NEWGroup Newsletter 30.5.2014

New Economy News: IPS Newsletter
May 30, 2014

State Universities of the 1%

Dear friend,

The challenge of our time is to educate our children and ourselves in the values and skills required to transition to a New Economy that redefines our relationships to one another and nature. However, there are many barriers to this challenge at a time when our education system is becoming increasingly corporatized, driven by profit motives rather than the broader interests of people and the planet.

A new Institute for Policy Studies report, “The One Percent at State U,” provides a glimpse into how the corporate model is influencing public universities. The report finds rising inequality within these universities, with extremely highly-paid top executives combined with skyrocketing levels of student debt and low-wage faculty. As noted in The New York Times, our findings suggest these trends are closely related and should be addressed together. (Below are the report’s key findings and an infographic.)

As my colleagues pointed out, university boards of trustees — which set the compensation packages of university presidents — are commonly made up of corporate executives. And given that private-sector executive compensation has soared to astronomical levels, these trustees are increasingly out-of-touch with notions of reasonable compensation. According to the American Council on Education, nearly a third of university presidents themselves have never been professors and many have business backgrounds.

This corporatization inevitably affects the quality and substance of higher education. Low-wage adjunct and contingent faculty have less time to spend with students. Students with massive debt loads have less flexibility to pursue careers that serve social and environmental needs. And with so many university leaders coming out of the for-profit sector focused on short-term gains, it’s hard to have confidence that they will be able to advance the type of educational transformation needed to meet the challenges of a warming planet.

We’re encouraged by the attention this new report has received and hope it can help galvanize pressure to ensure that our public universities are truly serving the common good.


Noel Ortega
New Economy Coordinator
New Economy Working Group, IPS

The One Percent at State U

One Percent at State U Report Cover

Key Findings:

  • The student debt crisis is worse at state schools with the highest-paid presidents. The sharpest rise in student debt at the top 25 occurred when executive compensation soared the highest.
  • As students went deeper in debt, administrative spending outstripped scholarship spending by more than 2 to 1 at state schools with the highest-paid presidents.
  • At state schools with the highest-paid presidents, part-time adjunct faculty increased 22 percent faster than the national average at all universities.
  • At state schools with the highest-paid presidents, permanent faculty declined dramatically as a percentage of all faculty. By fall 2009, part-time and contingent faculty at the top 25 outnumbered permanent faculty for the first time.
  • Average executive pay at the top 25 rose to nearly $1 million by 2012 — increasing more than twice as fast as the national average at public research universities.

By Andrew Erwin and Marjorie Wood

read more

State Universities of the 1%

One Percent State University Infographic

Data extracted from “The One Percent at State U,” design by Leslie Garvey.

see the full infographic

The Cooperative Economy: A Conversation with Gar Alperovitz

Gar Alperovitz

“From climate change to a medieval level of wealth disparity, what we face in this country is no longer a regulatory crisis,” says Alperovitz. “We face a systemic crisis.”

Published in Orion magazine

read more

The Central Contradiction of Capitalism that Piketty Overlooked

Jamaica Plain logo

“…typical of mainstream economists of all political stripes, Piketty misses the true contradiction of capitalism (and socialism for that matter), which is the assumption that exponential growth can continue forever on a finite planet.”

By John Fullerton, Capital Institute

read more

Piketty in Elysium

Vanderbilt Mansion

If inequality sells in bookstores and box offices, it will sell at the polls as well.

By John Feffer

read more


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