Date: Thu, 18 Dec 1997 21:59:07 -0600 (CST)
From: Dennis Grammenos <dgrammen-AT-prairienet.org>
Subject: M-I: BusinessWeek: Meanwhile, the Ivy League...



BusinessWeek

22 December 1997

------------------------
http://www.businessweek.com/1997/51/b3558143.htm
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               MEANWHILE, THE IVY LEAGUE IS ROLLING IN CLOVER

       Yale University President Richard C. Levin has for several
       years mulled what many of his peers have considered for their
       colleges--running the place more like a business. ''We have
       to manage this institution efficiently,'' he says. ''We can't
       do everything under the sun.'' He would like to pare
       departments that don't serve a strong need and focus on
       ''centers of selective excellence.''

       But Levin's actions haven't matched his ruminations. Yale's
       restructuring has been limited to modest reductions in
       administration, consolidation of biology graduate programs,
       and enrollment cuts at the divinity school. Even those steps
       galled alumni and professors, who associate Yale's
       preeminence with academic abundance.

       SURFEIT. Such is life among the elites. While state
       universities face plummeting government assistance and
       smaller private colleges struggle to maintain enrollment,
       Yale and a few dozen other top-tier institutions still
       thrive. They attract six or more applicants for every
       freshman slot--a surfeit that has persisted over the past
       decade despite annual tuition of more than $20,000. They
       still guarantee financial aid to everyone who needs it. And
       they spend liberally to attract star faculty and research
       grants.

       These universities remain insulated from market pressures in
       part because they have established an aura of quality--call
       it brand strength or snob appeal--that keeps students coming,
       despite the price. An Ivy League degree doesn't win higher
       starting salaries than other diplomas, but it does lead more
       often to top graduate programs and, so, to greater
       professional attainment. Throw in access to powerful alumni
       networks, and ''the interest of very able people in going to
       leading institutions has not only remained strong--it has
       become stronger,'' says William G. Bowen, president of the
       Andrew W. Mellon Foundation and ex-president of Princeton
       University.

       Indeed, experts believe these schools could charge far more
       than they do and still draw top students. Yet they don't have
       to. Most are insulated by coffers bloated by the stock market
       that spin off millions in annual operating income. Yale's
       endowment, swelled by a record $1.7 billion capital drive, is
       $5 billion. Harvard University, the fund-raising king, has $9
       billion.

       PUBLIC URGENCY. Such fund-raising feats cushion the effect of
       ebbing government research assistance. They also reduce
       universities' reliance on tuition and fees to about 65% of
       the total budget, compared with 90% or higher at small
       private schools. So big-endowment institutions can better
       afford the financial aid that maintains diverse classes even
       as they plow millions into new technology and upkeep for
       aging buildings. That perpetuates their reputations as
       top-drawer academies.

       This lesson hasn't been lost on big public universities.
       These days, ''we cannot do it just with state support and
       tuition,'' says Judith A. Ramaley, president of the
       University of Vermont, which recently raised $108 million in
       its first-ever capital campaign. The University of California
       at Berkeley, ravaged by state cuts, is seeking $1.1 billion
       in private gifts by 2000; the Universities of Virginia,
       Illinois, and Michigan all are mounting fund-raising drives
       to rival the Ivies'.

       Those urgent campaigns, however, typically have followed
       radical downsizing and restructuring. Secure in their ivory
       towers, Yale and its peers generally can afford to eschew
       such strategies. They know that quality sells--whatever the
       price.

       By Susan Jackson in New Haven

  

   Copyright 1997, by The McGraw-Hill Companies Inc. All rights reserved.
                              







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