
College Presidents Making $1M Rise with Tuition and Student Debt - wyldfire
https://www.bloomberg.com/news/articles/2017-12-11/college-president-salaries-rise-9-and-1-million-paydays-double
======
jdlyga
Huge fan of Georgia Tech's online masters program. It's in the top 10 graduate
computer science programs in the world, and it's the same curriculum and same
degree that you would get on campus. But the total cost of the program is
around $7,000 dollars. Their reasoning? You don't pay for the stadium, the
student fitness center, career advisers, etc. You only have to pay for the
cost of the online program, professors, and TA's.

~~~
beamatronic
That's how much college used to cost WITH all that stuff. In the 90s. But we
had terrible food and no air conditioning.

~~~
thatfrenchguy
It’s mostly because financing by the states has disappeared though.

~~~
jimhefferon
This is right. We used to all agree, as a society, that we would all benefit
by people educating themselves, becoming then next generation of civil
engineers, doctors managers, and maybe poets. But we no longer believe that,
we believe that people should pay for it themselves.

~~~
JPKab
I think that your viewpoint focuses on the people paying, but you are ignoring
the people taking.

It's not fair to ask people to simply pay, and not allow them to hold the
institutions accountable. Universities are packed with dead weight professors,
dead weight majors, and dead weight administrators who take advantage of the
blind belief that a bachelor's degree in anything is better than nothing.

The University of Florida got rid of its Computer Science program a few years
ago, while expanding it's English department. Do you think that was a wise use
of Florida taxpayer's dollars?

------
bmcusick
I hope everyone's in on the joke that "non-profit" just means that someone
other than a class of people called "shareholders" siphons off all the
profits. It doesn't mean "low cost".

~~~
chasing
That's a very pejorative and mostly inaccurate way of putting it.

"Non-profit" doesn't mean people can't earn good money -- it means the
organization exists for a purpose other than profit and, therefore, gets some
tax breaks.

Most people I know who work in non-profits are paid below-market for their
skills.

~~~
geofft
> _Most people I know who work in non-profits are paid below-market for their
> skills._

This is true, but orthogonal - the complaint is about how much the bosses
make, not how much the workers make.

~~~
cmiles74
And the fact that they are using their non-profit status as an excuse to pay
their employees less than market value, while the executive suite cashes huge
check,s is deplorable.

~~~
chasing
No, non-profits tend to underpay simply because they often have less money.
Well-funded non-profits probably pay at-market rates. Or higher.

------
rdtsc
I remember my tuition rising sharply while the school was building things like
a new rec center with a large pool and a lazy river. (Yes, I think there is
obvious irony there installing a lazy river on a college campus and making
students take 6 figure loans to pay for it). In the meantime the evening
college which had people trying their hardest to work and go to school was
strapped for funds, couldn't afford printer paper and was printing exams
double sided in a tiny font.

~~~
Retric
Students are free to go to less expensive schools. However, as long as people
underestimate debt, spending more to attract more students is simply rational
behavior.

~~~
barrkel
You say that people underestimate debt, but it goes the other way too. My
experience as a poor child growing up was that I could see no way to afford
university fees, because the numbers looked too big. Loans wouldn't make a
difference because I couldn't comprehend the subjective experience of making
so much more money later in my career.

Thankfully, college fees were abolished in my country (Ireland) in 1996. It
enabled me personally to envision going to college where I couldn't before.

~~~
pdxandi
I had the same experience.

I knew I was covering my college tuition and even in 2000, I couldn't
understand how I could ever afford out of state tuition and room and board. I
had near perfect grades and solid test scores, but the financial obligation
scared the hell out of me and I had no idea private schools handed out big
scholarships for good students.

I ended up staying in town and going to my local state college and had a good
experience, but I completely missed out on the prospect of going to a top
university where I would meet other ambitious and curious people. I worked
part-time to full-time for four years to pay for my tuition, and it was tough.
I wish I could've been immersed in college and academia and even college-life,
but the cost just felt like a huge barrier when I was 18 years old.

TL;DR: I fear poorer people may be more afraid to attend college because of
the costs, causing an even greater gap between the haves and have-nots.

~~~
_acme
Many top schools (e.g., Harvard) are essentially free (both in terms of
tuition and from loans) for children of families making under roughly
$100,000.

------
dcole2929
To me this issue is basically the same as most other pay discrepancy issues in
other fields. It all boils down to directly attributable results. If a college
endowment increases by 800 million under a presidents stewardship he can point
to that as directly attributable to him. It doesn't mean others didn't assist
but it's a very public win for him. It's hard to argue that he doesn't deserve
1% of that. With professors it's hard for them to argue that they are the
reason why the college has X number of dollars with any clarity. Unless some
alum donates a lot of money and says specifically this is because of this or
that teacher it's impossible for them to quantify their worth to the school.
Thus admin staff who can do that see their salaries increase commiserate with
what they can argue they bring to the school, while the professors who should
be more important are left behind. Schools are a business today and that's
reflected in their priorities of money > education.

~~~
ihsw2
How do you reconcile that with external effects? Surely a college endowment
increases for reasons outside of the college presidents' actions and it is not
directly attributable to him/her.

If all college endowments grow in lockstep with demographic/economic growth
then surely it stands to reason that college endowment growth can be
attributed to this. While is foolish to assert that demographic/economic
growth is 100% responsible, it is equally foolish to assert that college
presidents are 100% responsible for endowment growth.

~~~
dcole2929
Absolutely, but it's up to the board or whatever functions similarly at a
university to make that decision. I'm not laying out an algorithm for
president's inflated salary just explaining what i see to be the reasoning
behind it. Like most things, compensation isn't a reflection of absolute truth
but of what one can argue to be reasonable. I'd imagine you could take the
increase in endowment and compare to the average schools increase across the
same time period or some other such metrics, if one were so inclined.

------
marcoperaza
Tuition has skyrocketed yet class-size keeps going up and many tenured
professorships are in fact being abolished across the country. Where is the
money going?

To an explosive growth in administrative (ie non-academic) staff. With the
government giving out loans to anyone who wishes to attend, colleges have no
reason to keep their costs in check.

Dartmouth, my alma mater, has about one employee per student. Most of these
people do nothing, at best. Many are engaged in running one of the dozen or so
administrative departments, one for every kind of minority imaginable,
dedicated to indoctrinating students in how much they are oppressed by the
white-male patriarchy. Most are just bureaucratic paper pushers who are
totally unnecessary. Another chunk is overpaid low-skill laborers who are
making several times the market rate in the area, but are unionized and
protested (with the support of naive students) when there was an attempt to
bring their compensation down slightly. And to be clear, I don’t blame any of
these groups for protecting their own interests, I blame the college
leadership for not doing what must be done.

The college overpays for building projects by whole-number multiples and is
generally getting ripped off by contractors.

The solution is to limit the amount of federal government student loans per
year to a much smaller number. The colleges will kick and scream and complain
of "evil [political party]" stealing education from babies' mouths, or
something like that. But then they'll quietly start making the tough decisions
to cut their ridiculous expenses and bring tuition down.

------
Cd00d
College president is essentially a sales job, where fundraising is the primary
objective. These salaries, while optically horrible, should reflect the
success of the president at bulking up the endowment.

Like in many industries, a great sales person can often become one of the
highest compensated employees, because it's still only a portion of what they
generated.

I think an important conversation to be having is what are the universities
doing with the massive endowments they've built up?

~~~
fastball
This might seem crazy, but I actually think the point of a college president
is to ensure that his college is teaching students effectively and for as
little expenditure as possible...

~~~
Hooke
The parent comment makes a fair point in my opinion. The job you're describing
is done by the #2 at a university (provost or executive vice chancellor or
whatever title they want to use). The president's job is to court 7 and 8
figure donations and to be a symbolic figurehead. Not all of this money is
wasted; often the donations go toward supporting research or paying grad
student stipends. Administrative bloat is a huge problem at universities but I
actually no longer see the presidential salaries as being very objectionable
relative to other forms of waste I've seen, like the money spent on stadiums
or unnecessary luxury amenities.

~~~
froindt
Of course it varies by university, but in Iowa the state universities
(possibly with the exception of UNI) pay for their athletic programs using no
tax dollars. Of course there are still millions donated to athletics which
doesn't help the greater student body.

If schools didn't have athletic programs, would the donations have been made
to the university at large?

------
paultopia
Forget about the presidents. At least they have a real job. What about the
football coaches, who make really obscene amounts? This article lists a ton of
state school coaches making way the hell more than any president.
[http://www.espn.com/college-
football/story/_/id/17892134/mic...](http://www.espn.com/college-
football/story/_/id/17892134/michigan-wolverines-coach-jim-harbaugh-salary-
tops-list-college-football-coaches)

~~~
larrymyers
What about football coaches? Div I football programs are big business,
bringing in tens of millions of dollars a year:

[http://sports.usatoday.com/ncaa/finances/](http://sports.usatoday.com/ncaa/finances/)

Most of the these football programs finance all sports for these large
universities.

College coaches are paid well because the programs they lead tend to be profit
centers for the school.

~~~
wincy
They profit off the labor of unpaid student athletes.

~~~
geofft
You make a very good point, but these students also generally get scholarships
to college, which is not an insignificant form of compensation at all -
especially given how much having a college degree matters for future lifetime
earnings.

~~~
avprpl
The graduation rate for those athletes tends to be quite low overall though,
so not all of them get that benefit.

~~~
tomschlick
That's their own fault. If you're given a free/mostly free ride you should
take advantage of it.

~~~
icebraining
It's not free if they're working for it. And that work may impede said
studies: [http://uk.businessinsider.com/college-student-athletes-
spend...](http://uk.businessinsider.com/college-student-athletes-
spend-40-hours-a-week-practicing-2015-1)

~~~
paultopia
plus the concussions.

------
at-fates-hands
I can understand why president's make a lot of money. From the article:

 _The chart-busting payday for Hatch, who has headed up Wake Forest since
2005, was partly from compensation of more than $3 million that came due in
2015_

 _" President Hatch's compensation over the course of his tenure reflects his
exceptional leadership," trustee chair Donna Boswell said. The school has
raised nearly $800 million under Hatch, she said._

So they paid the guy $3 million and got over $800 million back in return while
he's the university? As a student or faculty, that would be good news for me.
More endowments, better facilities, more scholarships.

The one thing I _do not_ understand is how technology has made everything more
efficient. How is it education seems to be one of those areas where despite
the advances in technology, tuition seems to still go up, certain courses and
majors demand more and more course materials, and the debt students have to
incur is greater and greater.

When I was in college in the mid aughts, they made a huge deal about giving
all the students laptops as opposed to having huge computer centers and the
millions they were saving by doing so. And yet, every year since then, tuition
went up. It's totally baffling to me.

------
kenjinp
This is unsurprising, as those of you who have read "Dictators Handbook" will
remember, college campuses are organizations governed by leaders with small
constituencies and sort of mathematically lead to crony-ism and big payouts
for supporters. The system is set up to incentivize this behavior, and the
universities need to be reorganized to achieve any other outcome.

------
jimhefferon
I see people writing who comment about excessive expenses, for instance for
fancy facilities. I'm a prof (not in any kind of administrations, though), and
when I went to state school in 76 there were non of these things, for sure.

But I have been in meetings where the admissions folks say "Prospective
students read in US News that they should ask about athletic facilities and
ours is significantly worse than our competitors" and the next thing you know
we are building a knockout gym. I perfectly understand the decision.

(It reminds me of the kind of stuff you read in Jared Diamond's _Collapse_ ,
where the system globally has problems that everyone can see but locally they
are forced to act in the same way as everyone else.)

~~~
dsfyu404ed
An insane amount of spending is just a dick measuring and box checking
competition between schools. They're worried that when some entry level
journalist needs to write another top-ten article to meet their quota they
won't be on the list and that when some other publication read by college
counselors aggregates all those BS lists they won't make the cut.

In dining services we'd spread ourselves super thin in order to check boxes
and QoS would slide. Then we'd get a bunch of complaints about QoS and cut
back. Wash rinse repeat.

------
crankylinuxuser
As mentioned in a reddit thread(1) of the same article:

"Let's see, average amount of student loan debt per graduate is $30k. Student
loans are usually a life-altering debt, designed to take decades to pay off.
That means for every year this chode gets paid $1M, 33.3 students are stuck
with paying off his yearly salary for the next 20 years. "

And that's just 1 person. And it's pretty easy to connect the dots to the real
problem, being that of administration is the one making the rules now for
education, not the faculty and academics. (2) (3)

Now, there is an argument that because more regulations and laws are passed,
that is why administration is being.. bloated. I'm not so sure how true this
is, but is is another factor that does seem to take a part of the whole
situation. (4)

(1)
[https://www.reddit.com/r/news/comments/7j755s/number_of_coll...](https://www.reddit.com/r/news/comments/7j755s/number_of_college_presidents_making_1_million/dr4vzqg/)

(2) [https://www.jamesgmartin.center/2017/06/administrative-
bloat...](https://www.jamesgmartin.center/2017/06/administrative-bloat-campus-
academia-shrinks-students-suffer/)

(3) [http://volokh.com/2010/08/24/administrative-bloat-at-
univers...](http://volokh.com/2010/08/24/administrative-bloat-at-
universities/)

(4) [https://www.chronicle.com/article/Think-College-Costs-Too-
Mu...](https://www.chronicle.com/article/Think-College-Costs-Too-Much-/146641)

~~~
kharms
Under his tenure the endowment raised an additional $800,000,000. Assuming a
conservative 2% spend-down, that's an additional $16,000,000 per year,
forever. If he gets paid $3,00,000 per year, forever that's still $13,000,000
in new money, or using your math - 433 students' tuition.

~~~
crankylinuxuser
We can show by rising tuition prices the money's going "somewhere". And given
administrations stratospheric rise, I'd say it's a safe claim to start looking
at the university presidents, the long list of VP's of $stuff, assistant VP's
of $more_stuff, the piles of directors... And the list goes on.

And I can damn near guarantee that the "433 students tuition" will instead be
spent on "Philanthropy" via constructing more buildings. I'm seeing it right
now in my town, with skyrocketing rents everywhere, gentrification, and school
pricing run amok (wife is trying to get in grad school).

------
bradleyjg
These organizations try to have it both ways. On the one hand they go to the
government and ask for all kinds of tax benefits on the basis that they are
doing good for society, but on the other hand when you ask why their employees
make so much money they say that's just how capitalism works. If their own
employees aren't willing to sacrifice for their mission, why should the rest
of us in the form of tax concessions?

------
awinder
Reminder: big banks were giving out 1M+ bonuses to traders / c-suite
executives in the midst of the 2008 financial crisis, while being bailed out
by the taxpayers to the tune of trillions. We're now re-tooling the entire tax
code to give them more money, but we're gonna crack the whip because of 58 --
thats fifty-eight -- college heads making over 1M in salary.

~~~
EduardoBautista
You want top talent, you have to pay for it. Otherwise they will just go work
somewhere else.

------
LeeHwang
This is just offensive. I know so many kids with degrees just struggling under
debt and poor job prospects.

We need a reformation for universities and their contract with society.

~~~
randomdata
Why does one take on debt they cannot afford, especially when they lack a good
career to help pay for it, in the first place?

From the stories I've taken in from people attending college over the years, I
suspect it is because they see people like these administrative staff, who
will tell you they got there by going to college, making serious amounts of
money and are willing to take a chance that they too will become that person
in the future. Which then becomes a self-fulfilling prophesy. The schools are
incentivized to ensure that a small group of college graduates are paid
handsomely to make their product look more attractive, and more students
taking notice of that attractiveness allows them to pay those people even
more.

Despite substantial growth in college attainment over the last number of
decades, incomes for the general population have remained stagnant and job
quality is in decline. That fact is reported in the news almost daily, it
feels like. It is no secret that the average person is going to see no
workplace gains by going to college, otherwise incomes would be going up
and/or job quality would be rising with increasing attainment. It appears to
me, however, that some are willing to gamble on the small chance they are the
exceptional case that gets the exceptional job (like College President).

Ultimately, the colleges are providing what the students want: A perceived
chance, albeit small, of significant upward mobility. Until their desires
change, it is going to be difficult to change that outward contract.

~~~
pessimizer
> It is no secret that the average person is going to see no workplace gains
> by going to college, otherwise incomes would be going up and/or job quality
> would be rising with increasing attainment.

Incomes do go up and job quality does rise with increasing educational
attainment, and empirically the average person is going to see workplace gains
by going to college.

People are not going to college solely to gamble on a chance to make million
dollar salaries. That's a bizarre outlook that excludes every middle class job
that increasingly tends to require a college degree.

Hell, most college administrators don't make more than middle class salaries.

~~~
randomdata
_> Incomes do go up and job quality does rise with increasing educational
attainment_

I really don't think this is found in the data. Among the general population,
incomes are quite stagnant, and job quality is considered to be falling. At
best, it is no better than in the past. With the rising rates of educational
attainment, if what you say is true, incomes should be rising along with job
quality. That does not appear to be happening.

What we do see that those with higher educational attainment are the ones who
are more likely to have the higher paying and better jobs, but that is not the
same thing as incomes increasing and job quality improving with increased
levels of schooling. All that really tells us is that those who have the most
difficulty in the workplace (those with mental disabilities, for instance) are
also most likely to have less formal education. Which comes as no surprise to,
well, anyone.

 _> That's a bizarre outlook that excludes every middle class job that
increasingly tends to require a college degree._

That is a bizarre outlook. Employers are not a charity to help out those with
college debt. Unless the law requires it, employers couldn't care less about
where you went to school. And the jobs that do require it by law are
vanishingly small. We covered why those with post-secondary educations are
more likely to get those better jobs (high achievers tend to be high achievers
in everything they do), but that does not mean it is a requirement or is
increasing as a requirement.

The only thing increasing is the rate of post-secondary attainment, which
understandably will result in more and more jobs filled with college
graduates. Of course. That's just basic math.

 _> Hell, most college administrators don't make more than middle class
salaries._

Along with everyone else. Why would you take on that massive debt if you knew
you were guaranteed to end up in the same place as you otherwise would?
Especially when education is a life-long endeavour. You can always go to
college once you have saved up the necessary cash. There is no rush.

The only reasonable explanation I see here is that people see the small chance
of significantly improving their situation beyond the average middle class
person. Which, given the costs of post-secondary education, is a pretty big
gamble. There has to be some kind of substantial reward potential given the
high stakes. Not just another middle class lifestyle like almost everyone else
in the country. That would never justify the costs.

------
crimsonalucard
If those presidents aren't paid that level of salary how will students learn?
Students need a great university leader in order to guide them on how to
learn. Also how will researchers produce science without a powerful leader
pointing the way? Its like my boss, if my boss wasn't paid to sit in a chair
all day to tell me to program an entire operating system, how would i be able
to do it? I'd be lost without a great leader. We need to pay these leaders 5
million dollars because of the great talent they have in telling other people
what to do.

------
Kevin_S
As others have mentioned, the problem is that people don't know what
presidents do.

Academic decisions are made by provost, the second in command.

A president's job is basically only fundraising from mega donors and being at
events mega donors are. If they are excellent at that, any president is worth
more than $1 million a year. All the rest is peripheral.

------
En_gr_Student
Wrong/weak metrics.

A better metric than the max, one that is less susceptible to noise, and more
indicative of the trend, is the sum of an upper quantile. A common one is the
"top 1%".

I would have loved to see a graph of the total remuneration to the top 1% of
college leaders (pres and others) by year.

------
pmarreck
Make college more accessible by providing low-interest financing > college
prices rise due to supply and demand > students end up in more and more debt >
college presidents (and profs, and the colleges themselves) profit massively.

All of these things are direct consequences of each other.

------
bawana
time for colleges and universities to issue IPOs. I want to buy shares in
Harvard or Stanford. Certainly the presidents of the schools will be baited
with the prospect of EVEN MORE money as their shares hit the stock exchange.
Options could be used to attract post graduate students?! By monetizing the
sport of education maybe we'll get Americans interested in higher education
again?

And then the rascals in the bureaucracy will learn to fear the SEC. Schools
will become politicized. Campaign contributions will flow to politicians from
major universities to foster favorable legislation.

I cant wait to see how complicated we can make the lives of our children.
Eventually people will choose to stop reproducing, just like in Japan, because
of the complexification.

------
jd007
Isn't this just that colleges are paying the market rate for good executives
because they want to get talented and experienced people to run them well?
Colleges are very complex and are definitely no easier to run than similarly
sized companies.

~~~
Glyptodon
I still suspect they could get 90% of the performance at half the price by
recruiting differently.

And of course, if the return on that extra 10% dwarfs half the salary, of
course it makes sense to pay for the extra 10%, too, I suppose.

------
CaptSpify
The thing that everyone hates the most about schools is the administration.
The most expensive part of schools is the administration.

Seems pretty obvious to me which part of schools needs slimming down.

------
ddorian43
Trickle down from the administrate & sports facilites. Also, what do
universities do with $1B ?

~~~
_acme
Schools don't generally spend their endowments; what they do is use the
profits (if any) from investing the endowment to fund the school's budget
(academic and otherwise), because tuition alone doesn't nearly cover the cost
of operating a college let alone a university.

------
junkscience2017
the ongoing hypocrisy of luxury resorts draining the wealth of a generation so
professors can espouse socialism is an important, if not essential facet of
our Hunger Games world

at Stanford, a blade of grass cannot deviate by a millimeter, yet the
professors decry capitalism

~~~
ch4s3
I think you're being downvoted because the ideology espoused by professors at
Stanford has very little to do with spending on administration and facilities
which drive costs.

~~~
dominotw
> ideology espoused by professors at Stanford

Would it be appropriate if the comment said "ideology espoused by college
presidents" . Here is OSU presidents who make around 3 mil giving a speech
about how little people at lower levels get paid.

[http://www.stlamerican.com/news/local_news/dr-michael-v-
drak...](http://www.stlamerican.com/news/local_news/dr-michael-v-drake-
delivers-wusm-homer-g-phillips-
lecture/article_ad079520-3c47-11e3-a32a-001a4bcf887a.html)

