Archive for July, 2012


The Department of Education has quietly announced that it will not enforce its very controversial state authorization rule, which required colleges to get government permission in every state where students enrolled in distance ed programs. The low key announcement with such a huge implications for colleges all over the country was probably due to the Obama administration wanting to downplay its embarrassment over the court’s recent rebuke of its gross regulatory overreach. The Obama ed department’s heavy handed push for state authorization threatened to cost colleges millions and throw the higher ed industry into turmoil. The only major beneficiaries of the fed action would have been government universities-no surprise there. Many small colleges faced closing or limiting their distance ed programs due to the high costs of meeting the new state authorization demands. But the biggest losers would have been distance ed students facing fewer low cost education options. For more on this major development, see today’s report in Inside Higher Ed: http://www.insidehighered.com/news/2012/07/31/education-department-wont-enforce-state-authorization-distance-education-programs

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According to the Christian Post, at least 10 Christian colleges and universities may be financially unsustainable. Several others are at risk of falling into the same pit.

The Financially Sustainable University, by Jeff Denneen and Tom Dretler, examined financial stability based on two factors: expense ratio and equity ratio. Colleges with a high increase in expense ratio (expenses as a percentage of revenue) and a high decrease in equity ratio (total net assets, or assets minus liabilities, divided by total assets) are considered financially unsustainable.

The list of those at risk is a bit surprising. Most of them have been around for a long time, have pretty deep pockets, strong denominational affiliations, and high national visibility. Maybe they’re considered “too big to fail,” but we know where that got certain global financial giants in the past few years. Of course, unsustainability is variable status over time. Some modest changes in either direction might turn things around for any of those institutions at risk or creeping closer to trouble.

Here’s the list of the “financially unsustainable“:

  • Azusa Pacific University, Azusa, Calif.
  • Baylor University, Waco, Texas
  • Calvin College, Grand Rapids, Mich.
  • Catholic University of America, Washington, D.C.
  • Georgetown University, Washington, D.C.
  • University of Notre Dame, Notre Dame, Ind.
  • Palm Beach Atlantic University, West Palm Beach, Fla.
  • Regent University, Virginia Beach, Va.
  • Texas Christian University, Fort Worth, Texas
  • Westmont College, Santa Barbara, Calif.

Christian colleges and universities considered “at risk” include:

  • Colorado Christian University, Lakewood, Colo.
  • Covenant College, Lookout Mountain, Ga.
  • Houghton College, Houghton, N.Y.
  • Indiana Wesleyan University, Marion, Ind.
  • Oklahoma Baptist University, Shawnee, Okla.
  • Pepperdine University, Malibu, Calif.
  • Southern Methodist University, Dallas, Texas
  • Wheaton College, Wheaton, Ill.

Christian colleges and universities considered financially sound include:

  • Biola University, La Mirada, Calif.
  • California Baptist University, Riverside, Calif.
  • College of the Ozarks, Point Lookout, Mo.
  • George Fox University, Newberg, Ore.
  • Liberty University, Lynchburg, Va.
  • Oral Roberts University, Tulsa, Okla.
  • Union University, Jackson, Tenn.

Read more here.

Inside Higher Ed reports that Moody’s Investors Service‘s U.S. Higher Education Mid-Year Outlook is disappointing for higher education. American colleges and universities face the challenges of heightened competition for students, declining revenue sources, backlogged maintenance getting worse, and a growing number of new problems that can only compound existing problems.

The institutions already struggling financially are now much more vulnerable to an extended period of weakness in the global economy, so we can probably expect more cutbacks and closures across the country. Government universities and weak private colleges are most likely to feel the pinch first.

See the IHE news brief here.

Budget cuts at colleges around the nation are starting to hurt their local college-town communities, according this Wall Street Journal report. The report mentions the impact of cuts at Washington State University on our cross-border neighbor Pullman’s economy.

In a Washington Post column, John Feinstein urges colleges and universities to resist the temptation to put their superstar coaches, like the late Joe Paterno, on pedestals during their lifetimes.

Good luck.

When it comes to college sports, winning isn’t everything. But it is still the only thing fans and boosters truly care about. Which is why winning coaches will continue to receive god-like homage and tragedies like the Penn State debacle will be repeated once again in the not too distant future. Big time college sports is simple too big to be constained by the moral and legal codes of mere mortals.

The heart of the problem, however, is not corrupt coaches or out-of-control sports programs; it is intercollegiate athletics itself. Its value to students and the academic enterprise is marginal at best. Sure big-time athletics can help fund lots of other good things on campus. So can theft and prostitution. The fact that college sports programs have become cash cows is not an argument in their favor. They are a source of institutional devolution. Sports, not scholarship, not student development, not the shaping of men and women of honor, integrity, and service, drives many major academies today. Intercollegiate sports may be great entertainment, but they are always fundamentally distractions to the mission of quality higher education. And at institutions like Penn State, they sometimes completely derail the university’s mission. Once that begins to happen, college sport becomes a powerful negative force that undermines quality student learning and campus culture.

Can we derive benefits from intercollegiate athletics? Sure. But tragedies like the Penn State mess are symptoms of a much more dangerous ailment that college sports fans and boosters regularly mistake for academic health.

HT: Stephen Lyons

New economic data suggest that there is a disconnect between today’s mainstream universities’ job training emphasis and market realities (including job openings and salaries) greeting college grads. For many today, the cost of a job-oriented college degree simply isn’t worth it. According to Richard Vedder, a professor at Ohio University and an economist, historian and columnist, college grads face a glutted job market which simply can’t absorb them.

If the primary purpose of a college education is job training, then lots of students are wasting their money. Vedder notes in an article in the Chronicle of Higher Education,

“You cannot thumb your noses at economic realities or popular opinion forever without hav[ing] people ask “Why are we subsiding this activity?” If the 2011 data continue the trends with respect to earnings of the previous couple of years, I suspect more and more Americans will simply say “no” to higher education.”

If the purpose of a college education is primarily to get a job, then Vedder’s right. Sadly, that is the fundamental problem with American higher education: its misguided purpose.

Until Christian educators and parents recognize the higher purpose of a college education,  college tuition will largely be a waste of their money.

http://m.apnews.mobi/ap/db_6776/contentdetail.htm?contentguid=lDSxii6G

A BBC Report suggests that changing world demographics will redraw the world of higher education. China and India will soon produce the most college graduates on the planet. See the story here: http://www.bbc.co.uk/news/business-18646423

Noted scholar Niall Ferguson discusses the the “limits of public monopoly” in education and why UK higher ed is in trouble. See: http://www.bbc.co.uk/programmes/b01jmxsk/features/transcript

While Americans complain about how long it takes students to finish college, German students are being sued by their universities for finishing too quickly. Perhaps our two countries should talk and strike a balance betwixt and between? Inside Higher Ed has this rather bizarre story.