Glenn Mroz: Higher Ed Funding Hitting Bottom

Glenn Mroz: Higher Ed Funding Hitting Bottom

May 13, 2011/Dome Magazine

By Glenn Mroz

Michigan has earned a dubious distinction: a decade of deep cuts to state higher education appropriations has made Michigan one of the bottom 10 states in the nation in tax dollars spent per student for higher education, a new State Higher Education Executive Officersreport indicates.

And this dismal statistic is about to get even worse. With the 15 percent decrease in higher education funding included in current state budget proposals, the Senate Fiscal Agency reports that Michigan’s funding for higher education has dropped almost 35 percent in the past 10 years. That will put the state among the bottom five nationwide in higher education funding.

All of this comes at a time when data are showing the only way for a state to increase its prosperity — measured as per capita income — is through increasing the percentage of college graduates in its population. And news reports are showing many Michigan businesses are unable to find enough qualified college graduates to grow their companies in our state.

Just before our spring commencement celebrations, I met with the Michigan Technological University Board of Control and told them of my major concern for the future of the state. The bottom line: businesses are already having a hard time finding enough talented, skilled people in science and engineering, and business will only flourish where the skilled and talented people are.

I think the MTU board members I addressed were just as concerned. Marty Richardson, who chairs the board, put it succinctly when she said, “I understand the terrible financial challenge our state faces, but this is extremely shortsighted. Education can be the answer to individual economic problems, to families’ problems and to society’s problems. But the situation is getting worse, not better; time is passing, and our opportunity is slipping away.”

This is what is most puzzling to those of us who have worked hard over the last decade to continue to turn out bright young graduates even in the face of slumping state support. Even as state funding for the 15 public universities dropped in real dollars — before considering inflation — from $6,840 in 2000 per student to $5,604, the number of bachelor’s degrees conferred increased from 34,551 to 41,171 — a 19 percent increase.

During the election, many of our leaders said repeatedly that they understood the importance of higher education to a prosperous Michigan.

But the top priority upon election has not been policies that help create and retain a large number of college graduates in our state, creating the raw material for the knowledge economy. It’s been yet another round of cuts to universities.

It’s often said that states are the laboratories of democracy. If that’s true, it seems we should be looking to successful states to emulate. How would I define success? Well, the most important way would be to look for states with high per capita income and low poverty rates. That would be an indication of a broad and healthy middle class.

If those are two key “dashboard” items, which states are doing the best? Connecticut, New Jersey, Massachusetts and Maryland are the top four. Wyoming, an oil state, sneaks in at five, then New York and Virginia.

How about low poverty rate states? Well, you find a surprising number of the same states in the top 10:Connecticut, Maryland, New Jersey, Virginia.

These states are also leaders in college attainment. And they all have fairly significant state and local tax burdens — all higher than Michigan’s today, and far higher than Michigan’s burden is expected to be after the current round of tax cutting.

There are states that have bet on being low tax states — Mississippi, South Carolina and Tennessee come to mind. And yes, they have been winning the competition for new auto assembly jobs. But their unemployment rates overall are above the national average. Worse, they’ve been losing the battle for prosperity, with incomes that lag far behind the national average — and even behind Michigan — and high poverty rates that suggest they have given up trying to create the conditions for a middle class to grow and flourish.

Those low-tax, low-education states are not even in the competition for the engineers, designers, finance and marketer positions that are the high-paying segments of industry. Those jobs will go to states that win the battle for college graduates.

Where will Michigan end up after dust from the current budget battle settles? Will we look more like a successful state — or more like one of those that seem to have tossed in the towel in the fight for prosperity? The deep cuts to higher education, and the seeming indifference of many in the public policy arena today to the collective value of that education and its role as a public good that creates wealth for all, would seem to provide an answer. One that doesn’t bode well for Michigan’s future prosperity.

Glenn D. Mroz is president of Michigan Technological University and chair of the Presidents Council, State Universities of Michigan.