Extract from a story in Issue 17, December 8, 2008 of The Jerusalem Report. To subscribe to The Jerusalem Report click here. Once the pride of Israel, higher education is ailing due to chronic government neglect Within one hour of Prime Minister Ehud Olmert's personal intervention in negotiations between the Finance Ministry and the Council of University Presidents, Israel's higher education system found itself 515 million shekels ($134 million) richer. After an impasse that lasted months, and on the eve of a looming major faculty strike, Olmert overruled his own Treasury on October 30 and explicitly ordered it to acquiesce to the universities' demands. But the university presidents didn't walk away from the negotiating table grinning. Even after winning this round, they painted a grim picture of the future of tertiary education in Israel. In media interviews, they described the state's newfound largesse as, at best, a stopgap lifesaver that will only tide them over for one year, and threatened that unless they receive a further 2 billion shekels ($500 million) in funding, they will, once again, call a strike next year. No one involved in higher education in Israel today would describe the current state of the universities as anything but a major crisis. Olmert's intervention came in the wake of a cumulative 1.3 billion shekel reduction in state funding for higher education between 2001 and 2007. Some universities are concerned that even after years of stripping library services, laboratories and faculty positions, they may still run short of money for salaries. Universities contend on a daily basis with staff shortages, overcrowded classrooms, outdated lab equipment, and an exodus by academics to overseas jobs. In order to slash expenditures, there has been an increase in the use of freelance lecturers, who are not eligible for tenure, pensions or severance pay. Government neglect of the universities is mortgaging the country's future, some observers believe. "Our future, economically, culturally and even militarily, is directly dependent on building and maintaining world-class research and academics," says Ze'ev Tadmor, former president of the Technion in Haifa and currently chairman of the board of its Ne'eman Institute for Advanced Studies. "If we fail to do so, this country will become a poor Jewish ghetto in a hostile Middle East, until one fine day it will disappear at the hands of an enemy." Visions of Israel as a beacon of higher education, in keeping with Jewish traditions of scholarship as the highest priority, preceded the Zionist movement. As early as 1882, Zvi Shapira, a professor of mathematics in Heidelberg, Germany, published a manifesto urging the establishment of research universities in the Land of Israel. But it wasn't until the 1920s and 1930s, when the Technion in Haifa, the Hebrew University of Jerusalem and the Weizmann Institute in Rehovot were founded, that a modern university system began to take shape. In 1948, these were the only degree-granting institutions, with a combined faculty of 118 professors and 1,635 students. Annual funding in the early years of the state was arranged through cosy, personal meetings conducted between the university heads and the finance minister, who would conclude the meetings with handwritten notes affirming the sums of money to be given to the universities. But the university system was about to expand in leaps and bounds. The late 1950s saw the additions of Tel Aviv University and Bar-Ilan University in Ramat Gan, followed by universities in Beersheba and Haifa in the 1960s. The student population swelled, and professorships increased at such a rate that top Israeli university graduates were routinely sent to complete doctorates and post-doctorates abroad with virtual guarantees of academic positions waiting for them on their return. By 1973, universities employed 4,389 professors and enrolled 50,000 students. The expansion required institutionalizing the relationship between the Treasury and the universities, leading to the creation in 1958 of the Council for Higher Education (CHE) as a regulating and licensing body and the Planning and Budgeting Committee (PBC) in 1977 for distributing government funding to institutions of higher education. The scope of the CHE grew enormously in the 1990s, when soaring demand for college degrees fuelled by the immigration from the Soviet Union and an economy that increasingly required college-educated workers led to the mushrooming of a system of over two dozen BA-granting colleges. The higher-education system in Israel today is comprised of 121,985 students at the eight major universities, 96,560 in the 27 colleges offering bachelor's degrees, and 42,000 at the Open University, which offers flexible distance-learning courses. There are also dozens of smaller institutions granting associate degrees and vocational training to technicians, teachers, art students and other vocational trainees. Higher education in Israel was founded mainly by immigrants who trained and taught in central European universities prior to the Second World War. Consequently, the system developed along the lines of European practices as opposed to the liberal arts tradition of the United States. Israeli undergraduates - who after three years of compulsory military service are on average older than their American counterparts - earn a BA in three years, usually in dual-major tracks that leave no room for broad coursework outside their concentrations. Students in fields such as law, medicine and pharmacology enrol directly in professional degree programs without first obtaining a BA. There is nothing in Israel even approximating Ivy League-style private universities with endowments larger than the GDPs of small countries. Apart from a handful of private colleges, post-secondary institutions in Israel depend largely on state funding, supplemented by philanthropic grants from abroad, for virtually their entire budgets. State allocation, granted via the PBC, is based on a formula for a teaching budget for BA programs determined by student enrolment figures and an institutional research budget, given in bulk grants, determined by research output (which is calculated by the number of advanced-degree students, publications and citations). The annual state allotment to higher education is 6.7 billion shekels ($1.7 billion). In return for state support the universities are required to charge students a uniform annual tuition fee, currently 8,588 shekels ($2,200). The income breakdown for a typical institution of tertiary education is 60 percent from state funding, 20 percent from tuition fees and the remainder from donations, usually from overseas and income from scientific patents. In recent years, Israeli universities have had to contend with a strong shekel, which reduced the value of donations from abroad, and the latest economic recession, which has had a dampening effect on overall contributions. Tadmor, a professor of chemical engineering who was president of the Technion between 1990 and 1998, is quick to point out that even the wealthy Ivy League American universities, with their billions in endowments, depend to a great extent on benefactors and government research grants. Indeed, two-thirds of scientific research in the United States is funded by government - compared to only about 50 percent in Israel - and the U.S. Congress recently approved a doubling of the research budgets of its National Science Foundation and similar federal agencies, with the U.K. undertaking similar research grant expansions. Both students and junior and senior faculty in Israel have strong unions that have frequently disrupted school years to press for their demands. Lecturers and professors are not hired under personal contracts - their salaries are determined by collective bargaining agreements that specify uniform national salaries based on rank, with advancement through the ranks largely determined by seniority alone. This hampers the ability of Israeli universities to attract high-flying researchers, whether in Israel or from abroad, to their ranks by offering high salaries or rapid advancement. Nevertheless, veteran observers recall many years during which the university system worked well, benefiting from ample budgets and harmonious relations with the Treasury. "There was once so much trust between Treasury officials and the CHE that university presidents could plan five-year budgets, even though the state budget is determined annually," says Tadmor. He traces the beginning of strains between the Finance Ministry and the universities to 1994, when university professors conducted a bitter 10 week strike to protest erosions in their salaries in the wake of broad cutbacks during an economic crisis in the mid-1980s. "Even the Treasury agreed that the lecturer deserved a large pay increase," relates Tadmor, "but it tried to use the new salary agreement as leverage to introduce differential, merit-based pay structures. The lecturers agreed, as long as they could determined the merit criteria - and the university senates [comprised of full professors] then essentially adopted criteria that restored uniform pay. The Treasury felt betrayed and the old trust has never been restored." When budget cutbacks were again on the agenda during the difficult recession of 2001 - 2003, the universities found themselves under relentless pressure from a Finance Ministry calling on them to make due with smaller budget allocations by increasing their efficiency. Prior to the negotiations that enabled the opening of the 2008-2009 academic year, state budgeting for higher education in Israel was cut by 20 percent. The universities, which are also highly dependent on foreign donations, suffered an additional blow due to the 20 to 25 percent strengthening of the shekel relative to foreign currencies in recent years. The result has been painful and deep cutbacks in libraries, laboratories and especially faculty positions - even as the student population has continued to rise. According to Hebrew University economist Joseph Zeira, who heads the university's Falk Institute for Economic Research, the reductions forced on the universities by the Finance Ministry are intended, at least partly, to goad them into adopting structural reforms. "The reason [for] these cuts is that the system of higher education needs to reform itself, and it has built in aversion to reform," Zeira tells The Report. "Hence, the only way to put pressure on the system to reform is to tighten the budget until it agrees to reform. Ministry officials have said a few times that if the Shohat committee report [advocating structural change in the educational system] will be accepted, they will return most of the missing budgets. Another reason for these cuts is that the Ministry of Finance is reducing government expenditures (as a percentage of GDP). So [they say] why should the universities be spared? That is the [ministry's] role in the system, to guard the Treasury. But of course, that does not mean that they should determine the overall policy. That is a political decision and it should depend on the political preferences of the elected representatives of the public." University heads bristle at the charge that they manage their campuses in an economically inefficient manner. They point to the following comparative statistics: The annual budget of super-elite Princeton University is a whopping $126,000 per student, while a large public American university, such as the University of Wisconsin, spends $45,000 per student, and the comparable figure at the U.K.'s Cambridge University is $24,000. Even university systems in continental Europe, such as the one in the Netherlands, have budgets that are in the range of $20,000 to $30,000 per student. The Israeli university allocates a measly $12,000 per student, a paltry sum - especially considering the first-rate work done on Israeli campuses despite years of budget erosion. Hebrew University, Tel-Aviv University, the Technion and the Weizmann Institute are among the top 150 universities worldwide. Israel is one of only 19 countries with at least one university among the top 150. The fact that Israel has four such universities puts the country in 9th place, and when the country's size is taken into account, Israel moves into second place, just behind Switzerland. "What does the Finance Ministry mean when it keeps demanding greater efficiency?" asks Tadmor. "When I started my term as president of the Technion [in 1990], we had 650 faculty members and 9,000 students. When I stepped down from the presidency [in 1998], the number of students had risen to 12,000 and the faculty had been reduced to 500. But does this count as an increase in efficiency, or a drastic reduction in quality?" The national student-faculty ratio is two and a half times higher in Israel than in the United States and has been rising continuously for decades. Recent high profile successes in Israeli academia, such as a number of Nobel Prize winners in chemistry and economics, are misleading indicators of the health of the system. "We are living on past glory," rejoins Tadmor. "The Nobel Prizes were awarded for work conducted decades ago. There was also a good deal of advanced teaching in recent years conducted not by the universities but by Israel's armed forces in fields such as computers and communications electronics, but as other fields like biology become important in future years, that cannot be relied upon." One cause of great concern to many observers is the fact that years of faculty cutbacks have caused recent doctoral graduates, lacking job opportunities in Israel, to seek employment abroad, usually in the United States. This brain drain could lead to a sharp erosion in Israel's academic standing within a few short years, as an older generation of researchers retires without adequate replacements. Statistical studies suggest that an entire generation of researchers has left the country. There are approximately 4,500 faculty members in Israel's tertiary education system - and an astounding additional 3,000 Israelis who have taken faculty positions overseas. More than one-quarter of lecturers who once taught in Israel are now in the United States alone, making Israel's brain drain to the United States 10 times the rate of Europe's. Even professors listed as working in Israel often spend a great deal of their time abroad. More than a quarter of the faculty members at Tel-Aviv University's economics department, for example, are the equivalent of "migrant workers," teaching alternate semesters in Israel and in the United States or Europe. Extract from a story in Issue 17, December 8, 2008 of The Jerusalem Report. To subscribe to The Jerusalem Report click here.