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Executive Summary
 
Introduction
 
The Context: State Budgeting and Higher Education's Vulnerability
 
The Continuing Battle to Sustain Current Support for Higher Education
 
Recent Experience: The Recession of the Early 1990s
 
What's Different?
 
Unprecedented Enrollment Growth
 
The Tuition Conundrum
 
Student Support
 
Concluding Observation
 
References
 
About the National Center for Public Policy and Higher Education
 

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Introduction


This essay is about recessions and the major policy considerations that states and institutions must face in the current economic downturn. I will discuss the public policy implications of three major variables in the course of the essay: (1) each of the 50 states has a unique higher education system; (2) each state also has unique revenue and budgetary processes; and (3) each recession is a unique, unpredictable event with its own unique causes, impacts, and duration. To these variables, one must add such conditions as a state's demographic characteristics and economic trends.

My focus will be on higher education policy, and I cannot overemphasize its importance. Skeptics will tell you that state public policy is a myth, and that politics is all there is. Politics is certainly more visible than policy, but policy is just as real. State policies look to desirable, even ideal, outcomes. In contrast, state politics look to the practical and the feasible, and political considerations weigh heavily on elected state officials who must make the key decisions about funding public services. The politics of scarcity are very different from the politics of prosperity--and different in ways that are often inimical to financial support of higher education.

State higher education policy, therefore, will be the setting for this essay. Within this setting, my observations are not guided by any generally accepted concept (if indeed there is one) that explains the complex interactions between government and higher education institutions. Rather, I first want to describe certain aspects of state financing of colleges and universities, focusing on those that were most affected by the recession in the early 1990s. Then I will discuss selected aspects of the current recession, particularly how it differs from earlier ones. I will close with a final observation on the present recession.

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