Louisiana's budget has shrunk drastically, and state government must make cuts. What should higher education's share of the cuts be?


Joseph N. Abraham, The Acadiana Educational Endowment and The American Public School Endowments

News flash:  the country is in an economic crisis.  Louisiana is worse off than most states, as we anticipate a 22% budget gap for the 2010 fiscal year.

Cuts will have to be made.  The state is looking at 20% cuts to higher education this year, and another 20% on top of that next year.  The Governor says it's only 15%, and has recently said he will reduce that to less than 10% (15% in real dollars).  An elected offical explained it to me, "Government has to cut back, and higher education is no different.  Colleges will have to absorb their fair share."

I had to admit, that sounded reasonable.

Then a few weeks ago on a radio talk show, UL's President Dr. Joseph Savoie and UL alumnus, State Senator and Appropriations Chair Mike Michot were discussing the budget cuts.  One caller spoke in hard realities:  "When my family loses income, we just have to tighten our belts.  Higher education is no different."  That also seemed logical.

But as I think about it, I wonder.  Is that really fair?  Is it smart?

And particularly important under a Republican administration and Legislature:  is it good business? 

First, government says it is just asking higher education to absorb its share of the burden.  But is it a fair share?  Under the 1974 Constitution, only higher education and health care budgets can be cut.  So for the past 35 years, every time cuts had to be made, higher education and health took the hit-- for everyone

Think about that.  For three and a half decades, higher education has had to shoulder everyone else's burden.  Our colleges-- and our college students-- had to absorb cuts for everyone.  That certainly wasn't fair.

So is it now fair for all of the other state departments to argue that higher ed is like everyone else?  The other departments didn't speak out when our colleges were carrying the burden for them; it seems disingenuous to suddenly argue for stoic teamwork, now that the shoe is on the other foot.

Next, it is absolutely true that in this recession, we all have to tighten our belts:  federal, state & local governments; businesses, families, and individuals.  So why not education?

Sadly there are people who, in order to manage their household incomes, will cut back on their children's futures.  But they are hardly the sort of people we admire, nor wish to emulate. 

Fact is, over and over across the country, the best parents and families will do without almost everything in order to educate their children.  For old-timers like me, the iconographic film on the subject was Henry Fonda and Maureen O'Hara in "Spencer's Mountain."  To secure a college education for their oldest son-- and with his help after graduation, a future for all of their children-- the Spencers chose to burn their half-finished home and sell their beautiful mountain.

It's the American Dream. 

But so far, it's not Louisiana's Dream.  In our near-200 years, the State of Louisiana has never said, "Our children come first."  We have never said that we are willing to sacrifice almost anything, except our children and their future.

To the contrary.  Our constitution, our fundamental, self-describing document, makes it clear that education is a lower priority than roads, bridges, agriculture, insurance, and Wildlife & Fisheries.  They're even less important than Civil Service.

And more recently, of course, we have made it clear to everyone that chicken plants and professional football teams are more important than our children.

To be fair, the Governor is right.  Louisiana state government is too big.  There is too much fat.  But the Brown and Oxford-trained Rhodes Scholar, who campaigned on an education platform, has to stop flowing with the quo, and begin fighting for our future.

Now, some taxpayers send their children to private and parochial schools, and they often argue with me.  They point out that funding of public education, including higher education, is not a cost they should have to shoulder.

I wonder if they've thought that through. Without public education, who is going educate their children's employees, co-workers and even their bosses?  How will their children's clients and customers earn enough money to pay for their products and services?  When their children settle down, who will vote in their elections, build their cities, volunteer for local civic and social efforts, and serve in public office?  Very few people can afford a private education.  If the only people with an education are those who can go the private route, then the workforce, the markets, the community, and the democracy will unravel.

The fact is, it doesn't matter where you, or your children, go to school.  All of us live in communities and cities and states and nations where the great majority are publicly educated.  We all have a vested interest in making sure that public education, and in particular public higher education, is strong.

Which brings me to my last point:  Is cutting higher education good business?

I'm a registered Democrat, but as I get older I find myself voting less by party, and more by person.  Accordingly, I find myself voting for more and more Republicans as I go along.  And I'm not entirely unhappy about that; I know that by voting Republican, I may lose some social programs I like, but I will gain some good business sense.  The Republicans are, by and large, the party of business.  They produce candidates who are good business people.

So let's look at it as businessmen, even entrepreneurs.   By some estimates, for every percentage point increase in a state's number of college graduates, per capita income increases $1000 to $1200 dollars-- per year

Note carefully:  that is not $1000+ for the college grads.  That is not $1000+ for each worker, nor even each adult.

It's $1000+ for every living, breathing body in Louisiana, from diapers to Depends.

Let's look at the numbers. 1% of Louisiana's population is 44,000 (less than a third of our current college students).  Educating those 44,000 for one year costs the state about $220M; educating them for four years is $880M.  Ouch.

But when those 44,000 graduate, overall personal income in Louisiana will rise $4.4 billion.

Every year.

For 40+ years.

That amounts to $175 billion in lifetime earnings for the state of Louisiana.  I'm a Democrat, which means that by law I'm a poor businessman.  So I'll need someone with more business smarts than me to explain the problem with a 20,000% ROI.

But that's just the earnings.  As good businessmen, we also need to consider the savings. 

In Louisiana, we spend way too much on health care.  Education correlates strongly with the general health of the population.  Educated citizens are healthier citizens, who incur fewer life-time medical costs.  They also tend to pay for their own medical care, so the state doesn't absorb as much of the cost.

We spend a fortune on law enforcement, criminal courts, jails, and rehab programs.  As education levels rise, crime decreases.

Unemployment insurance costs the state a king's ransom, directly through social programs (and health care, and crime) and in a multitude of indirect, private sector ways, through blighted properties and falling real estate values, unpaid bills and bankruptcies, and decreased overall economic activity.

Oh, and unemployment also undermines education.  The unemployed (which correlates fairly well with the uneducated) send their poorly-prepared and generally disinterested children to our schools, where they fall behind, disrupt classes, create truancy and vandalism and even felonies, and push our schools and our future down the spiral that much faster.

And then of course, inferior education levels hamper economic growth.  In 1984, the Louisiana population was 4.4 million.  In the 25 years since, the US population has grown 33%.

Louisiana's population is still 4.4 million.

The Governor is very pro-business, and we all want desperately to grow Louisiana businesses, and attract new businesses to our state.  But our educational system and the substandard education of our citizens block us at every turn. We have a hard time attracting professionals and entrepreneurs to Louisiana:  they will openly state they don't want to live in a 'banana republic.'  Even worse, we can't hold on to our own professionals and entrepreneurs.

And you know it's bad when not only can't we attract new business, but our own homegrown businesses constantly relocate to other states.

Good business is about making strategic decisions.   'Lower Taxes' and 'Smaller Government' may be worthy goals, but they are completely inadequate as a comprehensive strategy for running each and every aspect of the American democracy.  We do not want to decrease funding to everything, we do not want to shrink all aspects of government.  Just the waste, just the fat.  So 'Across-the-Board Cuts' is not sound management, it's a bureaucratic response, it's a mindless, easy way out.  And that is a very important insight:  my conservative friends tell me that lowering taxes and shrinking government are designed to be remedies to the bureaucracy. 

Right now in Louisiana, they appear to be accessories.

A few years ago I saw a bumpersticker that said, "If you think education is expensive, try ignorance."  It's sad to say, but in Louisiana, it's all we've ever tried.  For that matter, Louisiana could serve as the poster child for ignorance.

If we don't build a road in Louisiana for the next five years, we'll limp along.  If we don't construct another building for a few funding cycles, life will continue.  If we have fewer experts helping farmers, if we recruit fewer businesseses, if we delay some tax cuts and incentives, if we adjust the budget in a myriad of other ways, we'll get by.

But if we cut education, particularly higher education, it is not clear how Louisiana will ever recover from our current problems.  Because I hope by now I have made it clear that our current problems involve a lot more than a shrunken budget.

Good businessmen make decisions based on costs and benefits.  It's not enough to cut current costs, we need to cut future costs, and more important than either of those, we need to grow income.  State after state-- and nation after nation-- have made it abundantly clear that the best way, and the most economical way, to grow income and reduce costs in all sectors, is to grow education.

Governor, State Senators, Legislators:  we are at a cross-roads.  We need strategic thinking.  We need long-range planning.  We need vision, and foresight.  We need someone who can abandon the status quo, we need someone who can, and will, make sound business decisions.

Folks, we need Leadership.