Let's look at the University of Southern California coaches. In 2007 Pete Carroll was the highest paid coach receiving $4.4 Million. In 2009 athletic director Mike Garrett, Carroll's boss took home more than $1 million, while Carroll made $4.1-million and Steve Sarkisian, Carroll's assistant made nearly $1.2-million(Sander, 2010). Tim Floyd, the USC basketball coach made $1.6-million. Tuition, room and board is over $55,000 a year.
According to Zimbalist (2010) more than 100 college football coaches had annual compensation packages that surpassed $1 million and more than a dozen of them exceed $3 million. At least 42 of the 119 Division I-A coaches earned $1 million or more in 2006 (Upton and Wieberg, 2006) and i n 2008 t he average pay of major college football coaches was more than $1 million a year. From 2007 to 2009, head football coaches' salaries rose 46 percent to an average of $1.36 million in the Football Bowl Subdivision of Division I. Some coaches earn five to 10 times what university presidents do (Zimbalist, 2010).
So why have these sports programs and their high priced coaches? Some say because they bring in money. But do they? A recent report by the NCAA suggests that college sports lose money. Among the 119 schools with top Division I football teams, only 19 had athletic departments that generated a profit in 2006 (Winick, 2008). While the universities lose money there are plenty of affiliated "not-for-profit" groups that make a lot of money. For example the CEO of the New Orleans-based Sugar Bowl Paul Hoolahan made $645,000 in 2009 and in Tampa the CEO of the Outback Bowl Jim McVay made $808,000 and the CEO of the Fiesta Bowl John Junker also did well, he made $600,000 plus $120,000 no-interest loan and like the other bowl CEO's he is responsible for one game and one parade a year. Junker also has a COO, a VP, several executives and nine directors to run this one game a year program.
While this madness is going on executives have embraced another characteristic associated with the corporate mentality; higher education chiefs want to be paid like their corporate brothers. In 2006, the highest paid president of a private university is Northwestern's Richard Freeland who was paid approximately $2.9 million. James Gallagher President of Philadelphia University is next at $2.6, followed by William Brody of Johns Hopkins at $1.9. Presidents making more than $1 million increased to 12 in 2007, up from 7 the year before (Glater, 2007). The Northwestern University President who makes $2.9 million a year is 42.6 times the salary of his faculty who average $68,000 per annum (Burger, 2007). The Chancellor and the Board of Minnesota's Universities decided to give their college presidents performance bonuses in 2009 totaling over $300,000, while calling for 550 jobs in the university system to be left open or eliminated. They also raised tuition by about 3 percent. Do they teach ethics? According to Lewin, (2008), in 2007 David Roselle of the University of Delaware received a package of $2.4 million. In 2007, the highest paid president was David Sargent of Suffolk University he received a $2.8 million pay package, including a $436,000 longevity bonus. In 2009 Sargent received $1.5 million as he froze faculty salaries and raised student fees and caused an outrage. Following the corporate model these presidents and high ranking administrators and their well paid coaches fly around in private jets. For example the Southeastern Conference (SEC) has 12 university members and they own at least 22 jets (Fain, 2010).
It's not only the presidents who get rich. Salaries of university executives, not just presidents, have increased dramatically. In 2007, Michael Johns, Executive VP of Health Affairs at Emory University made $3,753,759 and Arthur Rubenstein Executive VP and Dean of the School of Medicine at the University of Pennsylvania made $3,335,767 (Lewin, 2009). Consider the University of Texas, it has increased its budget for administrative jobs that paid more than $200,000 by 40 percent during the period 2004 to 2008, at the same time tuition rose 57 percent (Root, 2009). For example, the University of Texas has not one but two athletic directors and in 2011 DeLoss Dodds the men's athletic director, will get a raise of $72,891, upping his base salary to $700,000 a year through Aug. 31, 2015. Dodds will be 76 years old when he will step down and then he will take a part time position at the school through Aug. 31, 2020, with a $100,000 yearly salary and benefits (Maher, 2011). In addition, Dodds would receive a $1 million annuity after taxes if he is still employed by UT in some capacity on Aug. 31, 2014. His current contract calls for a $750,000 annuity to be paid this year. Chris Plonsky the other athletic director (women) will be paid be paid $265,848 a year through 2017. But her supplement for helping Dodds with his men's program will jump from $40,000 to $90,000 per year. Plonsky, will also get an annual $62,500 windfall if no major NCAA infractions are committed (Maher, 2011). And guess what? Another increase for students and their families in the fall 2011. In December 2010 the Tuition Policy Advisory Committee wrote that without the increases in tuition and fees, UT would have to cut at least $17.3 million from its budget during the 2010-11 school year and another $14.2 million in 2011-12 (Rosales, 2010).
Cutting Costs- Shrinking the behemoths
While sinking millions into sports and managerial compensation these public nonprofit and private institutions face financial exigency. So what will they do: Fire tenured faculty by using financial exigency, close departments that do not attract paying customers (Classics and Language departments are dropping like flies), eliminate and combine degree offerings, hold down salaries and by all means get rid of those high priced full time faculty and hire lots of adjuncts. As of 2010 poorly paid adjuncts with no benefits made up over 50 percent of the teaching faculty and only 30 percent of the faculty had tenure (20 years ago 70 percent had tenure) and what about the other 20 percent, they are made up of non-tenured faculty, clinical professors, teaching assistants and graduate students. Some predict tenure will be a thing of the past as conservative state and local politicians not only call for its end but also placing a cap on faculty salaries and the elimination of sabbaticals and an increase in teaching loads. While cost cutting decimates the ranks of full time teachers, administrators keep on building high tech student friendly campuses.
What about the students? They become the victims of this mess. According to Kiley (2010) the graduation rate for public universities after six years is 50 percent and for private nonprofits its 65 percent and it will continue to drop as more and more students walk away from the outrageous price tag. In addition, a study by Arum and Roksa (2011) suggests that at least 45 percent of undergraduates demonstrated "no improvement in critical thinking, complex reasoning, and writing skills in the first two years of college, and 36 percent showed no progress in four years." While faculty complain about grade inflation and the quality of education, administrator's demand that seats be kept filled because it's an economic necessity. The business model embraced by colleges and universities suggests their priorities are not focused on education but on keeping those games alive and executives happy. Quickly this priority is turning into a business model of survival.
How did this happen? It began in the early fifties when the GI Bill of Rights gave returning veterans a ticket to an education and the behemoth universities were created. Their growth continued into the sixties as the "boomer" generation flooded campuses. The percentage of the population having a degree grew and became an artifact of national pride. Many universities became large education factories and they were managed like factories. Students moved through the system as raw materials ready to be converted by an ever-ending cadre of specialists offering lectures from yellow note pads turned brown. Overtime these institutions became vocational technical schools and the liberal arts, language and science departments were dwarfed by the so-called professional schools. People with sound financial and fund raising skills moved into top management positions. Boards of Trustees composed of industrialists and financiers demanded their institutions be run by managers. So they appointed ex-CEO's and lawyers to run their universities. Fifteen of the nineteen executives who are running UC Berkeley into the ground while enriching themselves are ex-CEO's or lawyers (Nijhawan, 2011).
Presidents and deans were now judged on their business acumen and their ability to attract students who want the type of training that would land them a good job. Except for several small colleges liberal learning and critical thinking was lost. In addition these educational factories had to move up the rankings, pass the regional, state and professional accrediting agencies by offering standardized training. Imposed on schools, departments and teachers were standard syllabi, degree requirements, curricula, textbooks, cases, technology and even grading rubrics. These institutions increasingly resembled high schools. All the student did was to declared a major and a minor and have a good time in the student friendly campuses that resembled Disney land for late adolescents, and of course have Mom and Dad pay for it.
Consider New York, the last state to establish a state university system. Since 1948 the state has created a university behemoth containing 64 campuses with 5,000 undergraduate programs and close to half a million students enrolled, and this excludes New Your City which has its own City University system. With enrollment and graduation rates dropping, a paucity of jobs waiting for those who leave, and state and local governments in fiscal crisis, executives of these institutions now manage by the numbers and financial exigencies take precedence over educational quality as departments are closed, tenured and non-tenured faculty are terminated, courses eliminated and class size ballooning. The brick and mortar institutions in America are shrinking faster than Drucker suggested.
Technology and demise of the brick and mortar university
Besides the cost, another factor led Drucker to predict that brick and mortar universities would be driven to extinction and this was his assessment of the competition from alternative education systems made possible by technology.
Drucker predicted that these sprawling total institutions called university campuses with their multiple departments, research labs, dorms, athletic fields and stadiums and hordes of tenured faculty would become relics. The libraries would be the first to go. Then the laboratories would become separate corporate entities engaging in research and development for a profit. Then the sports teams would become what they truly are; minor league systems for professional teams. Then the classrooms would go, giving way to the online universities. Tuition would drop as "big name" professors would leave in droves, giving up their $100,000 to $200,000 labor intensive professorships, to give lectures electronically to thousands and make a lot of money. We might even witness "free universities" offering online degrees, sponsored by a combination of corporate advertising, donations and public funds similar to National Public Radio (NPR). We now have the technology for courses to be offered across universities and the potential for students around the world to freely engage in discussions and have free access to course materials, books, articles and video lectures. Student papers and test results would be read and graded by computer software, and sophisticated versions of "Turnitin".
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