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July-August 2009

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Playing the Numbers: Higher Education Funding—The New Normal

Like the rest of the economy, higher education is suffering the effects of this recession. This year public colleges and universities will face some of their worst budget cuts ever—in some states up to 20 percent—leading to layoffs and massive reductions in services.

In 1999 Harold Hovey, a longtime state budget analyst, described public higher education as the “balance wheel for state budgets.” When times are bad, Hovey explained, legislators target higher education for larger budget cuts than other state services. Higher education gets singled out for two reasons. First, colleges and universities can collect their own revenues in the form of tuition. And indeed, it looks like tuition at public colleges and universities is on the way up all around the country. Second, college students aren’t the states’ neediest population. Unlike Temporary Assistance to Needy Families, Medicaid, or other state spending, higher education allocations go for services to a clientele that consists of many middle- and even upper-income citizens.

On the other hand, higher education has also tended to get bigger increases when state budgets are flush. In good times, higher education is generally viewed as a wise investment for states to make. Apart from the economic benefits that states hope to gain by increasing their educational capital, the public typically views colleges and universities in a favorable light. And unlike teachers’ or corrections officers’ unions, organized groups from higher education tend not be active in partisan politics.

William R. Doyle is an assistant professor of higher education at Vanderbilt University. He previously served as a senior policy analyst at the National Center for Public Policy and Higher Education, where he was project manager for the center’s first publication of Measuring Up, a state-by-state report card on higher education. Jennifer Delaney is an assistant professor of higher education at the University of Wisconsin, Madison. She served previously as a consultant to the Commission on the Future of Higher Education and a policy analyst at the National Center for Public Policy and Higher Education.

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