Magazine

Why College Costs Are Out of Control


Many states have cut deeply into their public colleges and universities to balance their budgets ("Colleges in crisis," Special Report, Apr. 28). North Carolina has pursued another strategy: cut the growth in state spending overall and increase investments in higher education. Even during the worst of our budget cycle, North Carolina's state government increased financial aid and provided additional resources to meet record-setting enrollments. The state's college-attendance rate has moved above the national average. We have given universities and community colleges substantial flexibility to manage budget cuts while protecting their core mission.

My proposed 2003-04 budget continues this trend by freezing tuition and increasing higher education investments. Our $3.1 billion capital investment in higher-education facilities remains on schedule. We are committed to the preparation and maintenance of a high-quality workforce -- the best competitive advantage our state will have in the global economy.

Governor Michael F. Easley

Raleigh, N.C.

Talk about a seller's market! I have two children attending highly regarded liberal arts colleges in the East. As an executive of an award-winning manufacturing company in the automotive industry, I was appalled to see the incompetence and complete lack of accountability or regard for the customer (the students and those paying the bills) at these institutions. While there is a strong focus on maintaining high-quality academic programs, there is absolutely no interest in controlling costs or other operational issues. Most of the people running these institutions wouldn't last five minutes in any kind of competitive business. The final straw will be when the college-age population declines and colleges lose control over the top line.

Todd S. Eaton

Pittsford, N.Y.

Two comments: 1) The arms race, focusing as it does on competitive research funding, greatly diverts faculty from teaching. 2) The "solutions" to financial squeezes become a large part of the problem as battalions of well-paid fund-raisers, marketers, cost analysts, etc., absorb an increasing share of the budget. Galloping bureaucratization, which focuses on peripherals to make up for the inability to manage the core processes of learning and inquiry, tends to be a drag on both efficiency and morale on the academic side.

Paul M. Hohenberg

Troy, N.Y.

I couldn't help but be amused that Harvard University had to engage McKinsey & Co. to figure out -- of all things -- that collective bidding was economical. I suspect that many undergraduate business students already knew that, let alone the professors and students at Harvard Business School.

J. Scott Joslyn

Seal Beach, Calif. How many colleges can afford to provide the kind of intense, individual instruction that the tutorials at Williams do ("Williams: Where the elite get eliter," Special Report, Apr. 28)? In a free society, no one is denying the right of those with means to the best education they can find, but it's absurd to claim those without such wherewithal can compete on an equal footing.

Walt Gardner

Los Angeles "Wi-Fi means business" (Cover Story, Apr. 28) is an interesting review of an emerging technology that has tremendous potential in appropriate environments. But the usage of Wi-Fi networks in certain retail and other venues is an attractive nuisance or, at best, inappropriate for the nature of the business.

Restaurants such as Starbucks (SBUX) require high volume and quick turnaround. My perception is that the typical Wi-Fi user will likely purchase little or no additional Starbucks' coffee products while on the premises...and how many Big Macs and fries can you eat in one sitting? Meanwhile, that customer is occupying a table for a "free hour of Wi-Fi with each Extra Value Meal" that could well be serving revenue-producing customers. Get my point?

Bill Ryan

Dana Point, Calif.

A wonderful and extensive summary of the new world of Wi-Fi. But Wi-Fi, which is very catchy and means wireless fidelity, has always been referred to as wireless networking. Why not Wi-Net?

Kenmore R. McManes

Laguna Woods, Calif. The Public Relations Society of America joined some 150 other entities, from organized labor to media companies to the Bush Administration, in filing friend-of-the-court briefs urging the Supreme Court to uphold First Amendment protections of all institutions ("Free speech or false advertising?" Social Issues, Apr. 28). American businesses exercise free-speech rights in many ways. To lump it all into the same category as advertising that is designed to boost sales and profits will throw a blanket of silence over litigation-sensitive businesses at a time when our society needs to rebuild a bond of trust between its citizens and all institutions.

The court must uphold the doctrine of free speech as it applies to corporations and other institutions to encourage them to use all means of communication to help the public understand the business, political, and moral philosophies underlying all their actions. Even if we don't agree with them, we want to hear more from corporations today instead of less.

Reed Bolton Byrum

President & CEO

Public Relations Society of America

New York In "American drivers: Stiffed on safety?" (Industries, Apr. 28), a box accompanying Christine Tierney's commentary asserts that U.S. carmakers are costing Americans' lives by not equipping their vehicles with the kind of electronic stability-control devices that many new cars in Germany are delivered with. However, the numbers provided -- 6,949 road deaths in Germany in 2001, vs. 42,116 in the U.S. -- offer no basis for answering that question. The relevant comparison is not total fatalities but fatalities per miles (or kilometers) driven. On that basis, there's not much difference -- 1.62 deaths per kilometer for the U.S., compared with 1.47 for Germany, according to the Federal Highway Safety Administration. And the answer to "who is safer?" is the British, with 0.78 fatalities per kilometer -- even without the German obsession with electronic safety devices.

Phineas Fiske

New York

Corrections and Clarifications

Statistics in this letter refer to fatalities per 100 million kilometers traveled, not per kilometer.

In "Interpublic Group: Synergy or sinkhole?" (Marketing, Apr. 21), a bit of clarification is required. There was no late-'90s "buying binge." Several strategic acquisitions were completed -- Hill Holliday, Shandwick Group (now Weber Shandwick-PR), Campbell Mithun Esty, and Draft Worldwide, to name a few. I suspect all have performed completely satisfactorily when measured against Interpublic Group guidelines.

IPG's cash balance at the close of business on Dec. 31, 1999, was in excess of $1 billion, and its long-term debt was about $350 million. Boom prices weren't paid for companies during the '80s or '90s. No investment bankers were used, and IPG and its board followed sound financial, strategic, and business judgment -- and corporate protocol. Also, the impact of September 11 and economic conditions over the past few years affect all global companies.

Today's four major advertising groups were all built through acquisitions. No one has a perfect history; IPG's record is equal to and better than most.

Eugene P. Beard

Wilton, Conn.

Editor's note: The writer, now retired, was IPG's chief financial officer from 1980-2000, as well as vice-chairman for finance and operations from 1995.


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