Enormous tuition subsidy means low earners are effectively education that makes them high earners.
By EVELYN GORDONHebrew University 88(photo credit: )
The universities are threatening not to open the fall semester next week unless the government gives them more money. If so, this will be the third disrupted academic year in a row: Last year, senior lecturers struck for almost three months to demand higher salaries; the year before, students struck for 41 days to demand lower tuition; now, it is the university administrators' turn.
Unlike the others, the administrators are not seeking money for themselves. Their claim is that due to repeated budget cuts, they can no longer afford to hire even the adjunct lecturers who have replaced tenured faculty in many departments. Thus without extra funding, they will have to close numerous departments, mainly in the humanities - something they consider unacceptable for a self-respecting university.
Also unlike the others, the administrators have a good case: As Dr. Dan Ben-David notes in his book Brain Drained, the country's ratio of senior faculty to population is now only half what it was in 1973. In absolute terms, both Hebrew University and Tel Aviv University have fewer senior faculty positions now than they did then (by 14 percent and 21%, respectively); yet the country's population has more than doubled. And as a percentage of gross domestic product, state-funded university budgets are now 38% lower than they were in 1977.
The result has been something a country whose only natural resource is brainpower cannot afford: a massive brain drain. Fully 25% of Israeli professors work in America, Ben-David says, compared to less than 5% of European professors. And while American universities admittedly offer better pay and higher research budgets, the main reason for this brain drain is that positions are simply unavailable here. Since tenured faculty cannot be fired, universities have instead reduced their staffs through hiring freezes.
YET WHILE increased government funding is clearly part of the necessary solution, the universities are wrong in thinking it can or should be the whole solution.
The blunt fact is that state-funded higher education worldwide is now more expensive than it was 30 years ago. There are various reasons for this, including the soaring costs of cutting-edge scientific research. But perhaps most significantly, the proportion of the population attending college has risen as college degrees have increasingly become prerequisites for good jobs. And since all state-funded systems heavily subsidize tuition, this has created a growing burden on national budgets.
Throughout the Western world, therefore, state-funded universities are being forced to augment their income from nongovernmental sources - namely, private donations and tuition. England and Germany, for instance, both recently raised tuition at state-funded universities; so have many American states (for state schools).
And that is the crux of the current budget standoff here: The Finance Ministry is willing to increase university funding, but has conditioned this on various reforms, of which the most important is a tuition hike.
Since university administrators do not set tuition themselves, this pressure tactic is aimed primarily at the cabinet, which currently opposes raising tuition, and secondarily at student unions, whose lobbying influences the cabinet's positions. Yet the administrators are not guiltless, either: Instead of recognizing that higher tuition is essential to their schools' financial future, and therefore pressing the cabinet to support it, they demanded that the government cover the entire shortfall. They thereby reduced pressure on both students and ministers to moderate their positions, while also depriving the Treasury of the academic imprimatur it needs to paint its demand as good for academia rather than merely for the state budget.
Yet the Treasury is right - not only for budgetary reasons, but because artificially low tuition subsidizes the rich at the expense of the poor.
Wealthy students, as burgeoning enrollment at expensive private colleges attests, can afford to pay far more than the current subsidized tuition of NIS 8,600 a year. The popular Interdisciplinary Center in Herzliya, for instance, charges NIS 31,500 a year. And with so much of the higher education budget devoted to subsidizing those who can pay, little money is left to provide financial aid to the truly needy.
Moreover, a university education is one of the best financial investments around. It is the difference between being stuck in a minimum-wage job and landing one that pays the average wage or better. Since the monthly minimum wage is currently about NIS 3,850 and the average wage about NIS 8,200, that difference comes to some NIS 4,350 a month. In other words, it would take exactly two months of work at average rather than minimum wages for a university graduate to recoup his entire year's tuition. Thus not only could students justifiably be asked to pay more, but the enormous tuition subsidy means that low earners are effectively subsidizing high earners - or, more accurately, the education that makes them high earners - through their taxes.
LAST YEAR, a committee on higher education reform recommended raising tuition to NIS 14,800 (about NIS 1,233 a month). For upper-income families, that is still easily affordable. And it is also still a fabulous investment: Ten months of work at average rather than minimum wages would finance the entire three-year degree.
If all of the country's 171,000 undergraduates paid that amount, it would increase the higher education budget by some NIS 1.1 billion a year - almost half the extra NIS 2.4 billion the universities say they need, and about one-sixth of the total state budget for higher education. In reality, of course, the increase would be far smaller, since much of the money would have to be funneled into increased financial aid. But it would still augment the universities' budgets by hundreds of millions of shekels a year, thereby easing their financial woes, while also reducing an unnecessary and unjust state subsidy to the wealthy. And, counterintuitively, it might even assist the universities' private fund-raising (as next week's column will explain).
With elections called for February, no serious progress on the university funding crisis is likely now. But for the sake of the future, the next government must give priority to resolving this crisis, through both higher state funding and higher tuition.
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