is for Research Universities as a Public Good:

How can the University of Michigan and the University Research Corridor make a better case to the public and to state officials that states should invest in public research universities?

Joe Serwach, Rebecca Myren, Jessica Gracon and Sara Christiansen The University of Michigan

The Challenges Facing Public Research Universities in America: Pub Pol 634

Paul N. Courant, James J. Duderstadt and Edie N. Goldenberg April 15, 2009

1

is for

Executive Summary Keywords: Transformation, opportunity, jobs and globalization -- Us vs. Them: As the wage gap between college and high school graduates widens, four-year universities are increasingly framed as a private good (making a quarter of the population richer) rather

than a public good benefiting all. The public good must be stressed to build public support.

-- Remembering the other 74 percent: Since only 26 percent of Michigan residents have bachelor’s degrees, the ways research universities benefit society as a whole -- including the 74 percent lacking four-

year degrees -- must be emphasized. Making outreach and public service major institutional priorities

improves all relationships.

-- Tipping point: Globalization, the recession and President Obama’s priorities bring historic opportunities for the URC universities -- key players in past historic transformations -- to play a decisive

role in Michigan’s transition to a knowledge-based economy.

-- Innovation equals half the growth: Half of the U.S. economic growth since World War II has been due to technological innovation. Research universities are magnets for R&D, creativity and innovation

and are often ground zero for the development of new ideas, relationships, new jobs, businesses and

whole industries. -- Brand identity: The University Research Corridor represents the best opportunity to create a new,

unified brand that brings together the best of Michigan’s three major research universities: The University

of Michigan brand identity is “leaders and best,’’ Michigan State University is the first land-grant or

“peoples university’’ and Wayne State is an urban research university. Their combined brand identity as the URC: jobs and economic transformation.

-- Leveraging assets: By joining forces, the URC partners can advocate for policies while simultaneously

serving their own constituencies, make markets work by serving as a bridge between government and business, inspire “evangelists” who spread their messages, leverage and nurture vast networks, master the

art of adaptation, and empower others by encouraging them to take leading roles.

A counter-insurgency strategy for Michigan’s research universities: Consider Michigan “the prize rather than the playing field.’’ State appropriations have been shrinking but remain the largest single payment of unrestricted dollars. Public support (which impacts governmental

and philanthropic support as well as enrollment and overall reputation) remains the great “prize’’ not to

be taken for granted or minimized.

Boost support for outreach and public service projects as well as research with a direct impact on

Michigan. Historically, there have been few financial incentives for faculty to make public service one of

their priorities. We propose that public service be further encouraged as part of the tenure process, and by establishing more selected seed grants.

Provide more attention to faculty and staff whose work touches the lives of the state’s populations

and the public good of society as a whole. We propose that a priority be placed on sharing stories that

show the people of Michigan the public value of their state’s investment just as companies regularly

report achievement to their stockholders.

Increasing, cataloging, quantifying and drawing attention to the number of partnerships with

regional and local partners including business, government, nonprofits and other colleges and

universities. We encourage the URC partners to better catalogue and build upon all of their partnerships. A successful “treetops’’ alliance where the public universities banded together through their massive

alumni base to fight back and influence public and political opinion in 1990, showed the power of

statewide outreach. Modern social networking sites like Facebook and other viral marketing efforts make such campaigns easier to attempt today.

2

is for

Why is Michigan racing to the bottom? Between 2002 and 2007, the state of Michigan cut higher education appropriations by 10 percent while increasing spending for prisons, human services, community health, environmental quality, police and K-12 schools by double digits (Presidents Council: State Universities of Michigan). Over the past 12 years, Michigan ranks 49th in the nation for increases in support for state higher education appropriations, boosting support an average of only 1.4 percent per year compared to the national average of 5.6 percent per year (Noren, 2009). In February 2009, in the midst of a national financial crisis, Michigan Gov. Jennifer Granholm’s 2010 budget proposal proposed a 3 percent cut in state support for four-year universities, and no cuts for community colleges, Medicaid or revenue sharing to cities. At the same time the governor in neighboring Ohio was calling for a 6 percent increase in higher education support, Granholm was asking Michigan universities to freeze their chief source of revenue –tuition. That same week, Christopher Hayter, program director for the Economic Development Program at the National Governors Association, offered a simple explanation for why most state’s have failed to keep up with inflation in their support for higher education and why a few, like Michigan, had let overall support decline: “There’s a golden rule of state Legislatures: That which we don’t understand, we cut.’’ This is the classic public versus private good argument for higher education. The individual advantages and benefits from a college degree, and the great return on investment for most families investing in a college education frame higher education as a private good. Bolstered by the frequently cited statistic projecting that college graduates earn $1 million more over a lifetime than high school graduates, the notion of higher education as a private good has created an “us versus them’’ perception of haves and have-nots. What about the idea of higher education as public good for all, including those who have never set foot on a college campus? Granholm frequently acknowledges the value of higher and post secondary education for the 26 percent of Michigan residents who earn a bachelors degree. Through the 2004 Cherry Commission, lead by Lt. Gov. John Cherry, she called on state universities to double the number of college graduates and she praised efforts and policies to boost access to higher education. Unfortunately, Granholm concluded early in her administration, after her first series of town hall meetings, that most people were more concerned with issues like health care and K-12 education, issues that impacted a greater number of voters than the 26 percent of the state who earned bachelors degrees (DesJardins, Bell and Puyosa, 2006). Perhaps part of the reason that higher education remains discretionary in the state budget is that research universities have not sufficiently demonstrated what 74 percent of Michigan residents who do not earn bachelors degrees gain from these institutions. The third generation automotive worker, the 70-year-old retiree and our own state Legislature, in action if not word, appear to be unconvinced that the value of the research conducted at Michigan universities, the knowledge and innovations they create, and the health care and public services they provide directly impact the quality of life for the majority. Thus, the public good argument remains unresolved.

Higher education and job creation Michigan has been in a recession for seven years, and creating jobs has been the overriding No. 1 priority. Granholm’s 2010 budget acknowledges the role of community colleges in job training and re-training by sparing them from cuts. Four-year institutions, however, have not

3

is for

been so fortunate. Yet, arguably, job creation and employment has been largely encouraged by the far-reaching social and economic impact of four-year research universities within the state. The role research universities have in creating jobs is often overlooked. By one measure, about half of the U.S. economic growth since World War II has been due to technological innovation (National Academy of Sciences, 2006). Bill Joy, as a U-M student in 1971, gained unprecedented access to one of the most advanced computer systems in the world, an experience that helped him become the so-called “Edison of the Internet” and co-founder of Sun Microsystems. The founders of major or rapidly growing U.S. corporations like Microsoft, Dell, Genentech, Facebook, Qualcomm, Broadcom and SAS all met at research universities across the nation, beginning their businesses soon after. How many members of the public know that Google, the iPod and Photo Shop were all developed by University of Michigan graduates either while they were in college or shortly after? Google, which today employs more than 19,000 people, with 1,000 jobs planned for its Ann Arbor office near U-M, did not exist until 1998, beginning as a class project at another research university. In 2004, U-M became the first university to openly commit -- without caveat or disclaimer -- to digitize all 6 million of the books in its library, part of an audacious goal to make all of the world’s information accessible to the entire world, fighting publishers in court to help win subsequent widespread support for the project. This venture has not only revolutionized the transfer of knowledge within academe, it is opening access to knowledge to the public at large. Through the Google Books Project, people around the globe now have free access to a nearly unlimited database of text, some previously restricted to authorized users only.

The Michigan difference The University of Michigan, the state’s flagship research university, offers an excellent case study demonstrating the value and need for public research universities to focus more on their public service missions, outreach and external relations. Beginning in 1999, U-M began a major push to collaborate with the state’s two other research universities, Michigan State University and Wayne State University, on the Michigan Life Sciences Corridor. Aiding in the growth of a Michigan biosciences industry, this initiative now directly and indirectly generates 98,807 jobs (Feinstein, Fulton and Grimes, 2009). In 2006, the three universities’ presidents decided to build on their success by forming Michigan’s University Research Corridor (URC) alliance. By aligning their resources, U-M President Mary Sue Coleman, MSU President Lou Anna Simon, and Wayne State President Irvin Reid (who was succeeded in 2008 by Jay Noren), sought to transform, strengthen and diversify Michigan’s economy. Within one six week period in late 2008-early 2009, Michigan’s URC and its partners announced five projects that could potentially generate nearly 18,000 jobs in the state. The new projects include U-M’s plans to buy Pfizer's vacant 174-acre Ann Arbor research complex to expand U-M’s R&D efforts, GM’s decision to invest $5 million working with U-M researchers to develop batteries for electric cars, and the decision of Massachusetts-based A123 Systems (which began at a research university and partners with U-M and MSU researchers with a U-M researcher overseeing one of their divisions) to build a manufacturing plant in southeast Michigan to supply batteries for Detroit automakers. Putting past rivalries aside, Coleman, Simon, and Noren now regularly work together, speak as a team when testifying before the Legislature as well as business groups. Their provosts and several vice presidents also meet, establishing initiatives like joint seed grants to encourage their researchers to collaborate on “revolutionary but feasible’’ research projects.

4

is for

The URC presidents have also asked outside experts to regularly benchmark their contributions. Their 2008 URC report to the public found the partners generated 69,285 jobs, with an economic impact of more than $13 billion, holding their own against the nation’s top research university clusters (Sallee and Anderson, 2008) in Massachusetts, California, North Carolina, Illinois, and Pennsylvania. In December 2008, Detroit Renaissance and The Detroit News honored the URC with their first Renaissance Award for being the one organization that best showed “outstanding leadership in reinventing the region’s economy.’’ Lawmakers have increasingly been more receptive to the URC; in 2007, the governor and lawmakers embraced a URC proposal to break them out within the state budget as research universities distinct from the state’s other 12 public universities which were dubbed state universities. In 2008, the House voted to appropriate money to the URC when no appropriation had even been sought (the URC asked that the funding be removed in conference committee) and the governor praised the URC in one of her weekly radio addresses. Nonetheless, the proportion of direct support research universities receive from the state of Michigan has been on a downward trajectory for decades. Critics see the advantages of a U-M education but then quickly ask why the rich should get richer, particularly if their own child did not get accepted (U-M is highly selective, only accepting one of every five applicants who apply as undergraduates and MSU is increasingly selective as well). Several lawmakers favor a “per pupil’’ funding model similar to the one used in K-12 schools where every university would get an equal amount for every student (a change that would cut U-M’s state support by nearly two-thirds and help smaller regional campuses). Some have even said U-M should privatize and have their appropriation divided among the other state universities. Thus, the question remains: How can public research universities make a better case to the public and to state officials that higher education is a worthwhile investment?

A counter-insurgency strategy for Michigan’s research universities In January 2007, a Princeton-educated PhD, supported by a brain trust of other research university PhDs as top aides, took over a major public organization that was widely seen as failing in its main objectives, while the hosting state’s population was openly hostile. Their new turnaround strategy included the goals of “making the people the prize rather than the playing field,’’ to boost outreach efforts in a targeted, decentralized and highly adaptive way so the team would continually learn and improve. Other goals: to have more of their team living and working among the state’s population rather than “commuting to them” from their distant entrenched bases, knowing 60 percent of their job was to communicate the right information and to enlist as many local partners and allies as possible. They also decided to work with anyone, forging deals or alliances with helpful allies. Some of their new efforts would be incredibly aggressive while others would be subtle, even covert. Most of the public and even members of his own team questioned whether the plan could possibly succeed but two years later the Princeton-educated PhD has been promoted and voted one of the world’s top public intellectuals and the strategy has been widely praised and emulated in other regions where the organization operates. The Princeton PhD was U.S. Army General David Petraeus and the hostile state was Iraq (Ricks, 2009). We propose Michigan’s three public research universities, working together as the URC, employ some of these same counterinsurgency strategies by similarly:

5

is for

Considering their home state of Michigan, “the prize rather than the playing field.’’

Research universities and their faculty have become increasingly global in their focus as faculty and students have grown more concerned with their role in a global community within their disciplines. But Michigan is far more than a home base from which to coordinate a global agenda. Most URC alumni, students, prospective students and financial supporters (including donors) call Michigan home. The three URC universities enjoy unique state constitutional autonomy meaning their ruling boards are elected directly by the state electorate. But the state constitution that guarantees that autonomy could be replaced if voters opt to call a constitutional convention in 2010 with voters having as recently as 2006 approved constitutional amendments overriding university policy decisions. While state appropriations have been shrinking in dollars and as a percentage of their budgets, they remain the largest single payment of unrestricted dollars in any of the universities’ budgets with public support remaining a great “prize’’ not to be taken for granted or minimized.

Boosting support for outreach and public service projects as well as research with a direct

impact on Michigan in their own targeted, focused “surge.” The great triad of higher education is made up of research, teaching and public service. Historically, however, there have been far fewer financial incentives for faculty to make public service one of their priorities. We propose that public service be further encouraged in the academy through adding weight to its importance as part of the tenure process, and also by establishing more selected seed grants to encourage such activities. In 2008, U-M opened a Business Engagement Center to offer a “front door,” or a “one-stop shop” for business interactions with the university. MSU followed suit by employing a similar operation in the heart of East Lansing. Both U-M and MSU set up new hubs for their activities in downtown Detroit close to Wayne State. The URC also made plans to open an office in Lansing near the Michigan Economic Development Corp. and the state Capitol. The URC presidents announced $900,000 worth of joint seed funding grants to encourage their researchers to collaborate on “revolutionary but feasible’’ research projects and officials from U-M spearheaded efforts to bring together the state’s 15 public universities and state foundations to establishment the Michigan Initiative for Innovation and Entrepreneurship, which harnesses foundation support to bridge the gap between university research and commercial development with plans to aid 200 startup companies. Such pre-seed capital is often the missing link many new businesses need to go beyond the idea stage.

Providing more attention to faculty and staff whose work touches the lives of the state’s

populations and the public good of society as a whole, knowing that 60 percent of their job

is communicating the right information to the public. The National Commission on the Future of Higher Education, whose members included former U-M President James Duderstadt, made six key recommendations including greater investments in globally competitive fields like science and engineering, a call for adopting a culture of “continuous innovation” and “demanding transparency, accountability, and commitment to public purpose in the operation of our universities” (Miller, 2006). The URC universities employ well over 500 communicators and even more development staffers who typically focus on promoting specific stories about their respective universities or university units. We propose an added caveat: that a priority be placed on sharing stories with the added goal of prioritizing stories that show the people of Michigan the

6

is for

public value of their state’s investment just as companies regularly report achievements to their stockholders. U.S. Sen. Lamar Alexander, R-Tenn., a former U.S. education secretary and presidential candidate, contends there is a “communications gap’’ between higher education and the public and elected officials, adding: “Congress simply doesn’t understand the importance of autonomy, excellence, and choice and the higher education community hasn’t bothered to explain it in plain English to members who need to hear it and understand it’’ (Goldsmith, 2009, p. 23).

Increasing, cataloguing, quantifying and drawing attention to the number of partnerships

with regional and local partners including business, government, nonprofits and other

colleges and universities. In its first two years, the URC has issued five reports to the public, built up a content-rich web site, www.urcmich.org, and has helped organize or sponsor events aimed at encouraging economic transformation through innovation including: A regional conference, the Role of Engaged Universities in Addressing Economic Transformation, which addressed the findings of the national Rising Above the Gathering Storm report; a 14-hour Earth Day 2008 broadcast and conference focusing on green technologies with WWJ-News Radio 950 with a similar event planned for April 2009; an appearance with New York Times columnist Thomas Friedman, shortly after the release of his book, “Hot, Flat, and Crowded: Why we need a Green Revolution and how it can renew America.’’ The URC is also the largest sponsor of the upcoming June 2009 National Summit: A Gathering to Define America’s Future. During the late 1980s and 1990, when Michigan Gov. James Blanchard was publicly pressuring universities to freeze tuition, Duderstadt recalls a successful “treetops’’ alliance where the public universities banded together through their massive alumni base to fight back and influence public and political opinion. We believe modern social networking sites like Facebook and other viral marketing efforts make such campaigns easier to attempt today, potentially making them more influential. In 2003, when U-M’s admissions policies were being challenged in the U.S. Supreme Court, Goldenberg (2009) notes the university won a split decision from a conservative court by enlisting the help of the business community as well as military leaders, obtaining a record number of amicus briefs detailing their support for affirmative action, successfully urging the court to preserve the affirmative action concept if not all the specific details of the university’s policies. The URC presidents have also reached out to business leaders, joining Detroit Renaissance, a coalition of CEOs of southeastern Michigan’s largest companies, enlisting their aid in new campaigns to shape state opinions on policy issues. Coleman proudly notes that business people have written her saying U-M has gone from being the hardest university to work with to one of the best. We encourage the URC partners to better catalogue and build upon all of their partnerships.

From public good to private good Higher education has long occupied a special place in society. Viewed as the creator of

knowledge, the producer of leaders, and the engine of the economy, higher education’s role has

been considered critical to society’s well being. Equally if not more important, higher education

has been seen as the intellectual conscience of society, above the marketplace throng. In return,

higher education has received public support, been exempted from taxation and often screened

from the scrutiny of the public eye. Much of that has now changed (Newman and Couturier,

2002).

7

is for

Imagine living in the United States of 1937: eight years after the stock market crash of 1929, the U.S. unemployment was 14 percent, considered a vast improvement from the 25 percent unemployment rate five years earlier (in contrast, over the past six months, a massive financial crisis would help the U.S. unemployment rate climb from 4.8 percent to 8.1 percent). In the 20 years between 1917 and 1937, the percentage of Americans aged 18-20 pursuing a higher education had tripled from 5 percent to 15 percent. Life Magazine, profiling the 150,000 U.S. college students in the class of 1937, argued “These boys and girls – and the others like them who will make up the Classes of 1938, 1939 and 1940 – will in 20 years occupy the seats of authority. Only then will the historian be able to tell how far mass higher education has advanced the American Dream’’ (Life Magazine, 1937; Thelin, 2004). Twenty years after that Life Magazine article, in 1957, unemployment would fall below 4 percent and the United States would be in the midst of one of the most prosperous periods in its history. The students of the late 1930s, who grew up in the Depression and fought World War II then took on leadership roles in the 1950s, would be dubbed “America’s Greatest Generation’’ in a popular book by NBC’s Tom Brokaw. U.S. history is full of instances where public universities played major roles in helping the nation through historic transformations, enhancing the public good. As far back as the founding of the American colonies by the British, higher education has been viewed as a public good. Societal benefits have included the advancement of knowledge, the discovery and encouragement of talent, the advancement of social causes, social justice and equity. The public universities of the 19th century helped move the United States from an agrarian economy to an industrial economy and later to a post industrial service-dominated economy. Today universities are again transforming the United States into a primarily knowledge-based economy, recognizing that every product or service begins with the power of ideas. The Morrill Act of 1862, providing federal lands to establish at least one land-grant college in every state (today there are 76), was the first legislation tying together the fortunes of government, universities and industry. The three have worked together ever since, transforming agriculture, developing new industries, sending men to the moon, curing diseases and coining the term “high technology’’ (Rosegrant and Lampe, 1992). During and after World War II, public universities worked closely with government and industry on massive research efforts while simultaneously educating a work force that would provide the nation with a technological edge that gave the United States the world’s largest economy while helping win wars. The URC institutions were national leaders in these changes. The Northwest Ordinance of 1787, which guided the newly acquired lands of Michigan and the Great Lakes region, declared, “religion, morality and knowledge being necessary to good government and the happiness of mankind, schools and the means of education shall forever be encouraged.’’ U-M, founded in 1817, was one of the nation’s first public universities without a religious affiliation and had as one of its first missions a plan to develop an education system from the primary grades to the university level (Chambers, 2005). By the mid-19th century, U-M had become the nation’s largest university. In February 1855, the state of Michigan would beat Pennsylvania (by 10 days) in forming a new type of American agricultural college that would become a national role model for land-grant colleges. During the winter of 1857-58, President Joseph R. Williams, the new college’s first president, went to Washington, lobbying (a decade before the term “lobbying’’ was first coined) for the Morrill Land-Grant Colleges Act, providing U.S. Rep. Justin Morrill with materials used in his speech introducing and citing the best arguments for passing the act.

8

is for

Williams organized a mailing of 5,000 copies of a 60-page booklet about his new college, offering it up to newspaper editors, elected officials and business leaders as a national template for future colleges (McCristal, 2004). Williams had students mail circulars and provided other key congressmen with arguments that helped win the eventual passage of the bill. Land-grants were “people’s universities’’ drawing students from every section of the state, getting their experts into every county through land extension offices. Michigan’s agricultural college, since it was already in existence when the act was passed, would quickly become known as the pioneer land-grant institution, becoming Michigan State University, despite the opposition of U-M. Wayne State University in Detroit, now one of a small number of urban research universities, would later complete the trio. More than 75 percent of the nation’s college students are enrolled in public colleges and universities, including 75 percent of bachelor degree recipients, 75 percent of doctoral degree recipients and 70 percent of engineering and technical degrees (Duderstadt, 2004). Howard Bowen (1977) notes that higher education serves a dual role as both an agent of stability and as an agent of change, encouraging stable and orderly social development, while also providing students with an environment fostering intellectual and emotional growth. Bowen (1977) further argues that Karl Marx transformed the world through social institutions and Jesus Christ tried to change the hearts of humanity while higher education “dares to do both,” changing institutions and individuals simultaneously (p. 23). But by the late 1960s, American college campuses, particularly large public research universities including the University of Michigan and the University of California-Berkley, had become hot-beds of student unrest and social change that drew negative scrutiny from lawmakers and many members of the public. When the U.S. Higher Education Act came up for reauthorization in 1972, the higher education community argued that federal scholarship support should go directly to universities while congressional leaders and the White House successfully argued for the establishment of new Pell grants that would be awarded directly to students, who could use them in any postsecondary institution, including vocational schools and community colleges, not just universities (Cook, 1998). Just as the voting age was lowered from 21 to 18 to make most undergraduates voters, subsequent aid programs passed by Congress and state lawmakers went directly to college students, a change the higher education community considered “a debacle’’ as support shifted to individual students rather than the institutions themselves. State support for higher education as a percentage of spending has dropped steadily lower for more than four decades, with more and more of the growing cost burden shifting from state and federal governments to students and their parents through increased tuition rates and elected officials blaming the increases on the universities themselves. Today, 55 percent of U.S. higher education support now comes from private sources (tuition, philanthropy, endowment earnings and earnings from auxiliary activities like medical centers) while just 45 percent comes from all governmental sources (Duderstadt, 2008). A growing number of policy makers began arguing that higher education provides the most good to the individuals receiving it as the wage gap between college graduates and high school graduates widened. The rich – and educated – literally were getting richer while the under-educated were seeing their earnings decline. Between 1979 and 2000, after adjusting for inflation, the median weekly wage of Michigan workers with at least a bachelor’s degree climbed by 30 percent while the wages of those with just a high school diploma fell by 8 percent, and wages for those with less than a high school degree dropped 25 percent (Blank, 2003). During the current recession, those trends benefiting the educated and penalizing those with a

9

is for

lack of education have accelerated. Between December 2007 and January 2009, the first 13 months of the current recession, the United States lost 3.75 million jobs requiring a low education attainment (in fields such as manufacturing, construction, retail, and hospitality industries) while the nation enjoyed a net gain of 163,000 high education attainment jobs (Glazer and Grimes, 2009), though nearly all job categories retracted after August 2008. Over the past two decades, Glazer and Grimes (2009) show that low education jobs have grown 15.7 percent in the 19 years from January 1990 to January 2009 while the number of high education jobs has grown by 32.4 percent. Leaders in both political parties pushed to increase college loans that can be repaid and re-allocated to future students rather than one-time grants, arguing that those who benefit the most should pay for those gains. Longanecker (2005) argues that states will continue to encourage the shifting higher education balance from public good to private gain because the current high tuition/high aid model with loans and grants is cheaper for state governments, because the shift fits with the trend toward privatization and a market-based model, and because the institutions themselves like having the greater autonomy that comes when governments are smaller stakeholders than individual families paying tuition. While the current high tuition/high aid model may be more affordable for state governments at the present time, this model could become costly in the long run. Ehrenberg (2006) notes that such a model may require students to take out larger loans as part of their aid package in order to cover the cost of their education. As a result, students carrying greater debt burden may be less likely to pursue low-paying fields and majors such as education and social work that ultimately prepare students to contribute to society yet provide no guarantee of large investment returns. Courant, McPherson, and Resch (2006) suggest that students may be discouraged from even applying to high tuition institutions not knowing that high aid is available to cover their tuition costs. Therefore, there is a need for institutions to limit increasing tuition costs in order to attract students from a variety of income levels. Research universities enjoyed great public support when scientific advancements and research were crucial elements to winning World War II, the Cold War and the 1960s space race, when the competition with communism encouraged investing in America’s “best and brightest’’ but today’s international competition in a “flat world’’ requires investments in educating and training the entire work force (Duderstadt, 2008). Policy makers know they can impact more workers for less money by steering more investments toward community colleges, which have the lowest per pupil costs, yet another factor turning public favor away from costly research universities and toward lower cost alternatives.

Building a brand: URC equals jobs/economic transformation The vast U.S. nonprofit sector, which includes more than 1 million organizations from churches to service agencies to hospitals and most universities, has been the “forgotten middle child,” often less-noticed when compared to the overriding public debates over the influence of its dominant siblings, the public and private sectors. Courant et al. (2006) notes that just 5 percent of higher education students were enrolled in for-profit proprietary institutions, with the remaining 95 percent enrolled in nonprofit public or private institutions. From decade to decade, the government and business sectors battle for power and public attention. But like a middle child in a family dominated by the eldest and youngest siblings, the nonprofit sector is frequently the often-overlooked glue, a flexible peacemaker who gets far less attention but nevertheless ties the entire family together. Crutchfield and Grant (2008) argue the greatest nonprofits/social sector organizations achieve maximum impact by brilliantly doing six things (six things that

10

is for

could also aptly describe the role and potential role of the URC): advocate for policies while simultaneously serving constituencies, make markets work, inspire “evangelists” who spread their messages, leverage and nurture vast networks, master the art of adaptation, and share leadership by empowering and encouraging others to lead. They contend, “The secret to success lies in how great organizations mobilize every sector of society – government, business, nonprofits, and the public – to be a force for good. In other words, greatness has more to do with how nonprofits work outside the boundaries of their organizations than how they manage their own internal operations. Great organizations work with and through others to create more impact than they could ever achieve alone’’ (Crutchfield and Grant, 2008, p.19). Crutchfield and Grant’s description fairly sums up the ambitions of the URC as well as the public service function of the vast majority of public as well as private universities that operate as nonprofits. The URC presidents constantly evangelize about the new knowledge-based economy and the role public research universities will play in transforming Michigan and the world. They talk about the global competition and what they are doing, but rather than pleading for government help, they speak as leaders of successful enterprises others might wish to join with and invest in. As Coleman told the state House March 3,

“I want to share just one last story from Ann Arbor because in the end, this is all about the stories of individuals and what they are doing. One of our engineering professors, Ann Marie Sastry, has focused her work on alternative forms of energy. She has expertise in battery technologies and she’s working on developing new kinds of batteries that are going to be needed and necessary to power the plugin cars and trucks that we’re going to need in the future to distance ourselves from foreign oil…. As we state that we want to become in Michigan the advanced battery capital of the world, people like Professor Sastry and her colleagues at Michigan State and Wayne State and her company and other companies will help drive us there… From our numerous accomplishments, the URC is still in its infancy. We’re only two years old and we’re learning how to work with each other but I’m very pleased so far in what we’ve been able to accomplish. We are hopeful about the future of the URC as we are hopeful about our state.”

Rep. Lee Gonzales, D-Flint Twp., replied that he had just talked with Sastry the day before, calling her “a spectacular problem solver on par with the three of you and I really appreciate what you’re doing.” He later told the hearing room, “We have about a five year window, according to Dr. Sastry, that we not lose our leverage with 80 percent of all automotive R&D related, that other state’s specifically California are trying to chew off. That’s the challenge for all of us in this room.’’ House leaders later that day announced a package of tax incentives that would make Michigan more generous than any other state for attracting advanced battery makers (University Research Corridor, 2009). Granholm signed the incentives into law April 6. Duderstadt (2008) argues the great advantage Michigan’s research universities have had over their rivals has been the great amount of autonomy, noting universities in states like California and Texas are parts of statewide “master plans” or systems while Michigan’s higher education “plan” appears to be a free-market combination of “anarchy and benign neglect” (p. 2). Michigan is the only state in the union whose universities do not answer to a statewide board, giving them unique autonomy universities in other state envy. But Duderstadt also noted that historically that system of “anarchy’’ has resulted in each of the 15 universities in Michigan competing against each other and among themselves, when fighting for support. He also describes years of rivalries between the universities and within the Legislature with different political factions backing U-M or MSU or Wayne State (Duderstadt, 2007, pgs. 197-206). The URC was, in part, an attempt to

11

is for

enjoy many of the advantages of a real merger or creation of a statewide system (collaboration, unified goals, unified budget goals) without giving up autonomy or their own unique cultures. The URC also represents the opportunity to create a new, unified brand that brings together the best of all three research universities. In a December 2008-January 2009 MSU market survey of Michigan adults “with a reason to care about higher education” (defined as having a child 10-17 in the household), respondents rated “MSU is part of Michigan's University Research Corridor" as one of the top five messages that most positively affected their image of MSU from a list of 20 messages. The term was not defined in any way for the audience in administering the survey, showing both opportunity and vulnerability as the new alliance defines itself or allows others to define it. Thelin (2004) focuses on the notion of saga, the idea that institutions follow patterns set by historical strands. In university communications and outreach, a similar idea is to “build your brand’’ by focusing on a powerful narrative or story, repeating key messages again and again that can be shared with external audiences including government officials, the media, donors, and the public at large. Branding expert Laura Ries describes branding as the one or two descriptive words people most closely associate with a product or person, arguing that products or even presidential candidates with a widely-recognized “brand” win public support (e.g., Hope/Barack Obama, Compassionate Conservative/George W. Bush) while those with a less recognized or remembered brand identity tend to lose or be overlooked. For example, U-M, as an elite research university, has built its brand around the branding messages of its famous fight song, as representing the “leaders and best’’ while low-cost community colleges, in contrast, emphasize their accessibility and affordability. The MSU brand has been associated with being a land-grant or “peoples university’’ while Wayne State is best known as an urban research university. The brand identity most closely associated with the URC’s message is “jobs” or perhaps “economic transformation.” The URC’s focus on jobs, the single subject Michigan cares most about after a seven-year recession, grabs the attention of reporters and elected officials. Besides the role of research and healthcare in creating new jobs and the potential for new industries, Moretti (2004) found wages of low-skilled workers also rise when the number of college graduates increases in an area and Ballard (2006) similarly contends an increase in education level boosts a community’s productivity and creates other “spillover effects’’ as the labor pool for low-education jobs shrinks. College graduates are also more likely to vote, volunteer their time and even donate blood (Courant et al., 2006). Another tremendous advantage of research universities is their specialty in studying fields that might not immediately seem practical or popular. For example, Courant notes university departments studying the Middle East or Middle Eastern languages received relatively little public attention before September 11, 2001 but became very much in demand immediately after the 9/11 attacks (Courant et al., 2006). U-M’s impact on the public good, including those who never set foot on a university campus, can be seen in the various outreach programs and service initiatives in which students and faculty get involved. In the 2006-07 academic year, 19,000 U-M students were involved in courses, programs, and student organizations that focused on community service and civic engagement (University of Michigan’s Edward Ginsberg Center for Community Service & Learning, 2006-07). Tutoring programs disperse student tutors to area schools and public housing sites; service-learning courses offered through the Sociology department place student volunteers in community agencies in Detroit, Ypsilanti, and Ann Arbor where students volunteer 4-6 hours per week; and over 60 faculty members engage in community-based research and teaching through

12

is for

Arts of Citizenship (UM Ginsberg Center, 2006-07). The URC presidents frequently describe how North Carolina created the Research Triangle and began investing in higher education 50 years ago as the textile industry began to move operations overseas and how Pittsburgh invested in higher education, high tech and healthcare as its steel industry began to decline in the 1980s. Both regions offer a roadmap for transforming Michigan, they contend. Goldin and Katz (1999) describe how states that wanted to develop particular industries such as mining or engineering in the early 20th century invested heavily in making sure their universities had top programs in these fields where they expected their economies to grow. In each case, the promise of an economic transformation was a powerful message that translated into renewed investments in higher education and profound economic changes within those regions. Over the past 40 years, “big government” became a negative term as the proportion of support research universities receive from states steadily declined. Continuing trends included privatization and a more market-driven economy and market-driven universities as the private good of higher education continually eclipsed the public good. However, Malcolm Gladwell (2002) argues that long-term trends are not constant and often come to a “tipping point’’ where trends suddenly – and with little warning -- spike sharply in one direction or another. After years of gradual declines, support for higher education seems to be at such a tipping point. The current economic crisis helped bring a new President and First Lady to Washington who attended and worked in leading roles for research universities in the Great Lakes region. President Barack Obama has successfully sought and won support for massive new government investments in education and research spending, recently setting the goal of devoting 3 percent of the nation’s GDP – about $420 billion – to research and development, a level not seen since the Space Race of the 1960s. Obama, in his first address to Congress February 24, listed three top priorities that are each important to the University of Michigan, its URC partners and other research universities: energy, healthcare and education. President Obama, in messages stressing higher education’s role in enhancing the public good, told Congress,

“The answers to our problems don’t lie beyond our reach. They exist in our laboratories and universities; in our fields and our factories; in the imaginations of our entrepreneurs and the pride of the hardest working people on Earth… History reminds us that at every moment of economic upheaval and transformation, this nation has responded with bold action and big ideas…. From the turmoil of the Industrial Revolution came a system of public high schools that prepared our citizens for a new age. In the wake of war and depression, the GI Bill sent a generation to college and created the largest middle-class in history. And a twilight struggle for freedom led to a nation of highways, an American on the moon, and an explosion of technology that still shapes our world. In each case, government didn’t supplant private enterprise; it catalyzed private enterprise…. In a global economy where the most valuable skill you can sell is your knowledge, a good education is no longer just a pathway to opportunity – it is a pre-requisite. Right now, three-quarters of the fastest-growing occupations require more than a high school diploma. And yet, just over half of our citizens have that level of education. We have one of the highest high school dropout rates of any industrialized nation. And half of the students who begin college never finish. This is a prescription for economic decline, because we know the countries that out-teach us today will out-compete us tomorrow. And so tonight, I ask every American to commit to at least one year or more of higher education or career training. This can be community college or a four-year school;

13

is for

vocational training or an apprenticeship. But whatever the training may be, every American will need to get more than a high school diploma. And dropping out of high school is no longer an option. It’s not just quitting on yourself, it’s quitting on your country – and this country needs and values the talents of every American. That is why we will provide the support necessary for you to complete college and meet a new goal: by 2020, America will once again have the highest proportion of college graduates in the world’’ (Obama, 2009).

The first major legislation signed by Obama, a massive stimulus bill, specifically required that states, in order to receive the support, would not be able to cut funds for education so Granholm’s cuts were part of a state House-passed budget but the dollars were replaced with federal stimulus dollars. Michigan, currently facing the threatened potential bankruptcy of two of Detroit’s Big Three automakers, is at a transformative tipping point just as the former Soviet Union was two decades ago. In April 1987, then-U.S. Secretary of State George Shultz, a former business professor at two major U.S. research universities, tried a new tactic in his talks with Soviet Union General Secretary Mikhail Gorbachev. Instead of focusing on their bilateral relationship or nuclear weapons or the Cold War, he described how information technology, financial markets and manufacturing were already globalizing nations around the world, how production crossed borders, how knowledge and information were growing more important than minerals or heavy industry and how “any country that closes itself off… is going to lose out’’ to rising economic powers like China, Singapore, South Korea, Israel, West Germany and Japan. Two days later, Gorbachev told the ruling Poliburo “The world is interconnected, interdependent’’ and later recalled his conversation with Shultz as a “milestone’’ (Mann, 2009). If the arguments about the inevitability of globalization could help convince the last leader of the Soviet Union to transform the only system he had ever known, we believe these same trends will continue to transform Michigan’s economy and culture and that they can simultaneously transform the image of research universities as a powerful public good deserving of increased public partnerships and investments.

References

Ballard, Charles L., (2006) Michigan’s Economic Future. (page 51). Michigan State University Press. Ballard, C.L., Courant, P.N, Drake, D.C, Fisher, R.C. and Gerber, E.R. Michigan State University Press. Blank, R.M. (2003). “The Less-Skilled Labor Market in Michigan.’’ Michigan at the

Millennium: A Benchmark and Analysis of Its Fiscal and Economic Structure, edited by Ballard, C.L., Courant, P.N, Drake, D.C, Fisher, R.C. and Gerber, E.R. Michigan State University Press. Bowen, Howard (1977). Goals: The Intended Outcomes of Higher Education, Investment in Learning, Jossey-Bass. Chambers, Tony C., (2005). “The Special Role of Higher Education in Society,’’ pages 13-14.

14

is for

Higher Education for the Public Good: Emerging Voices from a National Movement, edited by Kezar, A.J., Chambers, T.C. and Burkhardt, J.C. Jossey-Bass. Cook, Constance Ewing. (1998). Lobbying for Higher Education: How Colleges and

Universities Influence Federal Policy, pages 25-28. Vanderbilt University Press. Courant, P.N., McPhersonm M. and Resch, A.M. ( 2006). The Public Role in Higher Education. The National Tax Journal, June 2006. Crutchfield, Leslie R. and Grant, Heather McLeod (2008), Forces for Good: The Six Practices of

High-Impact Nonprofits. Jossey-Bass. DesJardins, S.L., Bell, A. and Puyosa, I. “Michigan Public Higher Education: Recent Trends and Policy Considerations in the Coming Decade’’ in Ehrenberg, R. (Ed.) What’s Happening to Public Higher Education? Praeger: Westoport, CT. Duderstadt, James J., (2008). “Changing University Mission and Profiling in the United States: Some Lessons Learned in the New World’’ in European University Association Bologna Handbook, Raabe. http://www.bologna-handbook.com/

Duderstadt, James J., (2007). The View from the Helm: Leading the American University during

an era of Change, University of Michigan Press. Duderstadt, James and Womack, Farris (2004). The Future of the Public University in America:

Beyond the Crossroads, Johns Hopkins Press. Ehrenberg, R. (2006). The perfect storm and the privatization of public higher education. Change, January/February, 46-53. Feinstein, Abel, Fulton, George A. and Grimes, Donald R. (2009). “The Contribution of the Bioscience Industry to the Economy of Michigan.’’ Prepared for Pharmaceutical Research and Manufacturers of America, February 2009. Gladwell, Malcolm (2002). The Tipping Point: How Little Things Can Make a Big Difference,

Back Bay Books.

Glazer, Lou and Grimes, Don. “Michigan’s Transition to a Knowledge-Based Economy: Second Annual Progress Report.’’ March 2009. www.michiganfuture.org

Goldenberg, Edie N. (2009). Discussion with authors and colleagues, April 1, 2009. Goldin, Claudia & Katz, Lawrence F., “The Shaping of Higher Education: The Formative Years in the United States, 1890 to 1940,” Journal of Economic Perspectives, Winter, 1999. Goldsmith, Rae (April 2009). “Talking about transparency: How can campus communicators

15

is for

demonstrate the accountability of their institutions?’’ Currents: Council for the Advancement and Support of Education, April 2009. Institute for Higher Education Policy (1998). Reaping the Benefits: Defining the Public and

Private Value of Going to College: http://www.ihep.org/Pubs/PDF/Reap.pdf Life Magazine (1937). The Colleges Turn out their 1937 models: American boy and Girl. Life, June 7, 1937, p. 23. Longanecker, David (2005). “State Governance and the Public Good,’’ pages 68-69. Higher

Education for the Public Good: Emerging Voices from a National Movement, edited by Kezar, A.J., Chambers, T.C. and Burkhardt, J.C. Jossey-Bass. Mann, James (2009). The Rebellion of Ronald Reagan: A History of the End of the Cold War. (pages 242-247). Viking. McCristal, J. Bruce (2004). The Spirit of Michigan State. InnerWorkings LLC. p 13. Newmanm F., and Couturier, L.K. (2002). Trading public good in the higher education market.

Report from the Observatory on Borderless Higher Education. London, UK: Observatory on Borderless Higher Education. Noren, Jay (2009). University Research Corridor Presidents March 3, 2009 testimony, House Appropriations Subcommittee on Higher Education. http://www.urcmich.org/news/030309transcript.html Obama, Barack (2009). President Barack Obama’s Address to Joint Session of Congress, February 24, 2009. http://www.whitehouse.gov/the_press_office/Remarks-of-President-Barack-Obama-Address-to-Joint-Session-of-Congress/ Miller, Charles (chair) (2006): A Test of Leadership: Charting the Future of U.S. Higher Education, in National Commission on the Future of Higher Education in America (“The Spellings Commission”), U.S. Department of Education, Washington, D.C. http://www.ed.gov/about/bdscomm/list/hiedfuture/reports/final-report.pdf National Academy of Sciences, Rising Above the Gathering Storm: Energizing and Employing America for a Brighter Economic Future, 2007. Presidents Council: State Universities of Michigan. “Five year summary of Disinvestment in Michigan.’’ http://www.pcsum.org/pdfs/5_year.pdf Ricks, Thomas E. “The Gamble: General David Petraeus and the American Military Adventure in Iraq: 2006-2008,’’ Penguin Press, 2009.

16

is for

Rosegrant, Susan and Lampe, David R. (1992). Route 128: Lessons from Boston’s High-Tech

Community. Basic Books, a division of Harper Collins. pp 180. Sallee, Caroline and Anderson, Patrick. (2008). Michigan’s University Research Corridor. http://www.urcmich.org/economic/2008/AEG_URC_FinalReport_Sept08.pdf Thelin, J.R. (2004). A History of American Higher Education. Johns Hopkins University Press: Baltimore, MD. University of Michigan’s Edward Ginsberg Center for Community Service & Learning (2006-07). Annual report 2006-2007. Retrieved March 30, 2009, from http://ginsberg.umich.edu/downloads/Ginsberg%20Annual%20Report%20Final%204.17.08.pdf. University Research Corridor, (2009). “URC Presidents testify on job creation,’’ March 3, 2009. http://www.urcmich.org/news/030309jobs.html