Colleges in Dire Financial Straits

[TreadingLife]

Some of the posts above are guilty of the Fallacy of Composition. Even if maintaining or expanding sports were to work for one or the other college, that doesn't mean it will work for all. In fact, it can't.

The U President pursuing a sports strategy not only has to think s/he's smart, but also has to get lucky.

Just think: Let's expand our English Department and/or our Chemistry Department. We all know that won't work. Instead, expanding Sports some believe will work. And it's still College? But it can't work for all.

You aren't wrong dismalist, but you remind me of a joke about being chased by a bear

Steve and Mark are camping when a bear suddenly comes out and growls.  Steve starts putting on his tennis shoes.
Mark says, "What are you doing? You can't outrun a bear!"
Steve says, "I don't have to outrun the bear—I just have to outrun you!"

Many schools think they have a first-mover advantage on many fronts (new curriculum, new majors, new sports) even though they do not, but even if that assumption is wrong, all they really need to do is outlast the other schools also circling the drain in the hopes that they can grab their former students.

[dismalist]

Some of the posts above are guilty of the Fallacy of Composition. Even if maintaining or expanding sports were to work for one or the other college, that doesn't mean it will work for all. In fact, it can't.

The U President pursuing a sports strategy not only has to think s/he's smart, but also has to get lucky.

Just think: Let's expand our English Department and/or our Chemistry Department. We all know that won't work. Instead, expanding Sports some believe will work. And it's still College? But it can't work for all.

You aren't wrong dismalist, but you remind me of a joke about being chased by a bear

Steve and Mark are camping when a bear suddenly comes out and growls.  Steve starts putting on his tennis shoes.
Mark says, "What are you doing? You can't outrun a bear!"
Steve says, "I don't have to outrun the bear—I just have to outrun you!"

Many schools think they have a first-mover advantage on many fronts (new curriculum, new majors, new sports) even though they do not, but even if that assumption is wrong, all they really need to do is outlast the other schools also circling the drain in the hopes that they can grab their former students.

Fallacy of Composition. Everyone can think of their own institution. I'm thinking of the system.

[pgher]

Another point that has gotten lost in the discussion about sports was the impact of housing & dining services on campus finances. Many people, including my college-age kids, thought in spring 2020, Hey, I'm not in a dorm or eating food, so it should save the college money, right? So of course colleges had to give back what they had collected. Then followed a year of less-than-normal occupancy. But debt service continued, dining service contracts continued, etc. Colleges have been investing in dorms for two generations now, which was fine as long as the residential college experience was normative. But any hiccup at all and the system crashes.

[TreadingLife]

Some of the posts above are guilty of the Fallacy of Composition. Even if maintaining or expanding sports were to work for one or the other college, that doesn't mean it will work for all. In fact, it can't.

The U President pursuing a sports strategy not only has to think s/he's smart, but also has to get lucky.

Just think: Let's expand our English Department and/or our Chemistry Department. We all know that won't work. Instead, expanding Sports some believe will work. And it's still College? But it can't work for all.

You aren't wrong dismalist, but you remind me of a joke about being chased by a bear

Steve and Mark are camping when a bear suddenly comes out and growls.  Steve starts putting on his tennis shoes.
Mark says, "What are you doing? You can't outrun a bear!"
Steve says, "I don't have to outrun the bear—I just have to outrun you!"

Many schools think they have a first-mover advantage on many fronts (new curriculum, new majors, new sports) even though they do not, but even if that assumption is wrong, all they really need to do is outlast the other schools also circling the drain in the hopes that they can grab their former students.

Fallacy of Composition. Everyone can think of their own institution. I'm thinking of the system.

True, but there is nuance lost in the middle between what happens in the system and what happens to an individual institution.  Assumption up front: I do not believe that the entire system will fail, or that all SLACs will fail,  but individual institutions will. Further, most schools have no idea if they will fail or succeed. Hope isn't a plan. But, clearly some will make it, either through luck, the grace of God, etc., and it is that hope that keeps schools going in the short run. In the long run is where the shake-out of schools happens.

It reminds me of the story told in a field you might be able to relate to, dismalist. <warning to everyone else, dismalist and I are going into the econ weeds here> Let's think of the story of perfect competition and the long run. When profits are negative firms exit. We assume that all firms are homogeneous in the model, so who exits? Clearly not everyone in some bang-bang solution where everyone leaves. Here's where the nuance comes in. We then acknowledge that all firms in perfect competition really are not homogeneous, and that there are meaningful differences in cost structures, so that who exits are the relatively more inefficient firms.  The system shrinks. I completely agree. But who does the leaving matters. And I agree with you that no school  knows the answer to that ahead of time. Hence the hope. But I get it, the dismal science is dismal for a reason.  The fallacy of composition is real, but not all schools will fail, so here's to hoping your school is a shred more efficient than the next school.

[Ruralguy]

If you are raising significantly more money, especially for endowment, and/or enrollments are increasing without a decline in quality, you'll probably live out the decade at least. Maybe outlive competitors. But for small non elite schools the biggest competitor is always the state system, not the nearest small school.

[marshwiggle]

If you are raising significantly more money, especially for endowment, and/or enrollments are increasing without a decline in quality, you'll probably live out the decade at least. Maybe outlive competitors. But for small non elite schools the biggest competitor is always the state system, not the nearest small school.

I'd imagine the biggest threat to small non-elite schools is demographics; they rely on sufficient students from their local area, and probably have very little chance of recruiting from elsewhere. When the local age cohort drops sufficiently, they're done.

[Ruralguy]

Depends on how local.  For some schools, "local" can meet up to two states over. For others, its two towns over, maybe. But for either, a big state system is always going to be the biggest competitor that never goes away. If their share in the area goes up relative to the small schools, probably because of demographics, then yes, the smaller schools are living on borrowed time...or no time.

[TreadingLife]

Depends on how local.  For some schools, "local" can meet up to two states over. For others, its two towns over, maybe. But for either, a big state system is always going to be the biggest competitor that never goes away. If their share in the area goes up relative to the small schools, probably because of demographics, then yes, the smaller schools are living on borrowed time...or no time.

True, state schools are competition, but the product isn't exactly the same depending on what the student wants and needs. For example, we cater to a needy student who requires regular faculty-student interactions and who would not thrive in a 50+ person classroom, or on a big campus. COVID really brought home the need for some students to have a certain type of learning community to thrive. That's our value added. Our classes are the same as every other school, and our tuition is higher. But, and this a big but, if there are still students willing and able to pay for the residential, small LAC experience, we will stay in business. And we only need 400-500 incoming students per year to make the numbers work. Picking up an extra 50 students through more sports recruiting and another 50 via a closed SLAC nearby can make all the difference for a place like mine. Not every school is like mine, but plenty are.  If state schools can somehow "feel" small and keep student-faculty ratios low, then we have a real problem, but that's not what I am seeing in my state.

[Ruralguy]

Don't need to SLAC-splain, I've been at one for 22 years. My point is that the mission of small schools barely matters even for people who claim it matters. They put in their applications at the state school and a few others. For more than half of them, their first choice is the state school (and I don't mean the flagship in most cases). No other needs mean much when they can get the basics for much cheaper. That's what they tell us.

[quasihumanist]

If you're just looking for the credential and don't care about learning, the state school is cheaper and requires less studying (as long as you don't pick the "wrong" major).

[Ruralguy]

This description.applies to about a third to half of our students, and probably more before they arrive.

[Wahoo Redux]

If you're just looking for the credential and don't care about learning, the state school is cheaper and requires less studying (as long as you don't pick the "wrong" major).

I always take heat for this, but I will post it again:

Business and tech jobs. 

This is where higher ed is going, and maybe that's the way it is supposed to go.

[dismalist]

If you're just looking for the credential and don't care about learning, the state school is cheaper and requires less studying (as long as you don't pick the "wrong" major).

Absolutely, quasi, it's the credential that matters to get a wage premium. It's not that some majors eventually earn more than others, though they do, but that all get a premium, even, ... well, all can guess. That's because the college credential serves as a signaling device for many or most. An arms race, privately profitable and socially wasteful.

Thus, it's perfectly rational for a student to not care about learning, to go to a party school, to have grade inflation, and to have content that administrators, and only administratoirs, like.

Word has gotten around. The efficient solution would be to stop all subsidies to tertiary education, but the votes may be the other way -- for parties at school, touchy feely stuff, support groups, anybody can name it, and again, rationally so.

Only, it's not education.

[quasihumanist]

The efficient solution would be to stop all subsidies to tertiary education

The efficient solution would be to simply have everyone who can't contribute enough to the economy more than what it would take to give them a minimum standard of living - uh - raptured.

Efficiency isn't everything.

The question is how we take care of the half of our population that is disabled - all the "essential" workers who clearly aren't (at least until all their potential replacements are raptured), given how the economy can get away with treating them.

[dismalist]

The efficient solution would be to stop all subsidies to tertiary education

The efficient solution would be to simply have everyone who can't contribute enough to the economy more than what it would take to give them a minimum standard of living - uh - raptured.

Efficiency isn't everything.

The question is how we take care of the half of our population that is disabled - all the "essential" workers who clearly aren't (at least until all their potential replacements are raptured), given how the economy can get away with treating them.

Absolutely, quasi. Give the poor money.

By the way, "the economy" is us! :-)