 Let me welcome everybody. Welcome to the Future Trends Forum. I'm delighted to see you all here today. We have a great pair of guests with a really, really good book that I'm really looking forward to taking into. Since the beginning of a forum, since our very first month, way back in 2016, we have been focused on campus economics. How do we fund higher education? What does student debt mean right now? How do we support different kinds of labor on campus? What does public support mean? How is that changing? We've been covering this from multiple areas for month after month, year after year. And now we have some of the best people in the world to speak to about this. Sandy Baum and Michael McPherson are long-standing economists with long, brilliant careers in higher education, including not just being published on scholars, not just being great teachers, but also leading campuses, including colleges and universities. They are the author of a new book, Campus Economics, and I cannot recommend this book highly enough. In fact, we have a link to it in the bottom left corner of our screen. The first half of the book is the cleanest, most elegant, most up-to-date summary of how campus economics work. It's just fantastic. It's 75 pages or so, and it just sets the stage perfectly. The second half of the book looks at some of the biggest challenges, some of the biggest, most controversial questions around how we finance higher education. And that's why I'd like to have it in both here. So let me quickly clear the stage. Let me bring them up so that we can see both of them and then we can start our conversation. Well, greetings, Dr. McPherson and Baum. Hi. Hi. Thank you for those very generous comments about our book. Well, I mean every word of them. It is really, really powerful and delight. And it's great to see both of you. Are you coming to us from Maryland? We're in Bethesda, Maryland right now, yes. Okay. So there's always a very, very nerdy aspect of Bethesda, which is that it is the home of one of the world's most influential and successful computer game manufacturers with the name of Bethesda Software. So if you haven't seen that, you should check them out. They're amazing, but it's definitely an interesting case of every local successful business. But I'm so glad you could join us today. Let me just quickly ask, we have a unique way of people introducing themselves on the form, which is we ask people to describe what they're working on right now and what they're working on for the next year. So, you know, what are the, what are the big projects? What are the big economic terms? What services are you providing? But also what topics are you focusing on for the next year? Well, I'm thinking a lot about a lot of issues relating to higher education finance. Let me just say we're not in the process of writing another book. We had to look carefully and that was enough for now. We do hope, however, to pursue the ideas in this book. We're happy to talk to people on their campuses to engage in conversations about the issues. So we don't feel done with this book. Let me say that. But there always are, of course, important issues arising relating to student debt, relating to other financial aid issues, to racial equity on campuses and the funding of higher education. So, you know, I continue to work on all of those issues. Oh, excellent. Excellent. And Dr. McPherson. Yeah, well, right now I'm working on learning how to play Here Comes the Sun. You want to know what we're working on right now? Well, you have to tell me what instruments? Guitar. Acoustic? Acoustic, yeah. Very good. I'm one of those, you know, old people who has guitars that are much nicer than he deserves to have. But actually, in coming closer to the work that we're talking about today, I kind of recently recognized that all the stuff that I learned about in my youth in this field is now history. Things that used to be current become history. So, I'm thinking about doing several essays that are kind of located in the history of economic thought about the origins of the contemporary concept of human capital, you know, the history of famous Baumall and Bowen cost disease, what implications that has, and things of that sort. So, it's a, I'm not trained as a historian, but it's an interesting new adventure for me. And I think, unlike some fields, I mean, maybe in physics, though this is probably wrong too, but maybe in physics, old issues are just old, just dumb. In economics, that's never true. And there are always insights that you get from reading, you know, Will Baumall or at textbooks that are as fresh as they were when they were written. Excellent, excellent. Well, I have to say, just personally, I would love to see any work on the Baumall's cost disease. I would love to see that essay. I refer to this every week and the concept, and I would love to hear more about it. And of course, Sandy, we all need to hear this kind of work. We all need this right now, because academia is in quite a place. And every topic you've mentioned is one that is a great moment for us right now. But friends, I wanted to ask you about this book. And there are so many questions I want to ask. But the first one I want to put this to you as delicately as possible, because I know it's a political landline, or it's a multifaceted landline. It can blow up in different directions. You elegantly ask the reader to consider a given college or university as an economic entity. And you have this great way of putting it, not quite as a business and not quite as a non-economic entity, but something in between, setting aside a for-profit higher education for the moment. Thinking about private higher education and thinking about public higher education. How have you succeeded in talking to people about this in a way that doesn't just make everybody upset, that you don't get people throwing charges of corporatization of the university at you, or charges of dismissing the economic fundamentals of higher education? How do you get people to think about an individual campus in that economic sense? Well, I think one of the problems is that you frequently have two categories of people. One, the people who are really concerned about the bottom line at the institution, about the financial future of the institution, about efficiency on campus. And they tend to want to speak a language that uses terminology coming from business or economics. And that focuses on, look, this is what we're worried about. We have to have money. We have to have resources. Everything is fine. We have choices. And they tend to, they might think of the students as customers. They might think of, use words like the demand for our services that just turn off people who are, whose primary focus is the real educational mission of the institution. And then you have people whose focus is centrally the real educational mission, who just think, don't bother me with any kind of resource constraints or financial issues. I would say one of the things that the first time I started thinking about writing something like this, I was in a meeting with faculty and administrators and sitting together. And there were concerns about the budget. And one faculty member said, don't talk to me about money in the same conversation with curriculum. And I thought, oh, so here's the problem. The whole purpose, the reason we're all there is the mission. The reason we're there is not as it is in a for-profit company to make money. Or that's just not why we're there. We're there for the mission. But obviously, carrying out the mission involves resources. And resources are finite and there are trade-offs. So I think that what we're really trying to do is get people to have this conversation to think about their vocabulary, to think about the other people and the different roles that people on campus have and try to understand each other. Yeah, I guess I completely sympathized with that. One thing I think about is my role for seven years as a college president and being in the club of college presidents who like to commiserate with one another about our common terrible fate for which we are exceedingly well-paid, I should say. But I had the impression of a lot of college leaders would actually like to avoid dealing with the very difficult issues of trade-offs and painful choices about whether you can expand the faculty in one field or another and just let us take care of it. We're the pros. We know how to manage this. And when things go south as they will do from time to time, all of a sudden you hear from them, look folks, we're all in this together. This is going to be mutual sacrifice and all that. And I don't think you can work it that way. I mean, I think you have to either decide you're going to take total responsibility for the place and leave the faculty and the students to themselves or you're going to have to have a continually open dialogue. One of the things that we did at McAllister was either I or the provost at each of the monthly faculty meetings would give a little talk about some set of choices that we were facing. Not to bring the news of a decision, but to say this is on our plates. This is on everybody's plates. Let me give you a little insight into what the dimensions of it are and then we would encourage you to keep the conversation going on campus. I think for us, the most important thing is people have to find a vocabulary where they can talk with one another respectfully and in an informed manner. Well, it sounds like that's a great model for it. One that honors both conversational power of higher education, but also faculty governance. Well, that common language is difficult to achieve, but I think your book gives us a really solid vocabulary for it. The second question I want to ask, and this is something that I'm pretty obsessed with, has to do with the power of enrollment. There's a great Johns Hopkins book on managing small colleges and one chapter begins with enrollment as code for revenue, which I've always enjoyed. You've pointed out that depending on the institution, enrollment can account for a minority or a majority of revenue depending on the institution it's funding and so forth. But the question I have is we've been experiencing a steady decline in enrollment for the past decade. And that's unusual because we enjoyed a generation of steady indeed rampant growth from the early 80s through 2012. What kind of impact is this gradual decline going to have on higher education as a whole? How are you going to be able to keep funding or teaching and research missions if the number of customers or students or however you want to refer to them is starting to trickle down? So the it's hard particularly right now to make clear sense of the enrollment numbers because naturally that had a dramatic impact and in one year there was a very large drop in enrollment. And then I think it's easy for people to forget that it takes four or five years for that drop to work itself through the statistics. So one doesn't want to overreact to numbers that are this has been a problem with inflation too actually. So that's one thing. The other thing is in the background the demographics are changing. The number of 18 year olds in the society is going down after a long period when it went up. And so you have to pay differential attention to enrollment as a share of the population and enrollment just as a raw number. And I think you would find that a lot of the gradual decline is a result of the decline in cohort size. That still leaves you with a problem but it's a similar. And then you also have to recognize these huge regional differences. The Midwest is losing population to the Southwest and has been for a long time. So when you talk about enrollment troubles they really hit places like Minnesota where I used to be. Situation in Arizona or in Florida is very different. I think it's also really important not to talk about higher education and so it will monolithic in this competition. Different kinds of institutions fair very differently. I mean much of the enrollment decline is at community colleges and the for-profit sector has certainly shrunk and that's different from enrollment declines in public and private four-year institutions. And of course there still is a subset of institutions that are highly selective when they turn away a lot of qualified students and this is not an issue for them. And so the extent to which an institution is enrollment dependent really matters. You know for community colleges it's interesting because enrollment has declined funding per student has increased. So it becomes much more complicated to figure out the pros and cons and I think the circumstances of each individual institution are going to be very different in terms of the impact of enrollment changes. Oh this is fascinating. Thank you. Thank you both. Those are terrific answers. Friends I have so many questions for our guests but the forum is about all of you to ask your questions. So please this is a great time either if you're if you want to raise your hand and join us on stage you can tell that it's clear you don't have to be a beer have a beard in order to be on stage. But and if you want to type in your question in the Q&A box please do that and I'll share with everybody else. So while people are thinking while they're cogitating and thinking of questions there are a couple of comments that come from the chat. I just want to share those really quickly. We had a couple of people Tom Hames and Kiel Domchev asked how do we know the 1950s and the 60s weren't the blip that that was an unusual spike up but instead we have something different going on now. Kiel responds the 1950s through the 90s saw the rise of government policy pushing everyone to go to college coupled with the adoption of degrees as the required credential for white-collar employment or for white-collar employment. I guess based on those comments I would ask do you think we still have a political consensus that more and more people should get more and more post-secondary experience? You know I do I mean I think one of the things that that comment highlights that's really important is to talk about the decline without talking about the increase that preceded it it doesn't really make much sense because if what's happening is a sort of evening out of a positive trend I mean that would still involve a decline but you know the everyone should go to college I do think that for a period of time we got sort of carried away with everyone should go to college and not much discussion of where they should go or why they should go or what they should do when they're there and then we started to realize that actually it's not just about access to college it's about success and what we really need is to get people through college and of course we don't want a hundred percent success rate we want people to try college if they are interested and have a chance of benefiting so we do want more people to go to college we don't want financial constraints to be the reason people don't go to college but that doesn't mean that everyone should go to college and I think there is more realization now of the importance of strengthening other pathways to success because some of those pathways are things that we call college I mean when you hear people say yeah but you know maybe you want to be a plumber why should you go to college and you need to say yeah but you need to learn how to be a plumber and you're probably going to do that you know maybe at a community college and that's college so part of it is about the definition of college and I just think that there have been questions about the value of a college education for a long time and again you have this problem that you find a few people for whom college didn't work out and there are absolutely people who are worse off after trying college than they would have been if they hadn't but that's just not going to be true of most people but there always can be those exceptions we have to recognize them we have to stop pretending like this works out for everyone but it's very clear that colleges and maybe the the public discourse ignores this too much but college isn't just about getting a piece of paper college is about learning learning to think not just learning specific subject matter learning to solve problems and that's not going to stop being important and education is not going to stop being important and we can't let the conversation be entirely in terms of pieces of paper specific credentials or or even earnings or even earnings you know go back to my new found interest in history back in the 1970s college actually for a little while didn't pay off well at all great labor economist Richard Freeman wrote a book called the overeducated american and it turned out that that downward trend in the earnings gain from higher education was a blip and it turned around quickly it had to do partly with with men going to college because they were trying to avoid the draft and now Mira and a number of other technological considerations but some of the best writing and thinking about the non economic reasons for going to college occurred in that era you know it's easy if you're trying to sell your institution to say you know you're going to get rich or you're going to make a million dollars more than if you don't go to college right it's harder to explain to people why even if that's not true and I should make clear it is true if you complete college you will make a million dollars more not discontent in the course of your career but you should there are good reasons why you should come to college anyway you will become a more discerning thinker you will have capacities to to help your community change in constructive ways from what you learned while you were in college and you will have the joy of learning which is a very precious thing so in some ways we'd be better off if college didn't pay off quite as well as it does because then you would have fewer people looking at college attendance is a meal typically and more people looking at it as a way of enriching their lives thank you for walking us down both paths of the monetary benefits and the non financial benefits we have questions uh sandy and mike that are just piling up and i want to make sure people get a chance to ask them so let me fire off the first one and this is from our friend tom hams who is smack dab in the middle of the texas heat dome so if he expires the next five minutes we need to get to his question first where are we seeing the greatest increase in the costs of colleges and do these align with tuition rises and can you explain discrepancies so i assume that this is a question about where do we see increases in how much it costs to produce education and does tuition follow and we know that there's a really weak link between the price of producing education and tuition if you're looking at public institutions obviously the level of appropriations of state and and in some cases local funding for higher education has so much to do with how those costs are covered and i think you know it's really hard to say again you know making these generalizations we know that institutions are spending more and more on financial aid now do you think of financial aid as an expenditure do you think about it as a discount you never had that money anyway you didn't spend it you wouldn't have your revenues that depends on the type of institution that you're in um and different institutions really spend differently i mean you look at you know for profit institutions spending on advertising and there's a surprising amount of advertising among none about among nonprofit institutions as well obviously the biggest expense for colleges and universities is personnel but it's not that the faculty are getting rich um but it is that it is very expensive to pay all of these people and to pay for their health insurance and so on so if you ignore those expenses you're never going to find the answer but you know everyone looks at well how much are we spending is their administrative vote i think the administrative vote vote issue is quite overblown because the number of personnel who are not instructors the share that really hasn't gone up it's that instead of having you know secretaries we have technology people and they do get paid more than than the secretaries did so that makes the the budget for those people go up but again i think it's looking at every individual institution certainly differs by sector but it also differs by region of the country um and and a lot by selectivity um so i don't think that tuition increases are in fact i mean they're long over the long run yeah sure tuition goes up to cover higher expenses but that connection is rather tenuous at least in the short term ah that's that's that's great to hear thank you and tom as always thank you for the really keen question if you're new to the forum friends that's an example of a q and a question so if you'd like to follow tom's footsteps and ask one of those just head to the bottom of the screen that white strip click the question mark button and type one in and here's another one in fact and this is actually a question about specific aspect of university administration um here this is from uh our friend mark the fusco who asks i haven't read the book yet but i wanted to ask why boards are in many cases honorific or philanthropic rather than fiduciary ah do you want to bring that back up again uh no i i i get it so uh uh why don't we have more business people running boards i guess would be a translation of that question and i think a big part of the answer is they're not business uh uh i was in a wonderful discussion once uh with richard chate who was a long time student of and writer about higher education who who was serving on a group the agb the association of governing boards uh they they had organized a committee to talk about improving board selection and richard said mostly the committee was people from the world of business they're there they were the people who were worried about this and he said you know i always wonder uh wouldn't it be interesting if you had college professors serve on the boards of corporations because they're thoughtful men and women and they've had a lot of experience in the world they're they're the source of the future leadership of businesses uh why wouldn't you do that and the answer he said of course is we don't know anything about running a business but so why do you business people think that because you're good at running businesses you'd be good at running college you don't know anything about colleges you spend your time thinking about whatever business you're in you don't spend your time thinking about colleges we think about colleges all the time and uh i don't think the fiduciary obligations can be ignored in fact it's illegal to ignore them and i don't think boards in fact do ignore them but it's not about the money so with that mean we should have more of those honorific and thrill philanthropic boards and fewer fiduciary seats oh look it makes perfect sense to have somebody who really understands how to do an audit successfully somebody who understands the investment portfolio that needs to be managed even if you have a small endowment in some ways a small endowment means you need to pay more effective attention to to how well you're doing so no i think i think there are specific functions where it's absolutely important to have but that doesn't mean you have to have a group like that as an essential composition okay very good thank you um and uh mark thank you for the great question by the way the book is full of these observations that really just lay bare how colleges and universities work you mentioned endowments and those here your section on that is just really just so badly needed i think we have more questions that are just lining up you know now the dam is burst and people are full of queries which is what we love and mike garden from georgia asks with growing interest in lifelong learning what is the likelihood we might see colleges experimenting with subscription models so if what that means is you know can i sign up and take a class or can i have an online you know learning experience obviously colleges are going to try for one thing is that many colleges are looking for alternative sources of revenue and it could be that some sort of a subscription service that people would sign up for and they would take some classes uh sure i mean that that probably makes sense but is it going to be that we're going to stop having you know the sort of traditional model of you go to a certain college and you follow a path to getting a degree you know i really don't think that's what's going to happen i think for a long time people in the in the era of mooks are going to change the world um it was oh maybe we're going to have pop feed higher education where you take a course here and of course there and whatever and maybe we even have a third party that keeps track of the courses you've taken and in the end they'll add up to a total and you'll have a degree but of course that's not what education is it's more than the sum of its parts and so anybody who's who's on a college campus knows that they're not just thinking about you know the isolated courses they're thinking about the experience that they give to their students and they're thinking about if a student is seeking a certain credential what are all the parts that have to fit together to accomplish that credential so you know if that question is about is there something else that many colleges and universities could do to you know provide through their expertise this kind of experience for adults sure but does that transform higher education i don't think that transforms higher education yeah you know the way i would look at this is that uh i don't i i think it's very likely that that colleges and universities many colleges and universities will get more into the business of educating older adults than they have historically and i think that's partly because at least in the universe i hope for people will have more time to think and study when they're older than they than they have historically been able to do because people basically worked until they died if you go back 100 years now hopefully people will live longer and will be able to space out their work alternating with other kinds of activities in their lives that's a dream i admit in many ways but the odds that the best place to go when you're 50 is the place you went when you were 20 not that good right so i don't think you you should find individual colleges focused on educating their little group of people over their entire lives but instead that colleges should be available to people to draw on in their older lives now maybe consortia of schools could collectively offer something like a subscription but you know maybe you you you're 55 years old you're doing fine in your work but you've always had this hankering to learn to draw go to an art school right learn to draw don't think about whether Carnegie Mellon is the right place to go to learn to draw maybe it is well i know but uh but i think i have to be more flexible than that or a community college community college absolutely so maybe we'll see a consumer behavior along these lines but we won't necessarily see institutional subscription models as a result right that's fascinating um mike thank you for that great question and you can see friends that we have more and more questions coming up and there's uh there's one from Miriam Wallace let me bring this one up on stage so everyone can see it uh and uh Miriam asks i'm concerned about defunding public institutions along with public rhetoric saying high red isn't worth it how do those of us at public's articulate our value for external audiences and Miriam's at the University of Illinois Springfield you know public public higher education as people have sometimes said the the funding of public higher education by legislatures and governors is always at the end of the whip uh when when there is a budget squeeze for the state budget as a whole as there is generally in recessions you take a look at the list of things you really can't you know you you can't cut public safety you can't cut public health even if some people think you can you can't cut elementary secondary school which is actually what higher education has fundamentally rest on the one thing you feel like you can cut higher education it's out there at the whip and you think you can cut it partly because the colleges can make up for it with higher tuition and there's a kind of a nod and a wink in some cases that the legislature's saying you go take care of your financial problems yourselves we're we're going to worry about other things so i think that's a continuing threat that we see and i do also agree that that many politicians are dining out on uh beating up on on higher education doubts about its true value either in purely economic terms or in ideological terms but man the society we live in fundamentally built around knowledge invention technological advance the idea that we can continue to build that without investing public money as well as private money in and the preparation of our people to think well communicate well the things you really get out of college let me just say that i think one of the real problems that is relevant to the to the question is that many um state legislators particularly but lots of public figures it's not so much that they're questioning the whole idea of college is that they're really questioning the idea of learning as opposed to occupational preparation so you need more art historians do we need more anthropologists whatever so i think one of the important tasks is to educate people about why it is that people need to learn broadly why they need to become become educated and that the specific area they study is not really the issue i mean no matter what field you're talking about the number of people whose careers end up being closely related to what they studied in college is smaller than anyone would think and we need people to stop i mean what what i would like to shut down is this idea that it's worthless if you're studying something that you know what if you're studying history i mean really you want to say it doesn't matter if people don't have a historical perspective even if they're not going to be historians when they grow up so i think focusing our attention on that issue is really critical what's the what was that reagan quote when he was governor in california it's not the responsibility california taxpayers to subsidize intellectual curiosity i think yeah yeah that's the that's the opponent um merriam thank you for that great question and good luck it'll annoy and mike and sunday thank you for those excellent excellent answers we have more questions and i want to make sure everyone gets a shot at these and here comes one from a trustee at amherst university um and this question is isn't bowman's cost disease the key driver here as productivity growth and delivering teaching and administrative services is almost nil while pay needs to continue to rise to retain faculty etc that's john blames says a trustee at amherst you know it's it's something i've thought about because i am thinking about writing an essay about the history of the cost disease and i think there's a sense in which that's fundamentally got to be true that uh you know health care uh live musical performance live theatrical performance uh classroom teaching these are all things where uh productivity uh that's a great deal of difficulty in advancing um you know uh will bomb all used to say that that going to the going to a concert hall and listening to beto vince fifth symphony is going to take an hour and a half of the time of 90 people no matter what you do with technology you can make the sound better with better speakers and and higher education has definitely a lot of those qualities as does health care uh but empirically when you look at the data year by year and over time you have to recognize that there are a lot of other things that are going on in addition to this cost disease and it's not and i'm sure uh dr williams mr williams doesn't mean to imply this it's not the soul explanation and it's not enough i mean it's it's really important to get people to understand that but it doesn't take us off the hook or trying to figure out how we can produce high quality higher education without using quite so many resources i mean i think we have to stay in that make that effort because the reality is it's really expensive and it's worth a lot but we need to keep making that effort even acknowledging that no we're never going to be able to be you know sort of have tuition you would you would want to oppose anything that says tuition can only rise at the general rate of inflation because that's really a problem but that's not the end of the story i couldn't find the page off hand but you the two of you have a good a good discussion about this in the book where you're talking about back office functions and how those can be automated and those can be more productive uh in various ways thank you both uh and thank you um for the great question um trustee williams really appreciated that we have a question which i can't flash on the screen because it happened in the chat and it happened in a real hurry um but if i can summarize it uh several people including our dear friend lisa durf we're talking about ai in education um and uh the possibility of both uh students and faculty using ai to produce more more of their work and the final result of this exchange let me make sure i get this right here um with uh they mentioned for example uh sol cons uh con mego um part of con academy um and then the question they have is does if if we have ai deployed at scale within higher education and being used by both faculty and students does that reduce the value uh and therefore the price of higher education lisa and everybody please if i've mangled that horribly please please correct me in the chat and i can amend yeah i mean i certainly don't want to make any predictions about what role ai is going to play uh my instinct is to say that we're in a moment where everyone thinks everything is going to change dramatically and my guess is that things are going to change things are going to evolve but it's not going to be the end of the world as we know it um obviously we you know many people have thought about what are the concerns about people not creating their own work both students and faculty that's obviously a big concern um but you know education is about people and it's about people interacting with people and learning together how to think and solve problems and um you know ai doesn't have a mind of its own in that sense it's not going to replace uh human beings and i think we may face a lot of new challenges in making sure that we structure our institutions so that we really do promote creativity and individual thought and people working together but um we just have to face those challenges it's not that this is going to take over education and make the people irrelevant i really think that just misses the whole concept of of a meaningful and high quality education if i can reduce uh with that point uh to a slogan uh we may get more ai but we're always going to need more ai hmm hmm whether it's a or h um unofficial or humanoid um well the least lisa at all uh thank you for for forming that and uh sandy thank you for that very passionate defense as well as michael thank you for the really useful slogan um we have a couple more questions coming in and here is one that sounds a little cryptic to my ear but i might um i might be missing this i think sandy this one is aimed for you um which is what insights do you have from your experience at skidmore uh and this is okay i guess that's for me um you know i mean i uh taught at skidmore and mike taught at williams and and was president of mccallister i mean so the question is about what about you know strong liberal arts colleges i think that both of us have been really shaped by our liberal arts experiences i mean i went to brenmore i just spent 10 years on the brenmore college board and so i have a lot of liberal arts college experience and i think that it makes me value all the more um what people can do together and the communities that colleges can create of course i'm also an economist studying this this industry and so i'm very aware of what a small slice of higher education these colleges represent but i think they are terrifically important and i would love to have more students have have more access to those experiences i think they're they're really important and and they're worth a lot and i feel very fortunate to have had that experience excellent um well jessica thank you for the question if you want to uh add more to it um please please feel free again with the q and a box or with the chat uh i'm i'm curious dr mcfrison you you spoke about your interest in history and for me that always makes me want to turn that around to looking ahead a bit i mean as a futurist i draw heavily on history for precedent examples inspiration models um i'm if you could start off by um and and of course um dr bowman i would love to hear you as well on this where do you think the next decade of higher education financing goes um what are some of the big contours of the next 10 years that we should be looking out for i mean for example should we be anticipating a further decrease of state funding both for universities and community colleges at least on the per student basis do you think we're going to have a major attempt to legislate something about student debt um will the demographic tide really keep cutting down that trickle of incoming students what does the next 10 years look like for you uh i'm i'll try to say something interesting but let me first say something boring hardly uh almost always things change less than you think they're going to there is a tremendous amount of persistence in these institutions you know with the exception of the roman catholic church in institutions of higher learning are the longest existing institutions in the western world they were founded in the 1200s basically on a similar model to what they are now with rowdy young people coming into these privileged places and tearing up the town i mean it's it's amazing if you go back and look at this that was they were faculty run institutions and they joined together to actually select their own presidents um there's something about this organizational structure that really works and that has survived tremendous amounts of change not without changing itself but it really has a lot of persistence personally i think over the next 10 years uh forgive me if this answer is too political that's okay we uh we are at some risk of uh losing our democracy and one thing we know about authoritarian regimes and i don't want to go too far i'm not predicting that there's going to be some revolution in the united states but one thing we know about more authoritarian orientation is it is very incompatible with successful higher education because you can't afford to have free thought and free thought is what nourishes higher education so i hope this passes and we don't actually have that kind of loss of intellectual freedom but there are some threats out there and they yeah they do worry i mean i think obviously a lot of what happens in the next decade depends on you know like who's going to be our next president i mean all you have to do is look around at the different states in the country and i mean florida's been in the press more than others about changes in higher education and you can see that things could change pretty dramatically pretty quickly depending on um which way the government goes but barring extreme outcomes i mean funding state funding has been cyclical always always and you know you can look at graphs of what has happened to funding per student and what has happened to tuition prices and as always just you see years and years and years of things going in in opposite ways and those sorts of things are going to continue to happen state funding has picked up again and pretty much you know caught up and do i think that we're going to suddenly say oh let's put a much larger share of our state budgets into higher education no what are we going to stop funding it in a reasonable way no because i think that in fundamentally state legislators know how dependent they are on higher education for their workforce even if they don't appreciate education per se they do appreciate having having a trained workforce and so again i think um you know and i feel like you know i'm old enough to have a listen to this conversation um over and over about this is the end we can't possibly have this financing model any longer it's going to crash hasn't crashed yet that doesn't mean it never will but i think things are going to evolve i think the things that we can't predict now and i think they're going to be important changes but i really think you know some colleges will go out of business but they won't you know just you know was a decade ago that people were saying a large share of colleges are going to cease to exist in the next decade well they haven't some colleges will go under because they won't be able to make it but that's always true um that happens to businesses all the time and we don't say oh we don't have a viable model of businesses so um you know i'm not i'm not a futurist and i'm not going to make big predictions but i think it's really easy to go overboard with thinking that we are at a on a dramatic precipice well this is this is very very useful i appreciate your your uh if the social science paper generator model always begins includes the phrase continuity and change um i mean you've you've you've hit the continuity elements really really hard and that's that's important um i do want to ask about one one possible aspect of change sendy you're talking about um uh you know changes in the business model or the business model being durable in the book you sketch out very clearly that uh the discount rates have been rising more and more steeply and just again friends if if you haven't encountered the phrase before this is the amount by which a university discounts its published tuition price so a discount rate of 50 percent means that if the tuition published is 50 000 it means the median person actually pays 25 000 um how much how much further can the tuition discount go i mean the cuba has it below 50 or i'm sorry higher than 55 percent for a lot of private universities and uh publics are closing it behind that uh does that just keep escalating in line with uh overall macroeconomic trends of increasing wealth and economic inequality well um i mean one thing is that as tuition rises the discount rate is going to rise because you have to keep if you want people to be able to afford it the percentage changes in the aid you give them are going to be greater than the percentage changes in the tuition obviously you're not going to get to 100 percent i mean you can't draw a straight line up because then there would be no revenue um and i think that there's again these averages are hard to look at because there's so much um difference across institutions um so you know i think probably it has to slow down but when people say why don't we stop and just stop discounting and get back to what is the real tuition we aren't going to do that because you're not going to charge everybody the same price because you would be cutting out all those students who can't afford it will there be more schools that do this thing of we're cutting our tuition by you know 20 percent and then we're going to give less financial aid potentially there will be um but in terms of a dramatic change is is the model of discounting and charging different students different prices is that going to go away you know i don't think it's viable for that to go away maybe there will be fewer institutions giving 100 of their students a discount but uh again i think it's a kind of thing that we have to monitor and it's obviously not going to keep going up up up up people used to predict like student debt was just going to go straight up up up up forever and of course it didn't it started going down down down nobody really noticed that but it did so um you know um this is probably going to go on for a while and the discount rate is going to be high but it might not rise at the same rate that's interesting that's it thank you thank you that especially makes sense with uh continued rise of of tuition i have so many more questions to ask and i think people would like to chime in with still more and we are at the end of the hour um you two have taken us through a whirlwind tour of campus finances um what's the best way to keep up with the two of you and your new work i mean you know um michael if we want to find uh these these historical essays that you're starting to work on and send if you want to find uh you know your thoughts about these major issues rolling higher education how how can we keep up with you too well i have a website sandybaum.com which i try to keep up and i do write um blogs on the urban institute website but you should share our email addresses with people and anybody who has questions should feel free to to contact us thank you thank you um well i'm happy to do that um i mean you know i'm i'm happy to offload the work of contacting you to other people um but i but but more seriously i'm i'm absolutely delighted that you've taken an hour to share your thoughts with us um and that you took much more than an hour to write a really really excellent book thank you for all of your work i'm looking forward to seeing what you produce next um and uh all best during this extremely extremely hot summer um well thank you very much for the opportunity thank you oh our pleasure our pleasure but don't go away friends let me just point out where we're headed over the next two weeks if you'd like to keep talking about this if you'd like to keep wondering about everything from discount rates to debt to Balmain's cost disease and overall college finance um please there are multiple venues for you to do that uh on twitter or a mastodon just use the hashtag ftte you can see my accounts there and both of those who are of course on my blog and if you would like to look into our previous sessions where we've talked about campus finances just go to tinyurl.com slash ftfrchive and you can find a whole series of sessions on that looking ahead we have a bunch of forum events coming up including several on ai plus in campus organizing so if you just go to our forum website you can find more about that and of course last time i'll say this please subscribe to my sub stack about ai and the future of higher education i'd love to hear your thoughts there uh thank you all for such great questions and such great commentary today i really appreciate it you helped make this a really really powerful session thank you all for your patience i know i've had a pretty difficult past month and i really appreciate all of your support thank you for all of that i hope all of you managed to stay cool where it is hot and above all i hope all of you managed to stay safe take care everyone be well we'll see you next time online bye bye