by Mitch Kokai
Senior Political Analyst, John Locke Foundation
Anthony Hennen of the Martin Center focuses on potential mislabeling of some higher education spending.
Public colleges spend public money, but college officials are reluctant to make information about their budgets easy to understand. That aversion to transparency makes it easier to pass non-instructional expenses along to students.
Many experts have discussed the problem. But without transparency, it can be hard to show just how much so-called instruction is actually some other activity.
“The accounting habits of research universities obscure the fact that professors are hired to perform research as well as teaching and simply record the totality of their academic year salaries as expenditures for ‘Instruction,’” wrote Charles Schwartz, a professor emeritus of physics at the University of California-Berkeley.
In a 2008 report on North Carolina higher education, Andrew Gillen and Richard Vedder explained that many universities “distinguish themselves through their research, not their teaching. Thus, some ‘instructional costs’ likely include research activities, at least those funded by the institution through low teaching loads for faculty.”
But universities don’t reveal which expenditures are for actual instruction and which are for research. As a result, tuition essentially subsidizes the cost of research for professors, but students are unaware.
Faculty expenses “are the major cost driver in higher education,” according to Vance Fried, an economist at Oklahoma State University and the author of a 2011 study from the American Enterprise Institute on making colleges more efficient. Spending on faculty can be divided into instructional, research, or service. Of these, Fried says the instructional portion is the largest. Or, at least it appears to be the largest.