Chuck
Submitted by R.Will (not verified) on October 12, 2009 - 10:57am.
"I would point out that the CPI-U tracks rather closely the median household income over the last 30 years; the point being that tuition, room & board at UofM are even more out of reach to the average family in the State of Michigan (the owners of UofM) than in 1981 " The key word above is income. What does an income time series have to do with an expense time series. This is classic ignoratio elenchi: answering a question that has not been asked. The question (at least originally) is not why income is down - relatively or absolutely - but why expenses are up. The fact that the expenses are out of reach reflects the spread between the two time series. Why should UM be responsible for the income time series, which it doesn't control, versus the expense time series, which it has a marginal ability to control. Note the word marginal, the bulk of the expense time series is not under its direct control, but driven by national/global forces. UM has no obligation to distort market pricing to assist your inability to earn sufficient compensation to pay for expense figures it doesn't control. "R. Will's point seems to be that since the BLS tracks 80,000 items; you can see significant variation in individual items. So what! Thanks for obfuscating the discussion; " This is not only not obfuscation, but central to the debate: I don't care about eigenvector components that don't drive a principal component analysis. If the university used no tulip bulbs, would I care about tulip bulb exposure? I do care about the cost of intellectual capital because it is a core driver of the expense base. Does Michigan control the market price of intellectual capital? Definitely not. Does Michigan control global energy prices. Absolutely not. Does the BLS inflation figure accurately capture UM's inflation drivers? Absolutely not. "I want to know what value added services my son will get in a few years that I did not get given that he will need four times the money in real terms that I needed to go to school!" Your son will earn a wage that has nothing to do with Michigan's expense base, or at least very little to do with those figures. The WSJ and most other publications have questioned the value of the degree. The numbers show that a school like Michigan will add that value. Besides, your argument only makes sense (using real terms) if you use the right deflator, which you haven't. " I hope he gets gold plated fixtures and a jacuzzi in his dorm room, he'll certainly be paying for it." Well, no, neither you nor your son will pay for that Jacuzzi: the university budget of roughly $5.2Bn dollars per year contains a line of something like $770MM/year in tuition. Your son and his fellow students pay something like 16% of the tab. Your son is living in dorms that I and other donors have built via their contributions over the years. The state contributes $25MM/year to buildings for UM, yet UM builds $400MM/year. Who do you think fills the gap? "This is my take on what has been happening over the last 30 years: knowledgeable insiders skim the cream of the university's research for a song, leaving the dud research to be paid for by everyone else. The people of Michigan get the mine shaft, the insiders get the gold and UofM students and the their families get to foot the bill for the overhead and the bureaucrats who administer the exponentially increasing research budget." Your claims as to research are outrageous. I'd like to see supporting factual evidence, not bald assertions. Perhaps you should contact the NIH which entity provides most of the dollars. Dollars that are growing each year. Unlikely were your allegations to possess a scintilla of merit. The people of Michigan provide the university with $325MM/year out of $5.2Bn in total budget. The idea that the people of Michigan possess bragging rights relative to the university died in roughly 1960 when funding tumbled. At this juncture, Jim Duderstadt's (sp?) comment is on target: UM used to be state funded, then state located, then state associated, now merely state molested. ".the bureaucrats who administer the exponentially increasing research budget." This statement alone deserves special mention. UM' s research budge t plugs the gap/hole left by vanished appropriations. Without these research dollars, all students would be paying much larger tuition figures. Michigan is considered sui generis in that their researchers receive more dollars than their aggregate budget line costs.they act as a university profit center. In part, research dollars lead to "cost recovery" dollars which support buildings in which the research is done, and in which students are trained. Would your son pay less if research dollars were lower? Given that central administration has been cut in numbers and dollars (counter to your assertion), isn't it better to see those figures go down while research dollars go up?
I find your letter utterly without merit, misinformed, and slanderous toward the folks at UM who have shielded you from the ugly reality that you and each and every parent of each an every child at UM is supported by: the federal government ($650MM/year), by out of state donors (2/3 of all donation dollars from the 1/3 of the alumni body who live out of state) who lob in $200MM/year and by out of state tuition differentials (roughly $160MM/year).
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Submitted by ChuckL (not verified) on October 9, 2009 - 11:59am.
I would point out that the CPI-U tracks rather closely the median household income over the last 30 years; the point being that tuition, room & board at UofM are even more out of reach to the average family in the State of Michigan (the owners of UofM) than in 1981 R. Will's point seems to be that since the BLS tracks 80,000 items; you can see significant variation in individual items. So what! Thanks for obfuscating the discussion; I want to know what value added services my son will get in a few years that I did not get given that he will need four times the money in real terms that I needed to go to school! I hope he gets gold plated fixtures and a jacuzzi in his dorm room, he'll certainly be paying for it.
This is my take on what has been happening over the last 30 years: knowledgeable insiders skim the cream of the university's research for a song, leaving the dud research to be paid for by everyone else. The people of Michigan get the mine shaft, the insiders get the gold and UofM students and the their families get to foot the bill for the overhead and the bureaucrats who administer the exponentially increasing research budget.
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Submitted by ChuckL (not verified) on October 8, 2009 - 4:38pm.
"...with shrinking state appropriations and students upset over tuition hikes, private support has become increasingly important for funding research at the University."
People should know that tuition as well as room & board rate hikes have consistently exceeded the rate of inflation (CPI-U, www.bls.gov). For example, as a Freshman in 1980, I paid about $1100 tuition & fees and about $1100 for room & board at Alice Lloyd Hall for the fall semester. In the Fall of 1981, I move into the ICC's Michigan Co-op and paid about $900 per semester for room & board (and was not kicked out at Christmas time either). In 2009 dollars, both the tuition and room & board at Alice Lloyd Hall would be $2881; the Co-op would be $2137 for the semester. Now, here is the interesting part: look at what the actual charges are today! Tuition per semester today: $5830; Alice Lloyd Hall room & board per semester today: $4462; Mich-House per semester today: $2260. Room & board at the ICC has stayed in line with inflation or about 3.3% a year while at Alice Lloyd Hall, costs have gone up at about %5 a year or about 50% faster than inflation every year for the last 29 years. Tuition has gone up at the rate of 5.9% per year or about 78% faster than inflation every year for the last 29 years.
I would point out that the strategy for holding down costs has been, "...private support has become increasingly important for funding research at the University..." for the last 29 years! Look how well it has worked...not! I would suggest that the game of winning private dollars has actually cost more than it has brought in as evidenced by the excessive increases in tuition and room & board over the last 29 years. My son will be graduating from high school soon and it is not fun telling my son he will have things harder than I did.