Thinning the Herd

by Jay Schalin

Higher education was fed very well and grew fat in the years following World War II. It is starting to go on a diet — and many schools might not be able to adapt to and survive in an era of lower revenues.

On the Pope Center site, Jesse Saffron tells how many schools’ finances are moving closer to the edge of bankruptcy, with industry analysts such as Bain Capital, Moody’s, Inside Higher Ed, and Forbes confirming that assessment. Of course, a few colleges fail every year, but it’s usually only a trickle, not a flood. Today, many long-established schools are financially vulnerable. State flagships and prestigious private schools generally don’t have a problem, but small, private colleges with medium or lower admissions standards — the ones that most rely on tuition to meet their budgets — could get squeezed out of business.

Of course, there is also the possibility that greater government intervention could stall the creative destruction process. After all, it is imperative that we prop up every failing institution that funnels money to or ideologically supports certain political parties. (Yes, the previous sentence is sarcasm.)