The Undoing of North Carolina’s Progressive Formula for Education Finance

For this week’s blog post, I’d like to focus on two major events that have affected higher education in North Carolina. First, I’ll discuss the release of a joint study of the economic impact of all branches of higher education in North Carolina. The study was conducted by Economic Modeling Specialists International, and it was funded by the North Carolina Business Higher Ed Foundation, the NC Community Colleges Foundation, the University of North Carolina system (from non-state funds), and the 36 campuses of North Carolina Independent Colleges and Universities[1]. Second, I’ll discuss the recommendations of the UNC Board of Governor’s panel on centers and institutes. According to coverage by Jane Stancill at The News and Observer, the panel recommended the elimination of UNC Chapel-Hill’s Center on Poverty, Work, and Opportunity, East Carolina’s Center for Biodiversity, and North Carolina Central University’s Institute for Civic Engagement and Social Change[2].

Both events are related to the political struggle over higher education finance in North Carolina. Before moving on to a discussion of the role of the EMSI study in this struggle, I’d like to offer a brief analysis of its contents. The headline reads “Impact of Higher Education in North Carolina Totaled $63.5 Billion in 2012–13.” The most important foundation for this figure comes from the claim that these institutions are creating jobs both through their academic programs and through institutional operations. The report attributed the creation of over 322,000 jobs to NC Community Colleges, 426,000 jobs to the UNC system, and 219,590 jobs to North Carolina Independent Colleges and Universities. While it is easy to get lost in the facts of the report, the message is clear. Higher education is a major economic force in North Carolina. Investment in higher education produces significant economic returns for the State’s citizens.

Clark Kerr predicts this message when he discusses the origin of the State’s interest in education broadly and research-based higher education specifically. In his essay, Hard Choices, Kerr notes that productivity’s reliance on knowledge creation forces the government “to take more interest in education at all levels but particularly in higher education and especially in the research university” (Kerr[3] 189). Kerr’s argument is that the government has a responsibility to secure the economic growth of the State. Economic growth depends on productivity. Knowledge creation plays a crucial role in productivity, and knowledge creation ultimately depends on the research university.

Kerr’s argument reminds me of the thoughts of Duke’s own Mac McCorkle. I was fortunate enough to be a part of Mac’s seminar on North Carolina politics last year. Throughout the course Mac emphasized the increasingly problematic status of North Carolina’s progressive formula for education finance. The formula, as Mac called it, reads: investment in education produces economic growth, which in turn produces the revenue needed for future education investment. Mac pointed out that North Carolina’s political operations for the past century have largely relied on this formula and have successfully empowered a stout middle of the road Southern democratic machine. Mac’s primary concern in the course was that the efficacy of this formula was coming to an end. Kerr’s insights regarding the connection between knowledge creation and productivity shed light on why this might be so. According to Mac, as long as the public has faith in the formula, center-left Southern progressives will succeed in the polls. According to Kerr, the formula’s efficacy rests on the ability of knowledge creation to increase productivity. If it is the case that knowledge creation no longer plays as significant a role in the cultivation of productivity as it once did, then it may be becoming more difficult for the public mind to imagine the fruitfulness of investment in education. Therefore, the chief motivation behind the release of the EMSI study, in my mind at least, is the desire to reassert the formula and remind the general public and the general assembly (in light of upcoming budget negotiations) that investment in education really does make economic sense.

The success of North Carolina republicans in recent years can be attributed, at least in part, to the ability of republican operatives to exploit weaknesses in the formula. One such weakness appears when one considers the importance of the connection between productivity and knowledge creation. If the value of education becomes translated into a value for jobs or a value for economic productivity, then programs that do not explicitly produce jobs or lead to increases in productivity are no longer seen as valuable. This is the public logic[4] behind the recent recommendations made by the UNC Board of Governors panel on centers and institutes. The panel began last year by reviewing 240 centers and institutes in an attempt to help the UNC system consider the redirection of $15 million dollars in center funds toward core educational expenses. While the panel has only recommended the elimination of three centers, 13 more have targeted for further review. The public logic behind this review makes sense to North Carolinians who for years have bought into the aforementioned formula for progressive success. And so what does this mean for liberal education?

In his work The University: An Owner’s Manual, Henry Rosovsky extols the virtues of liberal education, even in the context of the research university. Rosovsky readily acknowledges that many degree pathways and required core courses aren’t intended to provide explicit vocational training, and he even goes so far as to say that a liberal education “is a perfectly reasonable end in itself” (Rosovsky[5] 100). This is to say that from a certain perspective liberal education is good for what it is and not necessarily for what it does. Rosovsky and others would draw a clear line between liberal education and job training. From this point of view, education is a strictly human endeavor. It is the development of a fully human being. This perspective is lost when we buy the NC progressive formula wholesale. If the value of education is essentially quantifiable in terms of a $63.5 billion dollar economic benefit, then it may not make sense to invest in programs and centers that do not increase the number significantly. Many, including Nan Keohane, have argued that liberal education is important for the development of intellectual capacities that will aid the student in job-related efforts, but this argument doesn’t seem to have as much force as it used to. A similar argument that liberal education is important for ensuring the critical thinking skills of publicly engaged citizens also seems to have lost some of its force. So what are we to make of all this, and what should we do about it?

There is no denying that external pressures, at the same time political, industrial, and commercial, determine a significant number of internal conflicts within universities, but these pressures also determine how the university interacts with the outside world. Funding priorities reflect revenue streams, and shifts in the legislature can call into question the very existence of marginalized academic programs. One strategy to address these issues could involve what I’ve called “responsible management of academic affairs.” Universities and colleges are currently trying to do more with less or at least the same as they’ve been used to with less. My guess as to why this is the case (informed by Kerr) is that they are relatively slow in adapting to change. The formula no longer works as well as it used to. It still works to some degree, but I don’t think waiting out political changes that have taken place over the past 30+ years is a winning strategy. And I don’t think we can expect the same kind of return on investment in education that we saw in the post-war era decades of the 1950s and 60s. Instead of trying to do more with less or the same with less, higher education administrators and professors should consider doing less with less.

This strategy coupled with a principled stand on the issue of liberal education could work to improve the strategic position of higher education within the larger industrial, commercial, and political framework. I don’t think talk has been exhausted about values outside of the market, and we have a template for a discussion of liberal education as good in itself. If we couple these assertions with a willingness to pull back on some of the more obviously economic benefits of higher education, we might coax out a bit more investment from policymakers and industry leaders. We have to find a way to compensate for the reality that the famous North Carolina progressive formula no longer works like it used to, while at the same time preserving the foundations of our humanity, the foundations that make our nation and society strong.

I’ll end on a note from Cardinal Newman. Kerr quotes Newman as saying that the university “is the high protecting power of all knowledge and science, of fact and principle, of inquiry and discovery, of experiment and speculation; it maps out the territory of the intellect, and sees that . . . there is neither encroachment nor surrender on any side” (Kerr 2). It seems to me as if we’ve allowed considerable political and economic encroachment. If we couple technological innovation with the kind of ideological innovation Newman would have appreciated, we might succeed in securing a sure future for higher education and all that it should protect.

[1] See http://www.nccommunitycolleges.edu/emsi-study

[2] See http://www.newsobserver.com/2015/02/18/4565209_unc-board-panel-recommends-elimination.html?rh=1

[3] See Kerr, Clark. The Uses of the University. 5th ed. Cambridge, Mass.: Harvard University Press, 2001.

[4] I admit that there may also be a private logic behind these decisions. Political motivations related to the activities of Gene Nichol in particular have probably played an important role.

[5] See Rosovsky, Henry. The University: An Owner’s Manual. New York: W.W. Norton, 1991.