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One of the treasured tenets of the American dream is that adults will leave to their children a better world than they inherited. Tragically, that aspiration is being assigned to the ash heap of history as instant gratification and greed rise to the fore.
Nationally, our adult leaders have not balanced the federal budget in over 20 years and have been using the tax system to lighten the burden on the affluent while passing on the debt to the young. That burden now reaches in excess of $94,000 per person.
Our love of sports is so out of control that we use public money to subsidize billionaire team owners with luxury stadiums while reducing our commitment to education. In Minneapolis, taxpayers are still paying off the $150 million of debt plus interest incurred to fund a football stadium for a billionaire owner while imposing draconian cuts to its schools.
Not to be outdone, the regents and presidents of the University of Minnesota have increasingly been moving more and more assets away from struggling students and into the pockets of overpaid administrators. Undergraduates at the university are paying $3,000 a year more in tuition than the national average for public universities, which includes $1,700 more in per student administrative costs than the national average.
The university itself reports that student life is becoming increasingly unaffordable, with 43.6% of undergraduates worried “about the ability to pay for housing ” and another 20% enduring “food insecurity.”
And all the while, the regents and top administrators are focused on improving their own well-being, This should not surprise us, because previous reports have shown that the university pays its administrators far higher salaries than are paid at all levels of government from municipal to county to state to federal.
For instance, the general counsel for the university makes some $200,000 more than our state’s attorney general, $100,000 more than the chief justice of the U.S. Supreme Court and $150,000 more than America’s Secretary of State.
All too typical was the U’s hiring in 2020 of Myron Frans, then the state commissioner of management and budget. Although Frans’s new position as senior vice president for finance and operations was comparable, the pay differential was significant. Frans’s compensation moved from $158,000 at the state to $399,000, plus another $50,000 to $80,000 in deferred compensation along with a far more generous pension. Interestingly, the U was in the midst of a $166 million shortfall at the time.
Since 1991, the university president’s salary has soared some 500%, from $152,300 to $805,950, not including retirement contributions and other benefits that put the total well over $1 million.
Meanwhile, tuition and fees for students have risen from $2,728 to $15,859. Students can no longer work their way through college and, therefore, many rely on students loans. On the average, this comes to over $25,000 for a four-year undergraduate degree.
And although the university president makes two and a half times more than the president of the United States, that has been deemed insufficient. Now she also serves on the Securian Financial corporate board for an additional $130,000 a year. Despite the fact that Securian oversees the university’s multibillion-dollar retirement system, President Joan Gabel and the Board of Regents see no conflict of interest. They tell us that university officials who report to Gabel will look after university employee life insurance and retirement accounts with Securian and protect us from any conflicts of interest.
Continuing on this path is destructive. University governance needs a complete turnabout that genuinely focuses on our young. It cannot just be a simple tuition freeze but rather must be a complete overhaul with major reductions in administrative costs. Here is what the regents or the Legislature should do:
1) Cap the university president’s salary at that of the president of the United States. This should be a standard for all public entities that receive federal funds.
2) The Legislature establish an independent commission to investigate numerous scandals at the university and the enormous costs they impose on the students and public. Currently, the university is “investigating” allegations of fraud that have been brought by the medical/scientific community against the Alzheimer’s Research Project. The National Institutes of Health pegs the costs in the billions of dollars.
Suffice it to say that the university’s management and oversight of these medical research projects has been wholly inadequate and severely criticized nationally and internationally from the New York Times headline “The University of Minnesota’s Medical Research Mess” to Forbes’ “Why the University of Minnesota’s Research Scandal Threatens Us All” to the obvious question raised by Minnesota Public Radio: “Why Do Scandals Keep Happening at the University of Minnesota?”
In essence, the university is paying extraordinary salaries for harmful results.
3) The governor should create a council of independent experts to work with the regents and university leadership to steadily lower administrative and other overhead costs while lowering student tuition with the goal of making student loans unnecessary. This also means integrating the athletic department into the solution. Nothing should be off the table.
4) The governor and Legislature should set aside $1 billion in a student foundation fund using the annual proceeds from investment (approximately $50 million) for purposes of lowering student tuition at all Minnesota public institutions now. The state currently has a $17.6 billion surplus. This $1 billion investment would be a one time expenditure. In addition, this same approach ($1 billion set aside in a foundation and invested with the proceeds going to the program) could be utilized to fund innovative programs in K-12.
The overall goal must be to guarantee to our children access to a quality and affordable educational experience so they are properly equipped to guide us through the enormous challenges of climate change and the restoration of a growing middle-class democracy.
Arne H. Carlson was governor of Minnesota, 1991-1999. Richard Painter is S. Walter Richey Professor of Law at the University of Minnesota.
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