays senior professors an average salary of $195,700 now, with add-ons like a sabbatical every third year, subsidized Manhattan apartments, and, in some cases, mortgage assistance for country houses. NYU is quite dependent on tuition dollars for its cash flow. The current sticker price for tuition, room, board, and fees comes to about $64,000 a year, making NYU one of the costliest universities in the United States. About 53 percent of its students have taken out loans. NYU Abu Dhabi is the avatar of something new: a branch of an American university, offering American degrees, but funded by a foreign government. Given who is paying the bills, how does an American university maintain academic freedom, the bedrock of the American system, at this offshore branch? If it’s true as reported, to borrow Sexton’s phrase, that top university administrators didn’t know of the abuses, that in itself is scandalous. The Abu Dhabi development was under way, after all, in 2008. NYU’s moral standing is in the toilet. Great universities are about things more important than empire building and real-estate acquisition.
Who pays for higher education?
Who pays for higher education? Whether talking about the government role or the student responsibility, the question is controversial all over the world, and many policies are in flux.
The United States has a large tuition and philanthropy dependent private nonprofit sector, which contains both the most and the least prestigious and selective institutions and which provides two very substantial non-tax-based revenue streams -- tuition and philanthropy – that are unmatched in any other country.
The U.S. features a significant reliance on tuition fees as well as more nearly break-even fees for food and lodging in the public as well as the private sectors, with tuition fees ranging at undergraduate levels in neighborhood of 20 to 40 percent of instructional costs.
Tuition fees in the United States are assumed to be paid up-front by parents to the extent that the family is deemed to be financially able to contribute.
Colleges and universities in the United States – public as well as private – obtain significant revenue from philanthropy (both past philanthropy in the form of returns on endowment, as well as current philanthropy in the form of annual donations. From the very extensive other-than-tax revenue to U.S. colleges and universities, public and private, the United States gets more higher education for the tax dollar spent than any other country. Because of (i) our very accessible admission policies (that is, students being able to access colleges and universities who would be deemed academically unprepared in any other country), (ii) the ability of students to move from essentially open admission, "short-cycle," community colleges into bachelor degree colleges and universities, and (iii) the very extensive volume of (mainly) need-based financial assistance, the United States has a measure of accessibility unmatched by any other country. (This in spite of our high tuition fees in both the public and private sectors.) [source]
IVY LEAGUE COLLEGE PRESIDENT SALARIES
Total Pay for Local College Presidents
Amy Gutmann, University of Pennsylvania: $1.08 million
Constantine Papadakis, Drexel: $1.02 million
John Strassburger, Ursinus: $715,504
Mordechai Rozanski, Rider: $531,778
Alfred H. Bloom, Swarthmore: $529,370
James T. Harris III, Widener: $445,763
*Nancy J. Vickers, Bryn Mawr: $402,135
*James P. Gallagher, Philadelphia University, $356,603
* Antoinette Iadarola, Cabrini: $349,736
* Thomas R. Tritton, Haverford, $345,092
Jerry Greiner, Arcadia; $277,868
David R. Black, Eastern, $244,011
Rosalie M. Merenda, Neumann, $243,358
*David Roselle, University of Delaware, $2.45 million
Richard McCormick, Rutgers: $666,999
Graham B. Spanier, Penn State: $611,367
Ann Weaver Hart, Temple: $572,900
Source: Chronicle of Higher Education survey
Ivy League President Salaries go Sky High
Gutmann's base salary increased from $630,000 to $750,000, about 19 percent. Gutmann's pay is second-highest among Ivy League presidents, behind Columbia's Lee Bollinger, who got $1.4 million.
The University of Delaware said Roselle's $2.4 million-plus package included 17 years worth of deferred compensation accumulated over his tenure. Elsewhere in the region, presidential salaries continued to climb.
Ursinus president John Strassburger ranked as the highest-paid in the survey among presidents of baccalaureate institutions, at $715,504 in total compensation, up from $333,721. His pay also includes $355,831 in deferred compensation, school officials said.
Pennsylvania State University president Graham B. Spanier was fifth among public universities nationwide, at $590,000 in base pay for 2007-08, up from $545,000. His total package is $611,367.
Other presidents who received more than a half-million in total compensation include:
Alfred H. Bloom, Swarthmore, $529,370; and Ann Weaver Hart, Temple, $572,900.
President Tilghman's total compensation neared $800,000 for the 2007-08 academic year, according to the University's most recent tax filings. Tilghman's pay — including her $738,432 salary as well as $45,027 in benefits and deferred compensation — stood at $783,459 in the 2007-08 academic year, the most recent year for which tax filings are publicly available. The amount marked a 5.5 percent increase over her 2006-07 compensation package, which totaled $742,444.
- Digital Diploma Mills: The Automation of Higher Education history of how this got started & the connections
- Wrestling the Military-Academic Complex May 2, 2004 The reach of the military-academic complex goes far beyond schools like West Point and Annapolis; today almost 350 civilian universities conduct Pentagon-funded research.
- Harvard Inc. has prestige, money, and power - a $19 billion endowment, by some reports the wealthiest nonprofit in the world after the Catholic Church.
- Academic Ranking of World Universities
Annual ranking of the top 500 universities based on "several indicators of academic or research performance, including alumni and staff winning Nobel Prizes and Fields Medals, highly cited researchers, articles published in Nature and Science, articles indexed in major citation indices, and the per capita academic performance." Includes top-100 lists for Europe, North and Latin America, and Asia Pacific universities. Rankings go back to 2003. From the Institute of Higher Education, Shanghai Jiao Tong University.
- Columbia University's National Center for the Study of Privatization in Education, Director Henry Levin said commercial education is "a growth industry, and you get rich not by being skeptical, but by being enthusiastic." NYT 4.1.06
- Campus Commercialization University Small Business Patent Procedures Act
“It is the policy and objective of the Congress to use the patent system to promote the utilization of inventions arising from federally supported research or development” and “to promote collaboration between commercial concerns and nonprofit organizations, including universities.” — The Bayh-Dole Act, a k a the University Small Business Patent Procedures Act.
Executive Compensation The Million-Dollar President, Soon to Be Commonplace
The Chronicle of Higher Education, 6.11.24
A 'Chronicle' survey finds 53-percent increase in presidents with compensation of at least $500,000. The number of chief executives in higher education moving into the highest ranks of compensation accelerated in the past year. While the salaries do not have the eye-popping quotient of those of corporate CEO's -- whose median compensation was just over $6-million among the 350 largest U.S. corporations -- the steady upward march of higher-education compensation is increasingly spreading from private institutions to public colleges and universities. A total of 112 presidents of traditional four-year public and private institutions, and systems, had compensation packages totaling at least $500,000. While this survey includes 853 institutions or systems, 17 percent more than last year, the number in that level of compensation increased by 53 percent. The change was most pronounced among presidents of public institutions. The number of leaders of public universities making at least $500,000 nearly doubled over last year. E. Gordon Gee of Vanderbilt University received a compensation package of $1.2-million, the only continuing president who earned more than $1-million. But three other presidents -- Shirley Ann Jackson of Rensselaer Polytechnic Institute, Aram V. Chobanian of Boston University, and Harold J. Raveche of Stevens Institute of Technology -- all eclipsed the $900,000 mark. (Dr. Chobanian, who was an interim president, has since stepped down.)
Ivory Tower Executive Suite Gets C.E.O. Level Salaries 11.15.04
The earnings of many top university presidents are spiraling up toward $1 million a year, according to an annual survey by The Chronicle of Higher Education, rising far more quickly than faculty salaries.
Forty-two presidents of private universities were paid $500,000 or more in the 2003 fiscal year, the most recent for which figures are available, compared with 27 presidents the previous year. Just two earned half a million in 1994.
The highest-paid private university president, William R. Brody of Johns Hopkins University, earned $897,786 in university compensation, not counting at least $100,000 in annual pay for membership on several corporate boards. At least five other university presidents earned more than $800,000, including Judith Rodin, who has since left the presidency of the University of Pennsylvania, and Gordon Gee, the chancellor of Vanderbilt. They received the second- and third-highest compensation packages. The presidents of public universities, too, are earning salaries that would have been inconceivable a few years back, although they remain lower than on private campuses. At public universities, 17 presidents earn more than $500,000, compared with 12 last year and 6 the year before that. Mark A. Emmert of the University of Washington is the highest-paid public university president, earning $762,000 this academic year. Carl V. Patton of Georgia State, who receives $722,350, and Mary Sue Coleman of the University of Michigan, who receives $677,500, rank second and third.
"These huge salaries feed into the ongoing corporatization of the academy," said Roger Bowen, general secretary of the American Association of University Professors, who earned about $120,000 a year when he was president of the State University of New York at New Paltz during the last decade. "Universities do not exist to make money but to educate our students and citizens, a role that is central to our democratic society. We send the wrong message when we transmogrify our campus presidents into C.E.O.'s."
The Chronicle based its listings of private university presidents on the most recently available university federal tax filings, for the 2002-2003 fiscal year. It collected its data on public university presidents by conducting telephone interviews with officials at 131 public research universities and colleges, said Julianne Basinger, who compiled this year's special section. The figures for public university presidents reflect their current compensation, she said.
The median compensation for presidents of private research universities rose to $459,643 in 2003 from $314,944 in 1999, or 46 percent, The Chronicle reported.
Several members of university boards said their presidents deserve the compensation because their responsibilities are increasingly complex, with oversight of thousands of employees, as well as vast research budgets and fund-raising campaigns. Dr. Brody of Johns Hopkins, who has a medical degree and a doctorate in engineering, manages Maryland's largest private work force, with 45,000 employees, and the largest research budget of any American university, more than $1 billion.
"He deserves his compensation," Raymond A. Mason, chairman of the Johns Hopkins board, said in a statement.
But the rising salaries of presidents appear to be opening a social and financial breach with professors. The average compensation for full professors at public and private universities last year was about $100,000, Dr. Bowen said.
The rising presidential salaries at public universities come as many legislatures have slashed their states' higher education budgets. Public four-year colleges raised tuition on average 14 percent last year and 10 percent this year, according to the College Board.
Still, trustees at public universities say that to attract talented leaders they must compete with the private universities. The University of Washington Board of Regents enticed Dr. Emmert to leave the chancellorship of Louisiana State University in Baton Rouge, where he was paid $590,000, by matching that figure and adding a $160,000 one-time incentive to move, Jeff Brotman, the chairman of Costco who is the president of the board of regents, said in an interview.
"We think we got tremendous value," Mr. Brotman said. "It's like going into Costco and you see a bottle of Dom Perignon for $90. That's a great value, but it's not cheap."
At many universities, the most highly compensated official is not the president. At Duke in the 2003 fiscal year, for instance, Nannerl O. Keohane, who was the president then, received $528,622 in total compensation, while Mike Krzyzewski, the basketball coach, received $853,099.
The highest-paid person in American academic life, according to The Chronicle, was Maurice Samuels, who received $35.1 million, including a bonus of $14.5 million for reaching investment goals, as senior vice president of the Harvard Management Company, which manages Harvard University's $22.6 billion endowment. Lawrence H. Summers, the Harvard University president, received $529,397 in total compensation.
2013 Harvard Management Company now 30 Billion endowment.
Two top educators at Boston University made the list of highest-paid presidents for the 2002-2003 year. Jon Westling, who left the Boston University presidency in July 2002, received $700,626 in total compensation. John R. Silber, the chancellor who had served as president from 1971 through 1996 and who assumed the duties but not the formal title of president when Dr. Westling stepped down, received $808,677 in total compensation during the same fiscal year.
A year later, in October 2003, Boston University paid $1.8 million to Daniel S. Goldin, a former NASA administrator, to walk away from his contract as university president the day before he was to assume the duties from Dr. Silber. http://www.nytimes.com/2004/11/15/education/15salary.html
New York University $20 million venture-capital rival Stanford
6/2010 New York University plans to launch a $20 million venture-capital fund that aims to spur technology entrepreneurship at the school. The NYU Innovation Venture Fund is the latest initiative from the school to support new companies emerging from the university's research. Polytechnic Institute of New York University said it would join with New York City and Columbia University to host the NYC Media Lab to foster collaboration between media and technology companies, and the universities' researchers. "The fund is continuing that effort to bring the university in the direction of solving significant science and technology problems and making a material impact on society at large," said Frank Rimalovski, the fund's managing director. Mr. Rimalovski last worked at New Venture Partners LLC, a Murray Hill, N.J., venture fund that he co-founded. NYU contributed $2 million to start the fund. The rest will be raised through donations. The fund will be making investments ranging from $100,000 to $1 million in early-stage companies in sectors such as information technology, computer software and biotechnology. Several other universities, including the University of Wisconsin, Purdue University and Boston University, have started similar programs, Mr. Rimalovski said.
End the University as We Know It By Mark C. Taylor April 27, 2009
GRADUATE education is the Detroit of higher learning. Most graduate programs in American universities produce a product for which there is no market (candidates for teaching positions that do not exist) and develop skills for which there is diminishing demand (research in subfields within subfields and publication in journals read by no one other than a few like-minded colleagues), all at a rapidly rising cost (sometimes well over $100,000 in student loans).
In my own religion department, for example, we have 10 faculty members, working in eight subfields, with little overlap. And as departments fragment, research and publication become more and more about less and less. Each academic becomes the trustee not of a branch of the sciences, but of limited knowledge that all too often is irrelevant for genuinely important problems. A colleague recently boasted to me that his best student was doing his dissertation on how the medieval theologian Duns Scotus used citations.
The emphasis on narrow scholarship also encourages an educational system that has become a process of cloning. Faculty members cultivate those students whose futures they envision as identical to their own pasts, even though their tenures will stand in the way of these students having futures as full professors.
The dirty secret of higher education is that without underpaid graduate students to help in laboratories and with teaching, universities couldn't conduct research or even instruct their growing undergraduate populations. Thats one of the main reasons we still encourage people to enroll in doctoral programs. It is simply cheaper to provide graduate students with modest stipends and adjuncts with as little as $5,000 a course with no benefits than it is to hire full-time professors.
In other words, young people enroll in graduate programs, work hard for subsistence pay and assume huge debt burdens, all because of the illusory promise of faculty appointments. But their economical presence, coupled with the intransigence of tenure, ensures that there will always be too many candidates for too few openings.
The other obstacle to change is that colleges and universities are self-regulating or, in academic parlance, governed by peer review. While trustees and administrations theoretically have some oversight responsibility, in practice, departments operate independently. To complicate matters further, once a faculty member has been granted tenure he is functionally autonomous. Many academics who cry out for the regulation of financial markets vehemently oppose it in their own departments.
If American higher education is to thrive in the 21st century, colleges and universities, like Wall Street and Detroit, must be rigorously regulated and completely restructured. The long process to make higher learning more agile, adaptive and imaginative can begin with six major steps:
1. Restructure the curriculum, beginning with graduate programs and proceeding as quickly as possible to undergraduate programs. The division-of-labor model of separate departments is obsolete and must be replaced with a curriculum structured like a web or complex adaptive network. Responsible teaching and scholarship must become cross-disciplinary and cross-cultural.
2. Abolish permanent departments, even for undergraduate education, and create problem-focused programs. These constantly evolving programs would have sunset clauses, and every seven years each one should be evaluated and either abolished, continued or significantly changed. It is possible to imagine a broad range of topics around which such zones of inquiry could be organized: Mind, Body, Law, Information, Networks, Language, Space, Time, Media, Money, Life and Water.
3. Increase collaboration among institutions. All institutions do not need to do all things and technology makes it possible for schools to form partnerships to share students and faculty.
4. Transform the traditional dissertation. In the arts and humanities, where looming cutbacks will be most devastating, there is no longer a market for books modeled on the medieval dissertation, with more footnotes than text.
5. Expand the range of professional options for graduate students. Most graduate students will never hold the kind of job for which they are being trained.
6. Impose mandatory retirement and abolish tenure. Initially intended to protect academic freedom, tenure has resulted in institutions with little turnover and professors impervious to change.